Nomura Hits Record ROE on Recurring Revenue and Global Markets, But Sustainability Questions Loom

Strong Q1 Results Across the Board

Nomura’s first quarter of fiscal 2027 delivered a ROE of 15.4%—the highest since Q1 2020—with all divisions reporting higher revenue and income before income taxes. The CFO highlighted three pillars: earnings growth from recurring revenue, sharp international growth, and the launch of a deposit sweep service. “In this quarter, all divisions achieved higher revenue and income before income taxes than in the previous quarter and ROE reached 15.4%.” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2026-07-29

Recurring Revenue and Wealth Management

Wealth Management net revenue rose 9% to JPY 145.4 billion, with income before tax up 16%. Recurring revenue hit an all-time high of JPY 59.2 billion, driven by net inflows of JPY 539.6 billion. The recurring revenue cost coverage ratio reached 76%, showing progress toward the 2030 vision. “The recurring revenue rose to an all-time high of JPY 59.2 billion.” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2026-07-29 This is a key differentiator in a market where recurring revenue growth has been declining among many software firms (as seen in global tape decliners).

The banking division also saw a 19% increase in banking revenue, helped by the new deposit sweep service. “We launched deposit sweep service to strengthen our banking business.” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2026-07-29

International and Global Markets Strength

International businesses saw record pre-tax income since 2008-09, with Global Markets net revenue up 26%. Equities revenue surged 41%, while fixed income rose 11%. Global Markets is now more diversified, with growth in equity products and securitized products. “International businesses saw sharp growth, particularly in our priority areas.” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2026-07-29

However, the CFO noted that July revenue has slowed, partly due to summer seasonality and market corrections. Analysts pressed on sustainability. “Currently, it is more or less flat” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2026-07-29 on a year-on-year basis for wholesale revenue.

Capital Policy and ROE Target

Nomura raised its ROE target to 10-12% by 2030, but Q1 ROE of 15.4% far exceeds that. Analysts questioned whether this is sustainable and what it means for capital allocation. The CFO emphasized that capital is managed carefully to avoid concentration risk.

In closing, in May this year, we raised our numerical target range for ROE to 10% to 12% or more by 2030 and our target for income before income taxes in 2030 to at least JPY 750 billion. ROE of 15.4% in the first quarter was the highest since the April to June quarter of 2020.

This echoes prior calls where the company discussed balancing growth investment and shareholder returns. In the April 2026 call, the CFO said: “CET1 ratio will not decline due to this factor. We don’t think so. As you rightly pointed out, we are also hopeful that this will lead to improved ROE.” — Hiroyuki Moriuchi, CFO · 2026-04-24 That optimism is now validated. And from the October 2025 call: “We have committed to the market of 40% dividend or above and total payout ratio of 50% or above.” — Hiroyuki Moriuchi, Chief Financial Officer (CFO) · 2025-10-28 Nomura remains committed to shareholder returns even as it invests for growth.

Conclusion

Nomura’s Q1 results are a clear inflection point, with structural reforms finally paying off. Financial Services firms globally are being rewarded for stability and recurring income; Nomura is leading the trend. The key tests will be whether the July slowdown is temporary and whether the ROE can sustain above the new target range. The company is well-positioned with a strong balance sheet and growing international footprint.