Fiscal Year End: December 31 Most Recent Results: FY2025 Full Year (Jan-Dec 2025), reported February 6, 2026 Next Earnings: Q1 FY2026, ~April 29, 2026

Download Manifest

File	Type	Period	Size	Path
5214-Q2-2025-presentation.pdf	H1 FY2025 Presentation (English)	Jan-Jun 2025	1.2M	interim/

Note: FY2025 full-year English presentation not available for direct download (NEG's IR pages are JS-rendered). FY2025 actuals sourced from StockAnalysis, MarketScreener, and press releases. All amounts in ¥B unless noted.

---

Section A: Filing Monitor

1. Filing Activity Overview

Date Filed	Filing Type	Description	Source
Feb 27, 2026	News Release	FireLite glass adoption announcement	neg.co.jp
Feb 6, 2026	FY2025 Tanshin	Full-year consolidated results + FY2026 guidance + dividend increase + EGP2028 update	TDnet / neg.co.jp

Filing activity: Normal. Full-year results + forward guidance, no unusual disclosures.

2. FY2025 Full Year Results (Year Ended December 31, 2025)

Consolidated P&L

Metric	FY2023	FY2024	FY2025	YoY Change
Revenue (¥B)	280.0	299.2	311.4	+4.1%
Gross Profit (¥B)	33.2	54.3	80.0	+47.3%
Gross Margin	11.9%	18.2%	25.7%	+7.5pts
Operating Profit (¥B)	(11.8)	5.5	33.6	+514%
Operating Margin	(4.2)%	1.8%	10.8%	+9.0pts
EBITDA (¥B)	25.4	34.4	57.8	+68.0%
EBITDA Margin	9.1%	11.5%	18.6%	+7.1pts
Net Income (¥B)	(26.2)	12.1	29.6	+145%
EPS (¥)	(282.90)	141.66	382.32	+170%
FCF (¥B)	—	—	23.1	—
DPS (¥)	—	130	150	+15.4%

This is a dramatic turnaround. NEG went from an operating loss of ¥11.8B in FY2023 to ¥33.6B operating profit in FY2025 — a ¥45.4B swing in two years. The drivers:

1. Display glass price increases — NEG successfully pushed through price revisions across its LCD/OLED glass substrate business, recapturing margin lost to competition and raw material inflation
2. Electronics demand — robust demand for glass products used in semiconductors and data centers
3. Productivity improvements — factory efficiency gains and logistics cost reductions
4. All-electric melting furnace conversion — reducing energy costs and improving output quality

The gross margin expansion from 18.2% to 25.7% (+7.5pts) is the story. This is pricing power and operational leverage working together.

Segment Overview (from H1 Presentation + Full Year Data)

NEG reports two segments:

Electronics & Information Technology (~54% of revenue)

This segment contains Display Glass (~80% of segment) and Electronics (~20%).

Display Glass:

• Progress in display glass price revisions drove margin expansion
• H1: Demand remained strong but inventories at customers depleted → volume decline offset by pricing
• H2: Signs of inventory adjustment at customers, but demand expected "to remain firm"
• Dinorex UTG (ultra-thin glass for foldable phones): adopted by Xiaomi MIX Flip 2 following Motorola razr series
• Converting to all-electric melting furnaces for productivity and supply chain strengthening

Electronics:

• Robust demand driven by semiconductors and data centers
• Other products showed gradual recovery
• This is the growth engine within the segment

H1 quarterly sales trend: Q1 ¥40.6B → Q2 ¥43.0B (accelerating)

Performance Materials (~46% of revenue)

This segment contains Composites (~80%) and Medical Care, Heat-Resistance, Buildings (~20%).

Composites (Glass Fiber):

• Demand sluggish due to intense competitive environment
• UK subsidiary operations suspended in June 2025 — restructuring charge of ¥2.9B taken
• The weakest part of the business

Medical Care / Heat-Resistance / Buildings:

• Medical and Buildings: sales volume recovery and price revisions → sales increase
• Heat-Resistance: weak demand continues

H1 quarterly sales trend: Q1 ¥34.2B → Q2 ¥35.8B (slight improvement)

Operating Profit Bridge (H1: ¥2.8B → ¥16.6B)

Factor	Impact
Productivity and capacity utilization	Positive (major)
Unit sales and pricing	Positive (largest single driver — display price increases)
Material/energy/logistics	Positive (logistics cost decrease)
Display volume decrease	Negative (offset by pricing)
Electronics sales increase	Positive

5. Balance Sheet & Cash Flow Highlights

Metric	FY2025
Cash & equivalents	>¥120B
Equity ratio	70.2%
ROE	6.1%
FCF	¥23.1B
DPS	¥150

The balance sheet is very strong — 70% equity ratio with >¥120B cash. FCF of ¥23.1B comfortably covers the dividend (¥150/share × ~77M shares = ~¥11.6B). NEG is in a position to increase shareholder returns or pursue M&A.

6. FY2026 Guidance

Metric	FY2025 Actual	FY2026E Guide	YoY Change
Revenue	¥311.4B	~¥321B	+3.1%
Operating Profit	¥33.6B	~¥35B*	+4.2%
Net Income	¥29.6B	~¥24.6B	(17.0)%
EPS (¥)	382.32	~327*	(14.4)%
DPS (¥)	150	160	+6.7%

*Consensus estimates from MarketScreener (6 analysts, mean consensus "OUTPERFORM").

Key guidance notes:

• Revenue: "modest top-line growth" — consistent with displays stabilizing and electronics continuing
• Operating profit: consensus expects slight growth, but management guided for a decline
• Net income drops because FY2025 included large extraordinary gains (¥20.4B from Fujisawa plant and South Korean asset sales in H1 FY2024 that inflated the base, plus the ¥2.9B UK restructuring charge was absorbed). Adjusting for these one-offs, underlying profitability is improving
• Dividend increased to ¥160 despite lower guided NI — shareholder return commitment is clear
• US tariff impact: "direct impact immaterial," but could cause global economic downturn and demand depression
• FX assumption: 1 USD = ¥145, 1 EUR = ¥160
• EGP2028 medium-term plan update included, signaling continued strategic alignment

The Q2 presentation forecast (July 2025) vs FY2025 actual:

Metric	Q2 Forecast	FY2025 Actual	Beat/Miss
Revenue	¥310.0B	¥311.4B	Small beat
Operating Profit	¥27.0B	¥33.6B	¥6.6B beat (+24%)
Net Income	¥17.0B	¥29.6B	¥12.6B beat (+74%)

Management massively sandbagged the H2 — operating profit came in ¥6.6B above the mid-year forecast. This suggests either genuine upside surprise in H2 demand/pricing or consistently conservative guidance. Either way, it means FY2026 guidance may also be conservative.

9. Red Flag Alerts

Red Flag	Detected?	Details
UK restructuring	Monitor	UK composite subsidiary suspended operations Jun 2025; ¥2.9B charge. Small but signals competitive pressure in glass fiber
Display inventory adjustment	Monitor	H2 commentary noted "signs of inventory adjustments" at display customers
NI decline guidance	Context	FY2026 NI guided down — entirely driven by non-recurrence of FY2024/25 extraordinary asset sale gains, not operating deterioration
Going concern	No	—
Executive changes	No	—

No real red flags. The UK restructuring is a small cleanup, and the display inventory adjustment is normal cyclical behavior that NEG expects to manage through pricing power.

10. Key Takeaways

1. Operating profit recovery is the headline. From a ¥11.8B loss in FY2023 to ¥33.6B profit in FY2025 is a ¥45B swing. Display glass price increases, electronics demand (semi/data center), and productivity gains all contributed. Operating margin went from negative to nearly 11%.

2. FY2025 massively beat management's own H1 forecast. OP of ¥33.6B vs the ¥27B guide from July — a +24% beat. Management sandbagged hard. This pattern suggests FY2026 guidance (~¥35B consensus OP) may also be conservative.

3. Net income decline in FY2026 is noise, not signal. It's entirely due to non-recurrence of extraordinary asset sale gains. Underlying operating profitability is stable to improving.

4. Electronics/data center is the growth driver. Within the E&IT segment, the electronics sub-segment (semiconductors, data centers) is the secular growth pocket. Display glass is more about margin management through pricing discipline than volume growth.

5. Dinorex UTG and new applications are the long-term story. Ultra-thin glass for foldable phones (Motorola, Xiaomi), satellite solar panels, and perovskite solar cells are all new markets NEG is developing from its display glass technology base. These are early-stage but could become material over the medium term.

11. Investment Implications

Does this change the thesis? Reinforces the recovery thesis. NEG has proven it can reprice display glass and extract operating leverage. The question for FY2026+ is whether this margin level is sustainable or whether competitive dynamics (especially from Chinese glass makers) will pressure pricing again.

Single most important takeaway: The ¥33.6B operating profit vs ¥27B mid-year guide shows management is either genuinely surprised by demand or systematically conservative. Either way, FY2026 guidance may have upside.

What to watch for Q1 FY2026 (~April 29):

1. Display glass pricing — can NEG maintain price increases against Chinese competition?
2. Electronics demand — is the semiconductor/data center tailwind continuing?
3. FY2026 guidance update — any upward revision would be a strong signal
4. Glass fiber/composites — any signs of recovery or further restructuring?
5. Dinorex UTG adoption — new OEM wins for foldable phones?

Action: HOLD. Trading at ~¥6,329 vs analyst target of ¥6,777 (+7% upside). P/E of ~17x FY2026E is reasonable for a cyclical recovery story with potential upside to consensus. The balance sheet is strong (70% equity, >¥120B cash), dividend growing, and the operational turnaround is proven. Main risk is display glass cycle reversal.

---

Sources: NEG IR, StockAnalysis, MarketScreener, TipRanks

---

Topics

• ai-infrastructure