AI, Inc. (4388) AI Stock Analysis

• Market Cap: ¥2.58B
• Dividend Yield: N/A
• Average Volume (3M): 27.83K
• Price to Earnings (P/E): 19.2
• Beta (1Y): 0.78
• Revenue Growth: 126.85%
• EPS Growth: -114.79%
• Country: JP
• Employees: 56
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): 9.80
• Shares Outstanding: 6,304,298
• 10 Day Avg. Volume: 34,790
• 30 Day Avg. Volume: 27,826
• PEG Ratio: 1.59
• Price to Book (P/B): 1.19
• Price to Sales (P/S): 1.89
• P/FCF Ratio: 37.87
• 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: 58 Neutral
• Price Target: ¥439.00 ▼(-6.79% Downside)
• Action: Reiterated Date: 10/31/25
• Date: Action: Reiterated 10/31/25

AI, Inc.'s overall stock score is primarily influenced by its strong financial performance, particularly its revenue growth and solid balance sheet. However, the negative net profit margin and operational inefficiencies weigh heavily on the score. Technical analysis indicates a bearish trend, and valuation metrics are unattractive due to the net loss and lack of dividend yield.

Positive Factors

Robust Revenue Growth

Revenue growth near 75% year-over-year indicates accelerating product adoption and expanding market penetration. Sustained top-line expansion creates scale advantages, funds incremental investment in R&D and sales, and provides a multi-quarter runway to address profitability gaps while retaining growth optionality.

Strong Balance Sheet

A high equity ratio and minimal leverage give the company structural financial flexibility to fund growth initiatives, absorb shocks, and pursue strategic investments without heavy external financing. This reduces solvency risk and preserves capacity for medium-term expansion or M&A.

Positive Free Cash Flow

Persistent positive free cash flow and a favorable FCF-to-net-income relationship show the business converts activities into cash despite accounting losses. That cash buffer supports capex, working capital and strategic spending, lowering dilution risk and sustaining operations over the next several quarters.

Negative Factors

Negative Net Profit Margin

A negative net margin driven by a 2025 net loss means the company is not currently generating accounting profit from operations and financing. Over the medium term this undermines return metrics, limits retained earnings for reinvestment, and may force strategic tradeoffs between growth and profitability.

Declining Operating Margins

Falling EBIT and EBITDA margins point to operational inefficiencies or weaker operating leverage. Without structural cost improvements or productivity gains, margin erosion will make it harder to translate strong revenue growth into sustainable profitability and could pressure future cash generation.

Weakening Operating Cash Flow

A decline in operating cash flow, even with positive free cash flow, signals core operations are producing less cash. If persistent, this trend can strain liquidity for daily operations, increase reliance on financing, and constrain the company's ability to invest while it repairs margins.

AI, Inc. Business Overview & Revenue Model

Company Description

AI,Inc. develops and provides various speech synthesis engines and solutions in Japan. It also offers consulting and peripheral system services. AI,Inc. was incorporated in 2003 and is headquartered in Tokyo, Japan.

How the Company Makes Money

AI, Inc. generates revenue through multiple streams, primarily by offering software-as-a-service (SaaS) solutions that allow businesses to access its AI tools on a subscription basis. This recurring revenue model ensures a steady income as clients pay monthly or annual fees for continued access. Additionally, the company earns money through professional services, including consulting and implementation support, helping clients integrate AI solutions into their existing systems. Key partnerships with major cloud service providers enhance AI, Inc.'s market reach and product capabilities, contributing significantly to its earnings. Furthermore, the company explores revenue opportunities in data licensing and custom AI development projects tailored to specific client needs.

AI, Inc. Financial Statement Overview

Summary

AI, Inc. demonstrates strong revenue growth and maintains a solid balance sheet with low leverage. However, profitability has been impacted by a net loss in 2025, affecting margins and return on equity. Cash flow management remains effective, but operational efficiency needs improvement to enhance profitability.

Income Statement

AI, Inc. has shown strong revenue growth, with a significant increase from 2024 to 2025. However, the net profit margin is negative in 2025 due to a net loss, indicating profitability challenges. The gross profit margin remains healthy, suggesting efficient cost management. EBIT and EBITDA margins have declined, reflecting potential operational inefficiencies.

Balance Sheet

The company maintains a strong equity position with a high equity ratio, indicating financial stability. The debt-to-equity ratio is low, reflecting minimal leverage and reduced financial risk. However, the return on equity has declined due to the net loss in 2025, impacting overall profitability.

Cash Flow

AI, Inc. has experienced a decline in operating cash flow, but free cash flow remains positive, indicating effective capital expenditure management. The free cash flow to net income ratio is favorable, although the operating cash flow to net income ratio has been impacted by the net loss, suggesting potential cash flow challenges.

Breakdown	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	1.49B	734.98M	634.00M	756.57M	887.57M
Gross Profit	749.19M	513.90M	475.42M	604.30M	745.32M
EBITDA	31.42M	120.75M	31.73M	122.75M	295.20M
Net Income	-15.69M	109.72M	16.37M	83.76M	215.19M
Balance Sheet
Total Assets	2.96B	1.71B	1.39B	1.35B	1.35B
Cash, Cash Equivalents and Short-Term Investments	1.59B	575.20M	1.24B	1.18B	1.10B
Total Debt	129.03M	246.39M	152.11M	2.80M	3.46M
Total Liabilities	442.17M	409.26M	202.46M	75.33M	119.98M
Stockholders Equity	2.36B	1.30B	1.19B	1.28B	1.23B
Cash Flow
Free Cash Flow	74.01M	167.66M	12.94M	121.71M	168.54M
Operating Cash Flow	101.73M	169.61M	18.16M	130.56M	180.60M
Investing Cash Flow	-245.08M	-1.04B	-5.21M	-8.85M	-11.86M
Financing Cash Flow	-382.07M	90.83M	44.38M	-43.59M	-31.90M

AI, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 471.00
• 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:4388, the sentiment is Negative. The current price of 471 is above the 20-day moving average (MA) of 430.85, above the 50-day MA of 428.82, and above the 200-day MA of 462.06, indicating a bearish trend. The MACD of -5.13 indicates Positive momentum. The RSI at 45.00 is Neutral, neither overbought nor oversold. The STOCH value of 31.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4388.

AI, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
3773	80 Outperform	¥20.38B	10.40	―	2.54%	6.31%	38.60%
4441	73 Outperform	¥14.72B	22.65	―	1.66%	16.60%	6.60%
4392	72 Outperform	¥10.59B	13.83	―	1.66%	8.96%	-1257.34%
1724	64 Neutral	¥3.43B	14.31	―	3.94%	-2.32%	54.00%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
4388	58 Neutral	¥2.58B	19.16	―	―	126.85%	-114.79%
6522	54 Neutral	¥3.26B	-24.76	―	―	5.57%	56.29%