Earnings Report: NTN Corporation Missed Revenue Estimates By 6.6%

The interim results for NTN Corporation (TSE:6472) were released last week, making it a good time to revisit its performance. Results look mixed - while revenue fell marginally short of analyst estimates at JP¥203b, statutory earnings were in line with expectations, at JP¥19.91 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for NTN

Following last week's earnings report, NTN's five analysts are forecasting 2025 revenues to be JP¥837.7b, approximately in line with the last 12 months. Statutory earnings per share are predicted to leap 61% to JP¥13.15. In the lead-up to this report, the analysts had been modelling revenues of JP¥862.1b and earnings per share (EPS) of JP¥21.99 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a large cut to earnings per share estimates.

The consensus price target fell 5.7% to JP¥279, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on NTN, with the most bullish analyst valuing it at JP¥280 and the most bearish at JP¥275 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 0.7% annualised decline to the end of 2025. That is a notable change from historical growth of 7.7% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.8% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - NTN is expected to lag the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for NTN. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of NTN's future valuation.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for NTN going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 3 warning signs for NTN (of which 1 doesn't sit too well with us!) you should know about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.