Nomura Q3 Earnings Call Highlights

Nomura (NYSE:NMR) reported third quarter operating results for its fiscal year ending March 2026, with management highlighting sustained return on equity above its long-term target range and strong performance across its four main divisions, partially offset by losses in its “other” segment tied to digital asset-related businesses.

Quarterly results and shareholder return

Chief Financial Officer Hiroyuki Moriuchi said return on equity was 10.3%, marking the seventh consecutive quarter the firm has reached its quantitative 2030 target of 8%–10% or more. Group-wide net revenue totaled JPY 551.8 billion, up 7% quarter-over-quarter.

Income before income taxes declined 1% to JPY 135.2 billion, while net income fell 1% to JPY 91.6 billion. Earnings per share were JPY 30.19.

Moriuchi said the four main divisions produced solid results, with their combined pre-tax income rising 8% to JPY 142.9 billion, which he described as the highest level in 18.5 years since the first quarter of the fiscal year ended March 2008. However, the “other” segment posted losses due to a downturn in market conditions affecting digital asset-related operations.

Nomura also announced a share repurchase program aimed at enhancing shareholder returns and capital efficiency. The buyback will run from February 17 to September 30, with an upper limit of 100 million shares and JPY 60 billion in total.

Nine-month performance and progress toward 2030 goals

For the first nine months of the fiscal year, income before income taxes rose 15% year-over-year to JPY 432.1 billion, while net income increased 7% to JPY 288.2 billion. EPS was JPY 94.67, and ROE was 10.8%.

Moriuchi said nine-month pre-tax income was running “slightly ahead” of Nomura’s management vision target of over JPY 500 billion by 2030. He attributed performance to strong profits in Wealth Management, organic growth in Investment Management’s existing operations despite acquisition-related costs, broad strength across Wholesale businesses, and steady progress in Banking despite costs rising ahead of a planned deposit sweep service launch next fiscal year.

Wealth Management: record recurring revenue assets and high margin

Wealth Management net revenue increased 14% quarter-over-quarter to JPY 132.5 billion. Income before income taxes rose 29% to JPY 58.5 billion, producing a pre-tax margin of over 40%, which Moriuchi noted was ahead of market expectations.

Recurring revenue reached an all-time high of JPY 52.7 billion, supported by net inflows of recurring revenue assets exceeding JPY 500 billion. Flow revenue increased to JPY 79.8 billion, which management attributed to accurate assessment of market movements and customer needs and the supply of new products. The recurring revenue cost coverage ratio rose 1 percentage point to 71%, reflecting ongoing cost controls.

Total sales rose about JPY 300 billion to JPY 6.6 trillion. Equities sales increased 4%, while bond sales declined 25%, as flat yen bond sales were offset by weaker foreign bond sales due to the absence of prior-quarter primary deals. Investment trusts and discretionary investments grew steadily, and insurance sales remained strong. Management said these trends show Japan’s “shift from savings to investment” has firmly taken root.

Key Wealth Management KPIs included:

• Recurring revenue assets net inflow: JPY 503.9 billion (largest net increase on record)
• Recurring revenue assets balance: JPY 28.1 trillion (record high at end of December)
• Flow business clients: up about 270,000 to 1.53 million, supported by improved market conditions and primary deals, including the SBI Shinsei Bank IPO

In the Q&A, Moriuchi said he would refrain from predicting whether strong investment trust inflows are sustainable given market and customer preference factors. He added that structural change in Japan supports a higher margin environment than in the past, while also noting the business is influenced by cyclical market factors. He said Nomura is continuing selective investments, including in AI, to improve customer services.

Investment Management: record business revenue, acquisition-related profit pressure

Investment Management net revenue was flat at JPY 60.9 billion, while pre-tax income fell 42% to JPY 17.9 billion. Management cited one-time expenses related to the Macquarie public asset management business acquisition (completed December 1, 2025) and weaker investment gains, including from American Century Investments.

Business revenue, which the company described as a stable revenue component, rose to an all-time high of JPY 57.8 billion, helped by the acquisition and solid performance in Japan. Assets under management reached a record JPY 134.7 trillion at end-December, with net inflows of JPY 115 billion, marking the 11th consecutive quarter of net inflows. Alternative assets under management increased to a new high of JPY 3.3 trillion.

Management said the impact on consolidated net profit after tax from acquisition-related costs was offset by a reversal of the valuation allowance for deferred tax assets associated with the acquisition. Moriuchi also provided additional color on the acquisition’s initial contribution, stating that the newly consolidated business added approximately JPY 25 trillion in AUM, produced about JPY 7 billion in business revenue for the period, and incurred about JPY 5 billion in operating expenses, with total expenses including operating costs rising to roughly JPY 11 billion after one-off acquisition-related costs and amortization of intangible assets.

Looking forward, he said Nomura expects roughly $100 million in transfer and integration-related costs over the next two years, with most recognized over the one-year period starting in the fourth quarter. The company plans to discuss expected growth investment spending at its investor day in May.

Wholesale strength, Banking growth, and digital asset volatility

Wholesale net revenue increased 12% to JPY 313.9 billion, and income before income taxes rose 17% to JPY 62.3 billion. Global Markets net revenue rose 9% to JPY 256.8 billion, with fixed income revenue up 12% to JPY 136.9 billion and equities revenue up 5% to a new high of JPY 119.9 billion. Investment Banking net revenue increased 31% to JPY 57.1 billion, which management said was the strongest performance for the period since the fiscal year ended March 2017.

Banking net revenue rose 7% to JPY 13.7 billion, while pre-tax income increased 31% to JPY 4.2 billion, supported by lending and trust/agent services. Management said preparations for the deposit sweep service planned for next fiscal year are progressing as scheduled.

Group-wide expenses were JPY 416.5 billion, up 10% quarter-over-quarter. Drivers included an FX impact of JPY 9 billion and JPY 13 billion in one-off costs, including acquisition-related expenses and temporary costs from partial changes to the deferred compensation plan, as well as variable costs such as bonuses, commissions, and floor brokerage fees. In the Q&A, Moriuchi said the deferred compensation accounting method change had an impact of about JPY 8 billion in the third quarter, with a similar impact expected in the fourth quarter, and an estimated JPY 15–16 billion impact next year, with much of that expected to occur in the first year before normalizing.

On digital assets, management said losses in the “other” segment were partly due to negative performance in EMEA tied to digital asset market movements and currency hedges. Moriuchi said Laser Digital was negatively impacted by market movements in October and November, describing crypto earnings as inherently volatile. He said Nomura has tightened controls over positions and risk exposure to limit short-term fluctuations while aiming to capture growth in crypto markets over the longer term. During Q&A, he added the firm is reducing risk volume in positions to control near-term volatility, while pursuing growth through a mix of activities including market making, asset management, venture ecosystem support, and custody-related businesses.

For capital, Tier 1 capital at end-December was JPY 3.6 trillion and the common equity Tier 1 ratio was 12.8%. Moriuchi said the quarter-over-quarter change reflected, among other factors, a regulatory capital ratio calculation method change following the Macquarie acquisition’s completion. He said the clarification of the CET1 impact after closing the deal helped inform the timing of the share buyback decision, while the size reflected a balance between future investment opportunities and shareholder returns.

In an early read on January trends, Moriuchi said Wealth Management net revenue was tracking about even with third-quarter levels, while Global Markets was broadly in line despite some slowdown in Japan rates amid increased volatility. Investment Banking started more slowly, but he said the pipeline remains solid. He also noted that the earnings impact from fraudulent transactions linked to phishing scams was negligible in the third quarter and is expected to remain minimal based on recent conditions.

About Nomura (NYSE:NMR)

Nomura Holdings, Inc is a global financial services group headquartered in Tokyo, Japan, with origins dating back to 1925 when Tokushichi Nomura II established the firm as a securities business. Over the decades Nomura has grown from a domestic securities house into a multinational financial services firm by expanding its product offerings and international footprint. The company is publicly listed and operates through a network of subsidiaries and branches to serve a broad client base.

Nomura’s principal businesses encompass retail brokerage, wholesale (investment banking and global markets), and asset management.