CINC, Inc. Q3 FY2026 Earnings Deep Dive Report

For the first nine months of the fiscal year ending October 2026, CINC, Inc. (Growth: 4378) reported revenue of ¥1,264 million (down 8.5% YoY) . However, thanks to a fundamental review and optimization of SG&A expenses, the company achieved a significant recovery in operating profit, reaching ¥33 million (compared to an operating loss of ¥85 million in the same period last year) . The progress rate against the full-year operating profit target has reached 450.9% , clearly demonstrating an improvement in the company's earnings foundation.

On the business front, while the Solutions segment—which operates the flagship tool "Keywordmap"—experienced a temporary rise in churn and a decline in customer count, the Analytics segment, centered on consulting, has intensified its focus on AI Search Optimization (GEO / LLMO) . Signs of a structural transformation are emerging, evidenced by the acquisition of major enterprise clients and an increase in average monthly revenue per user.

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1. Earnings Highlights and Profit Structure Trends

Operating Profit Sees Significant Improvement of +¥118 Million YoY

For the first nine months of FY2026, consolidated results showed revenue of ¥1,264 million (down 8.5% YoY) and gross profit of ¥765 million (down 13.3% YoY). Conversely, rigorous cost control led to a 24.4% reduction in SG&A expenses ( ¥732 million ). As a result, the company achieved profitability across all profit lines, with operating profit of ¥33 million , ordinary profit of ¥36 million , and quarterly net profit of ¥25 million .

The slide below shows the cumulative Q3 results and the progress rate against the full-year forecast.

Against the full-year forecast (Revenue: ¥1,681 million, Operating Profit: ¥7 million, Ordinary Profit: ¥7 million, Net Profit: ¥4 million), the revenue progress rate at the end of Q3 stands at 75.2% , maintaining a level generally in line with the plan. Notably, the profit progress is exceptional, with operating profit at 450.9% , ordinary profit at 483.6% , and net profit at 549.9% , significantly outpacing full-year expectations.

Factors Behind Cost Structure Optimization

The primary driver for the ¥118 million improvement in operating profit compared to the ¥85 million loss in the same period last year is the reduction in SG&A expenses:

• Advertising Expenses : ¥55 million ( down ¥71 million YoY)
• Outsourcing Expenses : ¥59 million ( down ¥51 million YoY)
• Other SG&A Expenses : ¥210 million ( down ¥75 million YoY)
• Personnel Expenses : ¥409 million ( down ¥38 million YoY)

By keeping the cost of sales (¥498 million) at the same level as the previous year while bringing low-ROI outsourced tasks in-house and reviewing marketing investments, the company has directly improved its profit structure.

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2. Financial Soundness

As of the end of July 2026, total assets stood at ¥1,401 million (up ¥21 million from the end of the previous fiscal year), total liabilities at ¥315 million (down ¥9 million), and total net assets at ¥1,086 million (up ¥30 million). Cash and deposits within current assets remain strong at ¥871 million , maintaining a robust cash position.

The equity ratio has further increased from 76.5% at the end of the previous fiscal year to 77.5% , ensuring a financial foundation well-equipped for new business development and investments in AI-related technologies.

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3. Segment Trends and KPI Analysis

① Solutions Business (Development and Sales of Keywordmap, etc.)

• Revenue : ¥510 million ( down 14.8% YoY)
• Operating Profit : ¥72 million ( down 41.7% YoY)
• Number of Contracted Clients : 292 (down 66 from 358 YoY)
• ARR (Annual Recurring Revenue) : ¥550 million (down ¥130 million from ¥680 million YoY)
• Average Monthly Churn Rate : 3.6% (deteriorated by +0.9pt from 2.7% YoY)

In the Solutions business, churn caused by client personnel turnover and shifts in marketing strategies has led to a downward trend in customer count and ARR. In response, the company is strengthening its customer success structure and implementing AI search-compatible features into Keywordmap , such as the "AI Answer Misinformation Diagnosis (Beta)" and "AI-Friendly Diagnosis (Beta)" to visualize hallucination risks. Furthermore, the company has begun paid provision of the enterprise plan for " AIsearchmap ," an analysis and monitoring tool for AI Search Optimization (GEO/LLMO), advancing the sophistication of its service lineup.

② Analytics Business (Marketing DX Consulting)

• Revenue : ¥739 million ( down 7.7% YoY)
• Operating Loss : -¥15 million (loss narrowed YoY)
• Number of Contracted Clients : 124 (up 7 QoQ, down 1 YoY)
• Average Monthly Unit Price : ¥760,000 (up ¥110,000 from ¥650,000 YoY)
• Percentage of Clients with Contracts of 6+ Months : 94% (improved by +8pt from 86% YoY)

The key KPI trends for the Analytics business are as follows:

While the impact of the decline in customer count from the previous fiscal year persists, the increase in average monthly unit price (¥760,000) and the improvement in the long-term contract ratio (94%) are clear trends. This is driven by the successful shift from traditional SEO consulting to " AI Search Optimization (GEO/LLMO) Consulting ," which enhances visibility within generative AI platforms like ChatGPT and Gemini. Inquiries from major enterprises with over ¥100 billion in revenue and global corporations are increasing, indicating steady progress in high-value-added services.

③ M&A Intermediary Business

• Revenue : ¥28 million
• Operating Loss : -¥23 million

Although revenue was recorded this quarter due to deal closures, the segment posted an operating loss due to upfront costs associated with business launch. The company continues to develop deals by leveraging synergies with its existing marketing support client base.

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4. Growth Strategy: Building an AI Search Optimization (AIO) Ecosystem

Changes in Search Paradigms and Market Opportunities

With the proliferation of generative AI, user information-seeking behavior is rapidly shifting from "search engines" to "AI dialogue/AI Overviews." Consequently, the most critical issue in corporate marketing is "how to get company information cited or mentioned by generative AI (GEO/LLMO)." As the global AI market continues to expand, CINC aims to establish a leading position in this field by fully leveraging the natural language processing technology and data analysis infrastructure cultivated through its SEO business.

Ecosystem Development Through Alliances

Beyond providing services on its own, the company is promoting the construction of a "Common Infrastructure for AIO (AI Search Optimization)" that involves various partner companies.

By collaborating with advertising agencies, consulting firms, web production companies, SIers, and PR firms, CINC provides its data x technology x AI infrastructure as a platform. This strategy allows the company to leverage sales networks by deploying AIO solutions to end-clients through partners, without the need for a massive internal sales force.

Implementation Track Record and Capability Expansion

The cumulative number of AI search optimization support projects has reached approximately 65 (up from 50 as of Q2 2026), with implementations across a wide range of industries including finance (major securities, banks, credit cards), leisure, human resources, real estate, major electronics manufacturers, and telecommunications. The company is forming a virtuous cycle (growth cycle) by systematizing algorithm trends and improvement know-how gained from these experiences and rapidly feeding them back into product features and consulting menus.

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5. Summary and Future Focus

The Q3 FY2026 earnings reflect a transitional period where "profitability recovery through cost structure reform" and "business model transformation toward new areas (GEO/LLMO) adapted to the generative AI era" are occurring simultaneously.

Three key points to watch in the future are:

1. ARR Re-growth for Keywordmap and AIsearchmap : The pace of churn reduction and new customer acquisition through the full-scale launch of paid plans and AI feature enhancements.
2. Continued Acquisition of Major Clients and Unit Price Increases in the Analytics Business : Accumulation of high-unit-price consulting projects based on the track record of over 65 companies.
3. Progress in Monetizing Partner Alliances : The launch of indirect sales channels through the common infrastructure concept and the scalability of the SaaS + BPaaS model.

With a solid capital base and cash position, the progress of initiatives aimed at establishing a position in the AI search optimization market will be closely monitored.