NMR — Nomura Holdings, Inc.

Summary of Nomura Holdings Q4 2026 Earnings Call

1. Key Financial Results and Metrics

• Full Year Results:

  • Group net revenue increased by 15% year-on-year to JPY 2,167.7 billion.
  • Income before income taxes grew 14% to JPY 539.8 billion.
  • Net income rose 6% to JPY 362.1 billion, marking a record high for the second consecutive year.
  • Return on Equity (ROE) was 10.1%, meeting the target range of 8% to 10% set for 2030.
  • Wealth Management and Wholesale segments achieved their highest income levels ever.

• Q4 Results:

  • Group net revenue rose 5% quarter-on-quarter to JPY 577.2 billion.
  • Income before income taxes fell 20% to JPY 107.7 billion; net income decreased 19% to JPY 73.9 billion.
  • Earnings per share stood at JPY 24.34, with an ROE of 8%.

2. Strategic Updates and Business Highlights

• Wealth Management:

  • Income before income taxes increased by 23%, with recurring revenue reaching an all-time high of JPY 56.8 billion.
  • Net inflows of recurring revenue assets exceeded JPY 400 billion for the quarter.

• Investment Management:

  • Net revenue surged 42% to JPY 86.2 billion, driven by growth in existing business and international acquisitions.
  • Assets under management rose to JPY 137 trillion.

• Wholesale:

  • Revenue growth across all regions, with Global Markets and Investment Banking achieving record highs.
  • Despite a 2% decline in net revenue to JPY 308.1 billion, the division remains a key growth driver.

• Banking:

  • Net revenue increased by 6% to JPY 14.5 billion, with ongoing expansion in loan products.

3. Forward Guidance and Outlook

• Nomura expects to pay an ordinary dividend of JPY 24 per share, bringing the annual dividend to JPY 51 per share, with a payout ratio of 41%.
• The company aims to maintain an ROE of 8% to 10% and income before income taxes exceeding JPY 500 billion.
• In April, Wealth Management's net revenue remained stable, while Wholesale's performance improved significantly due to a rebound in equity markets.

4. Bad News, Challenges, or Points of Concern

• Q4 Declines: The significant drop in income before income taxes (20%) and net income (19%) was attributed to decreased profits from affiliates and an impairment loss in Investment Management.
• Expense Increases: Group-wide expenses rose by 13% quarter-on-quarter, influenced by impairment losses and regulatory changes affecting compensation.
• Market Risks: Continued geopolitical risks and market volatility pose challenges for future performance, particularly in Wealth Management and Wholesale.

5. Notable Q&A Insights

• Concerns were raised regarding the impact of regulatory changes on personnel expenses and the overall cost structure, with expectations for a high cost-income ratio moving forward.
• Discussions on private credit highlighted a cautious approach to managing risks while maintaining a diversified portfolio.
• The CFO confirmed that the CET1 ratio is expected to remain stable despite business expansions, and there is ongoing discussion about potentially raising ROE targets in future board meetings.
• The company remains optimistic about the private asset market's growth potential, despite short-term credit cycle risks.

Overall, Nomura Holdings demonstrated strong full-year performance but faced challenges in Q4, particularly in profitability and rising expenses. The outlook remains cautiously optimistic, with strategic initiatives aimed at sustaining growth and managing risks effectively.