I'm going to present the financial results for fiscal year 2017 and business outlook for fiscal year 2018. Let me start with the summary of the financial results. The order received grew year-on-year by 50.5% to JPY 247.8 billion. Sales increased by 32.9% from the previous year to JPY 207.2 billion. Thanks to positive development of the tester market, especially growth of the memory tester market, for the first time since 2006, we have seen good results of the order received. Our internal dedicating efforts contributed to the fourth quarter sales, which exceeded our initial forecast. Sales have passed the JPY 200 billion mark again for the first time since 2006. Operating income grew by 76.1% year-on-year, reaching JPY 24.5 billion. Because of the product mix impact, gross profit margin declined year-on-year. However, operating income margin exceeded 10% for the first time since 2007, thanks to revenue increase.
Net income was JPY 18.1 billion, increased by 27.5% year-on-year. Regarding annual dividend per share, in January, our forecast called for JPY 26 per share. However, since our fourth quarter performance was better than expected, we have increased the dividend payout by JPY 7 year-on-year to JPY 32, and for the second half of the year, it is JPY 23. Next, order received by business segment and by region. Semiconductor and component test system business grew by 60% year-on-year to JPY 169.7 billion. Investment in data centers have become robust, which resulted in growth of memory business, and memory functionality is going up toward high-end, such as 3D NAND. Such market trends led to higher demands for our memory testers.
Non-memory tester business has been also solid, thanks to strong performance of the automotive and display application markets throughout the year and recovery of mobile business in the second half. Mechatronics system business grew by 64% year-on-year to JPY 44 billion. As the memory market has performed well, investment in device interface has been active accordingly. Service and other business increased by 8% year-on-year to JPY 34.1 billion. By region, which is on the right of the slide, the pink color represents South Korea, orange is Taiwan, yellow represents China, and other regions including Southeast Asia, where semiconductor manufacturing locations are concentrated. In those areas, we see increase. Next, sales by segment and by region. Sales development is based upon the same reasons as the order received. Semiconductor and component test system business grew by 39% year-on-year to JPY 140.9 billion.
Mechatronics system business increased by 43% to JPY 35.9 billion. Service and other business showed 3% growth year-on-year, reaching JPY 30.5 billion. Non-Japanese semiconductor players have been aggressively investing in testers, and our overseas sales accounts for 93.2% now. Let me share with you the fourth quarter summary. The quarterly order received has reached JPY 85.4 billion, close to the record high we achieved in the second quarter in 2000. Early in 2000s, demands depended largely on PC market, but this time we have seen growth in tester demands due to expansion of semiconductor applications, ranging from consumer electronics to infrastructure, and device types from memory to sensors. Sales increased, and we have recognized better gross profit margin. As a result, operating income margin has exceeded 20% for the first time since the second quarter 2007, the best quarterly result in recent years.
This is the quarterly orders by segment. Semiconductor and component test system business grew by 54% quarter-on-quarter to JPY 60.2 billion. Out of which, non-memory testers generated JPY 29.3 billion, and memory tester was JPY 30.9 billion. In non-memory testers, demands in the area of display driver increased since the previous quarter. In memory testers, DRAM and flash memory have seen equally strong demands. There have also been some inquiries for advanced orders to be booked in the first quarter in 2018, pushing up total orders by about JPY 15 billion. Mechatronics system business grew by 80% quarter-on-quarter to JPY 14.1 billion. In accordance with the positive trend of the memory tester market, it shows strong growth. Service and other business grew 14% quarter-to-quarter to JPY 11.1 billion. Next, quarterly orders by region.
In South Korea, orders in the areas of DRAM and flash memories have increased, resulting in total number of JPY 32.3 billion. In Taiwan, demands for high-performance logic ICs and display driver have grown steadily, and the result was JPY 24.1 billion. Next, quarterly sales by segment. Semiconductor and component test system business grew by 47% quarter-on-quarter to JPY 49.5 billion. Out of which, non-memory tester business amounted to JPY 31.9 billion, and memory tester business was JPY 17.6 billion. In non-memory, mobile and computing sectors are main growth drivers. In memory tester business, as I mentioned earlier, sales has exceeded our initial forecast. Mechatronics grew by 10% quarter-to-quarter to JPY 10 billion. Service and other business has grown 5% quarter-on-quarter to JPY 8.5 billion. Next, quarterly sales by region. In Taiwan, sales has been driven by high-end SoC, which uses leading-edge process.
Sales have reached JPY 27.2 billion. In South Korea and China, sales has grown, driven by DRAM and flash. In fourth quarter alone, our overseas sales accounts for 94.6%. Next is operating income. Gross profit margin has been improved by 9.9 points to 55.7%. We have booked JPY 3.3 billion inventory write-down from nanotechnology business in the third quarter, so no impact on the fourth quarter anymore, and increased sales of highly profitable logic IC business. As a result, profitability has been improved. SG&A has increased quarter-on-quarter by JPY 3.9 billion, resulting in JPY 24 billion due to increase of performance-based bonus payout. Operating income has grown by JPY 10.6 billion to JPY 13.9 billion. Operating margin has increased by 14 points to achieve 20.4%. Now, full year results of operating income. Gross margin has decreased by 6.2 points year-on-year, resulting in 51.4%.
Due to write-down of nanotechnology business and product mix change to higher ratio of memory tester and mechatronics. Operating margin has been improved by 2.9 points to achieve 11.8%. SG&A efficiency has been improved, and it has compensated decline of gross profit margin. Next, R&D and other for the quarter. R&D expenses were at JPY 9.7 billion. CapEx was JPY 2.4 billion. Depreciation and amortization was JPY 1.4 billion. Full year results, R&D expenses were JPY 33.5 billion. CapEx was JPY 5.4 billion. Depreciation and amortization was JPY 5 billion. This is the last slide of this chapter. This is the financial status. Total assets is JPY 254.6 billion. Cash and cash equivalents are JPY 104 billion. JPY 8.6 billion increased since the end of previous fiscal year. Inventories were JPY 10.5 billion up since the end of the previous fiscal year to reach JPY 49.6 billion.
Equity attributable to owners of the parent was JPY 124.6 billion, accounting for 49%.
That is the financial results for fiscal year 2017. Next, fiscal year 2018 business outlook. First, 2018 market forecast calendar year. In non-memory tester market, AI servers and cryptocurrency mining will consume more and more high-performance logic IC, and that will drive demands for testers. In smartphone business, high-end SoC will be installed in some smartphones. However, overall, the tester market will be flat due to stagnant unit volume and sales. In 2017, automotive and LCD and OLED performed well, and we expect that trend will continue. Based on this, our forecast of the non-memory tester market stayed the same since the initial forecast, that is $2.2 billion-$2.3 billion in size. In memory business, which is short-term demands driven, fluctuates significantly, so our forecast is not fixed accordingly. However, we see demands for data center will continuously strong and memory tester market will keep expanding.
We expect our customers will increase investment in premium DRAM and non-volatile memory for servers going forward. We currently estimate the memory tester market size to be about $900 million, staying at the upper side of the range of three months ago. This is business forecast of our company for fiscal year 2018. Although we expect the market will grow, we estimate our order volume will decrease to JPY 220 billion because we have carried forward JPY 15 billion equivalent orders to fiscal year 2017. If we adjust for it, fiscal year 2018 order forecasted will be the same level as fiscal year 2017. Based on these expectations for orders and backlog, we anticipate an increase in revenue in fiscal year 2018. Gross profit margin expected to remain at the same level year-on-year in fiscal year 2018.
We will work to increase profit while also remaining conscious of SG&A efficiency this fiscal year. Operating income is forecast to be JPY 34.5 billion, an increase of JPY 10 billion. Operating margin is forecast to be 15%. Our forecast assumes foreign exchange rates of one US dollar to JPY 105, one euro equivalent to JPY 135. While orders received continues to grow, we will further reinforce our parts procurement capacity. In addition, we have formulated a long-term management policy for the next 10 years and a midterm management plan for the next three years. These policies will shape our drive for growth. These mid-to-long-term policies, to be described later, call for R&D expenses of JPY 35 billion, capital investment of JPY 7 billion, and depreciation costs of JPY 5.5 billion in fiscal year 2018. Outlook by segment. First, non-memory testers.
High-end SoCs and logic ICs used for smartphones and AI servers will see sharp improvements in performance and greater miniaturization this year. As a result, test times will become longer and test itself will become more complicated. We anticipate increased sales of testers due to these technological evolutionary factors. Demand from the automotive and display-related sectors will continue at the strong level of fiscal year 2017. Our non-memory tester business sales forecast for fiscal year 2018 is JPY 93 billion, about JPY 5 billion up from fiscal year 2017. Memory tester outlook. In the midst of current so-called super cycle, the memory tester market continues to grow. Advantest will take advantage of our number one position in this market to further increase sales. In DRAM, due to strong demand for server DRAM, investment in backend DRAM testers is expected to continue to grow.
In flash memory, investment in testers for volume production of 64-layer and 72-layer 3D NAND, and in burn-in testers to guarantee NAND reliability is also expected to continue at a robust pace. In fiscal year 2017, sales for testers for nonvolatile memory such as 3D NAND and DRAM testers were about equal, a trend that is expected to continue this year. Our memory tester business sales forecast for the current term is JPY 67 billion, an increase of approximately JPY 14 billion year-on-year. Mechatronics system demand for memory handlers and automotive handlers is showing strong growth, pointing to a sales increase. We estimate that our nanotech business bottomed out in fiscal year 2017. As a result of this, JPY 38 billion is our forecast of sales for mechatronics business.
Our fiscal year 2018 sales forecast for our services and other businesses, while there will be some growth in secondhand sales and service contract revenue, SSD tester growth is expected to drive an overall increase in segment sales. Our forecast is JPY 32 billion. Fiscal year 2017 business result and outlook for fiscal year 2018. This is it from me. Thank you very much. As for part one, if you have any questions, we'd like to entertain them. Since time is limited, you can ask up to two questions. I will designate the person who can ask questions. If you have any questions, please raise your hands and please mention your company name and your name, please. Please bring the microphone. I'm Wadaki from Nomura Securities. Thank you very much for strong forecast presentation. I have two questions.
Disco made a downward revision of business forecast for April through June quarter. You might fear it's too high for demand. Yoshida San, Yoshida San, do you see any sign or a negative signal you're observing? In March and April, I visited customers in Asia, many of them, and our customers' perspective is that it's a stable growth track they're in. Looking at political situations, relationship between the U.S. and China, trade war that's happening, how that kind of trade friction impact on our industry. For the short term, it's a negative. In China, we do have a very strong position, for Chinese customers, their motivation for the short term, there might be some fluctuations on their part. Looking at the mid to long term, if the situation continues that way, I believe China needs semiconductors, and they need to make semiconductors.
They have strong motivation, so it's not so unfavorable against us. Demand for memory itself, it's now regarded as commodity, so has been in the cyclical cycle of going up and down. I'd like to touch upon this later. The growth for semiconductors, mid to long term, it's stable, so I don't see any sudden dip in demand. Second question. (Myong San), I'd like you to talk about this largely. There is strong forecast for fiscal year 2018. What are the products that drive this one? Like flash tester, V93000 in DRAM, flash high speed tester. I'd like to know about it. SoC is the first one I'd like to touch upon. High-end smartphones, it has been sluggish, but looking at mid-range, 7 nm, 10 nm, miniaturization is being done. With shifting, test time becomes longer. V93K business is on the recovery mode now.
Next one, automotive product. As you know, ADAS is included. This business, just like fiscal year 2017, will have a good momentum. Next one, driver IC. For this business segment, just like last year, this year, 2018, is positive. This year it's even better than 2017 because of TDDI. They start production of TDDI, which requires longer testing time. Tester for these drivers, it's positive. As for memory, NAND flash price, you see. Investment might not be so active, but 3D NAND, 72-layer and higher than that might be launched this year. That requires longer tester time, so that requires more investment. Premium product, DRAM for servers. Production is on the rise, so this requires longer tester time and tester environment will be stringent. T5503HS high speed tester and also T5833 core testing tester, these are enjoying higher demand. Thank you very much.
Person in the front seat. Thank you. I'm Moriyama from J.P. Morgan. I'd like to know the breakdown on these slides. On page 8, memory tester, Q3, JPY 12.6 billion-JPY 30.9 billion, JPY 15 billion advance order. If it's memory DRAM and NAND and HPC for non-memory, could you tell me the breakdown? For the 50% of total sales, it's HPC and computing. Remainder is 50%. For memory, non-memory, 50/50. On page 8, from Q3 to Q4, memory tester, JPY 12.6 billion-JPY 30.9 billion. NAND, DRAM is 50/50. Yes, it's 50/50. For the pull in to Q4 of JPY 15 billion, this includes both NAND and DRAM? That's right. Thank you. Non-memory, let me confirm. It's 50/50. What's 50/50? Computing and SoC, 50%. MCU, analog, display, driver, 50%. Computing SoC, 50%. What's the latter? MCU, power related device display, 50%.
From third quarter to fourth quarter, order received, it's flat issue, about JPY 26.5 billion, but it went up to JPY 29.3 billion. For AP, it's on the rise. Also for HPC, it also went up. Yes, both of them went up. Okay. Thank you. Thank you. The annual capacity for the annual sales for this fiscal year and next year, in terms about labor and material, how confident you are to secure these necessary resources? I know in the first half of last year, you struggled in this point. In the first half, we had difficulty in catching up in our production. While we had that difficulty, just more and more orders came in. From third quarter to fourth quarter, order level went up and also sales level went up as well.
We have seen a good effect out of our efforts for bigger capacity. In the fourth quarter, capacity enhancement has been done to exceed JPY 65 billion sales. We have such good capacity. As for material procurement, we still have some issues, so we haven't resolved this issue yet completely. Thank you very much. Thank you.
The next, the participant in the middle on the third row. I'm Damian Tong from Macquarie Capital. Regarding your order forecast of fiscal year 2018, which is JPY 220 billion, let me know split between the first half and the second half of the year. Are you asking about the first half and the second half? Yes. Is it 50% for the first half or more orders in the second half of the year? We estimate evenly between first half and the second half, 50% each. What about the split between memory tester business and non-memory tester business? How do you see it? It is a difficult question, but we assume 50% and 50% as well. Thank you. I have an additional question. This fiscal year, you carried forward orders of memory to the fourth quarter.
At this moment, are you conservative about the forecast for the second half of the year? Looking at trends, we are based on fiscal years. Next year, the fourth quarter, that is from January to March. It means it is the beginning of the new budget period for our customers. Considering that and looking at the trends of usual years, it may appear to be conservative. However, there are many uncertainty. That's why we tended to be conservative. Thank you. The participant on the third row over there, please. I'm Naka nomyo from Jefferies Securities. Two questions. First question is about your forecast on gross margin. You expect it to be maintained at the level of previous year. What do you think is positive factors and negative factors?
For example, foreign exchange might be a negative one, but write-down will turn positive, and others such as product mix and capacity utilization. How do you see them? Is your question about our fiscal year 2018 forecast? Yes. You previously said gross margin is expected to stay at the same level year-over-year. Almost the same level as the actual result of fiscal year 2017. Excluding inventory write-down of JPY 3.3 billion, which we recognized in fiscal year 2017. Did you say excluding that? Yes, because that negative impact will not affect fiscal year 2018 numbers. Does it mean gross margin will be better if excluding that negative impact of write-down? Are you talking about fiscal year 2018 gross margin? Yes.
It will be improved because there will be no more negative impact of JPY 3.3 billion from inventory write-down. We expect the sales will increase. It will result in compensating fixed cost. What's your forecast of SG&A? FY 2018 SG&A, we forecast it will be around JPY 85 billion, including R&D spending and other. Thank you. Thank you. Another question. The other day, Teradyne made announcement of their business results. They said they would revise their outlook for a deno memory or logic tester market. Is your outlook different from theirs? If so, where does the difference come from? Is it because of difference in product or customers? FY 2018 sales forecast, they revised downward by JPY 300 million. That's my understanding.
I think it is because they revised their outlook about their AP business, which is not in our business portfolio, therefore nothing to do with our business. That's my understanding. They said it does not mean they have lost share in MCU or automotive sector. No, no. I think they referred specifically to a certain company, to mobile AP. I think they said other business categories in automotive sector or PMIC will continue growing, which resonates with our outlook. Thank you.