Hmcomm ＜265A＞ provides services that visualize sound using artificial intelligence (ai) to solve customer challenges. With the acquisition of a technology transfer venture from AIST as a catalyst, research and development focused on ai related to "sound" has been carried out, aiming for social implementation of its results. In a B2B business, companies that require voice recognition and abnormal noise detection are customers, with 80% of total company revenue coming from direct contracts, although cases through agencies also exist. The company handles core technology research and development and related upstream processes internally, while outsourcing downstream development processes to maintain technical ability, executing an efficient and quick development process. The segments are divided into the AI product business that offers universal products usable for a broad customer base (69.5% of revenue for the December 2023 period) and the AI solution business that handles custom-made services tailored to specific customer needs (30.5% for the same period).

In the AI product sector, the company offers AI voice recognition products for call centers, such as "Voice Contact," AI automatic response products "Terry," AI meeting minutes products "ZMEETING," and abnormal noise detection products "FAST-D." Compared to abnormal noise detection, the proportion of voice recognition is higher, resulting in a recurring revenue model. In the third quarter of the fiscal year ending December 2024, the number of AI product clients was 41, with an average customer transaction value of 12.3 million yen. On the other hand, the AI solution business operates on both contractual non-recurring and recurring revenue models, with 46 projects and an average project value of 5.2 million yen.

For the third quarter of fiscal year ending December 2024, revenue reached 744 million yen, with an operating profit of 125 million yen. In AI products, the average transaction value has increased for two consecutive periods (up 1.7 million yen year on year). The number of accounts remained at the same level as the second quarter, showing expansion within the same account. In the AI solution business, in addition to ongoing projects from the previous period centered around digital transformation (DX), a new research and development project concerning domestic large language models has also been received and progressed smoothly. Full-year revenue is expected to increase by 29.9% year-on-year to 1,040 million yen, with operating profit anticipated to rise by 55.9% to 129 million yen.

The company's strength lies in conducting research and development focused on "sound" and being able to complete everything from research and development to product development in-house, promoting the transfer of learning models built through problem-solving research and development to the next challenges. The unique research and development-based business process allows for a seamless response from AI solutions to AI products, enabling the company to cater broadly from small to large enterprises. It can be flexibly customized to meet customer needs, providing services that differentiate the company from others. For example, at Yaskawa Electric ＜6506＞, work related to shipping decisions (sound detection) in factories has been automated, and with Benesse Holdings, AI has been used to "unmanned" the sales order reception and completion processes through natural conversations with customers. Additionally, a co-creation relationship has been established with JR East Japan ＜9020＞ by systemizing malfunction determination in railroad assets from the perspective of abnormal sound.

According to a third-party agency, the domestic ai market is expected to grow at an annual rate of nearly 9% over the next five years, and the market size in the voice recognition and abnormal noise detection field is expected to remain stable. Among them, predictions indicate that anomaly detection solutions may double over the next five years. Moving forward, the company aims to increase the current number of AI product implementations per company (1.1 in the fiscal year ending December 2023) by strengthening cross-selling and expanding the number of AI products. In addition, it seems that efforts will also be made to accumulate the number of agencies to accelerate user acquisition. By expanding AI solutions, which serve as leading indicators for AI product deployment, the company also aims to steadily build stock revenue from AI products. Promoting a research and development-based business process to expand the top line through the growth of AI products, the company aspires to become the No. 1 company as a group of specialists in "sound x ai." As stable performance continues, attention is drawn to this company as a sound-focused entity among the recently listed ai-related stocks.