I will now present the financial results for the second quarter of the fiscal year ending March 2027. First, here are the key points of the earnings announcement. For the first half of the fiscal year, both revenue and profit increased compared to the previous year. Revenue increased due to growth in sales of musical instruments, particularly digital musical instruments, as well as the weakening of the yen. Core operating profit increased significantly due to the absorption of rising procurement costs through price optimization, as well as higher revenue on a local currency basis, improvements in the product mix, the effects of structural reforms, and exchange rate impacts. Regarding the full-year forecast, we are maintaining our initial revenue forecast, taking into account the economic slowdown in Europe and China, as well as weak demand, particularly for audio equipment for consumer use.
On the other hand, we have revised our core operating profit forecast upward by JPY 2 billion from the initial forecast, taking into account the offsetting of cost increases through price optimization and the impact of exchange rates. We now expect JPY 40 billion. Next are the results for the first half of the fiscal year ending in March 2027. Revenue totaled JPY 237.9 billion, core operating profit was JPY 22.3 billion, core operating profit ratio was 9.4%, and net profit was JPY 18.7 billion. Compared to the same period last year, revenue increased by JPY 21.5 billion or 9.9%, and core operating profit rose by JPY 9.5 billion or 74.2%. Excluding the impact of exchange rates, revenue also increased by 2.2%. Exchange rates were JPY 161 to the U.S. dollar and JPY 185 to the euro.
I will now explain the factors contributing to the change in core operating profit. Starting from JPY 12.8 billion in the same period of the previous year, there were factors that reduced core operating profit. These factors included a JPY 3.9 billion increase in costs and a JPY 2.7 billion rise in SG&A expenses. On the other hand, factors contributing to the increase included JPY 8.9 billion from higher revenue, increased production, and model mix, JPY 6.0 billion from the impact of exchange rates, and JPY 1.3 billion from the effects of structural reforms, resulting in a core operating profit of JPY 22.3 billion. The first-half results by business segment are as shown in this presentation. Both the musical instruments business and the audio equipment business posted increases in both revenue and profit. Next, here are the full-year earnings forecasts for the fiscal year ending in March 2027.
We are maintaining our initial revenue forecast of JPY 490 billion. We have revised our core operating profit forecast upward by JPY 2 billion from the initial forecast to JPY 40 billion. We expect a core operating profit ratio of 8.2% and net profit of JPY 31 billion. We anticipate full-year exchange rates of JPY 158 to the U.S. dollar and JPY 183 to the euro. For the second half, we anticipate exchange rates of JPY 155 to the U.S. dollar and JPY 180 to the euro. Now moving on to the profit forecast analysis. Starting from the JPY 31.9 billion of core operating profit from the previous fiscal year, we anticipate cost increases of JPY 12.4 billion and a JPY 5.4 billion rise in SG&A expenses.
However, we expect to see increases of JPY 17.0 billion from higher revenue and production volumes, as well as from model mix adjustments, JPY 6.4 billion from the impact of exchange rates, JPY 1.8 billion from structural reforms, and JPY 700 million from other business segments. This results in a projected core operating profit of JPY 40.0 billion. Compared to the previous forecast, although there are factors such as higher cost increases, we have factored in increased revenue, higher production volumes, model mix adjustments, and the impact of exchange rates, resulting in a JPY 2 billion upward revision. Here are the full-year forecasts by business segment. For the musical instruments business, we expect revenue of JPY 322.0 billion and core operating profit of JPY 26.5 billion. For the audio equipment business, revenue of JPY 150.0 billion and core operating profit of JPY 12.5 billion.
For other business, revenue of JPY 18.0 billion and core operating profit of JPY 1.0 billion. Revenue projections remain unchanged for all business segments compared to the previous forecast. The forecast for core operating profit has been revised upward by JPY 2.5 billion to JPY 26.5 billion for the musical instruments business and downward by JPY 500 million to JPY 12.5 billion for the audio equipment business. The forecast for the other business remains at JPY 1.0 billion. Next is an overview by business segment. First is the musical instruments business. In the first half of the year, revenue increased in all categories except pianos. Piano revenue decreased due to sluggish consumer demand. However, digital musical instruments posted double-digit growth, driven by new products. Winds, strings, and percussion instruments saw stable, robust demand, leading to increased sales.
Guitars also saw firm demand, resulting in increased sales in all regions except China. First-half revenue totaled JPY 159.5 billion, with a core operating profit of JPY 15.4 billion and a core operating profit ratio of 9.6%. For the full fiscal year, we expect revenue growth driven by digital musical instruments. Although we expect piano revenue to decrease due to weak consumer demand, we anticipate that digital musical instruments will maintain their top market share and experience revenue growth thanks to the launch of new products. We also expect revenue growth for winds, strings, and percussion instruments due to continued strong demand, as well as stable revenue for guitars. The sales performance of our major products is detailed in this slide. Digital musical instrument sales grew significantly in the first half of the year, and we expect revenue to increase for the full fiscal year.
Here is the sales performance by region. Please refer to the slide for more information. Below are the main new products scheduled for release in the second half of the fiscal year in the musical instruments business. We will introduce compelling products in each category, including the GCB, Yamaha's smallest grand piano, the PSR-SX620, our flagship portable keyboard for the domestic market, the YDS-152 and YDS-122 digital saxophones, which combine expressive power with quiet operation, and the FG7 and FS7 series acoustic guitars, which are designed to support the musical expression of singer-songwriters. Next is the audio equipment business. While audio equipment for professional use recovered in the first half, audio equipment for consumer use remained sluggish. Revenue decreased for audio equipment for consumer use due to weak market conditions across all regions.
However, revenue for audio equipment for professional use remained on par with the previous year, as the Japanese and U.S. markets rebounded. Revenue for audio equipment for mobility use continued to grow in regions other than China, resulting in double-digit revenue growth. First-half revenue totaled JPY 70.8 billion, with core operating profit of JPY 7.0 billion and a core operating profit ratio of 9.9%. For the full fiscal year, we expect revenue growth driven by the expansion of the audio equipment for professional use and audio equipment for mobility use segments. Sales performance for major products is as outlined in the slide. While the audio equipment for consumer use segment continues to face challenging conditions, we anticipate revenue growth for the full year in the audio equipment for professional use and audio equipment for mobility use segments.
By region, while North America and Japan are showing growth, demand in China remains weak. Please refer to the slide for details. Here are the main new products in the audio equipment business. In the audio equipment for consumer use segment, we will launch the R200A stereo receiver, which features Yamaha's high-fidelity sound technology and design philosophy. In the audio equipment for professional use segment, we will launch the DM5 series of digital mixers in November. This series combines excellent sound quality, intuitive operability, and professional control performance in a compact design. In the audio equipment for mobility use segment, a jointly developed premium audio system has been adopted for Mitsubishi Motors' new Pajero. Regarding other business, although FA equipment sales increased in the first half of the year, revenue from automobile interior wood components decreased.
For the full year, while we anticipate growth in FA equipment, we expect revenue to remain on par with the previous year due to the discontinuation of golf product sales. We forecast a core operating profit of JPY 1 billion. Next are the other financial figures. As of the end of September, cash and cash equivalents increased by JPY 38.9 billion from the previous fiscal year, reaching JPY 147.8 billion. Inventories increased by JPY 11 billion from the end of the previous fiscal year, reaching JPY 163.3 billion. We expect this figure to be JPY 158.0 billion by the end of March 2027, and we will continue our efforts to optimize inventory levels. Total equity increased by JPY 26.9 billion from the end of the previous fiscal year, reaching JPY 506.6 billion. For the fiscal year ending in March 2027, we forecast ROE of 6.2% and ROIC of 5.5%.
Both are expected to be below the cost of capital, and we will continue to aim for levels exceeding the cost of capital by improving profitability and steadily implementing shareholder returns. We project an annual dividend of JPY 26 per share. We reduced the ratio of cross holdings to total capital from 8.6% at the end of March 2026 to 7.5% at the end of September. We plan to further reduce this ratio in the future. Capital expenditures, depreciation, and research and development expenses are as shown in the slide. Next, I will explain the key topics. This slide summarizes the major new products and services that we will launch from the first half to the second half of the fiscal year.
In addition to musical instruments and audio equipment, we will continue to develop products and services ranging from music co-creation apps to voice-based services that pursue intrinsic product value refined through technology and sensibility. Finally, here is an update on our progress regarding the key themes of our midterm management plan. Under rebuilding a strong business foundation, we secured the number one domestic market share for SOHO routers for the 22nd consecutive year. In mobility audio, which we have positioned as one of the key pillars of our evolving to create the future challenges, adoption has expanded to six companies and 20 models, and it is now set to be installed in the new Mitsubishi Pajero. Regarding sustainability initiatives, our school project in the Philippines is making steady progress, and we are offering Yamaha's music education program to private schools in Vietnam.
Under strengthening the management foundation, we continued to reduce our cross holdings and sold a portion of our shares in Yamaha Motor. Furthermore, as part of our stakeholder engagement efforts, we have published our Annual Report 2026. That concludes my presentation. Thank you very much.