Nomura Holdings Inc Earnings - Q2 2027 Analysis & Highlights
Nomura’s Q2 FY2027 call covered quarterly and first-half performance, divisional results, shareholder returns, market conditions, growth initiatives, and the near-term outlook.
Key financial results
Q2 group net revenue was ¥607.5 billion, down 12% quarter on quarter; income before income taxes was ¥148 billion, down 30%, and net income was ¥103.7 billion, down 29%.
Q2 EPS was ¥34.61 and ROE was 10.9%; first-half ROE was 13.3%.
First-half income before taxes across the four divisions increased 50%. Stable revenue was approximately 1.6 times its year-ago level.
Group-wide non-interest expenses were ¥459.5 billion, down about 3% quarter on quarter; compensation-related provisions and benefits fell about 5%, and trading-related expenses normalized.
The common equity Tier 1 capital ratio was 12.6% at September-end, down 0.6 percentage points from June-end.
Business segment results
Wealth Management: Net revenue was ¥141.5 billion, down 3% quarter on quarter, and income before taxes was ¥65.6 billion, down 8%. Recurring revenue reached a record ¥66.7 billion, up 13%, while net inflows into recurring-revenue assets reached a record ¥755.4 billion.
Investment Management: Net revenue was ¥84.8 billion, down 14% quarter on quarter, and income before taxes was ¥27.4 billion, down 39%. Stable business revenue was ¥82.3 billion; investment gains fell to ¥2.5 billion, reflecting a lower contribution from American Century Investments-related gains.
Wholesale: Net revenue was ¥308.9 billion, down 16% quarter on quarter, and income before taxes was ¥46.1 billion, down 51%. Global Markets revenue declined amid greater uncertainty, while Investment Banking revenue grew.
Wholesale—Global Markets: Revenue was ¥254.2 billion, down 20% quarter on quarter. Fixed income revenue fell 14% to ¥119.2 billion, and equities revenue fell 25% to ¥135 billion. Rates and emerging-market FX were weaker, while securitized products partly offset the decline in macro products; equity financing remained solid, but derivatives and execution services weakened.
Wholesale—Investment Banking: Revenue rose 9% to ¥54.7 billion quarter on quarter, supported by advisory, financing and solutions. Nomura ranked first in Japan-related ECM and DCM league tables for April–September.
Banking: Net revenue was ¥16.4 billion, up 7% quarter on quarter, and income before taxes was ¥4.4 billion, up 20%. Deposit-sweep balances and contracts grew, funding costs were kept in check, and trust fees benefited from new trusts and higher investment-trust balances.
Capital allocation
Nomura declared an interim dividend of ¥35 per share, representing a 41% payout ratio.
Management reiterated a commitment to a payout ratio of at least 40% and a total payout ratio of at least 50%; it said shareholder returns would be considered alongside financial soundness and current and prospective growth opportunities.
Management did not specify a share-buyback amount or timing, saying it would consider appropriate steps during the year.
For asset management, management said capital beyond seed investment would be deployed generously when suitable opportunities arise, while noting it did not expect a large-sized deal.
Industry trends and dynamics
Wealth Management recurring-revenue assets rose 20% year on year to around ¥31 trillion; Investment Management assets under management increased by ¥50 trillion to around ¥150 trillion, particularly reflecting an acquisition.
In Wealth Management, purchases for long-term diversified investment continued despite market uncertainty; discretionary investments rose 9%, and insurance sales rose 14% quarter on quarter.
Investment Management recorded ¥478 billion of quarterly net inflows, including roughly ¥1 trillion into investment trusts; alternative assets under management reached a new high.
Management described continued strong corporate funding demand and a robust DCM pipeline, including large deals. It also said rising rates could encourage a broader shift in flows from government bonds toward corporate bonds.
Management said demand for individual government bonds was rising as customers became more rate-sensitive and viewed them as an accessible alternative to deposits; it hoped this interest would broaden into other investment products and asset classes.
Competitive landscape
Nomura ranked first in both Japan-related ECM and DCM league tables for the April–September period and acted as bookrunner for 9 of Japan’s 10 largest first-half deals.
In data-center financing, management said Nomura focuses on medium-sized deals rather than large mega-deals and competes through deal structuring, solutions capabilities, industry knowledge, and execution speed.
Management said Nomura is not a commercial bank and does not rely on a huge balance sheet for this business. It described current securitization and private-credit activity as a small share of the overall activity and said it was being selective in pursuing opportunities.
Macroeconomic environment
The first half began amid Middle East-related volatility, with crude oil briefly exceeding $110 per barrel; major equity markets later reached record highs, followed by renewed uncertainty from rising rates, geopolitical risks, and equity-market corrections.
Management characterized the global economy as broadly resilient, while citing renewed inflation concerns linked to geopolitical risks and persistently high interest rates.
Management said market participants were waiting on the sidelines amid geopolitical concerns and high rates, and identified monetary-policy announcements, U.S. midterm elections, and Middle East developments as factors affecting markets in October.
Rising yen rates contributed to increased bond sales in Wealth Management, including a 66% quarter-on-quarter increase in bond sales.
Growth opportunities and strategies
Wealth Management recurring-revenue assets rose 20% year on year to around ¥31 trillion, supporting a more stable revenue base; management said the division was steadily accumulating these assets across market conditions.
In International Wealth Management, management said revenue had grown about sixfold since 2020, more than 3,000 client accounts had been opened, mainly in Hong Kong and Singapore, and a Dubai hub was established to support growth.
Management said it planned to pursue overseas asset-management opportunities selectively, while prioritizing organic growth in International Wealth Management and using limited capital for that expansion.
Nomura said it was investing in seed capital to develop future products, normalize underinvestment at its international asset-management business, and expand active ETFs; it described seed investment as supporting product development while helping limit P&L volatility through macro hedging.
Management identified efficiency initiatives, including simplifying complex system architecture and using AI to reduce costs, alongside revenue growth and operating leverage as ways to improve Wholesale’s expense ratio.
Financial Guidance and Outlook
Nomura’s stated ROE target toward 2030 was 10%–12% or higher, and management said Q2 ROE of 10.9% achieved that quantitative target.
For October to date, Wealth Management revenue was approximately at the Q2 level, with medium- to long-term asset-management inflows remaining solid.
Wholesale had started October more slowly than the previous quarter; management said some Global Markets products were subdued, equities remained solid, rates were recovering, and Investment Banking had a slower start despite a solid pipeline.
Management said it would pursue business opportunities while taking appropriate risks and maintaining cost controls; it expected Wholesale’s cost ratio to improve as market conditions normalized and revenue opportunities were monetized, while noting that a quantitative second-half cost-ratio outlook was difficult to provide.
