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Japan: Daikoku Denki Q1 sales fall 19.4% as Oizumi amusement profit reaches ¥464m

Smart gaming machines reached 45.0% of installed machines tracked by Daikoku Denki, while Oizumi's amusement revenue increased 61.5% during the quarter.

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Key Points
Daikoku Denki Q1 net sales declined 19.4% year-on-year to ¥12.36bn, with attributable profit down 38.9% to ¥1.48bn
Oizumi amusement sales rose 61.5% to ¥3.30bn as the segment moved from a ¥73m loss to a ¥464m profit
Japan's smart-machine transition continues despite a shrinking pachinko hall base, with pachislot utilization outperforming pachinko

Daikoku Denki and Oizumi Corporation reported contrasting first-quarter performances for the three months ended June 30, as Japan's pachinko and pachislot sector continued shifting toward smart gaming machines.

Daikoku Denki reported consolidated net sales of ¥12.36bn ($78m), down 19.4% year-on-year, while operating profit fell 34.4% to ¥2.31bn. 

Profit attributable to owners of the parent declined 38.9% to ¥1.48bn. The supplier does not disclose EBITDA in its Q1 Japanese GAAP materials.

Daikoku Denki's core gaming exposure comes through systems and equipment used by pachinko halls. It develops computer systems for hall operators and supplies hardware and software supporting pachinko and pachislot operations. Its DK-SIS data platform has formed part of its hall-management business since 1990.

The group said average gaming-machine utilization across April to June was 100.3% of the prior-year level. Pachislot utilization reached 102.6%, compared with 97.4% for pachinko. 

Smart machines accounted for 45.0% of installed machines at quarter-end, up 2.3 percentage points from March. The transition continues to support spending on compatible hall infrastructure even as Japan's parlor base contracts. 

Yano Research said Japan had 6,450 licensed pachinko parlors in 2025, down 3.8%, as smaller locations continued to leave the market. 

Daikoku Denki has been adjusting its systems operations around that shift. It launched cloud-based DK-SIS Infinity in April, expanding its data services for hall operators with real-time machine analysis and performance forecasting. 

Oizumi moved in the opposite direction financially. Consolidated sales increased 29.2% to ¥6.23bn and operating profit rose 248.6% to ¥629m. Profit attributable to owners of the parent increased 60.7% to ¥597m. Oizumi also does not report EBITDA in its Q1 materials.

Its amusement segment, which includes pachislot and pachinko machines alongside peripheral equipment for gaming halls, generated ¥3.30bn in sales, up 61.5%. Segment profit reached ¥464m, compared with a ¥73m loss a year earlier.

Oizumi said its May launch of LB Slot GALFY missed sales projections. However, subsidiary Takao's e Gakuen Mokushiroku Highschool of the Dead 3 contributed to profit as reused parts reduced manufacturing costs.

Oizumi is also scaling back peripheral equipment operations as fewer new halls open and smart-machine adoption reduces demand for some existing products. It plans to redirect resources toward businesses offering higher profitability and growth potential.

Sankyo reported a similar challenge on the machine-manufacturing side of the Japanese market, with Q1 sales falling 39.2% to ¥33.6bn as lower pachinko and pachislot volumes weighed on performance. 

The supplier retained its FY27 guidance despite weaker pachinko demand and has introduced lower pricing on selected machines as hall operators become more selective over capital expenditure.

Good to know

Smart pachislot represented 62.5% of installed pachislot machines tracked by Daikoku Denki at the end of June, compared with 31.1% for smart pachinko

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