U-NEXT HOLDINGS grew revenue 20.4% to ¥469.96bn in the year to August 2026, yet operating profit fell 4.2% to ¥30.26bn and profit attributable to owners of the parent fell 18.7% to ¥14.96bn. The company traces the gap to one segment: telecom and energy.
Revenue beat, profit missed
In its notice on differences from forecast, U-NEXT compared results with the plan it set on 14 October 2025. Revenue came in 10.8% above the ¥424bn forecast. Operating profit was 9.7% below the ¥33.5bn forecast, and net profit was 19.1% below ¥18.5bn.
The telecom and energy segment brought in ¥199.46bn of revenue, up 23.7%, but operating profit fell 27.7% to ¥9.53bn. Its operating margin dropped to 4.8% from 8.2% a year earlier. Against the opening forecast, the segment reached 62% of its planned operating profit. The other segments, including the corporate adjustment line, met their opening forecasts, according to the earnings presentation.
The three other operating segments also grew year on year. Content delivery operating profit rose 16.9% to ¥11.28bn, store and facility solutions rose 3.0% to ¥16.85bn, and finance, real estate and global rose 45.3% to ¥2.16bn.
What the company blames
U-NEXT attributes the shortfall to a Middle East problem that began at the end of February 2026 and pushed up energy prices. It says power procurement costs rose further in the summer demand season of the fourth quarter. Plans whose customer price tracks procurement cost lifted revenue. Operating profit suffered because fixed-price plans deteriorated as costs rose.
The company says it did not revise its forecast at the end of the third quarter because weather and sunshine hours move both customer prices and usage, which made a reasonable estimate difficult. It also says the gap at the ordinary profit level came mainly from foreign exchange losses linked to a weaker yen.
The presentation shows a company-defined pro forma operating profit, adjusted for one-off factors, that grew 20%. It strips out the energy hit and a boost in the store and facility segment from self-checkout machine replacements. This is management's measure, not the reported figure.
The recovery plan
The presentation lists two measures: correcting high-voltage fixed-price menus, through price revisions or a switch to market-linked pricing, and turning sales agency commissions into a variable cost. It says the latter has already been carried out at the main agencies. A chart shows the split of power sold between fixed-price and market-linked menus moving from 50:50 in August 2026 to under 20% fixed and over 80% market-linked by August 2027.
The plan costs customers. The company's forecast assumes net losses of 5,300 high-voltage and 53,400 low-voltage energy contracts in the coming year, with energy revenue roughly flat. Telecom and energy revenue is forecast at ¥205.3bn, up 3%, and EBITDA at ¥11.4bn against ¥9.84bn, up 16%.
Group guidance for the year to August 2027 is revenue of ¥524bn, operating profit of ¥32.5bn and net profit of ¥16.5bn. From that year, U-NEXT will report segment earnings as EBITDA rather than operating profit.
Dividend
The board kept the final dividend at ¥8.5 per share, as forecast, for an annual ¥17.0 and a total of ¥3.07bn. Payment is due to start on 30 November 2026. The annual figure compares with ¥15.50 a year earlier, and the company forecasts ¥19.00 for the coming year.
U-NEXT has scheduled a briefing for institutional investors on 15 October 2026.