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SAKURA Internet Inc.
(3778)
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Rating:45Neutral
Price Target:
¥2,757.00
▼(-0.83% Downside)
Action:Reiterated
Date:04/29/26
The score is held down primarily by weakened financial performance—sharp margin deterioration and deeply negative free cash flow alongside rising leverage. Valuation further detracts due to an extremely high P/E and minimal dividend yield. Technical indicators are comparatively neutral, offering limited offset to the fundamental and valuation risks.
Positive Factors
Recurring revenue model
SAKURA’s core business is built on subscription and usage-based infrastructure contracts with high retention. That recurring revenue mix creates predictable, durable cash inflows, supports capacity planning and customer lock‑in, and underpins long-term revenue stability and service-led differentiation.
Negative Factors
Sharp margin deterioration
A collapse in gross margin to ~22.5% and an operating loss in 2026 signal structural margin pressure, likely from cost inflation, pricing or mix shifts. Persistent margin weakness reduces internal funding for capex, weakens competitive positioning on price or service investment, and must reverse to restore durable profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring revenue model
SAKURA’s core business is built on subscription and usage-based infrastructure contracts with high retention. That recurring revenue mix creates predictable, durable cash inflows, supports capacity planning and customer lock‑in, and underpins long-term revenue stability and service-led differentiation.
Read all positive factors
SAKURA Internet Inc. (3778) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥118.18B
Dividend Yield0.14%
Average Volume (3M)1.25M
Price to Earnings (P/E)548.4
Beta (1Y)1.30
Revenue Growth12.38%
EPS Growth-92.67%
CountryJP
Employees839
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)64.28
Shares Outstanding41,890,700
10 Day Avg. Volume655,830
30 Day Avg. Volume1,250,683
Financial Highlights & Ratios
PEG Ratio-4.95
Price to Book (P/B)3.30
Price to Sales (P/S)2.81
P/FCF Ratio-3.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥5,980.00Price Target Upside115.11% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)47.07
Revenue Forecast (FY)¥47.77B
SAKURA Internet Inc. Business Overview & Revenue Model
Company Description
Established in 1996 and based in Osaka, Japan, SAKURA Internet Inc. delivers a comprehensive array of internet and technology services. The company specializes in providing internet access, along with various hosting solutions including co-locatio...
How the Company Makes Money
SAKURA Internet primarily makes money by charging recurring and usage-based fees for internet infrastructure services. Key revenue streams include: (1) Cloud/IaaS services: customers pay monthly and/or metered charges for compute, storage, and rel...
SAKURA Internet Inc. Financial Statement Overview
Summary
Income Statement
48
Neutral
Balance Sheet
56
Neutral
Cash Flow
34
Negative
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 32.97B | 35.30B | 31.41B | 21.83B | 20.62B | 20.02B |
| Gross Profit | 11.08B | 7.96B | 11.23B | 5.74B | 5.37B | 4.71B |
| EBITDA | 8.88B | 7.34B | 8.91B | 4.02B | 3.88B | 4.04B |
| Net Income | 2.57B | 216.02M | 2.94B | 651.72M | 666.55M | 275.45M |
Balance Sheet | ||||||
| Total Assets | 81.00B | 82.45B | 81.60B | 30.38B | 26.37B | 28.52B |
| Cash, Cash Equivalents and Short-Term Investments | 24.25B | 15.39B | 29.49B | 5.26B | 4.81B | 5.45B |
| Total Debt | 21.81B | 35.83B | 23.66B | 12.41B | 9.56B | 11.55B |
| Total Liabilities | 51.18B | 52.12B | 51.34B | 21.06B | 17.88B | 20.07B |
| Stockholders Equity | 29.61B | 30.10B | 30.06B | 9.14B | 8.35B | 8.32B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | -30.11B | -11.87B | -597.67M | 3.47B | 2.66B |
| Operating Cash Flow | 0.00 | 6.22B | 5.79B | 2.88B | 3.96B | 3.96B |
| Investing Cash Flow | 0.00 | -24.64B | -8.32B | -2.03B | -606.13M | -1.67B |
| Financing Cash Flow | 0.00 | 4.32B | 26.76B | -410.59M | -4.00B | -1.01B |
SAKURA Internet Inc. Technical Analysis
Neutral
2780.00
Price Trends
3081.72
Negative
2985.28
Negative
3017.29
Negative
Market Momentum
-10.03
Negative
43.97
Neutral
38.34
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3778, the sentiment is Neutral. The current price of 2780 is below the 20-day moving average (MA) of 2890.15, below the 50-day MA of 3081.72, and below the 200-day MA of 3017.29, indicating a neutral trend. The MACD of -10.03 indicates Negative momentum. The RSI at 43.97 is Neutral, neither overbought nor oversold. The STOCH value of 38.34 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JP:3778.
SAKURA Internet Inc. Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | ¥29.12B | 18.51 | ― | ― | 13.54% | 54.38% | |
68 Neutral | ¥15.36B | -24.59 | ― | ― | 12.01% | -191.13% | |
68 Neutral | ¥37.02B | 24.82 | ― | 0.39% | 22.45% | 23.34% | |
67 Neutral | ¥46.15B | 72.43 | ― | ― | 38.15% | 78.39% | |
65 Neutral | ¥8.72B | 10.27 | ― | 2.16% | -1.76% | 25.65% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
45 Neutral | ¥118.18B | 548.42 | ― | 0.14% | 12.38% | -92.67% |
* Technology Sector Average
JP:3778
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SAKURA Internet Inc. Corporate Events
SAKURA Internet Grants Restricted Treasury Shares to Align Management with Shareholders
Jun 23, 2026
SAKURA Internet has approved the disposal of 22,185 treasury shares as restricted stock compensation for three internal directors and eleven executive officers, at a price of ¥3,190 per share, totaling about ¥70.8 million. The shares wil...
SAKURA internet to Record Offset Extraordinary Items on AI-Linked Subsidy
Jun 16, 2026
SAKURA internet Inc. will book both extraordinary income and an equivalent extraordinary loss of up to ¥2,587 million in the first quarter of the fiscal year ending March 31, 2027. The accounting entries stem from government subsidies under t...
SAKURA Internet Revamps Board and Auditor Lineup to Support Long-Term Growth
May 25, 2026
SAKURA Internet Inc. has announced a reshuffle of its board and auditors, to be finalized after shareholder approval at the June 23, 2026 annual meeting. President Kunihiro Tanaka and Director and CFO Masataka Kawada will remain on the board, whil...
SAKURA internet Wins ¥2.5 Billion NII Cloud Contract for Large Language Model R&D
May 18, 2026
SAKURA internet’s subsidiary Prunus Solutions has secured a major contract from Japan’s National Institute of Informatics to supply cloud services for large language model RD in fiscal 2026. The deal, valued at about JPY 2.5 billion, w...
SAKURA internet Beats FY2026 Forecast on GPU Infrastructure Demand and Cost Controls
Apr 27, 2026
SAKURA internet Inc. reported that its full-year results for the fiscal year ended March 31, 2026, modestly exceeded its earlier consolidated forecast, with net sales reaching ¥35.3 billion and profits at every level surpassing guidance despi...
SAKURA Internet Posts Higher Sales but Swings to Loss, Targets Earnings Rebound in FY2027
Apr 27, 2026
SAKURA Internet reported a 12.4% rise in net sales to ¥35.3 billion for the year ended March 31, 2026, but swung to an operating loss of ¥403 million and saw profit attributable to owners of parent plunge 92.6% to ¥216 million. Prof...
SAKURA internet Wins ¥3.8 Billion National Generative AI Supercomputing Deal
Apr 13, 2026
SAKURA internet Inc. has secured a large-scale generative AI-related order from a national institution, centered on its cloud-based supercomputer offerings “SAKURAONE Managed HPC Cluster H100” and “SAKURAONE Managed HPC Cluster H...
SAKURA Internet Confirms Exploratory AI Cloud Collaboration Talks With Microsoft Japan
Apr 3, 2026
SAKURA internet Inc. has clarified recent media reports by confirming it is working with Microsoft Japan on a potential joint solution that would link its AI computing infrastructure with Microsoft Azure. The collaboration aims to expand AI infras...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.