Interim report
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1 Consolidated Financial Results for the second quarter (semi-annual period) of the fiscal year ending March 31, 2027 〔JGAAP〕 October 29, 2026 Company name: ZOZO, Inc. Listed stock exchanges Tokyo Code 3092 URL https://corp.zozo.com/en Representative Representative Director, President & CEO Kotaro Sawada Contact person Director, Executive Vice President & CFO Koji Yanagisawa (TEL) 043(213)5171 Scheduled date to file the semi- annual financial report November 13, 2026 Scheduled date of dividend payment November 30, 2026 Supplementary material for quarterly financial results : Yes Quarterly results briefing : Yes ( For analysts and institutional investors ) (Rounded down to million yen) 1. Consolidated business results for the six-month period of the fiscal year ending March 31, 2027 (April 1, 2026 to September 30, 2026) (1) Consolidated business results (Percentages indicate YoY changes) Net sales Operating profit Adjusted EBITA Ordinary profit Semi-annual profit attributable to owners of parent Million yen % Million yen % Million yen % Million yen % Million yen % Six-month period of fiscal year ending March 31, 2027 110,642 5.1 32,825 5.6 34,614 5.1 32,871 6.6 21,751 3.5 Six-month period of fiscal year ended March 31, 2026 105,249 6.5 31,074 2.0 32,920 7.6 30,826 1.0 21,006 -0.6 (Note) 1. Comprehensive income Six-month period of fiscal year ending March 2027 21,330 Million yen (-3.6%) Six-month period of fiscal year ended March 2026 22,128 Million yen (5.3%) 2. Adjusted EBITA = Operating profit + amortization of goodwill (including amortization of intangible assets recognized through purchase price all ocation (PPA)) + M&A-related expenses (including advisory fees and due diligence costs) Earnings per share Diluted earnings per share Yen Yen Six-month period of fiscal year ending March 31, 2027 24.74 - Six-month period of fiscal year ended March 31, 2026 23.68 - (Note) 1. Fully diluted earnings per share are not presented because there were no dilutive potential shares. (2) Consolidated financial position Total assets Net assets Equity ratio Million yen Million yen % Six-month period of fiscal year ending March 31, 2027 174,892 92,112 52.7 Fiscal year ended March 31, 2026 198,260 106,789 53.9 (Reference) Equity attributable to owners of parent Six-month period of fiscal year ending March 31, 2027 92,112 Million yen Fiscal year ended March 31, 2026 106,789 Million yen
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2 2. Dividends Annual dividends End of Q1 End of Q2 End of Q3 Year-end Total Yen Yen Yen Yen Yen Fiscal year ended March 31, 2026 - 19.00 - 20.00 39.00 Fiscal year ending March 31, 2027 - 20.00 Fiscal year ending March 31, 2027 (Forecast) - 20.00 40.00 (Note) Revisions to the most recently announced dividends forecasts: None 3. Consolidated earnings forecast for the fiscal year ending March 31, 2027 (April 1, 2026, to March 31, 2027) (Percentages indicate YoY changes) Net sales Operating profit Adjusted EBITA Ordinary profit Profit attributable to owners of parent Earnings per share Million yen % Million yen % Million yen % Million yen % Million yen % Yen Full year 241,900 5.9 74,400 7.3 77,900 7.2 74,400 7.4 49,700 3.7 56.20 (Note) Revisions to the most recently announced earnings forecast: None
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3 ※ Notes (1) Significant changes in the scope of consolidation during the six-month period of the current fiscal year : Yes New 1 HIGH LINK, INC. Exclusion - (2) Application of particular accounting procedures to the preparation of semi-annual consolidated financial statements : None (3) Changes in accounting policies, changes in accounting estimates, and retrospective restatement ① Changes in accounting policies caused by the revision of accounting standards : None ② Changes in accounting policies other than ① : None ③ Changes in accounting estimates : None ④ Retrospective restatement : None (4) Number of issued shares (Common stock) ① Number of issued shares at the end of the period (including treasury shares) Q2 of fiscal year ending March 2027 892,032,372 Shares Fiscal year ended March 2026 892,032,372 Shares ② Number of treasury shares at the end of the period Q2 of fiscal year ending March 2027 23,517,646 Shares Fiscal year ended March 2026 7,707,341 Shares ③ Average number of shares during the period (six-month period) Q2 of fiscal year ending March 2027 879,347,164 Shares Q2 of fiscal year ended March 2026 886,956,679 Shares ※ Review of the second quarter (semi-annual period) consolidated financial statements by a certified public accountant or auditing firm: None ※ Explanations and other special notes concerning the appropriate use of earnings forecast - The earnings forecast and other statements related to the future contained in this material are based on information currently available to the Company and on certain assumptions deemed to be reasonable. Actual results may differ materially from the earnings forecast due to various factors. Please refer to “1. Qualitative information on results for the six-month period ended September 30, 2026, (3) Explanation of consolidated earnings forecast and other forward- looking statements” on page 13 for the assumptions underlying the forecast and cautionary statements regarding the use of the forecast. - The Company group is scheduling a financial results briefing for institutional investors and analysts on October 29, 2026. The Company group will post the content of the briefing and the materials used on the day on its website promptly after the briefing.
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4 Table of contents of the appendix 1. Qualitative information on results for the six-month period ended September 30, 2026 .................................................. 5 (1) Overview of business results ......................................................................................................................................... 5 (2) Overview of financial position ....................................................................................................................................... 12 (3) Explanation of consolidated earnings forecast and other forward-looking statements ................................................. 13 2. Semi-annual consolidated financial statements ............................................................................................................... 14 (1) Semi-annual consolidated balance sheet ...................................................................................................................... 14 (2) Semi-annual consolidated statement of income and semi-annual consolidated statement of comprehensive income 16 (3) Semi-annual consolidated statement of cash flows ...................................................................................................... 18 (4) Notes on semi-annual consolidated financial statements ............................................................................................. 20 (Notes on the going concern assumption) .................................................................................................................... 20 (Notes on significant changes in shareholders' equity) ................................................................................................ 20 (Notes on segment information) .................................................................................................................................. 20 (Matters related to the business combination) ............................................................................................................. 20 (Significant subsequent events) ................................................................................................................................... 22
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5 1. Qualitative information on results for the six-month period ended September 30, 2026 (1) Overview of business results Business results for the current fiscal year [Table 1] YoY comparison (Unit: Million yen) Six-month period of previous fiscal year (April 1 to September 30, 2025) Six-month period of current fiscal year (April 1 to September 30, 2026) YoY change Gross merchandise value 312,473 (106.8%) 309,433 (100.0%) -1.0 % Gross merchandise value (excluding other GMV) 292,687 (100.0%) 309,290 (100.0%) 5.7 % Net sales 105,249 (36.0%) 110,642 (35.8%) 5.1 % Gross profit 98,448 (33.6%) 102,756 (33.2%) 4.4 % Operating profit 31,074 (10.6%) 32,825 (10.6%) 5.6 % Adjusted EBITA (Note) 2 32,920 (11.2%) 34,614 (11.2%) 5.1 % Ordinary profit 30,826 (10.5%) 32,871 (10.6%) 6.6 % Semi-annual profit attributable to owners of parent 21,006 (7.2%) 21,751 (7.0%) 3.5 % (Note) 1. Figures in parentheses are percentages of gross merchandise value (excluding other GMV). 2. Adjusted EBITA = Operating profit + amortization of goodwill (including amortization of intangible assets recognized through purchase price all ocation (PPA)) + M&A-related expenses (including advisory fees and due diligence costs) Under the corporate philosophy of “Inspire the world. Deliver joy every day.,” the Company group mainly operates Japan’s largest fashion e-commerce website, “ZOZOTOWN.” In April 2026, the Company group announced its Medium-Term Business Plan, under which it aims to achieve Adjusted EBITA of 90.0 billion yen in the fiscal year ending March 31, 2030 through business expansion in the three domains of “More Fashion,” “Near Fashion,” and “Global.” During the six-month period of the current fiscal year, the domestic fashion market remained relatively firm, supported by improvements in employment and income conditions. However, the outlook remains uncertain due to persistent inflation, climate change, geopolitical risks, and other factors. Under these circumstances, the Company group has continued to focus on making ZOZOTOWN, the core business in the “More Fashion” domain, even more attractive to both users and brands, with the aim of increasing the number of unique users and improving the conversion rate (the purchasing rate of unique users). Specifically, to maximize sales, the Company group strengthened customer traffic by airing TV commercials and increasing web advertising during the “ZOZOWEEK” sale event (11 days from May 14 to 24, 2026, and 10 days from September 18 to 27, 2026) and the summer sale (from June 17, 2026 to August 30, 2026). In addition, to meet the diversifying needs of users, the Company group continued to expand its lineup of new brands across a wide range of genres and strengthen item categories. Furthermore, with the aim of providing solutions centered on helping users find their “style” by addressing the upstream of purchasing behavior, the Company group launched “Lab-kun, ZOZO’s outfit recommendation AI,” as an official LINE account in April 2026, leveraging the extensive fashion-related data it has accumulated over the years. Through AI-powered outfit recommendations, the Company group supports users in selecting outfits for everyday wear and expects to generate new traffic to ZOZOTOWN by establishing LINE, with its large user base, as a new customer touchpoint. Since its launch, the Company group has continued to expand and improve its features based on usage patterns and feedback. In addition, in September 2026, the Company group launched a new personalized styling feature on the outfit-sharing app “WEAR by ZOZO,” offering an integrated experience from assessment and recommendations to explanations and virtual try-on. Based on the results of the “Core Style Finder,” which helps users identify their fashion preferences, the new feature recommends outfits using items available on ZOZOTOWN and also enables virtual try-on powered by generative AI. Sales of LY Corporation Commerce (combined sales of “Yahoo! JAPAN Shopping” and “Yahoo! JAPAN Auction”), another core business in the “More Fashion” domain, have continued to grow steadily, driven by the retention of customers acquired through the previous fiscal year, efforts by LY Corporation, which operates these platforms, to drive traffic to
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6 them, and promotional campaigns such as “Serious ZOZO Festival” (12 days in total: April 19, May 30, June 21, July 10 to 12, July 31 to August 2, and September 11 to 13, 2026). In the “Near Fashion” domain, the Company group acquired HIGH LINK, INC. (hereinafter, referred to as “High Link”), the operator of the comprehensive fragrance platform “Coloria,” as a wholly owned subsidiary in April 2026, and has consolidated its financial results since May 2026. The Company group has been working to create synergies, including by directing existing ZOZOTOWN users to High Link’s services. In the “Global” domain, the Company group continues to position LYST LTD (hereinafter, referred to as “LYST”) as a core business and aims to achieve step-change growth in the global market. Consequently, the gross merchandise value in the six-month period of the current fiscal year was 309,433 million yen (- 1.0% YoY), and the gross merchandise value (excluding other GMV) was 309,290 million yen (+5.7% YoY). Total gross merchandise value, including other GMV, decreased year on year. This was due to the discontinuation, at the end of September 2025, of recording the gross merchandise value from stores under ZOZO Option contracts on Yahoo! JAPAN Shopping under the “Others” category. However, the gross merchandise value excluding other GMV was largely in line with plan. Net sales were 110,642 million yen (+5.1% YoY), and gross profit was 102,756 million yen (+4.4% YoY). The gross profit ratio to the gross merchandise value (excluding other GMV) (gross profit margin) was 33.2%, a decrease of 0.4 percentage points from the same period of the previous fiscal year. As for net sales, the year-on-year growth rate was lower than that of gross merchandise value (excluding other GMV), mainly due to changes in the business mix resulting from one additional month of LYST consolidation compared with the same period of the previous fiscal year, as well as strengthened discounting and point-award campaigns, primarily on ZOZOTOWN, which are deducted from net sales. LYST operates a performance-based commission business model under which it earns commissions from partner brands listing their products on its platform, Lyst. Compared with the Consignment sales and LY Corporation Commerce businesses, LYST has a lower commission rate relative to gross merchandise value. The primary factors behind the decline in the gross profit margin were the same as those described under net sales. Selling, general, and administrative expenses were 69,930 million yen (+3.8% YoY). The ratio to the gross merchandise value (excluding other GMV) was 22.6%, a decrease of 0.4 percentage points compared with the same period of the previous fiscal year. The major factors behind the changes in individual expense items are as follows. The following percentages of gross merchandise value are calculated by dividing each SG&A expense by the gross merchandise value (excluding other GMV). Increasing (worsening) factors 1. Advertising expenses as a percentage of gross merchandise value rose by 0.2 percentage points due to one additional month of LYST consolidation, the commencement of consolidation of High Link, and increased web advertising costs and other related expenses for ZOZOTOWN. 2. Amortization of goodwill as a percentage of gross merchandise value rose by 0.2 percentage points due to one additional month of LYST consolidation and the commencement of consolidation of High Link. Decreasing (improving) factors 1. Shipping expense as a percentage of gross merchandise value declined by 0.5 percentage points, due to the improved economic terms with the delivery outsourcing partner from October 2025, following initiatives to improve delivery efficiency. 2. Logistics-related expense as a percentage of gross merchandise value declined by 0.2 percentage points, due to the improvements in operational efficiency at logistics centers, etc. Consequently, Adjusted EBITA of the six-month period of the current fiscal year was 34,614 million yen (+5.1% YoY), and the Adjusted EBITA margin was 11.2% of the gross merchandise value (excluding other GMV), remaining at the same level as the same period of the previous fiscal year. Operating profit was 32,825 million yen (+5.6% YoY), ordinary profit
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7 was 32,871 million yen (+6.6% YoY), and semi-annual profit attributable to owners of parent was 21,751 million yen (+3.5% YoY). Since the Company group is a single segment of the e-commerce business, information by segment is omitted. However, the performance of each business category within the single segment is shown below.
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8 [Table 2] YoY comparison by business segment By business segment Six-month period of previous fiscal year (April 1 to September 30, 2025) Six-month period of current fiscal year (April 1 to September 30, 2026) Merchandise value YoY (%) Net sales YoY (%) Merchandise value (Million yen) Compositi on (%) Net sales (Million yen) Merchandise value (Million yen) Compositi on (%) Net sales (Million yen) ZOZOTOWN business 235,614 75.4 72,575 245,886 79.5 75,571 4.4 4.1 (Outright purchase/ production & sales) 1,596 0.5 1,514 1,524 0.5 1,467 -4.5 -3.1 (Consignment sales) 224,964 72.0 62,373 234,501 75.8 64,580 4.2 3.5 (USED sales) 9,052 2.9 8,687 9,859 3.2 9,523 8.9 9.6 LY Corporation Commerce 34,448 11.0 10,558 38,469 12.4 11,932 11.7 13.0 LYST 18,633 6.0 2,467 21,618 7.0 2,980 16.0 20.8 BtoB business 3,991 1.3 660 3,316 1.1 576 -16.9 -12.7 Advertising business - - 5,462 - - 5,781 - 5.8 Subtotal excluding others 292,687 93.7 91,723 309,290 100.0 96,842 5.7 5.6 Others 19,785 6.3 13,525 143 0.0 13,800 -99.3 2.0 Total 312,473 100.0 105,249 309,433 100.0 110,642 -1.0 5.1 ① ZOZOTOWN business The ZOZOTOWN business consists of three business forms: “Outright purchase / production and sales,” “Consignment sales,” and “USED sales.” “Outright purchase / production and sales” is a business model under which the Company group purchases merchandise, bears inventory risk, and sells the merchandise. This includes purchasing fashion merchandise from brands, as well as merchandise ordered by the Company group (e.g., MS (Multi-Size), a business model discontinued at the end of the previous fiscal year). Under “Consignment sales,” the Company group holds merchandise from brands as consignment inventory and sells it on a consignment basis. Under “USED sales,” the Company group primarily purchases used fashion merchandise from individual users and resells it. This business is positioned as a value- added service to encourage purchases of new merchandise. The Company group recognizes that expanding the number of buyers and increasing the usage rate of ZOZOTOWN in fashion consumption are the key factors in achieving sustainable growth. To realize this, the Company group is working on creating a site that is attractive to both users and brands. Trends in major KPIs for the ZOZOTOWN business are as follows. (Number of shops, etc.) [Table 3] Changes in the number of shops and brands Previous fiscal year Current fiscal year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Shops in ZOZOTOWN (Note) 1 1,681 1,686 1,712 1,710 1,714 1,726 - - Outright purchase/production & sales 29 28 25 21 21 17 - - Consignment sales 1,652 1,658 1,687 1,689 1,693 1,709 - - Number of brands (Note) 1 9,208 9,215 11,193 11,247 11,548 11,599 - - (Note) 1. Numbers as of the end of the quarterly accounting period are shown. The number of new shops opened during the second quarter of the current fiscal year was 36 (a net increase of 12), while the number of new shops opened during the six-month period of the current fiscal year was 65 (a net increase of 16). Major new shops include “DoCLASSE,” a fashion brand targeting adults in their 40s and 50s, and “SABON,” an Israeli cosmetics brand specializing in body care and bath products, among others.
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9 (Number of annual buyers) [Table 4] Changes in the number of annual buyers Previous fiscal year Current fiscal year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Number of annual buyers (Note) 1, 2, 4 12,365,080 12,529,665 12,809,389 13,173,445 13,415,786 13,555,784 - - (YoY) 574,811 658,821 751,663 956,407 1,050,706 1,026,119 - - (QoQ) 148,042 164,585 279,724 364,056 242,341 139,998 - - Number of active members (Note) 1, 3, 4 11,587,777 11,803,843 12,119,711 12,479,312 12,716,094 12,841,096 - - (YoY) 668,092 775,139 907,719 1,075,921 1,128,317 1,037,253 - - (QoQ) 184,386 216,066 315,868 359,601 236,782 125,002 - - Number of guest buyers (Note) 1, 4 777,303 725,822 689,678 694,133 699,692 714,688 - - (YoY) -93,281 -116,318 -156,056 -119,514 -77,611 -11,134 - - (QoQ) -36,344 -51,481 -36,144 4,455 5,559 14,996 - - (Note) 1. The calculation period is the most recent one-year period prior to the end of the accounting periods. 2. The number of annual buyers is the sum of active members and guest buyers who made at least one purchase within the past year from each quarter. 3. The number of active members represents the number of members who have made at least one purchase within the past year. 4. Figures exclude buyers of “LY Corporation Commerce,” “LYST,” and “BtoB business.” During the second quarter of the current fiscal year, the number of annual buyers increased, resulting from an increase in the number of active members YoY and QoQ. The growth in the number of active members was attributable to the retention of new members acquired through the previous fiscal year, as well as steady progress in acquiring new members through web advertising and initiatives within ZOZOTOWN. In particular, in September, holding ZOZOWEEK, which the Company group had decided not to hold in the same period of the previous fiscal year, contributed to new member acquisition, among other factors. However, the quarter-on-quarter increase in the number of active members moderated compared with the previous fiscal year through the first quarter of the current fiscal year, partly due to the impact of strengthened web advertising and referral campaigns in the same period of the previous fiscal year. (Annual purchase amount and annual purchase pieces) [Table 5] Changes in the annual purchase amount and annual purchase pieces Previous fiscal year Current fiscal year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Annual purchase amount (Total) (Note) 1, 2, 3, 4 42,861 42,404 41,771 41,323 40,900 40,951 - - (YoY) -0.2% -1.8% -3.5% -3.8% -4.6% -3.4% - - (QoQ) -0.2% -1.1% -1.5% -1.1% -1.0% 0.1% - - Annual purchase pieces (Total) (Note) 1, 2, 3 10.8 10.7 10.6 10.6 10.5 10.5 - - (YoY) -1.0% -2.1% -3.2% -2.9% -3.0% -2.5% - - (QoQ) -0.4% -0.7% -1.1% -0.7% -0.6% -0.2% - - (Note) 1. The calculation period is the most recent one-year period prior to the end of the accounting periods. 2. Per active member. 3. Figures exclude buyers of “LY Corporation Commerce,” “LYST,” and “BtoB business.” 4. The amounts are in yen. During the second quarter of the current fiscal year, the annual purchase amount (Total) and annual purchase pieces (Total) decreased YoY. The main factor was an increase in the proportion of new members, driven by the continued steady acquisition of new members since the previous fiscal year. At ZOZOTOWN, members with shorter membership histories generally tend to have lower annual purchase amounts and purchase fewer items. On the other hand, compared with the previous quarter, the annual purchase amount increased slightly, while annual purchase pieces decreased slightly, remaining largely flat overall. This was because the quarter-on-quarter increase in the number of annual buyers moderated
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10 compared with the previous fiscal year through the first quarter of the current fiscal year, resulting in no significant change in the proportion of new members. (Average retail price, etc.) [Table 6] Changes in the average retail price, average order value, average purchase pieces per order and number of shipments Previous fiscal year Current fiscal year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Average retail price (Note) 1, 2, 3 3,744 3,584 4,277 3,974 3,682 3,640 - - (YoY) 1.2% -1.2% -2.1% -1.6% -1.7% 1.6% - - Average order value (Note) 1, 2, 3 8,543 8,183 9,328 8,864 8,506 8,388 - - (YoY) 2.4% -0.2% -1.0% -1.3% -0.4% 2.5% - - Average purchase pieces per order (Note) 1, 2 2.28 2.28 2.18 2.23 2.31 2.30 - - (YoY) 1.1% 1.1% 1.1% 0.3% 1.2% 0.9% - - Number of shipments (Note) 1, 2 14,242,174 13,924,003 16,230,382 14,620,850 14,814,900 14,291,323 - - (YoY) 3.3% 3.4% 4.6% 9.2% 4.0% 2.6% - - (Note) 1. Figures are based on quarterly accounting periods. 2. Figures exclude buyers of “LY Corporation Commerce,” “LYST,” and “BtoB business.” 3. The amounts are in yen. During the second quarter of the current fiscal year, list prices of new fall/winter items increased moderately YoY, while overall price levels of new merchandise remained generally in line with the same period of the previous fiscal year. Under these circumstances, the average retail price increased YoY due to a decline in the average discount rate, despite a slight increase in the proportion of sale items following ZOZOWEEK in September, among other factors. In addition, more frequent implementation of the free-shipping measure for orders of 12,000 yen or more compared with the same period of the previous fiscal year led to a higher attach rate (number of items purchased per order), among other factors. As a result, the average order value increased at a higher rate than the average retail price. i. Outright purchase/production & sales In the six-month period of the current fiscal year, the merchandise value was 1,524 million yen (-4.5% YoY), accounting for 0.5% of the gross merchandise value (0.5% in the same period of the previous fiscal year). Net sales were 1,467 million yen (-3.1% YoY). As of the end of September 2026, the number of shops opened on ZOZOTOWN for Outright purchase/production & sales was 17 (21 as of the end of June 2026). ii. Consignment sales In the six-month period of the current fiscal year, the merchandise value was 234,501 million yen (+4.2% YoY), accounting for 75.8% of the gross merchandise value (72.0% in the same period of the previous fiscal year). Net sales (consignment sales commission) were 64,580 million yen (+3.5% YoY). As of the end of September 2026, the number of shops opened on ZOZOTOWN for consignment sales was 1,709 (1,693 as of the end of June 2026). iii. USED sales In the six-month period of the current fiscal year, the merchandise value was 9,859 million yen (+8.9% YoY), accounting for 3.2% of the gross merchandise value (2.9% in the same period of the previous fiscal year). Net sales were 9,523 million yen (+9.6% YoY). ② LY Corporation Commerce LY Corporation Commerce is the combined sales of Yahoo! JAPAN Shopping and Yahoo! JAPAN Auction. Yahoo! JAPAN
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11 Shopping, an online shopping mall, and Yahoo! JAPAN Auction, an online auction service, are both operated by LY Corporation. The Company group operates the ZOZOTOWN store on Yahoo! JAPAN Shopping and, since March 2024, the ZOZOUSED store on Yahoo! JAPAN Auction. In the six-month period of the current fiscal year, the merchandise value was 38,469 million yen (+11.7% YoY), accounting for 12.4% of the gross merchandise value (11.0% in the same period of the previous fiscal year). Net sales (consignment sales commission) were 11,932 million yen (+13.0% YoY). ③ LYST LYST operates a business model in which it earns performance-based commissions from partner brands that list their items on the fashion shopping platform “Lyst.” It has been included in the scope of consolidation since May 2025. In the six-month period of the current fiscal year, the merchandise value was 21,618 million yen (+16.0% YoY), accounting for 7.0% of the gross merchandise value (6.0% in the same period of the previous fiscal year). Net sales were 2,980 million yen (+20.8% YoY). ④ BtoB business The BtoB business model includes building and operating brands' e-commerce websites and providing logistics services. In the six-month period of the current fiscal year, the merchandise value was 3,316 million yen (-16.9% YoY), accounting for 1.1% of the gross merchandise value (1.3% in the same period of the previous fiscal year). Net sales (consignment sales commission) were 576 million yen (-12.7% YoY). As of the end of September 2026, the number of consigned websites was 28 (29 as of the end of June 2026). ⑤ Advertising business The advertising business is a business model that generates advertising revenue by providing advertising space to client companies, including partner brands, mainly by utilizing the user reach of ZOZOTOWN and WEAR by ZOZO. In the six- month period of the current fiscal year, net sales were 5,781 million yen (+5.8% YoY). ⑥ Others The segment for “Others” within the gross merchandise value includes 1) the merchandise value of the stores that contracted for “ZOZO Option” (recording ended as of September 30, 2025) in the fashion category excluding ZOZOTOWN on Yahoo! JAPAN Shopping (service that enables those stores to benefit from sales support such as participation in the Company's promotional events), 2) the merchandise value from ZOZOMO, the system that supports directing customers from ZOZOTOWN to physical stores, 3) the merchandise value of “ZOZOSUIT” sold for a fee in the U.S., and 4) merchandise value from High Link. Only online sales of High Link's private-label products and fragrance products sold in smaller portions are included in the merchandise value. The merchandise value in the six-month period of the current fiscal year was 143 million yen, accounting for 0.0% of the gross merchandise value (6.3% in the same period of the previous fiscal year). Net sales (Others) include sales from businesses related to ZOZOTOWN (shipping income, settlement commission income, etc.), sales related to the gross merchandise value (Others) described above, and sales from High Link's businesses other than its online sales business. Net sales (Others) in the six-month period of the current fiscal year totaled 13,800 million yen (+2.0% YoY).
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12 (2) Overview of financial position ① Overview of total assets, liabilities, and net assets (Unit: Million yen) Previous fiscal year Six-month period of current fiscal year Increase/ decrease rate Total assets 198,260 174,892 -11.8 % Liabilities 91,470 82,780 -9.5 % Net assets 106,789 92,112 -13.7 % (Total assets) Total assets amounted to 174,892 million yen, a decrease of 23,367 million yen (-11.8% from the previous fiscal year end). Current assets decreased by 28,090 million yen (21.6%) from the previous fiscal year end to 102,223 million yen. This was mainly due to a decrease of 36,125 million yen in cash and deposits and a decrease of 4,395 million yen in accounts receivable. Non-current assets increased by 4,723 million yen (7.0%) from the previous fiscal year end to 72,669 million yen. This was mainly due to an increase of 1,460 million yen in property, plant and equipment, an increase of 2,733 million yen in goodwill, and a decrease of 115 million yen in investments and other assets. (Liabilities) Liabilities amounted to 82,780 million yen, a decrease of 8,690 million yen (-9.5% from the previous fiscal year end). Current liabilities decreased by 9,354 million yen (11.6%) from the previous fiscal year end to 71,317 million yen. This was mainly due to a decrease of 4,544 million yen in deposits received for consignment sales, a decrease of 809 million yen in income taxes payable, and a decrease of 2,167 million yen in provision for bonuses. Non-current liabilities increased by 664 million yen (6.2%) from the previous fiscal year end to 11,462 million yen. This was mainly due to an increase of 337 million yen in retirement benefit liability and an increase of 5 million yen in asset retirement obligations. (Net assets) Net assets amounted to 92,112 million yen, a decrease of 14,677 million yen (-13.7% from the previous fiscal year end). This was mainly due to an increase of 21,751 million yen from the recognition of semi-annual profit attributable to owners of parent, a decrease of 19,165 million yen from the repurchase of shares, and a decrease of 17,686 million yen from cash dividends. ② Overview of cash flows Cash and cash equivalents at the end of the six-month period of the current fiscal year decreased by 36,113 million yen from the end of the previous fiscal year to 33,308 million yen. The status of each cash flow and the factors contributing to the changes are as follows. (Unit: Million yen) Six-month period of previous fiscal year Six-month period of current fiscal year Increase/ decrease rate Cash flows from operating activities 17,246 21,502 24.7% Cash flows from investing activities -25,945 -9,643 -62.8% Cash flows from financing activities -28,772 -47,952 66.7% (Cash flows from operating activities) The net cash provided by operating activities was 21,502 million yen. This was mainly driven by profit before income taxes of 32,828 million yen, while negative factors included a decrease in deposits received for consignment sales of 4,544 million yen, a decrease in provision for bonuses of 2,165 million yen, and income tax payments of 10,952 million yen.
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13 (Cash flows from investing activities) The net cash used in investing activities was 9,643 million yen. This was mainly due to purchases of property, plant and equipment of 3,473 million yen, and payments for acquisition of shares of a subsidiary resulting in changes in the scope of consolidation of 4,599 million yen. (Cash flows from financing activities) The net cash used in financing activities was 47,952 million yen. This was mainly due to the dividend payments of 17,684 million yen, and payments for share repurchases of 19,165 million yen. (3) Explanation of consolidated earnings forecast and other forward-looking statements There is no change in the consolidated earnings forecast announced on April 30, 2026.
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14 2. Semi-annual consolidated financial statements (1) Semi-annual consolidated balance sheet (Unit: Million yen) Previous fiscal year (As of March 31, 2026) Six-month period of current fiscal year (As of September 30, 2026) Assets Current assets Cash and deposits 69,416 33,291 Accounts receivable-trade 53,348 48,952 Merchandise 3,496 4,197 Raw materials and supplies 37 56 Others 4,014 15,725 Total current assets 130,314 102,223 Non-current assets Property, plant and equipment 26,930 28,391 Intangible assets Goodwill 21,812 24,545 Others 6,777 7,422 Total intangible assets 28,589 31,967 Investments and other assets 12,425 12,310 Total non-current assets 67,946 72,669 Total assets 198,260 174,892 Liabilities Current liabilities Accounts payable -trade 242 544 Deposits received for consignment sales 30,975 26,430 Short-term borrowings 20,000 20,001 Income taxes payable 11,596 10,786 Provision for bonuses 2,319 152 Provision for bonuses for directors 62 54 Provision for loss on liquidation of affiliates 0 0 Provision for loss on business liquidation 224 224 Others 15,249 13,123 Total current liabilities 80,672 71,317 Non-current liabilities Retirement benefit liability 5,151 5,488 Asset retirement obligations 4,528 4,533 Provision for loss on liquidation of affiliates 125 125 Others 993 1,315 Total non-current liabilities 10,797 11,462 Total liabilities 91,470 82,780
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15 (Unit: Million yen) Previous fiscal year (As of March 31, 2026) Six-month period of current fiscal year (As of September 30, 2026) Net assets Shareholders' equity Capital stock 1,359 1,359 Capital surplus 1,328 1,328 Retained earnings 111,393 114,578 Treasury stock -11,039 -28,480 Total shareholders' equity 103,042 88,785 Accumulated other comprehensive income Valuation difference on available-for-sale securities 116 105 Deferred gains or losses on hedges 4 -6 Foreign currency translation adjustment 3,161 2,781 Accumulated remeasurements of defined benefit plans 464 445 Total accumulated other comprehensive income 3,747 3,326 Total net assets 106,789 92,112 Total liabilities and net assets 198,260 174,892
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16 (2) Semi-annual consolidated statement of income and semi-annual consolidated statement of comprehensive income Semi-annual consolidated statement of income (Unit: Million yen) Six-month period of previous fiscal year (April 1, 2025 to September 30, 2025) Six-month period of current fiscal year (April 1, 2026 to September 30, 2026) Net sales 105,249 110,642 Cost of sales 6,800 7,886 Gross profit 98,448 102,756 Selling, general and administrative expenses 67,374 69,930 Operating profit 31,074 32,825 Non-operating income Interest income 83 129 Received rent 1 1 Operations support fee 3 3 Income from recycling 26 25 Subsidy income - 21 Gain on unused points 76 114 Others 11 8 Total non-operating income 202 304 Non-operating expenses Interest expenses 145 156 Rent expenses 1 1 Commission expenses 20 1 Foreign exchange losses 238 33 Loss on investment partnerships 44 58 Others - 7 Total non-operating expenses 449 258 Ordinary profit 30,826 32,871 Extraordinary income Gain on sale of non-current assets 0 1 Total extraordinary income 0 1 Extraordinary losses Loss on sale and disposal of non-current assets 14 44 Total extraordinary loss 14 44 Semi-annual profit before income taxes 30,812 32,828 Income taxes-current 9,017 10,201 Income taxes-deferred 788 875 Total income taxes 9,805 11,077 Semi-annual net profit 21,006 21,751 Semi-annual profit attributable to owners of parent 21,006 21,751
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17 Semi-annual consolidated statement of comprehensive income (Unit: Million yen) Six-month period of previous fiscal year (April 1, 2025 to September 30, 2025) Six-month period of current fiscal year (April 1, 2026 to September 30, 2026) Semi-annual net profit 21,006 21,751 Other comprehensive income Valuation difference on available-for-sale securities -1 -10 Deferred gains or losses on hedges 4 -11 Foreign currency translation adjustment 1,127 -379 Remeasurements of defined benefit plans -8 -19 Total other comprehensive income 1,122 -421 Semi-annual comprehensive income 22,128 21,330 (Comprehensive income attributable to) Semi-annual comprehensive income attributable to owners of the parent 22,128 21,330
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18 (3) Semi-annual consolidated statement of cash flows (Unit: Million yen) Six-month period of previous fiscal year (April 1, 2025 to September 30, 2025) Six-month period of current fiscal year (April 1, 2026 to September 30, 2026) Cash flows from operating activities Semi-annual profit before income taxes 30,812 32,828 Depreciation 2,528 3,169 Amortization of goodwill 1,006 1,576 Share-based compensation expenses 144 129 Loss (gain) on investment partnerships (- is a gain) 44 58 Loss (gain) on sale and disposal of non-current assets (- is a gain) 14 43 Increase (decrease) in provision for bonuses (- is a decrease) -2,237 -2,165 Increase (decrease) in provision for bonuses for directors ( - is a decrease) -5 -7 Increase (decrease) in retirement benefit liability (- is a decrease) 230 309 Interest and dividends income -83 -129 Interest expenses 145 156 Commissions paid 20 1 Foreign exchange losses (gains) (- is a gain) 223 32 Increase (decrease) in notes and accounts receivable -trade (- is an increase) 7,665 4,442 Increase (decrease) in inventories (- is an increase) -944 -553 Increase (decrease) in prepaid expenses (- is an increase) -586 -807 Increase (decrease) in accounts payable-trade (- is a decrease) 53 280 Increase (decrease) in deposits received for consignment sales (- is a decrease) -4,750 -4,544 Increase (decrease) in accounts payable-other (- is a decrease) -1,924 -1,260 Increase (decrease) in accrued consumption taxes ( - is a decrease) -2,722 -1,121 Others -552 47 Subtotal 29,081 32,485 Interest and dividends income received 83 129 Interest expenses paid -145 -158 Income taxes paid -11,773 -10,952 Net cash provided by (used in) operating activities 17,246 21,502 Cash flows from investing activities Purchase of property, plant and equipment -2,992 -3,473 Purchase of intangible assets -1,115 -1,175 Proceeds from collection of lease and guarantee deposits 0 1 Payments for lease and guarantee deposits -2 -184 Purchase of investment securities -31 -222 Payments for the acquisition of shares of a subsidiary accompanied by a change in the scope of consolidation -21,807 -4,599 Payments of loans receivable -0 - Collection of loans receivable 0 1 Others 4 7 Net cash provided by (used in) investing activities -25,945 -9,643
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19 (Unit: Million yen) Six-month period of previous fiscal year (April 1, 2025 to September 30, 2025) Six-month period of current fiscal year (April 1, 2026 to September 30, 2026) Cash flows from financing activities Increase in short-term loans payable 43 - Repayment of short-term loans payable -669 -52 Repayment of long-term loans payable - -60 Commission expenses paid -20 -1 Repurchase of shares -10,001 -19,165 Redemption of bonds -1,979 - Cash dividends paid -16,033 -17,684 Others -111 -10,987 Net cash provided by (used in) financing activities -28,772 -47,952 Effect of the exchange rate change on cash and cash equivalents -75 -20 Increase (decrease) in cash and cash equivalents (- is a decrease) -37,548 -36,113 Cash and cash equivalents at beginning of the fiscal year 91,486 69,422 Cash and cash equivalents at end of the period 53,938 33,308
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20 (4) Notes on semi-annual consolidated financial statements (Notes on the going concern assumption) Not applicable. (Notes on significant changes in shareholders' equity) The Company has been repurchasing its own shares pursuant to the resolution of the Board of Directors adopted on June 16, 2026. During the six-month period of the current fiscal year, treasury stock increased by 19,165 million yen. For details of the repurchase of shares and the cancellation of treasury shares, please refer to “(Significant subsequent events) (Repurchase of shares and cancellation of treasury shares).” (Notes on segment information) Disclosure is omitted because the Company group is a single segment of the e-commerce business. (Matters related to the business combination) (Business combination by acquisition of shares) 1. Overview of business combination (1) Purpose of the business combination through share acquisition Founded in 2017, High Link operates “Coloria,” a comprehensive fragrance platform, under the mission of “Color the world with fragrance.” By bringing High Link, which operates a business centered on fragrances with high affinity to fashion, into the ZOZO group, the Company aims to expand into the fragrance market and accelerate business development in the “Near Fashion” domain by incorporating sales methods such as subscription services. (2) Name and business description of the acquired company Company name: HIGH LINK, INC. Business description: Operation of a comprehensive fragrance platform, “Coloria” (3) Date of business combination April 16, 2026 (deemed acquisition date: April 30, 2026) (4) Legal form of business combination Acquisition of shares (5) Name of the company after the business combination HIGH LINK, INC. (6) Number of shares acquired and voting rights ratio Number of shares acquired: 93,818 shares Voting rights held: 100% (7) Basis for determining the acquiring company This is due to the acquisition of 100% of the voting rights through a share acquisition for cash consideration. (8) Date of agreement execution March 31, 2026
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21 2. Period of the acquiree’s performance included in the consolidated statement of income for the six-month period of the current fiscal year From May 1, 2026 to September 30, 2026 3. Acquisition cost of the acquired company and breakdown by type of consideration Consideration for acquisition Cash 4,950 million yen Acquisition cost 4,950 million yen 4. Details and amounts of major acquisition-related expenses Advisory fees and other related costs: 41 million yen 5. Amount, cause, and amortization of goodwill (1) Amount of goodwill recognized 4,632 million yen (2) Cause of goodwill Primarily attributable to the expected future excess earnings derived from anticipated business development. (3) Amortization method and period Straight-line amortization over 7 years 6. Amounts of assets and liabilities assumed on the business combination date and their breakdown Current assets 643 million yen Non-current assets 617 million yen Total assets 1,261 million yen Current liabilities 387 million yen Non-current liabilities 556 million yen Total liabilities 943 million yen 7. Amounts allocated to intangible assets other than goodwill, their types, amortization methods and amortization periods (1) Amounts allocated to intangible assets and their types Customer-related assets: 538 million yen (2) Amortization method and period Straight-line amortization over 5 years 8. Finalization of provisional accounting treatment for business combination As of the end of the first quarter of the current fiscal year, the identification of identifiable assets and liabilities acquired and the determination of their fair values as of the acquisition date had not yet been completed. Accordingly, the purchase price allocation (PPA) was provisional, and provisional accounting had been applied based on the best available information at that time. However, the PPA was finalized during the six-month period of the current fiscal year. The finalization of the provisional accounting had no impact on the semi-annual consolidated financial statements.
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22 (Significant subsequent events) (Repurchase of shares and cancellation of treasury shares) At the meeting of the Board of Directors held on June 16, 2026, the Company resolved on matters regarding the repurchase of its own shares pursuant to Article 459, Paragraph 1 of the Companies Act, and resolved to cancel treasury shares pursuant to Article 178 of the Companies Act. 1. Reasons for the repurchase of shares and cancellation of treasury shares On October 31, 2023, the Company announced a new shareholder return policy: “Our goal is to maintain a total return ratio, including share buybacks, of more than 80% on a five-year average basis, beginning with the fiscal year ended March 2024.” Since then, the Company has continued to consider the acquisition of its own shares, taking into account factors such as stock liquidity and stock price trends. The Company has decided to conduct the repurchase of shares in order to achieve its total return ratio target. In addition, all treasury shares to be acquired through the repurchase of shares will be cancelled. 2. Details of the repurchase of shares (1) Class of shares to be acquired Common stock (2) Total number of shares to be acquired Up to 43,000,000 shares (4.86% of the total number of issued shares (excluding treasury shares)) (3) Total amount to be paid for the acquisition Up to 30,000 million yen (4) Period of acquisition June 17, 2026, to December 30, 2026 (5) Method of acquisition Market purchase on the Tokyo Stock Exchange, Inc. (6) Repurchase during the six-month period of the current fiscal year Total number of shares repurchased: 16,911,800 shares Total acquisition cost: 19,165 million yen 3. Details of the cancellation of treasury shares (1) Class of shares to be cancelled Common stock (2) Total number of shares to be cancelled All treasury shares to be acquired pursuant to 2. above (3) Scheduled date of cancellation January 29, 2027 (Note) The total number of shares to be cancelled will be finalized after completion of the repurchase of shares. DISCLAIMER: This document is a summary translation of the Japanese version. Readers are encouraged to refer to the original Japanese vers ion for complete information. The Japanese version shall prevail in the event of any discrepancy, error, or omission.