Nomura Holdings, Inc.

What they do

Nomura provides investment banking, trading, asset management, and related financial services to individuals, corporations, and institutions. Its operations span retail, wholesale, and investment management segments, with a significant presence in Japan and international markets. The company also engages in proprietary trading, securities lending, and repurchase agreements, and manages client assets through discretionary and advisory mandates.

Revenue drivers

• Wholesale (Global Markets and Investment Banking) — Generates revenue from trading, sales, and advisory services across equity and fixed income products, including derivatives (e.g., credit derivatives), and from underwriting and M&A advisory. Net gains on non-trading derivatives were not significant in fiscal 2024-2026, but trading assets are a major balance sheet component.
• Retail (Wealth Management) — Provides brokerage, investment products, and financial planning to individual investors in Japan. Revenue is driven by commissions, fees, and net interest income on client cash balances. This segment is a stable fee-based revenue stream.
• Asset Management — Provides investment management products, including mutual funds and discretionary mandates. Revenue is based on assets under management (AUM) and performance fees. AUM growth is supported by market appreciation and net inflows from institutional and retail clients.
• Macquarie Acquisition (announced December 2025) — Nomura recognized goodwill in December 2025 from the Macquarie Acquisition, which includes client relationships with a net carrying value of ¥112.7 billion as of March 31, 2026 (weighted average amortization period 12 years). This acquisition expands its asset management and wholesale capabilities.

Recent performance

Fiscal year 2026 revenue was ¥1.20 trillion, up from ¥1.07 trillion in fiscal 2025, and net income was reported for fiscal 2026 (not explicitly stated in the excerpts, but revenue growth was driven by higher trading and asset management income). The latest balance sheet as of September 2011 showed total assets of $479.44 billion, total liabilities of $449.39 billion, and shareholder equity of $26.45 billion. Quarterly revenue for the three months ended September 2023 was ¥213.78 billion, up from ¥171.94 billion in September 2022. The company increased valuation allowances on deferred tax assets by ¥80.6 billion in fiscal 2026, primarily due to foreign subsidiaries' operating loss carryforwards.

Strategy

Nomura is expanding through strategic acquisitions, including the Macquarie Acquisition in December 2025, to enhance its asset management and wholesale franchise. The company is investing in technology and client-facing platforms, while managing risk through netting and collateral arrangements to reduce counterparty exposure. Management emphasizes prudent capital management, focusing on shareholder returns and maintaining a strong balance sheet. The firm is also accelerating its shift toward fee-based revenue to reduce volatility in trading income.

Risks

• Market risk — Revenue and profitability are sensitive to market volatility, interest rates, and credit spreads, as evidenced by significant fluctuations in trading assets and derivative valuations.
• Credit and counterparty risk — Exposure to counterparty defaults is mitigated but not eliminated; large notional amounts of collateral are pledged, and any failure could impact liquidity and solvency.
• Operational and regulatory risk — As a global securities firm, Nomura faces intensive regulatory oversight across jurisdictions, including capital requirements and conduct rules, which could increase compliance costs and restrict business activities.
• Valuation and tax risk — The company recognized significant valuation allowances on deferred tax assets (¥80.6 billion increase in fiscal 2026), indicating that future profitability in certain foreign subsidiaries may not materialize as expected.

Outlook

Management expects continued growth in client-facing businesses, leveraging the Macquarie Acquisition to broaden global reach and deepen product offerings. The company anticipates maintaining a strong capital position and expects to manage derivative collateral efficiently. No major external customer concentration exists, reducing reliance on a single client. However, the increased valuation allowances suggest caution about near-term tax benefits from prior losses.