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Introduction & Market Context
Casio Computer Co., Ltd. (TYO:6952) presented its first quarter results for the fiscal year ending March 31, 2026, on August 1, 2025, revealing challenges from U.S. tariffs and regional market variations. The company's stock has shown resilience despite these headwinds, trading at 1,203.5 yen as of the most recent close, up 0.71% and significantly above its 52-week low of 1,028.5 yen.
The presentation highlighted how external factors, particularly U.S. tariffs, have prompted Casio to revise its full-year operating profit forecast downward while maintaining its sales targets. The company continues to leverage its iconic G-SHOCK brand while expanding into new markets and business domains.
Quarterly Performance Highlights
Casio reported net sales of 62.2 billion yen for Q1 FY2026, representing a 3.0% year-over-year decrease. Operating profit declined more significantly, falling 17.6% to 3.7 billion yen, with operating profit margin contracting to 6.0% from 6.9% in the same period last year.
As shown in the following consolidated results summary:
The company's profit attributable to owners decreased by 39.8% to 3.7 billion yen, resulting in earnings per share of 16.32 yen. These results were impacted by unfavorable exchange rate movements, with the yen strengthening against major currencies compared to the previous year.
Breaking down performance by segment, the Timepiece business remained Casio's largest revenue contributor but experienced both sales and profit declines. The Consumer segment, which includes EdTech and Sound businesses, showed mixed results with a slight improvement in operating profit margin despite lower sales.
Timepiece Business Analysis
The Timepiece segment, accounting for approximately 63% of total sales, posted revenue of 39.5 billion yen, down 3.4% year-over-year. More concerning was the significant decline in operating profit margin from 14.4% to 10.7%, which the company attributed to U.S. tariff impacts and exchange rate fluctuations.
The regional performance revealed stark contrasts in market conditions. While North America showed 6% growth in local currency terms due to last-minute demand ahead of tariff implementation, China continued its troubling trend with a 30% decline. The "Other" category, which includes India and ASEAN markets, demonstrated robust 18% growth, highlighting the importance of these emerging markets to Casio's strategy.
As illustrated in this regional overview:
Product-wise, G-SHOCK watches (including BABY-G) accounted for approximately 44% of timepiece sales, with metal models representing 13% and resin models 31%. The company reported strong sales for its premium metal G-SHOCK lines, including the GMW-B5000D and MRG-B5000B models, while the GA-2100 series maintained stable demand.
The following product overview highlights key performers in the Timepiece portfolio:
Strategic Initiatives
Casio outlined several strategic initiatives to address current challenges and position for future growth. For the Timepiece business, the company is focusing on product concentration and selection for more efficient investment, enhancing both G-SHOCK and CASIO WATCH brand strength across different price ranges.
The marketing strategy emphasizes regional brand ambassadors, with global pop group XG selected as a worldwide ambassador. In India, the company is extending its use of two major brand ambassadors while expanding specialty stores from major cities to regional areas. Europe will see marketing efforts centered around pan-European brand ambassador Central Cee and expansion of directly managed flagship stores.
As shown in this marketing strategy overview:
In the EdTech business, Casio is maximizing promotion activities for the back-to-school season in Europe and the U.S. while expanding sales of its New ClassWiz calculators. The company is also working with relevant agencies in countries to strengthen clampdowns on counterfeit goods, which have been affecting market share.
For new business domains, Casio highlighted its AI robotic pet "Moflin," launched in November 2024 with the concept of "Always there for you." The company aims to expand in the mental wellness sector through this innovative product.
Forward-Looking Statements
Casio has revised its full-year operating profit forecast downward by 3.0 billion yen to 21.0 billion yen, primarily due to the estimated impact of U.S. tariffs across its business segments. The company maintained its net sales forecast at 270.0 billion yen, suggesting confidence in its ability to deliver on revenue targets despite headwinds.
The revised forecast represents a significant improvement over the previous fiscal year's operating profit of 14.2 billion yen, indicating expected year-over-year growth of 47.9% despite the downward revision.
As detailed in this forecast revision:
By segment, the Timepiece business is expected to generate 176.0 billion yen in sales with an operating profit margin of 14.2%. The EdTech business is projected to deliver 64.0 billion yen in sales with a 12.5% margin, while the Sound business continues to face challenges with an expected operating loss.
Casio's balance sheet remains solid with an equity ratio of 67.1% and net cash of 98.8 billion yen, providing financial flexibility to navigate current challenges and invest in growth initiatives. The company's strategic focus on premium products, regional expansion, and new business domains appears designed to offset the impact of tariffs and challenging market conditions in certain regions.
As Casio navigates these complex market dynamics, its ability to execute on its regional growth strategies in India and ASEAN markets while maintaining premium positioning for its iconic G-SHOCK brand will be critical to achieving its revised financial targets for the fiscal year ending March 2026.
Full presentation:
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