Economic and demand fluctuation risks in the electronics industry

「米国の通商政策の影響や原材料・エネルギー価格の高止まりなど、依然として先行きは不透明な状況が続いております。」

「In recent years in particular, there have been concerns about sharp demand fluctuations, including a rapid expansion in demand for HBM (high-bandwidth memory) and advanced semiconductors for AI accelerators driven by the sharp increase in generative AI and data-center investment, followed by a corresponding reactionary decline.」

「一方、米国の通商政策、中国経済の停滞継続、中東情勢の影響等により先行きは不透明な状況が続いております。」

「During the interim consolidated accounting period, Japan's economy was on a moderate recovery trend, partly due to improvements in the employment and income environment, but the outlook remained uncertain due to factors including the impact of U.S. trade policy and persistently high raw material and energy prices.」

「Meanwhile, the outlook remains uncertain due to factors including U.S. trade policy and the continued stagnation of the Chinese economy.」

「During the interim consolidated accounting period, Japan's economy was transitioning into an inflationary phase as price increases caused by yen depreciation continued alongside broader wage increases. Changes in this macroeconomic environment have also led to higher market interest rates, indicating significant changes in the economic environment.」

「During the consolidated fiscal year, the economic environment underwent significant changes, including the onset of inflation at levels not seen for 40 years and the Bank of Japan's lifting of its large-scale monetary easing policies, including negative interest rates. In addition, global geopolitical risks have increased due to the prolonged Russian invasion of Ukraine and conflicts centered on Israel in the Middle East. As a result, the unstable global situation has continued, including soaring raw material and energy prices and the ongoing depreciation of the yen.」

「Meanwhile, the economic outlook remains uncertain due to downside risks to overseas economies resulting from monetary tightening in various countries, as well as the risk of price fluctuations caused by geopolitical factors relating to Ukraine, the Middle East and elsewhere.」

「During the six-month period ended ...」

「During the first three months of the current fiscal year, Japan's economy began to recover moderately as the transition of COVID-19 to a Category V infectious disease eased restrictions on activity and economic and social activity began to revive. However, the economic outlook remained uncertain due to downside risks in overseas economies resulting from monetary tightening in various countries, the impact of raw material prices, and rising prices against a backdrop of yen depreciation.」

「From around the second half of the current fiscal year, inventory adjustments for semiconductors and high-tech products, together with employment adjustments and restrained investment centered on the U.S. GAFAM companies, rapidly led to restrained investment in data centers, the Company's main customer market, and declining demand for semiconductors related to hard disk drives, optical fiber, PCs and electronic devices.」

「During the first nine months of the current fiscal year, Japan's economy recovered moderately as restrictions on activity related to COVID-19 were eased. However, the outlook remained uncertain, with prices fluctuating alongside exchange-rate movements resulting from differences between monetary policies in Japan and the West, as well as higher resource prices due to the prolonged situation in Ukraine.」

「During the first six months of the current fiscal year, Japan's economy showed signs of recovery as restrictions on activity related to COVID-19 were eased. However, the outlook remained uncertain, with prices rising due to higher resource prices resulting from the situation in Ukraine and yen depreciation against a backdrop of differences between the monetary policies of the Western countries and Japan.」

「During the first three months of the current fiscal year, Japan's economy showed signs of improvement as the number of new infections declined with the promotion of vaccinations despite the impact of COVID-19. However, the situation remained unpredictable as variants spread, and corporate activities continued to be affected by lockdowns in major Chinese cities. In addition, resource shortages resulting from the situations in Russia and Ukraine, together with factors such as yen depreciation that pushed up prices, compounded the uncertainty surrounding the outlook.」

「Sanctions between countries resulting from the escalating situation in Ukraine have caused energy prices, including those of crude oil, natural gas and electricity, to surge and supplies to tighten, potentially disrupting the production of semiconductor components such as rare gases and rare metals.」

「Vaccinations and various economic measures have been implemented worldwide to address COVID-19, and signs of economic recovery have emerged in some countries and regions. However, the outlook for the domestic and overseas economies remains uncertain, including due to concerns about the spread of new variants.」

「Meanwhile, reduced automobile production caused by the semiconductor shortage has had a broad impact on related industries, while shortages of materials such as timber and metals and downside risks from soaring crude oil prices have left the future economic outlook uncertain.」

「During the cumulative first quarter of the current fiscal year, there were no new business or other risks, nor any significant changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「With generational shifts in manufacturing processes occurring every few years in the semiconductor and broader electronic components industry, including the emergence of EUV lithography equipment, the semiconductor memory market faces the risk of periodic major disruptions in the supply-demand balance and intensified seasonal fluctuations.」

「In considering the future economic outlook, attention must also be paid to domestic trends, trends in the global economy, particularly in the United States, the U.S.-China trade issue, and the potential for volatility in the financial and capital markets.」

「In considering the future economic outlook, attention must also be paid to domestic trends, trends in the global economy, particularly in the United States, the U.S.-China trade issue, and the potential for volatility in the financial and capital markets.」

「During the cumulative first quarter of the current fiscal year, there were no new business or other risks, nor any significant changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「During the current fiscal year, the global economy had been recovering moderately, but the impact of the COVID-19 pandemic spread from China to Asia, Europe and the United States, causing a sharp slowdown.」

「During the first nine months of the current fiscal year, the global economy remained uncertain due to the prolonged U.S.-China trade dispute, the slowdown in China's economy and geopolitical risks. Meanwhile, Japan's economy continued to recover moderately against a backdrop of improving employment and income conditions, but signs of stagnation in the outlook increased under the influence of the global economy.」

「During the cumulative second quarter of the current fiscal year, there were no new business or other risks, nor any significant changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「Meanwhile, the global economy remained uncertain due to the prolonged U.S.-China trade dispute, the slowdown in China's economy and geopolitical risks.」

「The Group's performance is affected by economic expansions and contractions in the market surrounding the electronics industry and by the resulting changes in demand, which may also affect its financial condition.」

「During the first nine months of the current fiscal year, uncertainty about the global economic outlook increased rapidly against a backdrop of the slowdown in China's economy resulting from the prolonged U.S.-China trade dispute. Japan's domestic economy remained resilient, but concerns also emerged about the impact of the U.S.-China trade dispute and yen appreciation resulting from the Federal Reserve's decision to defer a rate hike.」

「During the first six months of the current fiscal year, the global economy continued to recover overall, but the economic outlook remained uncertain due to the U.S.-China trade dispute and geopolitical risks.」

「During the cumulative first quarter of the current fiscal year, there were no new business or other risks, nor any significant changes to the business and other risks described in the annual securities report for the previous fiscal year.」

「The Group's performance is affected by economic expansions and contractions in the market surrounding the electronics industry and by the resulting changes in demand, which may also affect its financial condition.」

「During the first nine months of the current fiscal year, the global economy remained uncertain due to concerns including instability in the global political situation and geopolitical risks.」

「Despite the slowdown in China's economic growth and geopolitical risks, conditions were generally firm.」

「Meanwhile, the global economy remained uncertain due to political risks in Europe and the United States and increasing geopolitical risks.」

「During the first nine months of the current fiscal year, the global economy remained uncertain in Europe and the United States due to the impact of increased political uncertainty following the U.S. presidential election and the United Kingdom's withdrawal from the EU. Emerging economies also experienced an economic slowdown and remained uncertain. Meanwhile, Japan's economy continued to recover moderately against a backdrop of improving corporate earnings and employment conditions, although some uncertainty emerged due to exchange-rate movements following the U.S. presidential election.」

「During the first six months of the current fiscal year, the global economy continued to recover moderately in the United States. In Europe, uncertainty about the outlook increased due to the United Kingdom's withdrawal from the EU. Emerging economies, particularly China, also experienced an economic slowdown, and conditions remained uncertain. Meanwhile, Japan's economy was on a recovery track, but some uncertainty emerged as the yen appreciated.」

「During the first quarter of the current fiscal year, the global economy showed a gradual recovery centered on personal consumption in the United States, but uncertainty emerged regarding the economic outlook due to the United Kingdom's withdrawal from the EU and slowing growth in emerging economies. Meanwhile, Japan's economy remained uncertain, with concerns that the slowdown in the Chinese and emerging Asian economies, together with the appreciation of the yen, could affect corporate earnings.」

「The Group's performance is affected by economic expansions and contractions in the market surrounding the electronics industry and by the resulting changes in demand, which may also affect its financial condition.」