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Introduction & Market Context
CE Holdings Co Ltd (TSE:4320), a leading provider of healthcare information systems in Japan, presented its third quarter fiscal year 2025 results in August 2025, highlighting record-high sales and profits driven by strong performance in its electronic medical record (EMR) systems business. The company’s stock has performed well, trading at 760 yen, near its 52-week high of 785 yen, reflecting investor confidence in its growth strategy.
CE Holdings has established a strong market position in hospitals with fewer than 300 beds, which represent over 80% of Japan’s approximately 6,700 hospitals. With nearly half of these smaller hospitals yet to implement electronic medical record systems, the company is well-positioned to capitalize on this significant untapped market.
Quarterly Performance Highlights
CE Holdings reported impressive financial results for Q3 FY2025, with sales revenue increasing 12.8% year-over-year to 12,320 million yen. More notably, operating profit surged 68.9% to 1,195 million yen, while ordinary profit grew 68.7% to 1,205 million yen. Profit attributable to owners of the parent company reached 655 million yen, a substantial increase from 168 million yen in the same period last year.
The company attributed this strong performance to robust sales and maintenance of electronic medical record systems, coupled with the positive impact of reduced special losses in the pharmaceutical/medical device development support and digital marketing segments compared to the previous fiscal year.
As shown in the following consolidated profit and loss statement:
Detailed Financial Analysis
Breaking down performance by segment, the Healthcare Solutions Business, which includes electronic medical record systems, regional healthcare collaboration systems, and medical information systems development, saw sales revenue increase 12.4% to 11,922 million yen, with segment profit rising 53.7% to 1,191 million yen.
The Marketing Solutions Business, which encompasses digital marketing support and digital signage systems sales, showed significant improvement with sales revenue increasing 27.4% to 398 million yen and turning profitable with a segment profit of 3 million yen, compared to a loss of 31 million yen in the previous year.
Order intake reached a record high of 11,072 million yen, up 13.7% year-over-year, while order backlog stood at 5,152 million yen, representing a 7.3% increase. This strong order book provides visibility for future revenue growth.
CE Holdings’ flagship MI・RA・Is series of electronic medical record systems continues to gain traction nationwide, with 942 installations across Japan as of September 30, 2024. The system has been deployed from Hokkaido to Kyushu and Okinawa, demonstrating its broad market acceptance.
The following map illustrates the nationwide distribution of MI・RA・Is installations:
The company has identified significant growth potential in its target market. As shown in the following chart, 49% of hospitals with fewer than 300 beds have not yet implemented electronic medical record systems, representing approximately 3,300 potential customers. CE Holdings is well-positioned to capture this market, with 70% of its current customer base consisting of hospitals in this category.
Strategic Initiatives
In a significant strategic move, CE Holdings announced the transfer of a portion of its shares in subsidiary Micron to Tigermed Japan, effective July 29, 2025. As a result, Micron and its subsidiary M Frontier will transition from consolidated subsidiaries to equity-method affiliates. This partnership with Tigermed Japan, a leading global Contract Research Organization (CRO), is expected to enable Micron and M Frontier to expand their activities on Tigermed’s global platform.
The company also completed fundraising through the issuance of stock acquisition rights as of July 15, 2025, raising a total of 1,503.75 million yen. CE Holdings has decided to acquire and cancel all outstanding stock acquisition rights, having reached its initial funding goal through the Micron stock transfer.
Additionally, CE Holdings is participating in a model project for electronic medical record information sharing services, which began on April 22, 2025. The project involves the company’s MI・RA・Is series and participation in the "National Medical Information Platform" in Hokkaido and Yamagata Prefecture, aiming to implement and verify electronic medical record information sharing services.
In May 2025, the company launched "Recruit HOSPITAL," a no-code construction and operation service for medical facility recruitment sites, expanding its service offerings in the healthcare sector.
Forward-Looking Statements
CE Holdings has revised its FY2025 earnings forecast, increasing its sales revenue projection from 15,000 million yen to 15,200 million yen, representing a 4.4% increase over the previous year. However, the company reduced its operating profit forecast from 1,500 million yen to 1,400 million yen, citing the impact of Micron’s business transfer. Despite this adjustment, the revised operating profit still represents a 21.9% increase year-over-year.
Most notably, profit attributable to owners of the parent is now expected to reach 1,550 million yen, a substantial increase from the initial forecast of 820 million yen, due to the recording of special income from the partial transfer of Micron shares.
The following chart illustrates the revised earnings forecast for FY2025:
The graphical representation below shows the company’s historical performance and projected results for FY2025, highlighting the expected record highs in sales revenue, operating profit, and profit attributable to owners of the parent:
CE Holdings maintains a positive outlook, citing strong sales and maintenance of electronic medical record systems. While the consolidation of Micron will be excluded from the fourth quarter onward, the company expects revenue trends to continue positively. Operating profits are projected to increase significantly due to sales growth and reduced selling, general and administrative expenses in the medical devices-related support sector.
With a high customer retention rate for its electronic medical record systems, a growing installation base, and a large untapped market, CE Holdings appears well-positioned for continued growth in the Japanese healthcare information systems market.
Full presentation:
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