(Bloomberg) -- Uniqlo parent Fast Retailing Co. and Seven & i Holdings are among the first to kick off this earnings season in Asia.
Fast Retailing’s November-ending quarter may have seen operating profit growth soften as warmer autumn-winter temperatures dented sales, even with the backdrop for consumer spending in Japan looking promising.
Seven & i, operator of the 7-Eleven chain, may disappoint investors with operating profit declining for the third consecutive quarter. That’s despite a growth in customer traffic due to domestic campaigns, and a recovery in in-store same store sales internationally, according to Macquarie analysts.
The founding family of the Japanese convenience store giant is seeking to fend off a takeover bid from Canada’s Alimentation Couche-Tard Inc. Seven & i unveiled a plan to jettison its underperforming businesses in October to focus on its convenience store operations.
In South Korea, Samsung Electronics Co.’s operating profit is projected to recover thanks to the chip segment, where profit has probably tripled on robust demand in high-bandwidth memory used in the field of artificial intelligence.
Indian software services bellwether Tata Consultancy Services likely saw profit growth accelerating to a six-quarter high. Commentary on 2025 budgets will be closely watched as some analysts believe US President-elect Donald Trump’s promised corporate tax cuts should allow for more tech spending, at odds with another view that “America First” policies will discourage outsourcing projects.
Highlights to look out for:
Wednesday: Samsung’s (005930 KS) fourth-quarter operating profit likely rose on the back of AI-related demand for memory chips. In line with Micron’s disclosures, Samsung’s average selling prices for DRAM may have slightly improved, while that for NAND may have faced erosion, according to Bloomberg Intelligence. The Korean won’s depreciation could be a tailwind for component sales, buffering margin deterioration, but upside may be limited for smartphones and TVs due to rising component costs, HSBC said.
Thursday: Seven & i (3382 JP) may report a double-digit decline in third-quarter operating profit, as growth in superstore operations was offset by profit slipping across the rest of its segments, consensus show.
- Fast Retailing (9983 JP) is projected to show operating profit growth slowed as higher temperatures eroded sales of winter clothing in October. Higher store rents may limit margin expansion through 2025, analysts at BI wrote in a report. Prospects in mainland China, which accounts for nearly 20% of revenue, have also weakened after Chief Executive Officer Tadashi Yanai reiterated in November that the company doesn’t source cotton from Xinjiang, spurring calls for boycott of Uniqlo products on Chinese social media.
- Tata Consultancy Services (TCS IN) may see profit growth accelerating to a six-quarter high. TCS has been hiring more over the last two quarters in anticipation of a comeback in tech spending from its overseas clients. Depreciation in the Indian rupee may translate to higher revenue.
Friday: Yaskawa’s (6506 JP) third-quarter operating income likely turned positive for the first time in six quarters thanks to a recovery in the robotics business. Orders are set to grow 10%, Macquarie said. Analysts are keen on Yaskawa steadily shifting resources to the Americas for market share expansion, countering slow demand recovery in its main market China, according to SMBC Nikko.
©2025 Bloomberg L.P.