DMG MORI Q3 FY2026: Orders drive 46% rise in operating profit

For the nine months ended September 2026, DMG MORI reported revenue of ¥422.7 billion, up 23.2% year on year, and operating profit of ¥16.9 billion, up 46.3%. Profit attributable to owners of the parent was ¥8.7 billion, down 58.7%, highlighting the divergence between higher operating profit and lower net profit.

• More machine-tool orders: Orders rose for five-axis and multitasking machines, as well as models benefiting from demand for automation.
• Broad customer demand: Orders were strong from aerospace, defense, medical, power and energy, shipbuilding and semiconductor-related industries.
• Effect of a one-off gain a year earlier: Profit attributable to owners of the parent in the year-earlier period included insurance proceeds related to discontinued operations.

Higher revenue and operating profit show that strong orders are feeding through to sales. Net profit, however, compares unfavorably because the year-earlier period included insurance proceeds related to the Russian business. Investors should distinguish higher profit from core operations from a decline in net profit driven by a one-off factor.

Machine Tools benefited from firm orders for five-axis and multitasking machines, as well as models designed for automation. Orders also grew from semiconductor-related companies, including for ultra-high-resolution laser equipment used in semiconductor manufacturing, supporting higher revenue and operating profit.

Industrial Services handles machine repairs and recovery, as well as the provision of solutions. The company said the favorable order environment continued, and is seeking to add value through post-installation services alongside sales of machines.

Orders exceeded the year-earlier level in every region, while demand was broad across industries. The backlog for machine tools increased from about ¥400 billion at the end of 2025 to about ¥500 billion at the end of September 2026. The company also expects more long-lead-time projects, which could support sales not only in the fourth quarter but from 2027 onward.

DMG MORI left its FY2026 forecast unchanged. It expects revenue of ¥580 billion, up 12.6% from the previous year, operating profit of ¥30 billion, up 58.1%, and profit attributable to owners of the parent of ¥15.5 billion, down 35.5%.

There is no change from the previous forecast. The approximate 2025 actual figures are calculated from the year-on-year comparisons disclosed by the company. The foreign-exchange assumptions are ¥157.7 to the U.S. dollar and ¥181.8 to the euro. Orders remain strong, but changes in demand or exchange rates could leave actual results below forecast.

Total assets stood at ¥877.6 billion at the end of September 2026, about 1.0% higher than at the end of 2025. The equity ratio attributable to owners of the parent was 40.6%, up 1.4 percentage points from 39.2% at the previous fiscal year-end.

The company is directing funds toward growth investment, including factory equipment. In August, it raised about ¥20 billion through a public offering. The funds are intended for capital investment at sites including the Nagaoka factory, a factory in Germany and the Chicago solutions center, as well as for boosting production capacity and potential future mergers and acquisitions and capital and business alliances. As the available figures for operating cash flow are limited, this summary focuses on the company’s disclosed funding and investment plans.

DMG MORI is expanding its offering beyond machine sales by combining services, software and automation. It is also working on using AI on factory floors and optimizing machining processes, with the aim of improving equipment utilization and customer productivity.

• Capital investment: The company plans to use proceeds from its public offering for investment at sites including Nagaoka, Germany and Chicago.
• Stronger product lineup: It is rolling out new models in the five-axis INH series, as well as horizontal boring machines designed for high rigidity and speed.
• AI on factory floors: A project promoted by Japan’s Ministry of Economy, Trade and Industry and NEDO has been selected, with the goal of optimizing machining processes using equipment data.

The strategy is to expand production capacity while demand is strong and advance high-value-added products and digital services. In the medium to long term, corporate value will depend on converting the order backlog into sales and using the capital raised to improve productivity and drive profit growth.

Orders are strong, but machine tools are exposed to changes in corporate capital spending and economic conditions. Investors should also watch when the larger backlog translates into results and how effectively the company’s investments, funded in part by the share offering, deliver returns.

• Shifts in capital spending demand: Orders are growing across regions and industries, but a downturn or changes to customers’ investment plans could delay orders or deliveries, affecting revenue recognition and profit.
• Foreign-exchange movements: The full-year forecast assumes ¥157.7 to the U.S. dollar and ¥181.8 to the euro. Actual exchange rates moving away from those assumptions could cause revenue or profitability to differ from forecast.
• Converting backlog into sales: Long-lead-time projects are increasing. Delays in production capacity, parts supply or delivery management could slow the conversion of backlog into sales.
• Capital efficiency after the share offering: The public offering secures funds for investment in factories and other assets, but also increases the number of shares outstanding. The challenge is to turn investment into stronger earning power.
• One-off factor in profit comparisons: Net profit in the year-earlier period included insurance proceeds. Assessing future earnings requires looking beyond a simple year-on-year comparison to the level of profit from core operations.