ORIX Corporation: Q1 FY2027 Financial Summary (Form 6-K)
Business Context and Reporting Period
This filing covers ORIX Corporation's first quarter consolidated financial results for the period ended June 30, 2026, filed on August 6, 2026. The results are prepared under U.S. GAAP. A material change in reporting scope occurred due to the decision to sell ORIX Bank Corporation, which is now classified as a discontinued operation. Consequently, comparative figures for the prior year have been retrospectively reclassified to exclude the bank's results.
Key Financial Metrics
| Metric (Millions of Yen) | Q1 2026 | Q1 2025 | YoY Change |
|---|---|---|---|
| Total Revenues | 876,628 | 746,973 | +17.4% |
| Operating Income | 133,919 | 119,918 | +11.7% |
| Income from Continuing Ops (Pre-Tax) | 406,150 | 145,666 | +178.8% |
| Net Income (Attributable to ORIX) | 280,832 | 107,288 | +161.8% |
| Basic EPS (Yen) | 256.07 | 94.63 | +170.6% |
Balance Sheet and Liquidity
- Total Assets: ¥18,256,420 million (up 1% from March 31, 2026).
- Total Liabilities: ¥13,413,847 million (relatively unchanged).
- Shareholders' Equity: ¥4,710,425 million (up 5%); Equity Ratio is 25.8%.
- Debt: Short-term and Long-term debt totaled ¥6,308,802 million (excluding discontinued operations).
- Cash and Equivalents: ¥968,923 million (excluding discontinued operations).
Material Changes and Segment Performance
The significant increase in profitability is primarily driven by non-operating gains rather than core operational expansion.
- Equity Method Investments: Equity in net income surged 970% to ¥207,918 million. This is largely due to valuation gains on Kioxia Holdings Corporation shares recognized through TB Investment Limited Partnership and gains from the sale of SUGIKO GROUP HOLDINGS CO., LTD.
- Discontinued Operations: ORIX Bank Corporation was sold to Daiwa Next Bank, Ltd. on August 3, 2026. The bank's assets (¥3.26 trillion) and liabilities (¥3.01 trillion) are now presented separately. No loss was recognized upon classification as held for sale in Q1.
- Segment Results:
- Japan & APAC: Profits increased 455% to ¥289,811 million, driven by equity investment gains.
- USA & Europe: Profits increased 495% to ¥63,000 million, driven by valuation gains in private equity.
- Infrastructure: Profits decreased 37% to ¥43,317 million due to the absence of a prior-year gain on the sale of Hotel Universal Port Vita.
- Insurance: Profits increased 16% to ¥27,960 million due to higher premiums and investment income.
Guidance, Outlook, and Risks
- Dividend Policy Revision: The Board revised the dividend policy for FY2027. The annual dividend will be the higher of 39% of adjusted EPS (excluding Kioxia gains/losses) or ¥156.10 per share. The estimated total dividend for FY2027 is ¥187.36 per share.
- Forecast: Net income attributable to ORIX shareholders for the six months ending September 30, 2026, is forecast at ¥840,000 million (+209.9% YoY). Full-year FY2027 net income is forecast at ¥530,000 million (+18.5% YoY).
- Uncertainty: Future earnings remain sensitive to Kioxia share price fluctuations, which impact equity method income but do not generate direct cash inflows for ORIX.
- Tax Status: The Company notes it may be classified as a Passive Foreign Investment Company (PFIC) for U.S. tax purposes.
Investor Verification Checklist
- Quality of Earnings: Verify the extent to which Q1 net income is driven by non-cash valuation gains (Kioxia) versus recurring operational cash flow.
- Discontinued Operations: Confirm the final sale price and gain/loss recognition for the ORIX Bank Corporation transaction in the Q2 filing.
- Dividend Sustainability: Assess whether the revised dividend policy (capped at 39% of adjusted EPS) provides sufficient coverage if Kioxia-related gains diminish in future quarters.
- Segment Reclassification: Review the impact of the new segment structure (Japan & APAC, Infrastructure, USA & Europe, Insurance) on future performance comparisons.