Avex Inc. raised its full-year profit forecast after agreeing to sell its stake in a Southeast Asian joint venture to partner Sanrio Co.
The Japanese entertainment group now expects net income of ¥2.8 billion ($17.8 million) for the fiscal year ending March 2026, up from an earlier projection of ¥1.2 billion ($7.6 million). The 133% upward revision reflects both the pending asset sale and improved operating performance.
Avex will transfer its entire holding in Sanrio South East Asia Pte. Ltd. to Sanrio, generating approximately ¥1 billion ($6.4 million) in extraordinary gains. The Singapore-based venture was established in 2020 to manage character licensing across the region, with Sanrio holding 70% and Avex Asia controlling the remaining 30%.
The exit marks a retreat from the partnership that was designed to capitalize on Southeast Asia’s growth potential using intellectual properties including Hello Kitty. Sanrio’s decision to consolidate ownership suggests the company sees greater value in direct control of regional licensing operations.
For Avex, the transaction provides a financial boost during a period of heavy investment in new talent and IP development under its medium-term business plan. The company has faced pressure on operating margins as it prioritizes long-term growth initiatives over near-term profitability.
