ORIX Corporation

ORIX reported FY26 net income of JPY 447.3 billion, beating the revised forecast of JPY 440 billion and marking a third straight year of record profits. Net income increased JPY 95.6 billion, or 27%, from the prior year, and ROE was 10.4%, up 1.6 percentage points. Pretax profit was JPY 691.4 billion, up JPY 211 billion or 44% year over year. In Q4, net income was JPY 57.6 billion, weighed down by JPY 97.2 billion of impairments, mainly at ORIX USA. FY27 guidance calls for net income of JPY 530 billion, ROE of 11.7%, and pretax profit of JPY 760 billion, with finance segment profit expected at JPY 308.3 billion, operations at JPY 240.7 billion, and investments at JPY 290 billion. The company also guided to a full-year dividend of JPY 187.36, a JPY 250 billion buyback, and an 85.9% projected total return ratio.

CEO Hidetake Takahashi framed FY26 as a year of steady progress in the first stage of the company’s long-term vision and a major management transition. He emphasized three priorities: portfolio optimization, sophisticated risk management, and new business creation, then added business model transformation under the new structure. His tone was confident but disciplined, stressing that ORIX will keep balancing growth investment and shareholder returns while improving capital efficiency and making faster, more accountable decisions through the new CxO system.

CFO Masataka Yamada highlighted the key financial outcomes and the bridge into FY27. He pointed to record FY26 net income of JPY 447.3 billion, pretax profit of JPY 691.4 billion, and the quarterly impairment burden of JPY 97.2 billion, while noting that investment profits benefited from Greenko and other asset sales. For FY27, he guided to JPY 530 billion net income, JPY 760 billion pretax profit, and JPY 187.36 DPS, supported by a JPY 250 billion buyback; he said the higher buyback reflects cash inflows and capital release from the ORIX Bank sale, future profit levels, ROE, and financial soundness.

Analysts pressed management on why ORIX Bank is being sold, whether the JPY 124.2 billion gain is the main factor, and how the cash will be used. Management said the bank had weaker deposit stickiness, limited room to improve ROA because it is a regulated business, and lower strategic fit versus other uses of capital; proceeds will not be earmarked for one specific purpose, but rather reinvested where ORIX has competitive advantage, especially real assets and Japan PE. Questions also focused on U.S. credit costs, Middle East exposure, China, and future ROE growth; management said U.S. issues are being actively reduced but recovery will take years, Middle East direct exposure is limited, China exposure will be managed and rotated rather than exited, and reaching 15% ROE by FY35 remains a stretch but achievable through steady execution.