freee K.K. (TSE: 4478) reported consolidated results for the first nine months (July 1, 2025 to March 31, 2026) of the fiscal year ending June 2026 (FY6/2026) under Japanese GAAP. Revenue rose 29.3% year-on-year to ¥30,843 million from ¥23,850 million as the cloud-ERP user base expanded, but the profit picture diverged sharply from the top line: operating profit fell 47.4% to ¥622 million from ¥1,183 million, ordinary profit dropped 65.5% to ¥357 million, and net profit attributable to owners of the parent slid 67.5% to ¥328 million from ¥1,011 million. Basic EPS came in at ¥5.55 versus ¥17.20 a year earlier, and comprehensive income fell 64.5% to ¥349 million.
Revenue past ¥30 billion as the ERP base widens
freee provides cloud accounting, payroll and HR, and ERP software as a service (SaaS) for small and mid-sized businesses, alongside financial services. Its "Platform" business — centered on cloud ERP and embedded finance — continued to scale the paying-customer base over the nine months, pushing revenue past the ¥30 billion mark for the cumulative period. The 29.3% growth rate underscores that demand for cloud-based back-office software among Japan's smaller companies remains robust, even as the broader software sector matures.
Reported profit slides on growth investment
The steep declines in reported profit reflect a deliberate choice to keep investing for growth rather than any weakness in the underlying business. freee continued to spend heavily on sales, marketing and product development to capture share, which pushed costs up faster than the revenue line over the period. Operating profit fell to ¥622 million and the gap widened further down the income statement, with ordinary profit at ¥357 million and net profit at ¥328 million — a 67.5% year-on-year drop. The pattern is characteristic of a SaaS company prioritizing customer acquisition and product breadth over near-term margin.
Adjusted operating profit dips but stays positive
freee guides investors toward adjusted operating profit — operating profit before share-based compensation, M&A-related intangible amortization, and other one-off costs — as a cleaner read on the underlying business. On that measure, profit fell a more modest 15.0% to ¥1,797 million from ¥2,116 million over the nine months, well above the reported operating figure of ¥622 million. The gap between the two metrics shows how much non-cash and one-off items, layered on top of growth spending, weighed on the statutory result.
Balance sheet solid; full-year guidance points to profit growth
At period-end, total assets stood at ¥57,777 million and net assets at ¥20,358 million, with owners' equity of ¥20,252 million and an equity ratio of 35.1%. As a growth-stage company reinvesting in the business, freee pays no dividend. For the full FY6/2026 year, management maintains guidance for revenue of ¥41,930 million (+26.0%) and adjusted operating profit of ¥2,520 million (+33.7%), alongside adjusted free cash flow of ¥1,260 million to ¥2,520 million — implying that, even after a soft nine-month reported profit, the company still expects adjusted profitability to expand over the full year as growth investment is paced against an enlarged revenue base.
| Metric | 9M FY6/2026 | 9M FY6/2025 | YoY |
|---|---|---|---|
| Revenue (¥M) | 30,843 | 23,850 | +29.3% |
| Adjusted operating profit (¥M) | 1,797 | 2,116 | -15.0% |
| Operating profit (¥M) | 622 | 1,183 | -47.4% |
| Ordinary profit (¥M) | 357 | 1,034 | -65.5% |
| Net profit attrib. to owners (¥M) | 328 | 1,011 | -67.5% |
| Basic EPS (¥) | 5.55 | 17.20 | -67.7% |
| FY26 revenue guidance (¥M) | 41,930 | — | +26.0% |
| FY26 adj. OP guidance (¥M) | 2,520 | — | +33.7% |
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.