Drecom Co., Ltd. (TSE: 3793), the Tokyo-based developer and publisher of mobile games and operator of online media and advertising businesses, returned to profitability in FY2026 (April 2025 – March 2026) on results disclosed May 12, 2026. Consolidated revenue surged 38.7% year-on-year to ¥17,547 million, from ¥12,655 million a year earlier, while operating profit jumped 264.9% to ¥408 million from ¥112 million. Ordinary profit climbed 498.3% to ¥318 million, and profit attributable to owners of the parent reached ¥213 million — a clear return to the black against a prior-year net loss of ¥1,035 million. Earnings per share recovered to ¥7.41, reversing the previous year's loss of ¥36.10 per share.
Mobile-game momentum drives the turnaround
The recovery was led by Drecom's game segment, where strong revenue growth across the company's mobile-title portfolio lifted top-line performance well above the prior year. The publisher's library of smartphone games — spanning original IP and licensed titles operated on a "games-as-a-service" model — benefited from healthy player engagement and live-operations monetization. The roughly 39% jump in consolidated revenue reflects this game-led momentum, which more than offset the relatively smaller contribution from the group's online media and advertising operations. The operating margin remained thin at around 2.3% of revenue, underscoring that the business is still in the early stages of scaling profitability after a heavy-investment phase, but the directional swing from a near-breakeven operating result to a meaningfully positive one signals improving operating leverage.
Balance sheet, cash flow and a leaner consolidation perimeter
Total consolidated assets stood at ¥11,876 million at year-end, down from ¥13,506 million a year earlier, while net assets rose to ¥5,043 million from ¥4,719 million. The equity ratio improved markedly to 42.0% from 34.6%, pointing to a stronger and less leveraged capital structure, with net assets per share of ¥172.26. Cash generation was a standout: operating cash flow more than tripled to ¥2,197 million from ¥634 million, investing activities provided ¥1,867 million, and financing activities used -¥1,618 million, leaving period-end cash and equivalents of ¥6,375 million. During the year, Drecom removed two subsidiaries — Studio Rex and BlasTrain — from its consolidation scope, streamlining the group structure as it focuses on its core game and media operations.
FY2027 guidance: a step-change in profitability, still no dividend
For FY2027 (ending March 2027), Drecom guided for revenue of ¥18,000 million (+2.6%) alongside a sharp expansion in earnings: operating profit is forecast at ¥1,000 million (+144.7%), ordinary profit at ¥900 million (+182.2%), and net profit at ¥600 million (+180.8%), equivalent to EPS of ¥21.05. The guidance implies the operating margin roughly doubling to around 5.6%, signaling that management expects the FY2026 turnaround to convert into materially higher operating leverage as game titles mature. On capital returns, Drecom declared no dividend (¥0) for FY2026 — unchanged from FY2025 — consistent with a company prioritizing reinvestment in game development and content as it rebuilds earnings momentum.
| Metric | FY2026 | FY2025 | YoY |
|---|---|---|---|
| Revenue (¥ million) | 17,547 | 12,655 | +38.7% |
| Operating profit (¥ million) | 408 | 112 | +264.9% |
| Ordinary profit (¥ million) | 318 | 53 | +498.3% |
| Net profit attrib. to owners (¥ million) | 213 | −1,035 | Return to profit |
| EPS (¥) | 7.41 | −36.10 | Return to profit |
| Equity ratio | 42.0% | 34.6% | +7.4pp |
| Operating cash flow (¥ million) | 2,197 | 634 | +246.5% |
| Annual dividend (¥) | 0 | 0 | — |
| FY2027 guidance — revenue (¥ million) | 18,000 | — | +2.6% |
| FY2027 guidance — operating profit (¥ million) | 1,000 | — | +144.7% |
| FY2027 guidance — net profit (¥ million) | 600 | — | +180.8% |
| FY2027 guidance — EPS (¥) | 21.05 | — | — |
JapanStockPulse provides informational content only and does not constitute investment advice. Figures are taken from the company's published earnings short report and may be subject to subsequent revision.