Tokyo-listed HEROZ Inc. lowered its fiscal 2026 earnings forecast on December 12, citing delayed project launches in its artificial intelligence business and weaker-than-expected performance at its security subsidiary.
The company now projects net income of ¥50 million ($329,000), down 66.7% from its earlier estimate of ¥150 million. Operating profit was trimmed to ¥500 million ($3.3 million) from ¥800 million, representing a 37.5% reduction. Revenue guidance fell 4.5% to ¥6.4 billion ($42.1 million).
HEROZ attributed the downgrade to timing shifts in its AIX division, where project commencements slipped later than planned, pushing revenue recognition into subsequent periods. The company also acknowledged that aggressive hiring of engineering and business staff front-loaded expenses before associated revenue materialized.
The AI security arm, operated through subsidiary Variosecure, revised its outlook downward despite tracking toward record annual sales. Management characterized the unit’s performance as falling short of initial projections set at the fiscal year’s start.
Despite the cuts, HEROZ maintained that both divisions would achieve year-over-year growth in revenue and operating profit. The company noted its business-to-business AI segment expanded roughly 30% compared to the prior year period.
For the second half, management outlined plans to strengthen AI agent capabilities and expand recurring revenue streams from products including HEROZ ASK and AI Sakura-san.
