Sluggish Capital Investment by Gaming and Amusement-Facility Operators and Market Contraction

「In our core gaming market, product sales remained high throughout the six-month period, partly due to front-loaded demand in the United States ahead of anticipated tariff increases. In overseas commercial markets, meanwhile, the economic slowdown, particularly in Europe, continued to be accompanied by inventory adjustments by major customers. In both the domestic commercial and amusement equipment markets, product sales during the six-month period fell below the year-earlier level, partly reflecting the reversal of the special replacement demand associated with the issuance of new banknotes in the previous fiscal year.」

「In our core gaming market, demand for capital investment by casinos and hotels remained high. In domestic and overseas commercial markets, demand for products related to the wider adoption of contactless, card-not-present payment methods remained firm, while demand for peripheral equipment related to smart gaming machines also remained solid in the amusement equipment market.」

「In the gaming markets of North America and Europe, demand for capital investment by casino hotels remained firm against a backdrop of growing global travel demand. In domestic and overseas commercial markets, demand for infrastructure to support the wider adoption of contactless, card-not-present payment methods, which are becoming standard in countries around the world, also remained firm. In Japan's amusement equipment market, sales of peripheral equipment remained solid as customers' demand to replace smart gaming machines increased.」

「In the gaming markets of North America and Europe, demand for capital investment by casino hotels remained firm against a backdrop of growing travel demand. In domestic and overseas commercial markets, the wider adoption of contactless, card-not-present payment methods, which are becoming standard in countries around the world, provided a tailwind. In Japan's amusement equipment market, demand for peripheral equipment at pachinko halls, which had been stagnant for many years, increased following the start of full-scale smart gaming machine installations.」

「Market conditions across all of our segments were on a recovery or improvement trend, and demand for our products generally continued to increase gradually.」

「As described above, market conditions across all of our segments were on a recovery or improvement trend, and demand for our products generally continued to increase gradually.」

「In the U.S. and European gaming markets, customers such as casino hotels maintained high investment appetite as the markets regained their pre-COVID vitality. Demand from customers in the commercial markets in Japan and overseas also remained generally firm, except in some cases where sales declined due to tighter restrictions under the Chinese government’s COVID-19 policies. Meanwhile, in Japan’s amusement venue equipment market, customers were cautious about investing in equipment ahead of the phased introduction of smart gaming machines beginning in November this year.」

「In the core gaming market, demand for capital investment by customers such as casino operators continued to increase in both North America and Europe as economic activity recovered and accelerated. Demand for capital investment in the commercial market, particularly in the distribution sector, also remained firm.」

「In the U.S. gaming market, the spread of COVID-19 vaccines led casinos to become more active than even before COVID-19, and customers’ investment appetite continued to recover. Demand also tended to increase in the commercial markets in Japan and overseas, particularly for products supporting the expansion and promotion of contactless and cashless cash payments as infection-control measures. However, in Japan’s amusement venue equipment market, customers’ appetite for investment in equipment and related items was restrained in preparation for the transition to new-regulation machines following the removal of old-regulation machines, whose deadline was the end of January this year.」

「Amid these market conditions, investment appetite in the U.S. gaming market was recovering as it regained its pre-COVID vitality, and demand increased markedly, particularly in the commercial markets in Japan and overseas, driven by the expansion and promotion of contactless and cashless payment methods due to concerns about infection. Meanwhile, in Japan’s amusement venue equipment market, visitor numbers at pachinko halls remained slow to recover, and the transition to new-regulation machines following the removal of old-regulation machines, whose deadline was next January, made little progress, partly due to semiconductor shortages. Customers therefore continued to restrain capital investment.」

「Although visitor numbers are beginning to return to casinos in the core gaming market, this has not yet led to a recovery in investment appetite. In Japan’s amusement venue equipment market, visitor numbers at pachinko halls remain slow to recover, and capital investment continued to be restrained.」

「Casinos in the North American gaming market remain subject to restrictions on visitor numbers and other measures even after reopening. In the European gaming market, repeated lockdowns in various countries have also meant that visitor numbers have not yet recovered in either market. As there has continued to be no sign of improvement in the COVID-19 situation, capital investment has remained restrained.」

「In the overseas gaming market and Japan’s amusement venue equipment market, casinos and pachinko halls were forced to temporarily close due to measures taken by governments around the world to prevent the spread of the novel coronavirus. Although they have now resumed operations, they have not regained their previous vitality because of restrictions on visitor numbers and other factors, and investment appetite has remained extremely weak.」

「Due to the spread of the novel coronavirus, casinos, amusement facilities and pachinko halls, the main customers of the gaming and amusement venue equipment businesses, were forced to temporarily close. In the commercial business serving the financial services, distribution and transportation markets, projects in Japan and overseas were delayed or suspended, and capital investment generally remained restrained.」

「In addition to continued restraint on capital investment by pachinko halls in the amusement venue equipment market, stagnation in overseas gaming markets due to revisions to German regulations became pronounced, leaving the overall business environment challenging.」

「Regarding the business environment surrounding the Group, capital investment in the gaming market was generally sluggish as the number of newly opened casinos declined in North America and Europe was significantly affected by the decline following rush demand accompanying the previous fiscal year’s revisions to German standards for gaming machines, including specification changes. In the commercial markets in Japan and overseas, demand remained firm in Japan, particularly in distribution and transportation, while demand in Europe was sluggish. In Japan’s amusement venue equipment market, the challenging business environment continued, with customers’ appetite for capital investment in new pachinko halls and store renovations declining amid a shrinking gaming population and the industry’s trend toward tighter regulations.」

「Regarding the business environment surrounding the Group, demand in the gaming market moderated from the strong levels seen in the previous fiscal year, with Germany in particular experiencing a decline following the earlier surge. Demand needs in the commercial markets in Japan and overseas nevertheless remained high. In Japan’s amusement venue equipment market, customers continued to restrain capital investment, partly due to the industry-wide period of voluntary suspension of equipment replacement.」

「In the core gaming market, capital investment in Europe is expected to decline as the rush demand accompanying revisions to German standards for gaming machines subsides, while the boom in capital investment in North America resulting from U.S. tax-cut measures is also expected to moderate.」

「Regarding the business environment surrounding the Group, the gaming market saw robust demand in Europe in addition to strong casino capital investment in North America, apparently due to the effects of tax-cut policies. In the commercial markets, including financial services, distribution and transportation, demand in Asia was sluggish, while stable demand was seen in Japan. Meanwhile, capital investment in Japan’s amusement venue equipment market continued to be restrained due to tighter industry regulations.」

「Meanwhile, in the amusement venue equipment market, customers’ declining appetite for capital investment continued as a result of tighter industry regulations.」

「The North American gaming market saw strong replacement demand, apparently due to the effects of major tax cuts, while demand in the commercial markets, particularly in Europe and Japan, remained firm. Meanwhile, in Japan’s amusement venue equipment market, customers’ declining appetite for capital investment continued due to the effects of tighter industry regulations.」

「Regarding the business environment surrounding the Group, the European gaming market performed well due to revisions to German standards for gaming machines, including specification changes, while the North American market, its main market, remained sluggish as the number of newly opened or renovated casinos declined. In contrast, demand in the commercial markets, including financial services, distribution and transportation, was firm in line with the recovery trend in economies around the world. Meanwhile, Japan’s amusement venue equipment market remained challenging, with pachinko halls, the Company’s customers, becoming less willing to invest in equipment amid tighter industry regulations.」

「Regarding the business environment surrounding the Group, demand in the gaming market was sluggish due to the decline in newly opened casinos in North America and concerns about market contraction resulting from regulatory changes in Germany, while stable demand was seen in the commercial markets in Europe and Japan. Meanwhile, in Japan’s amusement venue equipment market, capital investment continued to be restrained amid uncertainty about the outlook caused by revisions to gaming machine regulations and other factors.」

「Demand in the gaming market was sluggish due to a decline in newly opened casinos in North America and concerns about market contraction resulting from regulatory changes in Germany, while demand in the commercial markets, particularly in Europe and Japan, remained firm. In Japan’s amusement venue equipment market, capital investment continued to be restrained amid uncertainty about the outlook caused by revisions to gaming machine regulations and other factors.」

「Regarding the market environment surrounding the Group, the gaming market was challenging, including because of a decline in the number of newly opened casinos, while demand in the commercial markets was generally firm, despite differences by region and sector. Meanwhile, in Japan’s amusement venue equipment market, customers remained cautious about capital investment due to tighter regulations aimed at curbing excessive gambling incentives.」

「Regarding the market environment surrounding the Group, the gaming market was challenging, including because of a decline in the number of newly opened casinos, while demand in the commercial markets was generally firm, despite differences by region and sector. Meanwhile, in Japan’s amusement venue equipment market, customers remained cautious about capital investment due to tighter regulations aimed at curbing excessive gambling incentives.」

「Meanwhile, in Japan’s amusement venue equipment market, difficult conditions continued, with customers showing little appetite for capital investment due to the declining gaming population and revisions to gaming machine regulations.」

「Regarding the environment surrounding the Group, demand in the gaming market was active, mainly among OEM customers, while stable market conditions continued in the commercial markets, particularly in Europe. Meanwhile, Japan’s amusement venue equipment market remained challenging amid the stagnant pachinko market, partly because of the removal of “gaming machines that may differ in performance from certified machines,” whose deadline was the end of December last year.」

「Regarding the environment surrounding the Group, demand in the gaming market was evident mainly among OEM customers, while relatively stable market conditions continued in the commercial markets, including financial services, distribution and transportation, particularly in Europe and Japan. Meanwhile, in Japan’s amusement venue equipment market, customers remained cautious about capital investment ahead of the removal of “gaming machines that may differ in performance from certified machines,” whose deadline was the end of December this year, in addition to the contraction of the pachinko industry market.」

「While demand in the gaming market remained firm, demand in the commercial markets, including financial services, distribution and transportation, was sluggish. In Japan’s amusement venue equipment market, capital investment continued to be restrained, partly because of regulatory issues involving pachinko machines.」

「In the gaming and amusement venue equipment markets, customers are becoming increasingly cautious about capital investment, and the market is expected to remain challenging as price competition intensifies amid market contraction.」