Interim report
Page 1
[This is an English translation prepared for the convenience of non-resident shareholders. Should there be any inconsistency between the translation and the official Japanese text, the latter shall prevail.] Consolidated Financial Results for the Six Months Ended September 30, 2025 <under IFRS> 1-1, Showa-cho, Kariya, Aichi 448-8661, Japan DATE: October 31, 2025 Representative : Shinnosuke Hayashi DENSO CORPORATION President and CEO CODE: 6902 Contact : Tadashi Arai Listed on the Tokyo and Director, Finance and Accounting Div. Nagoya Stock Exchanges Telephone : +81-566-25-5511 Scheduled date of commencement of dividend payment : November 26, 2025 (URL https://www.denso.com/global/en/) 1. Consolidated financial results for the six months ended September 30, 2025 (from April 1, 2025 to September 30, 2025) (1) Consolidated operating results (Percentages indicate the change of the same period of the previous year) Revenue Operating profit Profit before income taxes Profit for the period Six months ended Millions of yen% Millions of yen % Millions of yen % Millions of yen % September 30, 2025 3,590,467 3.3 211,417 (15.8) 244,442(13.2) 151,158(26.5) September 30, 2024 3,474,852(1.1) 251,227 18.6 281,734 13.8 205,556 10.8 Profit attributable to owners of the parent company Comprehensive income for the period Basic earnings per shareDiluted earnings per share Six months ended Millions of yen % Millions of yen % Yen Yen September 30, 2025 131,357(31.2) 311,791 － 47.70 － September 30, 2024 190,837 13.0 (402,396) － 65.56 － (2) Consolidated financial position Total assets Total equity Equity attributable to owners of the parent company Ratio of equity attributable to owners of the parent company to total assets As of Millions of yen Millions of yen Millions of yen % September 30, 2025 8,149,512 5,149,403 4,957,131 60.8 March 31, 2025 8,125,000 5,188,918 4,978,266 61.3
Page 2
2. Cash dividends Annual dividends per share First quarter-end Second quarter-end Third quarter-end Fiscal year-end Total Yen Yen Yen Yen Yen Year ended March 31, 2025 － 32.00 － 32.00 64.00 Year ending March 31, 2026 － 32.00 Year ending March 31, 2025 (Forecast) － 32.00 64.00 (Note)Change in cash dividends: None 3. Consolidated full-year financial results forecast for the fiscal year ending March 31, 2026 (from April 1, 2025 to March 31, 2026) (Percentages indicate the change of the same period of the previous year) Revenue Operating profit Profit before income taxes Profit for the year Profit attributable to owners of the parent company Basic earnings per share Millions of yen % Millions of yen % Millions of yen % Millions of yen % Millions of yen % Yen Full year 7,240,000 1.1 651,000 25.4 714,000 23.5 548,000 17.8 497,000 18.6 180.52 (Note)Change in consolidated earnings forecasts for the fiscal year ending March 31, 2026: Yes For more information, please refer to "Notice Concerning Revisions to Consolidated Full-Year Financial Results Forecast" released today (October 31, 2025). Notes (1) Significant changes in the scope of consolidation during the period: None In : - ( Company Name : ) Out : - (Company Name : ) (2) Changes in accounting policies and accounting estimates 1) Changes in accounting policies due to the revision of the accounting standards : None 2) Changes in accounting policies except for those in 1) : None 3) Changes in accounting estimates : None (3) Number of issued shares (ordinary shares) 1) Number of issued shares at the end of the period (including treasury shares) FY2026 2nd quarter 2,910,979,691 shares FY2025 2,910,979,691 shares 2) Number of treasury shares at the end of the period FY2026 2nd quarter 206,952,043 shares FY2025 93,663,914 shares 3) Average number of issued shares during the six months ended September 30 FY2026 2nd quarter 2,753,943,987 shares FY2025 2nd quarter 2,910,813,019 shares Semi-annual financial results reports are exempt from review conducted by certified public accountants or an audit firm. Proper use of financial results forecast, and other information (Cautionary Statement Regarding Forward-Looking Information) This report contains forward-looking statements based on information available to the Company as of the date hereof and assumptions which it believes are reasonable. These forecasts are not intended as a guarantee of future
Page 3
performance. Actual results may differ materially from these forecasts due to changes in business operations, exchange rate fluctuations, and other internal and external factors. For details on the assumptions underlying the financial forecasts and important notes regarding their use, please refer to page 3 of the "Summary of Consolidated Financial Results for the Six Months Ended September 30, 2025," section "3. Summary of Financial Forecast." (Availability of Supplementary Materials for the Quarterly Financial Results) The Company plans to hold a briefing session for securities analysts and institutional investors on October 31, 2025. The materials used in this session will be posted on the Company’s website on the same day.
Page 4
List of Contents of Attachments Summary of Consolidated Financial Results for the Six Months Ended September 30, 2025 2 Unaudited Condensed Interim Consolidated Statement of Financial Position 4 Unaudited Condensed Interim Consolidated Statement of Income 6 Unaudited Condensed Interim Consolidated Statement of Comprehensive Income 7 Unaudited Condensed Interim Consolidated Statement of Changes in Equity 8 Unaudited Condensed Interim Consolidated Statement of Cash Flows 10 Notes to Unaudited Condensed Interim Consolidated Financial Statements 11 Assumption for Going Concern 11 Segment information 11 - 1 -
Page 5
Summary of Consolidated Financial Results for the Six Months Ended September 30, 2025 1. Summary of Management Results Guided by the philosophy of "green," "peace of mind," and "inspiring," the Company has been committed to the realization of "lasting vitality for the environment" and "safe, comfortable, and flexible mobility for all people" with the aim of reducing the Company's environmental burden and realizing a society without traffic accidents. The Company will leverage the strengths gained with automobiles and broaden the perspective of the solutions to encompass society as a whole, not just vehicles, thereby contributing to solving issues faced by society. For the six months ended September 30, 2024, revenue increased by ¥115.6 billion or 3.3%, year over year, to ¥3,590.5 billion due to increased vehicle sales, particularly in North America and Asia, and the expanded sales of products in strategic focus areas, despite the impact of the strong yen.Operating profit decreased by ¥39.8 billion or 15.8%, year over year, to ¥211.4 billion due to the impact of quality-related provisions, research and development expenses, and tariffs, despite efforts of cost reduction and production volume increase. Profit before income taxes decreased by ¥37.3 billion or 13.2%, year over year, to ¥244.4 billion. Profit for the period decreased by ¥54.4 billion or 26.5%, year over year to ¥151.2 billion, profit attributable to owners of the parent company decreased by ¥59.5 billion or 31.2% to ¥131.4 billion. By geographical segment, revenue in Japan increased by ¥69.0 billion, or 3.4%, year over year, to ¥2,099.5 billion due to the recovery from the impact of suspended operations of Japanese customers in the previous fiscal year. Operating profit decreased by ¥85.0 billion, or 72.9%, year over year, to ¥31.6 billion due to factors such as foreign exchange impacts, future investments, and one-time gains recorded in the same period of the previous fiscal year (e.g., land sales), despite production volume decrease. Revenue in North America increased by ¥48.7 billion, or 5.3%, year over year, to ¥973.0 billion due to the sales expansion of electrification products. Operating profit increased by ¥20.5 billion, or 56.2%, year over year, to ¥56.9 billion due to efforts of cost reduction despite the impact of tariffs. Revenue in Europe decreased by ¥2.7 billion, or 0.7%, year over year, to ¥363.0 billion due to fluctuations in production volume and other factors. Operating profit increased by ¥2.8 billion, or 47.3%, year over year, to ¥8.6 billion due to efforts of cost reduction. Revenue in Asia increased by ¥14.2 billion, or 1.5%, year over year, to ¥952.1 billion due to an increase in vehicle sales to Japanese customers. Operating profit increased by ¥19.2 billion, or 25.1%, year over year, to ¥95.9 billion due to efforts of cost reduction and production volume increase. Revenue in other regions increased by ¥3.4 billion, or 5.8%, year over year, to ¥62.0 billion. Operating profit decreased by ¥0.6 billion, or 4.8%, year over year, to ¥11.6 billion. - 2 -
Page 6
2. Summary of Financial Position Total assets as of September 30, 2025, increased by ¥24.5 billion, to ¥8,149.5 billion compared with prior year-end mainly due to an increase in intangible assets resulting from business combinations. The total for current and non-current liabilities increased by ¥64.0 billion, to ¥3,000.1 billion compared with prior year-end mainly due to an increase in bonds and borrowings. Equity decreased by ¥39.5 billion, to ¥5,149.4 billion compared with prior year-end mainly due to the acquisition of treasury stock. 3. Summary of Financial Forecast The full-year forecast for the fiscal year ending March 31, 2026, due to reflecting financial results in the second quarter and reassessment of foreign exchange rate assumptions, the Company expects revenue to be ¥7,240.0 billion, operating profit to be ¥651.0 billion due to reflecting reassessment of foreign exchange rate assumptions and the quality provisions recorded in the second quarter. Profit before income taxes to be ¥714.0 billion, profit for the year to be ¥548.0 billion, and profit attributable to owners of the parent company to be ¥497.0 billion. From the third quarter onward, the foreign exchange rate assumptions are 1USD = 145 yen. 1EUR= 170 yen. The above includes future forecasts based on information currently available. Actual results may differ materially from these forecasts due to changes in business operations, exchange rate fluctuations, and other internal and external factors. - 3 -
Page 7
Unaudited Condensed Interim Consolidated Statement of Financial Position [As of September 30, 2025] (Unit: Millions of yen) As of March 31, 2025 As of September 30, 2025 Assets Current assets Cash and cash equivalents 986,531 862,283 Trade and other receivables 1,242,986 1,239,367 Inventories 1,203,066 1,259,102 Other financial assets 112,714 71,676 Other current assets 164,681 165,556 Subtotal 3,709,978 3,597,984 Assets held for sale 199,861 246,663 Total current assets 3,909,839 3,844,647 Non-current assets Property, plant and equipment 2,009,710 2,012,358 Right-of-use assets 52,808 49,243 Intangible assets 229,337 303,068 Other financial assets 1,622,081 1,626,165 Investments accounted for using the equity method 123,901 126,091 Retirement benefit assets 70,484 70,876 Deferred tax assets 75,946 79,405 Other non-current assets 30,894 37,659 Total non-current assets 4,215,161 4,304,865 Total assets 8,125,000 8,149,512 - 4 -
Page 8
(Unit: Millions of yen) As of March 31, 2025 As of September 30, 2025 Liabilities and equity Current liabilities Bonds and borrowings 252,364 480,051 Trade and other payables 1,274,907 1,199,105 Other financial liabilities 38,278 45,891 Income tax payables 117,987 76,658 Provisions 286,918 260,598 Other current liabilities 88,641 99,665 Subtotal 2,059,095 2,161,968 Liabilities directly associated with assets held for sale 50,243 66,270 Total current liabilities 2,109,338 2,228,238 Non-current liabilities Bonds and borrowings 447,020 377,868 Other financial liabilities 26,754 27,022 Retirement benefit liabilities 221,883 220,766 Provisions 1,563 897 Deferred tax liabilities 116,215 130,517 Other non-current liabilities 13,309 14,801 Total non-current liabilities 826,744 771,871 Total liabilities 2,936,082 3,000,109 Equity Capital stock 187,457 187,457 Capital surplus 275,797 275,831 Treasury stock (189,428) (409,848) Other components of equity 1,195,454 1,259,001 Other comprehensive income associated with assets held for sale 115,884 154,116 Retained earnings 3,393,102 3,490,574 Equity attributable to owners of the parent company 4,978,266 4,957,131 Non-controlling interests 210,652 192,272 Total equity 5,188,918 5,149,403 Total liabilities and equity 8,125,000 8,149,512 - 5 -
Page 9
Unaudited Condensed Interim Consolidated Statement of Income [For the six-month period ended September 30, 2025] (Unit: Millions of yen) Six-month period ended September 30, 2024 Six-month period ended September 30, 2025 Revenue 3,474,852 3,590,467 Cost of revenue (2,975,233) (3,069,543) Gross profit 499,619 520,924 Selling, general and administrative expenses (270,692) (307,006) Other income 34,871 10,064 Other expenses (12,571) (12,565) Operating profit 251,227 211,417 Finance income 44,617 42,950 Finance costs (17,042) (14,117) Foreign exchange gains 1,552 1,388 Share of the profit of associates and joint ventures accounted for using the equity method 1,380 2,804 Profit before income taxes 281,734 244,442 Income tax expenses (76,178) (93,284) Profit for the period 205,556 151,158 Attributable to: Owners of the parent company 190,837 131,357 Non-controlling interests 14,719 19,801 (Unit: Yen) Earnings per share Basic 65.56 47.70 Diluted － － - 6 -
Page 10
Unaudited Condensed Interim Consolidated Statement of Comprehensive Income [For the six-month period ended September 30, 2025] (Unit: Millions of yen) Six-month period ended September 30, 2024 Six-month period ended September 30, 2025 Profit for the period 205,556 151,158 Other comprehensive (loss) income Items that will not be reclassified subsequently to profit or loss Net fair value (loss) gain on equity instruments designated as FVTOCI (534,773) 125,319 Remeasurements of defined benefit pension plans 14 551 Share of other comprehensive (loss) income of investments accounted for using the equity method (8) 49 Total (534,767) 125,919 Items that may be reclassified subsequently to profit or loss Exchange differences on translating foreign operations (75,764) 31,527 Cash flow hedges 1,823 1,448 Share of other comprehensive income of investments accounted for using the equity method 756 1,739 Total (73,185) 34,714 Total other comprehensive (loss) income (607,952) 160,633 Comprehensive (loss) income for the period (402,396) 311,791 Attributable to: Owners of the parent company (418,163) 289,403 Non-controlling interests 15,767 22,388 - 7 -
Page 11
Unaudited Condensed Interim Consolidated Statement of Changes in Equity [For the six-month period ended September 30, 2025] (Unit: Millions of yen) Equity attributable to owners of the parent company Capital stock Capital surplus Treasury stock Other components of equity Net fair value gain on equity instruments designated as FVTOCI Remeasurements of defined benefit pension plans Exchange differences on translating foreign operations As of April 1, 2024 187,457 273,481 (452,140) 1,301,445 － 518,254 Profit for the period － － － － － － Other comprehensive (loss) income － － － (533,686) 13 (77,150) Comprehensive (loss) income for the period － － － (533,686) 13 (77,150) Acquisition of treasury stock － － (2) － － － Disposal of treasury stock － 59 147 － － － Dividends － － － － － － Changes in the ownership interest in subsidiaries without a loss of control － (354) － － － － Transfer to retained earnings － － － (131,760) (13) － Transfer from retained earnings to capital surplus － － － － － － Transfer to other comprehensive income associated with assets held for sale － － － 124,661 － － Other － － 1 － － － Total transactions with the owners － (295) 146 (7,099) (13) － As of September 30, 2024 187,457 273,186 (451,994) 760,660 － 441,104 As of April 1, 2025 187,457 275,797 (189,428) 706,643 － 490,217 Profit for the period － － － － － － Other comprehensive income － － － 125,209 550 30,839 Comprehensive income for the period － － － 125,209 550 30,839 Acquisition of treasury stock － － (220,943) － － － Disposal of treasury stock － (9) 523 － － － Dividends － － － － － － Changes in the ownership interest in a subsidiary without a loss of control － 34 － － － － Transfer to retained earnings － － － (55,731) (550) － Transfer from retained earnings to capital surplus － 9 － － － － Transfer to other comprehensive income associated with assets held for sale － － － (38,232) － － Other － － － 14 － － Total transactions with the owners － 34 (220,420) (93,949) (550) － As of September 30, 2025 187,457 275,831 (409,848) 737,903 － 521,056 - 8 -
Page 12
(Unit: Millions of yen) Equity attributable to owners of the parent company Non- controlling interests Total equity Other components of equity Other comprehensive income associated with assets held for sale Retained earnings TotalCash flow hedges Total As of April 1, 2024 (4,141) 1,815,558 258,936 3,451,694 5,534,986 211,519 5,746,505 Profit for the period － － － 190,837 190,837 14,719 205,556 Other comprehensive (loss) income 1,823 (609,000) － － (609,000) 1,048 (607,952) Comprehensive (loss) income for the period 1,823 (609,000) － 190,837 (418,163) 15,767 (402,396) Acquisition of treasury stock － － － － (2) － (2) Disposal of treasury stock － － － － 206 － 206 Dividends － － － (87,327) (87,327) (24,924) (112,251) Changes in the ownership interest in subsidiaries without a loss of control － － － － (354) (391) (745) Transfer to retained earnings － (131,773) － 131,773 － － － Transfer from retained earnings to capital surplus － － － － － － Transfer to other comprehensive income associated with assets held for sale － 124,661 (124,661) － － － － Other － － － － 1 36 37 Total transactions with the owners － (7,112) (124,661) 44,446 (87,476) (25,279) (112,755) As of September 30, 2024 (2,318) 1,199,446 134,275 3,686,977 5,029,347 202,007 5,231,354 As of April 1, 2025 (1,406) 1,195,454 115,884 3,393,102 4,978,266 210,652 5,188,918 Profit for the period － － － 131,357 131,357 19,801 151,158 Other comprehensive income 1,448 158,046 － － 158,046 2,587 160,633 Comprehensive income for the period 1,448 158,046 － 131,357 289,403 22,388 311,791 Acquisition of treasury stock － － － － (220,943) － (220,943) Disposal of treasury stock － － － － 514 － 514 Dividends － － － (90,157) (90,157) (40,658) (130,815) Changes in the ownership interest in a subsidiary without a loss of control － － － － 34 (110) (76) Transfer to retained earnings － (56,281) － 56,281 － － － Transfer from retained earnings to capital surplus － － － (9) － － － Transfer to other comprehensive income associated with assets held for sale － (38,232) 38,232 － － － － Other － 14 － － 14 － 14 Total transactions with the owners － (94,499) 38,232 (33,885) (310,538) (40,768) (351,306) As of September 30, 2025 42 1,259,001 154,116 3,490,574 4,957,131 192,272 5,149,403 - 9 -
Page 13
Unaudited Condensed Interim Consolidated Statement of Cash Flows [For the six-month period ended September 30, 2025] (Unit: Millions of yen) Six-month period ended September 30, 2024 Six-month period ended September 30, 2025 Cash flows from operating activities Profit before income taxes 281,734 244,442 Depreciation 188,659 185,497 Decrease in retirement benefit liabilities (574) (2,369) Increase in retirement benefit assets (285) (323) Interest and dividend income (43,684) (42,304) Interest expenses 6,403 7,996 Foreign exchange losses 1,031 2,385 Share of the profit of associates and joint ventures accounted for using the equity method (1,380) (2,804) (Gains) losses on sales or disposal of property, plant and equipment (17,982) 2,792 Decrease in trade receivables 56,478 17,578 Increase in inventories (41,763) (41,606) Increase (decrease) in trade payables 2,233 (80,997) Decrease in provisions (27,763) (27,611) Other 49,230 48,335 Subtotal 452,337 311,011 Interest received 15,433 18,477 Dividends received 30,035 27,982 Interest paid (6,311) (7,986) Income taxes paid (98,619) (156,241) Net cash provided by operating activities 392,875 193,243 Cash flows from investing activities Decrease in time deposits 13,903 3,464 Purchases of property, plant and equipment (194,290) (188,987) Proceeds from sales of property, plant and equipment 31,586 9,445 Purchases of intangible assets (31,905) (31,244) Purchases of equity instruments (3,225) (33,383) Purchases of debt instruments (152) (142) Proceeds from sales of equity instruments 391,551 144,506 Proceeds from sales and redemption of debt instruments 425 385 Payments for acquisition of subsidiaries or other businesses － (55,590) Payment for sales of subsidiaries or other businesses 3,208 － Other (3,794) (9,643) Net cash provided by (used in) investing activities 207,307 (161,189) Cash flows from financing activities Net decrease in short-term borrowings (73,945) (18,765) Proceeds from borrowings 503 146,836 Repayments of long-term borrowings (134,397) (66,854) Repayments of lease liabilities (16,701) (12,414) Issuance of bonds 71,800 93,650 Dividends paid (87,327) (90,157) Dividends paid to non-controlling interests (26,071) (40,658) Purchase of treasury shares (2) (220,943) Increase in deposits for purchase of treasury shares － 50,945 Other 2,928 (2,682) Net cash used in financing activities (263,212) (161,042) Foreign currency translation adjustments on cash and cash equivalents (19,974) 4,740 Net increase (decrease) in cash and cash equivalents 316,996 (124,248) Cash and cash equivalents at beginning of period 789,390 986,531 Cash and cash equivalents at end of period 1,106,386 862,283 - 10 -
Page 14
Notes to Unaudited Condensed Interim Consolidated Financial Statements Assumption for Going Concern There are no applicable items. Segment information (1) Outline of reportable segments In the six-month period ended September 30, 2025, there were no material changes to the method used to identify the reportable segments, the business activities carried out by each reportable segment, or the measurement standards used to determine segment profits. (2) Revenue, profit/loss for each reportable segment [For the six-month period ended September 30, 2024] (Unit: Millions of yen) Reportable segment Others (Note) Eliminations ConsolidatedJapan North America Europe Asia Total Revenue Customers 1,377,659 916,739 329,094 792,856 3,416,348 58,504 － 3,474,852 Intersegment 652,865 7,589 36,628 145,019 842,101 67 (842,168) － Total 2,030,524 924,328 365,722 937,875 4,258,449 58,571 (842,168) 3,474,852 Segment profit 116,557 36,450 5,870 76,665 235,542 12,203 3,482 251,227 Finance income 44,617 Finance costs (17,042) Foreign exchange gains 1,552 Share of the profit of associates and joint ventures accounted for using the equity method 1,380 Profit before income taxes 281,734 (Note) "Others" is an operating segment that is not included in the reportable segments, such as business activities of subsidiaries in South America. [For the six-month period ended September 30, 2025] (Unit: Millions of yen) Reportable segment Others (Note) Eliminations ConsolidatedJapan North America Europe Asia Total Revenue Customers 1,456,925 967,707 324,247 779,748 3,528,627 61,840 － 3,590,467 Intersegment 642,586 5,302 38,755 172,325 858,968 142 (859,110) － Total 2,099,511 973,009 363,002 952,073 4,387,595 61,982 (859,110) 3,590,467 Segment profit 31,562 56,935 8,644 95,897 193,038 11,615 6,764 211,417 Finance income 42,950 Finance costs (14,117) Foreign exchange gains 1,388 Share of the profit of associates and joint ventures accounted for using the equity method 2,804 Profit before income taxes 244,442 (Note) "Others" is an operating segment that is not included in the reportable segments, such as business activities of subsidiaries in South America. - 11 -