Nidec Counts Major Loss in Its Balance

The world’s largest maker of precision motors, Nidec, announced on September 30th that it recorded 564.6 billion yen of final deficit in its consolidated financial statements as of March 2026. The biggest deficit in the company’s history was caused by counting on 632.1 billion yen of impairment loss, which stemmed from revision of financial statement with a scandal on its management.The auditor of Nidec withheld its opinion to the securities report. Nidec faces a possibility of being delisted from the stock market in Tokyo. 

Nidec was found as making false report on its finance in 2025. After the third-party committee’s investigation, it was revealed that Nidec added 160.7 billion yen of fictitious net profit to its financial report between March 2021 and April to June 2025. Nidec was also involved in wrong management, which affects quality of its products. The company replaced parts of motors or changed process of production without noticing to its clients. The total amount of false managements of quality went beyond eight hundred cases.

 

The committee regarded those false management as caused by hard pushes for better management made by its founder, Shigenobu Nagamori. Nagamori resigned as Nidec’s honorary chairman in February 2026. Although Nagamori promoted hostile buyouts to expand its business and focused on devices on electric vehicles, the business did not yield preferable results.

 

Nidec delayed annual securities report, which was scheduled in June 2026, for three months, because it took time to thoroughly investigate the false management. As it disclosed its security report, Nidec announced that its president, Mitsuya Kishida, stepped down. The company found that Kishida had made an inappropriate statement during the review of false management, but it did not tell the details of the statement. Michio Kaida succeeded Kishida.

 

It was unusual that the auditor of Nidec, PricewaterhouseCoopers (PrC), did not attach its opinion to the security report. The report is necessary to authorize the report to be credible. However, PrC refused to attach its opinion, because it could not confirm the credibility of the report. PrC found that some managers who had been involved in false management still remained in the process of reviewing Nidec’s financial report. PrC also did not attach its opinion to the reports in March and September 2025.

 

Remaining in the list of stock market is the focal point for Nidec for the time being. Japan Exchange Group (JPX) designated Nidec’s stock as on alert in October 2025. Nidec submitted its improvement plan to the JPX in January 2026. Nidec proposed new management to exclude top-down decision for setting goal of achievement or improvement in assessment which had heavily been leaning on benefits. The company is going to submit an additional report on the improvement.

 

However, the decision of delisting tends to depend on auditor’s opinion. Nidec failed in having the opinion for consecutive three times. It is closely watched whether this major manufacturer in Japan can show normalization of its management.

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