Mitsubishi Heavy Industries (MHI, TSE:7011) reported a ¥14.1 trillion order backlog at June 30, 2026. The useful reading is not “¥14.1 trillion of near-term sales.” It is that MHI has a large, segment-specific pool of contracted work whose conversion into revenue, cash and margin depends on timing, scope and execution.
The August 4 Q1 release is a timely example. MHI reported ¥2,022.4 billion of order intake, ¥1,194.2 billion of revenue and a ¥865.3 billion increase in backlog from its March year-end. For international readers, the best way to use those figures is to separate three questions: what was newly ordered, what was delivered, and which business carries the remaining work.
Key takeaways
- Order intake is new business booked in the period; backlog is work not yet recognized as revenue. Neither is a cash-flow forecast by itself.
- MHI’s June 2026 backlog was concentrated in Energy Systems (¥7.8 trillion) and Aircraft, Defense & Space (¥3.9 trillion), two businesses with different timing and execution risks.
- A simple opening backlog + intake − revenue calculation is a useful check, not an accounting identity. MHI’s numbers leave a ¥37.2 billion gap that requires disclosure context rather than guesswork.
- Watch segment mix, backlog conversion, margins, cash flow and management’s forecast assumptions together. A bigger backlog can coexist with slower delivery, cost pressure or changed contract scope.
Start with the three numbers—not the share-price story
MHI’s Q1 FY2026 presentation reported order intake of ¥2,022.4 billion, up 25.7% year on year on its comparable basis. Revenue was ¥1,194.2 billion, up 15.5%, while profit from business activities was ¥159.6 billion, up 65.1%.
Those are different measures. Order intake records newly won work. Revenue records work recognized during the quarter under the company’s accounting policies. Backlog is the remaining contracted work MHI reports after those movements and other changes. A company can post high intake without immediate revenue, especially in complex power, aerospace, infrastructure or defense programs.
For a broader guide to finding Japanese results dates, see ATG Press’s Japan earnings calendar guide. For the structure of the earnings documents themselves, see how to read Japanese earnings reports.
A practical backlog bridge
At March 31, 2026, MHI reported ¥13,237.6 billion of backlog. Adding Q1 intake and subtracting Q1 revenue produces a rough bridge:
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| Item | Amount | Definition / source |
|---|---|---|
| FY2025 year-end backlog | ¥13,237.6bn | Opening reported backlog; MHI Q1 presentation, p. 22 |
| Add: Q1 FY2026 order intake | ¥2,022.4bn | New orders in the quarter; MHI Q1 presentation, p. 7 |
| Less: Q1 FY2026 revenue | ¥1,194.2bn | Revenue recognized in the quarter; MHI Q1 presentation, p. 7 |
| Simple implied closing backlog | ¥14,065.8bn | Arithmetic check only; not a company-defined reconciliation |
| Reported June 30 backlog | ¥14,103.0bn | MHI Q1 presentation, pp. 5 and 22 |
| Difference | ¥37.2bn | Scope, timing or other reconciliation items require disclosure context |
The calculation is intentionally modest. It tells a reader whether new orders were larger than reported revenue in the quarter, but it does not prove that all revenue comes from the opening backlog or that every intake item will convert on the same schedule. Acquisitions, disposals, currency effects, contract modifications, eliminations and segment-definition changes can all matter. MHI notes that the FY2025 comparatives in its presentation were retroactively adjusted for an April 1, 2026 organizational change.
That is why it is better to read the reported backlog table and footnotes than to turn the bridge into a false precision exercise.
Where the June backlog sits
The remaining work was not evenly spread across MHI. Energy Systems represented roughly 55% of June-end backlog, while Aircraft, Defense & Space represented roughly 28%. That mix is more informative than the group total because it directs the next research question toward the execution cycle of each business.
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| Segment | Q1 FY2026 order intake | June 30, 2026 backlog | What to test next |
|---|---|---|---|
| Energy Systems | ¥1,359.3bn | ¥7,814.6bn | Gas turbines, nuclear and service revenue conversion; margin and capacity |
| Plants & Infrastructure Systems | ¥368.8bn | ¥2,286.1bn | Project timing, engineering execution and customer milestones |
| Industrial Solutions | ¥193.0bn | ¥103.2bn | Whether intake remains ahead of quarterly revenue on a smaller base |
| Aircraft, Defense & Space | ¥120.9bn | ¥3,898.3bn | Delivery schedules, program mix and budget / customer milestones |
| Others, Corporate & Eliminations | -¥19.7bn | ¥0.6bn | Elimination and reporting-scope effects |
MHI said Q1 intake rose year on year in Energy Systems, Plants & Infrastructure Systems and Industrial Solutions, with a particularly large increase in gas-turbine combined-cycle work. Its reported Aircraft, Defense & Space intake was lower year on year, while revenue in that segment rose. That combination illustrates the point: a quarterly intake comparison and a backlog stock are related, but they answer different questions.
Why energy systems deserve a separate read
MHI reported ¥7,814.6 billion of Energy Systems backlog at June 30, up from ¥6,983.2 billion at the FY2025 year-end. In the Q1 material, management highlighted strong gas-turbine combined-cycle intake in North America and Asia, as well as strong steam-power intake in the Middle East and Asia. It also raised the segment’s FY2026 order-intake forecast to ¥3,936.7 billion from ¥3,450.0 billion.
That is a company disclosure, not proof that every order has the same economics. A useful next step is to compare future quarterly revenue and business-profit progression with the stated mix of new equipment, services and long-cycle projects. The MHI Financial Report 2026 provides the wider FY2025 context, including group orders of ¥7,653.6 billion and revenue of ¥4,974.1 billion for the year ended March 31, 2026.
What backlog cannot tell you alone
A large backlog does not set a valuation, guarantee margin expansion or make a forecast safer. Four checks keep it in proportion:
1. Conversion: Is revenue rising in the segments where backlog is building, and at what pace? 2. Profitability: Are business-profit margins improving because of mix and execution, or are they being supported by non-repeatable items? MHI reported Q1 business-profit margin of 13.4%. 3. Cash: MHI reported Q1 free cash flow of ¥391.5 billion. Track future cash generation alongside advance payments, working capital and capital expenditure rather than treating backlog as cash. 4. Assumptions and scope: MHI’s FY2026 group forecast uses US$1=¥150 and €1=¥180 for the portion yet to be fixed. Foreign exchange, contract amendments and reporting changes can move the path from order to revenue.
For international investors, the Tokyo ordinary share is identified by code 7011. MHI’s stock-information page also states that shares trade in 100-share units and that its fiscal year ends on March 31. A TradingView chart is context for market movement only; it is not evidence for order, backlog or dividend claims.
A repeatable next-results checklist
On the next MHI release, repeat this sequence:
1. Record group intake, revenue, business profit, operating cash flow and the reported closing backlog. 2. Rebuild the rough backlog bridge, then flag—not invent—any difference from the reported closing figure. 3. Compare the backlog mix by segment with the mix of quarterly revenue and profit. 4. Separate management’s full-year forecast from delivered results, including any changed foreign-exchange assumptions. 5. Read the Japanese-market disclosure trail through TDnet’s English filing guide when a company or exchange filing is needed alongside the company presentation.
The Q1 release offers a straightforward conclusion: MHI’s larger backlog is meaningful evidence of contracted industrial demand, particularly in Energy Systems, but it is a starting point for research rather than a standalone investment conclusion. The dates, segment mix and cash conversion are what make the headline usable.
Sources
- Mitsubishi Heavy Industries, Q1 FY2026 Financial Results index, published August 4, 2026; accessed August 31, 2026.
- Mitsubishi Heavy Industries, Q1 FY2026 Presentation Materials (PDF), published August 4, 2026; three months ended June 30, 2026.
- Mitsubishi Heavy Industries, Q1 FY2026 Financial Results (PDF), published August 4, 2026; three months ended June 30, 2026.
- Mitsubishi Heavy Industries, Stock Information, accessed August 31, 2026.
- Mitsubishi Heavy Industries, Financial Report 2026 (PDF), published June 24, 2026; FY2025 ended March 31, 2026.
This article is for informational purposes only and does not constitute investment advice.
