Demand Risk from Economic Cycles, Capital Investment and Customer Purchasing Policies

「情報通信事業において当初計画では想定していなかったハイパースケーラーからの光コンポーネント製品のプロジェクト受注、売価アップがあり」

「During the interim consolidated accounting period, there were no new business or other risks, nor any material changes to the business or other risks described in the annual securities report for the previous fiscal year.」

「Close attention is required regarding the emergence of supply chain risks in products for major customers and delays in the recovery of the industrial machinery market, among other factors.」

「Due to continued growth in demand from data centers driven by the spread and expansion of generative AI, as well as foreign exchange effects, net sales increased 26.2% year on year to ¥185.7 billion and operating profit increased 66.8% to ¥34.0 billion.」

「In Europe and North America, economic and political factors such as high interest rates and subsidy policies have led telecommunications carriers to postpone capital investment, and demand recovery is expected around the fourth quarter.」

「Although investment restraint continued in the data center and FTTx markets, which had been active in the same quarter of the previous year, a diverse earnings base, including foreign exchange effects, strong demand from North American power utilities and firm demand for fusion splicers, enabled the Company to maintain a high profit level. Net sales declined 1.0% year on year to ¥219.5 billion and operating profit declined 5.0% to ¥29.5 billion, broadly unchanged from the same quarter of the previous year.」

「Although customers were curbing investment in the data center and FTTx markets, which had been active in the same quarter of the previous year, foreign exchange effects resulted in net sales increasing 1.0% year on year to ¥147.1 billion and operating profit declining 0.6% to ¥20.4 billion, broadly unchanged from the same quarter of the previous year.」

「Although there were concerns about a slowdown in current market conditions, demand was at the same level as in the same quarter of the previous year, and the weaker yen also had an effect. Net sales increased 4.2% year on year to ¥69.7 billion and operating profit increased 19.9% to ¥9.9 billion.」

「In the Information & Communications business, data traffic is expected to continue increasing as cloud adoption progresses and, more recently, the use of generative AI expands, while investment in FTTx and data centers is expected to continue growing, particularly in Europe and North America. In the short term, however, conditions require attention to a slowdown in capital investment by major IT companies and others due to concerns about an economic downturn.」

「The Group reported higher revenue and profit due to foreign exchange effects, strong demand for data centers and FTTx in the Energy and Information & Communications segments, improved productivity in the Electronics segment, and the easing of semiconductor shortages in the Automotive segment, among other factors.」

「Despite the impact of the Shanghai lockdown, the Group reported higher revenue and profit due to foreign exchange effects, strong demand for data centers and FTTx in the Energy and Information & Communications segments, robust smartphone demand in the Electronics segment, and the easing of semiconductor shortages in the Automotive segment.」

「Because the Group's products are primarily infrastructure products and components for finished consumer goods, its operating results are affected not only by economic cycles but also by trends in capital investment in each market, the competitive environment, supplier trends, changes in customers' purchasing policies, credit conditions, and other factors.」

「Despite the impact of the global semiconductor shortage and lower operating rates at some of the Group's sites due to the spread of COVID-19, operating profit, ordinary profit, and quarterly net profit attributable to owners of the parent increased, due to strong demand for data centers and FTTx in countries around the world and recovery from the substantial revenue decline caused by COVID-19 in the same quarter of the previous year, among other factors.」

「Despite the impact of the global semiconductor shortage, operating profit, ordinary profit, and quarterly net profit attributable to owners of the parent increased, due to strong demand for data centers and FTTx in countries around the world, increased demand for smartphones, and improved productivity, among other factors.」

「The global automobile production market has shown instability in orders and production due to the spread of COVID-19 and semiconductor shortages.」

「Although revenue fell 12.1% year on year to ¥147.2 billion due to lower demand in the domestic wire and cable market and intensifying competition for optical fiber, operating profit rose 85.7% to ¥8.3 billion, due mainly to fixed-cost reductions from structural reforms and valuation gains from higher copper prices.」

「The operating environment for the Group as a whole became extremely challenging due to the impact of the COVID-19 pandemic, which caused major customers to suspend production in countries around the world, as well as intensifying competition for optical fiber and FPC (flexible printed circuit boards).」

「Unable to keep pace with major changes in customer trends and the market, including declining smartphone demand from major customers and a sharp drop in optical fiber prices in China, all 3 core businesses—optical fiber, FPC, and automotive wire harnesses—declined substantially.」

「Although profit increased in the Energy segment as the impact of higher costs for the Bangladesh transmission line project subsided, revenue fell 7.8% year on year to ¥249.3 billion and operating profit fell 44.1% to ¥6.6 billion, reflecting the impact of intensifying competition for optical-related products in China and other factors in the Information & Communications segment.」

「Although the deficit narrowed as the impact of higher costs for the Bangladesh transmission line project in the previous consolidated fiscal year subsided, revenue fell 6.5% year on year to ¥167.4 billion due mainly to the impact of intensifying competition for optical-related products in China, while operating profit fell 38.1% to ¥4.4 billion.」

「Due to the impact of intensifying competition for optical-related products in China and a decline in overseas FTTx construction projects, revenue fell 6.2% year on year to ¥84.0 billion, while operating profit fell 65.3% to ¥1.9 billion.」

「The Energy and Information & Communications Company has experienced significant losses in its overseas EPC business, changes in the supply-demand environment for optical fiber in China, changes in the procurement policies of major customers in the hyperscale data center business, and intensifying competition.」

「Although costs associated with a higher employee turnover rate at a manufacturing base in Eastern Europe decreased, the slowdown in customers’ automobile sales volumes in Japan and China affected results. Net sales increased 1.0% year on year to ¥116.7 billion, while operating loss was ¥2.3 billion, compared with an operating loss of ¥2.6 billion in the same quarter of the previous year.」

「Although higher copper prices increased revenue, revenue declined following the reorganization of domestic electric wire sales companies in the previous consolidated fiscal year, while intensified competition in domestic and overseas markets and higher costs for power transmission line construction in Bangladesh reduced profit. Net sales decreased 1.3% year on year to ¥179.0 billion and operating profit decreased 40.9% to ¥7.1 billion.」

「Although the Energy business unit recorded higher revenue due to higher copper prices, overseas demand slowed, while demand for the Information & Communications business unit’s data center products declined. As a result, net sales decreased 0.8% year on year to ¥89.6 billion and operating profit decreased 4.8% to ¥5.4 billion.」

「Because the Group’s products are primarily infrastructure components and parts for consumer products, its operating performance is affected by economic cycles as well as trends in capital investment in each market and changes in customers’ purchasing policies.」

「Due to higher copper prices in the Energy business unit and strong performance in the Information & Communications business unit, particularly in overseas markets, net sales increased 10.6% year on year to ¥281.4 billion and operating profit increased 21.9% to ¥17.9 billion.」

「Due to higher copper prices in the Energy business unit and strong performance in the Information & Communications business unit, particularly in overseas markets, net sales increased 12.0% year on year to ¥182.0 billion and operating profit increased 61.2% to ¥12.1 billion.」

「Because the Group’s products are primarily infrastructure components and parts for consumer products, its operating performance is affected by economic cycles as well as trends in capital investment in each market and changes in customers’ purchasing policies.」

「Although the Energy business unit recorded lower revenue due to deteriorating domestic market conditions and lower copper prices, among other factors, and the Information & Communications business unit was affected by yen appreciation, strong overseas markets resulted in net sales decreasing 8.9% year on year to ¥254.4 billion and operating profit increasing 34.3% to ¥14.7 billion.」

「Due to lower revenue in the Energy business unit resulting from weakness in the domestic market and lower copper prices, among other factors, and the impact of yen appreciation on the Information & Communications business unit, net sales decreased 12.5% year on year to ¥162.5 billion and operating profit decreased 0.6% to ¥7.5 billion.」

「Because the Group’s products are primarily infrastructure components and parts for consumer products, its operating performance is affected by economic cycles as well as trends in capital investment in each market and changes in customers’ purchasing policies.」