AI, Inc. (4388) AI Stock Analysis

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AI, Inc.

(TSE/TYO:4388)

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Rating:73Outperform

Price Target:JPY 352.00▲(12.46% Upside)

Action:upgraded

Date:09/17/26

AI, Inc. achieves a solid score driven by an appealing valuation and a fortress-like balance sheet. The stock presents an attractive P/E multiple relative to its rapid revenue growth and benefits from positive short-term technical momentum. However, upside is constrained by fundamental weaknesses, notably a steady decline in gross profit margins and contracting free cash flow, alongside technical resistance at the 200-day moving average.

Positive Factors

Low leverageVery low leverage and substantial capitalization give the company financial flexibility to absorb operating volatility and fund investment without heavy reliance on borrowing. This reduces interest burden and refinancing exposure, supporting resilience over the next several quarters.

Negative Factors

Margin volatilityAlthough profitability has recovered, the lower net margin compared with earlier peak years shows that earnings quality and operating leverage have not fully returned. Continued margin volatility could limit profit growth even if revenue remains strong and make results less predictable.

AI, Inc. (4388) vs. iShares MSCI Japan ETF (EWJ)

Market Cap: JPY 1.88B
Dividend Yield: 1.28%
Average Volume (3M): 10.60K
Price to Earnings (P/E): 17.4
Beta (1Y): 0.50
Revenue Growth: -4.30%
EPS Growth: ―
Country: Japan
Employees: 114
Sector: General
Sector Strength: 55
Industry: Communication Equipment

AI, Inc. Business Overview & Revenue Model

Company Description

Headquartered in Tokyo, Japan, AI,Inc. specializes in developing and supplying a variety of speech synthesis engines and solutions within Japan. Established in 2003, the company also provides consulting and services related to peripheral systems.

AI, Inc. Financial Statement Overview

Summary

Strong revenue growth of 24.5% year-over-year and a highly conservative balance sheet with a debt-to-equity ratio of 0.04 are offset by compressing gross margins and negative cash flow trajectories.

Income Statement

70Positive

Balance Sheet

85Very Positive

Cash Flow

60Neutral

Financial statement breakdown
Breakdown	TTM	Mar 2026	Mar 2025	Mar 2024	Mar 2023	Mar 2022
Income Statement
Total Revenue	1.82B	1.85B	1.49B	734.98M	634.00M	756.57M
Gross Profit	908.75M	975.77M	749.19M	513.90M	475.42M	604.30M
EBITDA	240.52M	214.19M	31.42M	119.35M	31.73M	122.75M
Net Income	142.16M	110.96M	-15.69M	109.72M	16.37M	83.76M
Balance Sheet
Total Assets	2.51B	2.55B	2.96B	1.71B	1.39B	1.35B
Cash, Cash Equivalents and Short-Term Investments	1.39B	1.48B	1.59B	575.20M	1.24B	1.18B
Total Debt	95.25M	96.01M	129.03M	246.39M	152.11M	2.80M
Total Liabilities	337.55M	324.83M	443.16M	409.26M	202.45M	75.36M
Stockholders Equity	2.17B	2.22B	2.36B	1.30B	1.19B	1.28B
Cash Flow
Free Cash Flow	0	54.08M	74.01M	167.66M	12.94M	121.71M
Operating Cash Flow	0	76.92M	101.73M	169.61M	18.16M	130.56M
Investing Cash Flow	0	-417.72M	-245.08M	-1.04B	-5.21M	-8.85M
Financing Cash Flow	0	-271.25M	-382.07M	90.83M	44.38M	-43.59M

AI, Inc. Technical Analysis

Technical Analysis SentimentNegative

Last Price313.00

Price Trends

50DMA352.92Negative

100DMA358.90Negative

200DMA379.89Negative

Market Momentum

MACD-9.48Positive

RSI28.42Positive

STOCH37.54Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4388, the sentiment is Negative. The current price of 313.00 is below the 20-day moving average (MA) of 333.70, below the 50-day MA of 352.92, and below the 200-day MA of 379.89, indicating a bearish trend. The MACD of -9.48 indicates Positive momentum. The RSI at 28.42 is Positive, neither overbought nor oversold. The STOCH value of 37.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4388.

AI, Inc. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

JP:4388 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JP:3773	74Outperform	JPY 20.91B	11.16	―	2.95%	23.70%	7.16%
JP:4388	73Outperform	JPY 1.93B	17.42	―	1.28%	-4.30%	―
JP:1724	70Outperform	JPY 3.20B	8.60	―	3.80%	1.61%	-30.37%
JP:4441	68Neutral	JPY 15.76B	24.22	―	2.69%	24.30%	-3.68%
JP:4392	56Neutral	JPY 24.11B	27.92	―	1.35%	11.47%	―
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
JP:6522	41Neutral	JPY 6.39B	-20.49	―	―	-8.98%	-41.55%

* General Sector Average

Performance Comparison

JP:4388 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
JP:4388	AI, Inc.	313.00	-164.37	-34.43%
JP:1724	Synclayer Inc.	737.00	59.74	8.82%
JP:3773	Advanced Media, Inc.	1163.00	180.10	18.32%
JP:4392	Future Innovation Group, Inc.	739.00	444.97	151.33%
JP:4441	Tobila Systems, Inc.	1486.00	526.37	54.85%
JP:6522	Asterisk Inc.	695.00	337.00	94.13%

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.

Date of analysis: Sep 17, 2026

AI, Inc. AI Stock Analysis