Investment Rating - The investment rating for the industry is "Positive" and maintained [6] Core Insights - In FY2026Q1 (from September 1, 2025, to November 30, 2025), the company achieved revenue and net profit of 1,027.7 billion yen and 147.4 billion yen, respectively, representing a year-on-year increase of 15% and 12%. Both figures exceeded Bloomberg consensus estimates of 990.2 billion yen for revenue and 130.1 billion yen for net profit [2][4] - The performance of Uniqlo in Japan and overseas showed year-on-year revenue growth of 12% and 20%, respectively. The Greater China region saw a revenue increase of 7%, marking a return to positive growth, while other regions continued to experience high growth [2][4] Summary by Sections Latest Performance - For FY2026Q1, the company reported revenue of 1,027.7 billion yen and net profit of 147.4 billion yen, with year-on-year growth of 15% and 12%, respectively. This performance surpassed market expectations [2][4] Regional Performance - Japan: Revenue increased by 12% year-on-year, with strong sales in autumn/winter products and a double-digit growth in sales from overseas tourists, contributing to a same-store sales growth of 11% [10] - Greater China: Revenue grew by 7% year-on-year, rebounding from a decline of 10% in the previous quarter, driven by colder weather and improved operational efficiency [10] - Other Asia and Oceania: Revenue increased by 22% year-on-year, with double-digit same-store growth in markets like South Korea and Southeast Asia [10] - North America and Europe: Revenue rose by 33% year-on-year, supported by new store openings and strong sales of winter products [10] Inventory and Guidance - As of FY2026Q1, inventory increased by 6% year-on-year, primarily due to increased stocking of winter products. The company plans to optimize inventory by the end of the next quarter [10] - The revenue guidance for FY2026 is set at 38,000 billion yen (an increase of 11.7% year-on-year), with net profit expected to reach 4,500 billion yen (up 3.9% year-on-year) [10]

Core Insights - Fast Retailing Group, the parent company of Uniqlo, reported record-high performance for the fourth consecutive fiscal year ending in 2025, with significant contributions from both domestic and overseas operations [1][2] Financial Performance - In fiscal year 2025, Uniqlo's total revenue reached 3,400.5 billion yen, a 9.6% increase from the previous year, maintaining a leading position in the global apparel retail industry [2] - Operating profit rose by 13.6% to 551.1 billion yen, while net profit attributable to the parent company increased by 16.4% to 433.0 billion yen, indicating a stronger profit growth compared to revenue [2] - Uniqlo's inventory turnover days decreased to 118 days, down by 10 days from the previous fiscal year, alleviating inventory pressure and enhancing the efficiency of new product launches [2] Business Segments - Uniqlo remains the core brand of Fast Retailing, generating 2.9 trillion yen in revenue, accounting for approximately 86.4% of total revenue [2] - The GU brand contributed 330.7 billion yen (9.7%), while global brands accounted for 131.5 billion yen (3.9%) [2] Market Position - Uniqlo secured a 1.4% share of the global apparel market, ranking third, driven by stable sales of functional products like HEATTECH and AIRism [3] - The brand's competitive advantage stems from continuous fabric research and data-driven operations, balancing cost-effectiveness and brand strength [3] Domestic Market Performance - Uniqlo's domestic business in Japan achieved a record revenue of 1.03 trillion yen, marking a 10% year-on-year increase, making it the first Japanese apparel brand to surpass the trillion-yen mark in domestic sales [5] - The company has strategically reduced the number of stores by over 30 in the past five years, focusing on enhancing the quality of individual stores [6] International Market Growth - Uniqlo's overseas revenue reached 1.9102 trillion yen, an 11.6% increase, surpassing 55% of total revenue, solidifying its role as a key growth driver [7] - The North American market saw a revenue increase of 24.5% to 271.1 billion yen, while Europe experienced a 33.6% growth to 369.5 billion yen [9] Challenges in Greater China - The Greater China market faced a revenue decline of 4% and a profit drop of 10%, prompting Fast Retailing to implement structural reforms [9][11] - The company is shifting its focus from rapid store expansion to improving the profitability of individual stores, with plans to close or renovate about 50 stores annually [11] Product and Cultural Strategy - Uniqlo is enhancing its product strategy by focusing on functional innovation and local cultural integration, launching customized products to meet diverse consumer needs [12][14] - Collaborations with local cultural institutions and artists have been part of Uniqlo's strategy to strengthen its brand appeal and connect with consumers [15] Future Outlook - The management anticipates a cautious outlook for the Greater China market, expecting revenue and profit to decline by approximately 10% in the latter half of fiscal year 2025 [18] - Despite challenges, there are signs of positive developments as the company continues to refine its operational strategies to adapt to market conditions [18]