TWOSTONE&Sons Announces Third Quarter Results for Fiscal Year Ending August 2026: Group-Wide Growth Drives Significant YoY Gross Profit Expansion, Core Business Achieves 28th Consecutive Quarter of Record Revenue

TWOSTONE&Sons Co., Ltd. (Headquarters: Shibuya-ku, Tokyo; CEO: Yasushi Kawaba; COO: Katsuya Takahara; TSE Code: 7352; hereinafter "the Company") announced today, July 15, 2026, its third-quarter financial results for the fiscal year ending August 2026.

Summary of Third Quarter Performance (Fiscal Year Ending August 2026)

・ Third Quarter Financial Performance

Quarterly sales reached 5,217 million yen, an increase of 723 million yen (16.1% year-on-year).

Sales in the core engineer-matching business continued its streak of record highs for the 28th consecutive quarter.

During the third quarter, the Company continued strategic hiring investments aimed at medium- to long-term business expansion. This included hiring consultants and employee engineers, with an increased focus on recruiting executive-level talent.

As a result of these aggressive strategic investments, selling, general, and administrative (SG&A) expenses increased by 440 million yen year-on-year. However, due to solid group-wide growth, gross profit expanded significantly year-on-year, resulting in operating profit of 77 million yen, on par with the previous year.

In the fourth quarter, the Company will promote initiatives to accelerate growth in existing businesses while advancing preparations for commercializing new ventures aimed at future revenue expansion.

・ Outlook Beyond the Fourth Quarter (Fiscal Year Ending August 2026)

Beyond the fourth quarter, the Company will continue its proactive management approach focused on long-term growth and will advance various growth initiatives to drive revenue expansion for the fiscal year ending August 2027. While existing businesses maintain a revenue growth trend, the Company believes there is room for improvement in growth rates. To enhance growth rates, the Company will strengthen proposal capabilities, matching accuracy, and sales structures, while continuing to build systems for renewed growth acceleration through AI utilization and specialized sales functions. Additionally, through the planning and execution of new ventures, the Company aims to achieve sustainable and non-linear business growth. Regarding M&A, the Company will actively consider roll-up M&A focused on adjacent fields to create business synergies. By combining organic growth from existing businesses with non-linear growth from M&A, the Company aims for leapfrog growth and enterprise value maximization.

Key Focus Areas and Progress for Fiscal Year Ending August 2026

For the fiscal year ending August 2026, the Company has identified three key focus areas: "Aggressive Investment in Existing Businesses," "Execution of Strategic M&A Using Roll-Up Approach," and "Strengthening Governance."

First, regarding "Aggressive Investment in Existing Businesses," the number of active engineers increased by 10.5% year-on-year, supporting the continued revenue record streak in the engineer-matching business. During the third quarter, the Company continued aggressive hiring investments from the previous period, hiring 49 full-time engineers and 14 consultant personnel. The Company believes this has established a solid growth foundation for medium- to long-term revenue expansion. These human resources will be leveraged to accelerate the entire Group's growth pace.

Second, concerning "Execution of Strategic M&A Using Roll-Up Approach," the number of M&A opportunities evaluated reached 343, a 69.8% increase year-on-year, significantly expanding the pipeline. In the third quarter, the Company conducted PMI (Post-Merger Integration) for FAM Inc. while simultaneously evaluating new M&A opportunities. The Company will continue to strategically evaluate and execute M&A deals with capital efficiency in mind.

Finally, regarding "Strengthening Governance," the Company continues PMI for acquired companies and is advancing operational efficiency through initiatives such as group company consolidations. This fiscal year, Hasegawa, previously an outside director, was appointed as an internal director, strengthening the management structure. The Company will continue to enhance management discipline and governance to drive enterprise value.

Additional Information

▼ For details, please refer to materials posted on the Company's IR page:

https://twostone-s.com/ir/

▼ A third-quarter earnings briefing will be held today.

・ Overview: Third Quarter Earnings Briefing for Fiscal Year Ending August 2026

・ Date and Time: July 15, 2026 (Wednesday) 19:30 JST onwards

・ Speaker: CEO Yasushi Kawaba

・ Registration Page: https://zoom.us/webinar/register/WN_WK3Dt5BlS2qbC9cJoXmYiQ

Going forward, the Company will continue to uphold its mission of "BREAK THE RULES"—challenging unreasonable norms and creating new rational standards—not only to enhance the value of IT talent and businesses but also to contribute to solving societal challenges bound by outdated conventions.

About TWOSTONE&Sons

A holding company providing diverse solutions centered on engineer platform services. Founded in 2013 as Branding Engineer Inc., the Company listed on the Tokyo Stock Exchange Mothers Market (now Growth Market, Ticker: 7352) on July 7, 2020. On June 1, 2023, it changed its name to TWOSTONE&Sons Co., Ltd. and transitioned to a holding company structure.

The Group operates a wide range of businesses, contributing to society as a collective addressing social issues. For more information, visit the TWOSTONE&Sons corporate website: https://twostone-s.com/

Key Businesses of the TWOSTONE&Sons Group

enableX: A venture development firm building and implementing standards for business development in the AI era

https://enablex-inc.com/

AI Promotion Room: A partner supporting companies from AI adoption to internal stabilization

https://growth-one.co.jp/

Midworks: Freelance engineer and corporate matching service

https://mid-works.com/

Midworks for AI: Matching support for ready-to-deploy freelance IT talent specialized in generative AI

https://lp.mid-works.com/ai

TechStars Agent: IT engineer-focused career support service

https://techstars.jp/lp/agent/

Expert Partners Marketing: Professional marketers solving corporate marketing challenges

https://expertpartners.jp/marketing/business/

TWOSTONE&Sons press releases:

https://twostone-s.com/news/