Risks from Economic Trends, Rising Interest Rates and Tax Changes

「■ GPU prices are rising sharply and supply shortages are pronounced ■ Operating costs may increase due to higher electricity prices ■ Concerns about the risk of equipment obsolescence due to technological innovation ■ Competition with major cloud providers remains intense ■ Costs will arise from responding to AI and data protection regulations」

「Meanwhile, in addition to concerns about an economic downturn resulting from the impact of US trade policy, surging raw material and energy prices and continued inflation are affecting personal consumption and placing downward pressure on Japan's economy, and the outlook remains uncertain.」

「Meanwhile, the outlook remains uncertain due to concerns including the continuation of high interest-rate levels in Europe and the United States, the continued stagnation of China's property market, rising prices, geopolitical risks, developments in financial conditions, and US policy developments.」

「Meanwhile, the outlook has remained uncertain due to concerns about China's economic prospects, an unstable international situation, a review of monetary policy by the Bank of Japan, and rising prices.」

「Meanwhile, concerns remain about the impact of global monetary tightening, the prolonged situation between Russia and Ukraine, heightened tensions in the Middle East, surging resource and energy prices, exchange-rate fluctuations, rising prices in Japan and overseas, and the worsening labor shortage, and the outlook therefore remains uncertain.」

「Meanwhile, the outlook has remained uncertain due to the impact of global monetary tightening, concerns about the outlook for China's economy, surging crude oil and other energy prices and raw material prices associated with geopolitical risks arising from the prolonged situation between Ukraine and Russia, and the impact of exchange-rate fluctuations, including a sharp depreciation of the yen, on personal consumption and consumer behavior.」

「In addition, concerns remain that the economic environment will continue to be uncertain, including the impact on the economy from a sharp increase in COVID-19 cases in China and a shift toward recession triggered by a global inflationary phase.」

「During the cumulative second quarter of the current consolidated fiscal year, Japan's economy showed signs of recovery as economic activity moved toward normalization, including through the easing of activity restrictions, despite the impact of the spread of COVID-19 infections. However, the outlook remained uncertain due to surging fuel and raw material prices stemming from Russia's invasion of Ukraine, exchange-rate fluctuations and downside risks to the economy resulting from monetary tightening in various countries.」

「During the cumulative first quarter of the current consolidated fiscal year, Japan's economy saw a rapid easing of the impact of COVID-19 and a normalization of domestic economic activity. However, the outlook for the economy remained uncertain due to the spread of infections in China, inflation caused by higher raw material prices resulting from the prolonged situation in Ukraine, and a sharp depreciation of the yen.」

「During the cumulative third quarter of the current consolidated fiscal year, Japan's economy began to show signs of recovery as the rapid spread of infections subsided, owing in part to the progress of vaccinations, and requests for self-restraint were lifted and activity restrictions eased, after prolonged restrictions on social and consumer activity resulting from repeated declarations of a state of emergency and priority preventive measures to prevent the spread of disease following the emergence of new COVID-19 variants. However, the outlook has again remained uncertain following the emergence of a highly transmissible new variant.」

「During the six-month consolidated cumulative period, the emergence of variants of the novel coronavirus led states of emergency to remain in effect in major metropolitan areas. Restrictions on social and consumer activity under priority preventive measures and other measures continued to raise serious concerns about their impact on corporate performance and employment.」

「During the first quarter of the current consolidated fiscal year, the emergence of variants of the novel coronavirus led to the reissuance of states of emergency in major metropolitan areas. Restrictions on social and consumer activity under priority preventive measures and other measures continued to raise serious concerns about their impact on corporate performance and employment.」

「During the nine-month consolidated cumulative period, the spread of COVID-19 caused consumer sentiment to deteriorate. Although economic activity was gradually resumed after the state of emergency was lifted, concerns about further infection remained, and the outlook continued to be uncertain.」

「During the six-month consolidated cumulative period, the spread of COVID-19 caused consumer sentiment to deteriorate. Although economic activity was gradually resumed after the state of emergency was lifted, concerns about a resurgence of infections continued, and the economic outlook remained uncertain.」

「During the first quarter of the current consolidated fiscal year, the Japanese economy came under downward pressure after the government declared a state of emergency in April in response to the spread of the novel coronavirus, and inbound demand fell sharply due to the impact of entry restrictions imposed by various countries. Although the state of emergency was lifted in May of the same year, concerns about a second wave of infections remained strong in addition to the public mood of self-restraint related to COVID-19. With no sign of the outbreak subsiding, the outlook remained uncertain.」

「In the real estate market in which our group operates, demand for investment in Japanese real estate, which offers relatively stable yields due to low interest rates, remains high, and demand for real estate consulting services continues to be strong, as improved profitability and other benefits are expected. However, the impact of the novel coronavirus has made many investors more cautious about investing.」

「During the nine-month consolidated cumulative period, Japan's economy continued on a gradual recovery path against a backdrop of solid employment and income conditions. However, concerns about overseas economic conditions increased due to the prolonged US-China trade dispute, economic friction between Japan and South Korea and the UK's withdrawal from the EU, while the outlook for the economy remained uncertain because of concerns about the impact of the consumption tax increase and other factors in Japan.」

「During the six-month consolidated cumulative period, Japan's economy was on a gradual recovery path, with improvements in corporate earnings and employment conditions. However, concerns about overseas economic conditions increased due to intensifying US-China trade friction, deteriorating Japan-South Korea relations and the UK's withdrawal from the EU, while the impact of the consumption tax increase in Japan also raised concerns, heightening uncertainty about the outlook.」

「During the first quarter of the current consolidated fiscal year, the Japanese economy remained on a gradual recovery path, supported by continued improvement in employment and income conditions and the effects of various policies. However, the outlook remained uncertain due to factors including a slowdown in the Chinese and other Asian economies caused by intensifying US-China trade friction, uncertainty in the global economy and volatility in financial and capital markets.」

「During the consolidated fiscal year, the Japanese economy continued on a gradual recovery path, supported by steady corporate earnings and a recovery in personal consumption against a backdrop of improving employment conditions. However, the outlook remained uncertain due to the rapid increase in uncertainty surrounding overseas conditions, including the rise of protectionism led by the US and China and the UK's withdrawal from the EU, as well as the expected impact of the consumption tax increase scheduled for October 2019.」

「During the nine-month consolidated cumulative period, the Japanese economy continued to recover gradually, supported by strong corporate performance, improving employment conditions, inbound consumption and demand from redevelopment in central urban areas. However, factors raising concern about the outlook increased, including US-China trade friction, natural disasters and labor shortages.」

「During the six-month consolidated cumulative period, the Japanese economy remained on a gradual recovery path. Although the outlook remained uncertain, with growing concerns about trade friction caused by US trade measures, domestic conditions continued to improve, including employment and income conditions and a recovery in personal consumption, against a backdrop of stronger corporate performance.」

「During the first quarter of the current consolidated fiscal year, the Japanese economy remained on a gradual recovery path, supported by the government's economic policies and the Bank of Japan's monetary easing policy. However, unstable factors such as US economic policies and rising geopolitical risks in neighboring countries became more prominent, and concerns about the outlook continued.」

「Any significant deterioration in economic trends or economic conditions, a significant rise in interest rates, or changes in tax systems or other factors could affect the business results and financial position of our group.」

「The economic outlook is expected to recover gradually as employment and income conditions continue to improve, supported also by the effects of various government policies. However, attention must be paid to the impact of uncertainty surrounding policies pursued by the US administration and the political outlook and policies of emerging Asian countries, including China.」

「However, attention must be paid to the rising geopolitical risks surrounding US administration policies and conditions in Northeast Asia.」

「Overseas, there are concerns about the impact on the Japanese economy of issues including the UK's withdrawal from the EU, policies pursued by the new US administration and economic trends in emerging Asian countries, including China, as well as their impact on international financial markets. Economic conditions therefore remain highly uncertain.」

「Any significant deterioration in economic trends or economic conditions, a significant rise in interest rates, or changes in tax systems or other factors could affect the business results and financial position of our group.」

「Following the UK's decision to leave the EU, the need to monitor the impact of the economic outlook in Europe and emerging Asian countries, as well as significant fluctuations in foreign exchange rates resulting from factors such as the US presidential election, has increased further amid growing uncertainty in overseas economies and volatility in financial and capital markets.」

「However, weakness has emerged in overseas economies, and uncertainty remains as the economies of emerging Asian countries, including China, and resource-producing countries may slow more than expected, placing downward pressure on the Japanese economy.」

「At the same time, we believe it is necessary to continue monitoring the impact of the referendum result on the UK's withdrawal from the EU on the global economy, equity markets, foreign exchange markets and our business environment.」

「A substantial deterioration in economic conditions, a significant rise in interest rates, or changes in tax policy could affect the Group's operating results and financial condition.」