From our President and CEO Investors

To our shareholders and investors

We would like to express our sincere gratitude to our shareholders and investors for their continued support and consideration.

Net sales for the first quarter of the fiscal year ending March 2027 fell short of both the same period last year (98.8%) and our internal plan (92.7%). This was due to factors including a decline in inbound demand from mainland China—a trend that has continued since last fall—as well as sluggish in-store sales of summer merchandise caused by temperatures being lower compared to the previous year.
On the other hand, growth investments—including the strengthening of our retail business, the implementation of Goldwin500, and the enhancement of human capital—were front-loaded as originally planned, resulting in SG & A expenses reaching 100.6% of the plan. With net sales below plan and SG & A expenses executed as planned, operating profit amounted to 370 million yen, falling significantly short of both the same period last year and our internal plan.

Anticipating that the external factors that caused the slowdown in the first quarter will continue to affect the second quarter, we have revised our Earnings Forecast for the first half of the fiscal year ending March 2027.
We have revised net sales from the initial forecast of 59.9 billion yen to 55.6 billion yen; while continuing to execute growth investments as planned, we are reducing SG & A expenses elsewhere and have revised operating profit from the initial forecast of 7.0 billion yen to 4.2 billion yen. However, as our earnings have historically been weighted toward the second half of the fiscal year, we will carefully examine full-year performance while closely monitoring trends from the second quarter onward.

Despite these challenging conditions, the “Goldwin500” project is proceeding as planned. In the first quarter, we opened two stores in mainland China and one store in New York City in the United States. We aim to open seven more stores from the second quarter onward and are targeting net sales of 10 billion yen for the current fiscal year.
Additionally, 2026 marks the 60th anniversary of the founding of THE NORTH FACE brand in the United States. To commemorate this milestone, we will host an event at the event space on the first floor of our Tokyo head office for one month starting October 1, designed to once again convey the brand’s history of exploration and its essence, as well as to deepen our relationship with consumers. We sincerely hope that our shareholders and investors will join us for this event.

Our Group will continue to consistently pursue a management strategy that prioritizes securing gross profit margins and enhancing brand value over short-term net sales growth. We ask for the continued understanding and support of our shareholders and investors.