SMC sees Q2 sales growth despite operating profit decline

SMC Corporation announced its financial results for the second quarter ended September 30, 2025. Net sales increased by ¥5.2 bn (1.3%) year-over-year to ¥400.2 bn. However, operating profit saw a decline of ¥8.7 bn (-8.8%) to ¥90.7 bn. The company attributes the sales growth mainly to volume increases in Greater China, while operating profit was impacted by foreign exchange fluctuations and increased depreciation. For the full fiscal year 2025, the company has revised its net sales forecast down to ¥816.0 bn from ¥850.0 bn, and its operating profit forecast to ¥183.0 bn from ¥215.0 bn.

Regionally, Greater China performed well, driven by home appliances, flat panel displays, automotive, and secondary batteries. Demand in Europe is recovering, while North America, Japan, and Asia (excluding Greater China) remain sluggish due to delayed recovery in semiconductor demand and tariff impacts. SMC is also prioritizing investments in new technical centers, with the Japan Technical Center completed in September 2025 and an investment of approximately ¥120 bn.

SMC is expanding its "Sales Academy" globally to strengthen its sales organization and address a shortage of personnel. The company reported ¥28.3 bn in chiller sales for the first half of FY2025, targeting ¥100 bn in the future. Additionally, SMC repurchased treasury stock worth ¥21,795 million during the six months ended September 30, 2025, and resolved to pay interim dividends of ¥500 per share, totaling ¥31.6 bn.