Tenda Co. reported a quarterly loss after operating profit collapsed 95%, reflecting weakened demand for its core digital transformation services following a period of robust client spending.
The Shibuya-based company posted a net loss of ¥16 million ($107,000) for the three months through August, compared with a ¥150 million ($1 million) profit a year earlier. Revenue fell 18% to ¥1.27 billion ($8.5 million), the firm said Monday.
The DX Solutions unit, which accounts for nearly 60% of sales, saw revenue drop 31% to ¥730 million ($4.9 million) as the newly acquired Intelligent Systems subsidiary failed to offset a significant decline in enterprise contracts. Management attributed the shortfall to difficult comparisons with the prior year, when several large clients placed substantial orders.
The Techwise Consulting division managed 12% revenue growth to ¥241 million ($1.6 million), though segment profit declined 10% as subsidiary Almondo invested in positioning itself for generative AI opportunities. Game Content operations expanded 16% to ¥293 million ($1.96 million) on arcade machine projects, yet profit margins compressed sharply.
Despite the weak start, Tenda kept its full-year forecast unchanged at ¥6 billion ($40 million) in revenue and ¥550 million ($3.7 million) in operating profit, banking on a sharp recovery in coming quarters. The company expects new business areas in infrastructure, AI, and business intelligence to drive recovery.
