Nomura (US:NMR)2026-01-30 10:30Financial Data and Key Metrics Changes - Return on equity was 10.3%, meeting the 2030 target of 8%-10% for the seventh consecutive quarter [3] - Group-wide net revenue reached JPY 551.8 billion, a 7% increase from the previous quarter [3] - Income before income taxes decreased by 1% to JPY 135.2 billion, while net income also fell by 1% to JPY 91.6 billion [3] - Earnings per share for the quarter were JPY 30.19 [3] - Pre-tax income for all four divisions rose 8% to JPY 142.9 billion, the highest level in 18.5 years [4] Business Line Data and Key Metrics Changes - Wealth Management saw a growth of around 30% compared to the previous quarter, with net revenue increasing 14% to JPY 132.5 billion [4][7] - Investment Management's business revenue reached an all-time high, but profits fell due to weaker investment gains and one-time expenses from the Macquarie acquisition [4][12] - Wholesale net revenue rose 12% to JPY 313.9 billion, with Investment Banking net revenue increasing by 31% to JPY 57.1 billion [15][17] - Banking net revenue increased by 7% to JPY 13.7 billion, with income before income taxes rising 31% to JPY 4.2 billion [18] Market Data and Key Metrics Changes - Recurring revenue assets saw a net inflow of JPY 503.9 billion, reaching an all-time high of JPY 28.1 trillion [11] - Total sales rose to JPY 6.6 trillion, with equities growing by 4% and bonds declining by 25% [9][10] - The number of flow business clients increased by approximately 270,000 to 1.53 million, driven by buoyant market conditions [11] Company Strategy and Development Direction - The company announced a share buyback program to enhance shareholder return and capital efficiency, with a limit of 100 million shares and JPY 60 billion [5] - The focus remains on maximizing synergies between existing and newly acquired businesses, particularly in the Investment Management division [25][26] - The company aims to continue capturing growth in crypto markets while managing volatility through tighter control over positions and risk exposure [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance across all segments, with stable revenue growth and positive client flows [21] - The outlook for January indicated that Wealth Management's net revenue was on par with Q3 levels, despite some market selling pressures [21] - Management acknowledged the challenges posed by market volatility but emphasized a solid pipeline in Investment Banking [22] Other Important Information - Group-wide expenses increased by 10% to JPY 416.5 billion, driven by one-off costs and strategic investments [19] - The common equity Tier 1 ratio at the end of December was 12.8%, with Tier 1 capital rising to JPY 3.6 trillion [20] Q&A Session Summary Question: Regarding Laser Digital's losses and position management - Management confirmed that there were long positions taken and emphasized the importance of a robust risk management framework to control volatility [30][31] Question: Sustainability of Wealth Management's net inflow - Management refrained from making definitive comments on sustainability but noted a significant shift from savings to investment among retail investors [32] Question: Wealth Management pricing strategy - Management focused on value provision to customers and did not provide specific details on potential pricing changes [36] Question: Timing and scale of buyback - The buyback was timed to align with the completion of the Macquarie acquisition, and the size was determined based on investment strategy and shareholder return considerations [37] Question: Impact of personnel costs and deferred compensation - Management indicated an expected impact of about JPY 8 billion in Q4, with a gradual normalization of costs in subsequent years [41] Question: Long-term strategy for Laser Digital - Management acknowledged the need for a thorough discussion on growing the business while managing risk exposure [42]