Hotto Link, Inc. (3680) AI Stock Analysis

• Market Cap: ¥3.53B
• Dividend Yield: 1.17%
• Average Volume (3M): 238.27K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.95
• Revenue Growth: -21.76%
• EPS Growth: -5832.28%
• Country: JP
• Employees: 140
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): -97.64
• Shares Outstanding: 15,965,800
• 10 Day Avg. Volume: 211,960
• 30 Day Avg. Volume: 238,273
• PEG Ratio: -0.01
• Price to Book (P/B): 0.99
• Price to Sales (P/S): 1.10
• P/FCF Ratio: -10.63
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 44 Neutral
• Price Target: ¥224.00 ▼(-12.16% Downside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is weighed down primarily by deteriorated profitability and the 2025 negative free cash flow, alongside weak price trend and bearish momentum signals. Dividend yield offers limited support, but loss-making earnings and current technical weakness keep the overall assessment low.

Positive Factors

Sustainably healthy gross margin

A roughly 32% gross margin indicates the core business retains meaningful unit economics even while operating profit is negative. That level of gross profitability is durable and provides a margin buffer: management can focus on operating-leverage and SG&A control to restore operating profit without needing structural product re-pricing.

Manageable leverage and sizable equity

Low leverage (debt/equity ~0.17–0.30) and a sizable equity base give the company financial flexibility to absorb losses and fund a recovery. This reduces refinancing risk and preserves optionality for strategic investment or restructuring over a multi-quarter horizon without immediate solvency pressure.

Positive operating cash flow

Continued positive operating cash flow despite accounting losses signals that core operations generate cash and are not purely accrual-driven losses. That cash generation supports near-term liquidity, funds working capital needs, and provides a platform to rein in capex or seek measured investment while addressing profitability.

Negative Factors

Material net losses eroding returns

A clear shift to large net losses and deeply negative ROE is a structural deterioration of earnings quality that erodes shareholder capital. Persistent losses will constrain reinvestment, tenant management attention on cash preservation, and limit ability to fund strategic initiatives without external financing.

Free cash flow swung meaningfully negative

A sharp FCF reversal reduces runway and increases dependence on financing or equity to sustain operations. Over several quarters this can force cutbacks in growth projects, slow product development, or dilutive capital raises, impairing long-term competitiveness and strategic execution.

Revenue decline and volatility

Sustained revenue declines and volatility undermine scale benefits and make margin recovery harder. Weak top-line momentum suggests customer churn or demand erosion; without stable revenue growth, fixed costs remain harder to absorb and the pathway to durable profitability becomes uncertain.

Hotto Link, Inc. Business Overview & Revenue Model

Company Description

Hottolink, Inc. offers social media marketing support that collects, analyzes, and utilizes social big data in Japan. The company provides SNS marketing support, Twitter marketing support, Instagram marketing support, influencer marketing support, post campaign, and creative production. It also engages in the SNS data access rights and investment management business activities. The company was incorporated in 2000 and is headquartered in Tokyo, Japan.

How the Company Makes Money

Hotto Link generates revenue through a combination of service fees and subscription models associated with its digital marketing and analytics platforms. The primary revenue streams include consulting services for data analysis, software licensing for proprietary tools, and performance-based marketing solutions. Additionally, the company may form strategic partnerships with other technology firms and brands to expand its service offerings and reach new client segments, which can enhance its earnings potential.

Hotto Link, Inc. Financial Statement Overview

Summary

Financial performance is pressured by a shift from profitability to sizable losses in 2024–2025 and a 2025 free-cash-flow swing to meaningfully negative. Positives include still-positive gross margin (~32%), manageable leverage, and positive operating cash flow, but the scale of net losses and cash burn dominate near-term risk.

Income Statement

Profitability has deteriorated materially: the company moved from strong profitability in 2021–2022 to modest profitability in 2023, then to losses in 2024 and a very large net loss in 2025 despite still-positive gross margin (~32%). Revenue has also been volatile—strong growth in 2021–2022, followed by sharp contraction in 2023 and further declines in 2024, before a partial rebound in 2025. Positively, 2025 EBITDA margin turned positive again, but operating profit remains negative and the scale of net losses is the key overhang.

Balance Sheet

Leverage appears manageable with debt-to-equity in the ~0.17–0.30 range in recent years, and total equity remains sizable. However, returns on equity turned deeply negative in 2024–2025, reflecting that losses are eroding shareholder value and raising questions about earnings quality and sustainability. Overall balance sheet risk looks moderate, but continued losses could pressure capital over time.

Cash Flow

Cash generation weakened: operating cash flow stayed positive in 2024–2025, but it declined versus prior years and covered only a modest portion of accounting earnings in the loss-making periods. Free cash flow swung from solidly positive (2021–2024) to meaningfully negative in 2025, indicating higher cash burn from investment/working-capital needs. The key strength is ongoing positive operating cash flow, but the sharp free-cash-flow reversal is a notable risk signal.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.65B	4.27B	4.74B	7.91B	6.57B
Gross Profit	1.17B	1.29B	1.57B	2.16B	2.16B
EBITDA	213.20M	-40.26M	699.00M	2.74B	1.48B
Net Income	-1.79B	-564.63M	226.00M	1.82B	764.29M
Balance Sheet
Total Assets	6.00B	7.87B	8.49B	8.47B	7.31B
Cash, Cash Equivalents and Short-Term Investments	2.43B	3.30B	3.50B	3.60B	2.60B
Total Debt	1.22B	978.25M	1.18B	1.35B	1.69B
Total Liabilities	1.96B	2.02B	2.35B	2.52B	3.18B
Stockholders Equity	4.03B	5.86B	6.14B	5.95B	3.87B
Cash Flow
Free Cash Flow	-376.35M	295.00M	688.00M	478.36M	403.90M
Operating Cash Flow	239.97M	295.60M	698.00M	793.56M	678.71M
Investing Cash Flow	-921.07M	-432.91M	-716.00M	-291.06M	-536.01M
Financing Cash Flow	-144.31M	-193.11M	-154.00M	375.77M	307.87M

Hotto Link, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 255.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:3680, the sentiment is Negative. The current price of 255 is above the 20-day moving average (MA) of 239.70, above the 50-day MA of 253.10, and below the 200-day MA of 277.94, indicating a bearish trend. The MACD of -11.40 indicates Positive momentum. The RSI at 36.01 is Neutral, neither overbought nor oversold. The STOCH value of 20.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:3680.

Hotto Link, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3993	68 Neutral	¥107.39B	47.69	8.26%	―	28.88%	27.51%
4784	65 Neutral	¥211.03B	37.95	―	1.76%	377.76%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
3914	57 Neutral	¥16.47B	39.45	―	―	3.17%	-16.66%
4180	56 Neutral	¥84.95B	32.94	―	0.18%	25.88%	80.30%
4073	45 Neutral	¥1.43B	-6.62	―	―	-3.49%	-2246.63%
3680	44 Neutral	¥3.53B	-1.97	―	1.17%	-21.76%	-5832.28%