Business Expansion and Creation of New Products and Services

「Research and development expenses for the interim consolidated accounting period were ¥99 million, down 46.1% year on year. The main research and development activities were as follows: ・Validation and development of the effectiveness of applying AI agents to business operations through demonstration experiments with multiple customers ・Research into AI models and technical validation of the use of small language models for specific business operations ・Demonstration research on AI using company-specific knowledge and guardrail technology ・Demonstration research on autonomous control of industrial robots using physical AI and digital twins」

「• Research and development of a data analytics platform • Additional functionality development for Facteye® • Functionality improvements for Connected CI® • Research and development of new services」

「Research and development expenses for the consolidated fiscal year were ¥468 million, an increase of 10.1% year on year. The principal research and development activities are as follows.」

「R&D expenses for the interim consolidated accounting period were ¥185 million, up 12.5% year on year. Major R&D activities were as follows. (Connected Segment) • Research and development of a data analytics platform • Additional functionality development for FacteyeⓇ」

「R&D expenses for the consolidated fiscal year were ¥425 million, up 66.1% year on year. Major R&D activities were as follows.」

「R&D expenses for the six months ended the interim period were ¥164.698 million. Major R&D activities were as follows. (Digital Industry Business) We conducted the following development and research in the smart factory field, which supports digitalization in manufacturing and logistics, and the connected field, where development focuses primarily on the automotive industry: • Technology research for Connected CIⓇ • Technology research in the connected field • Research to identify needs for the SimuFieldⓇ series and feasibility verification for commercialization • Research and feasibility verification for commercialization of cloud-related services in the connected field • Development to expand LogiPullⓇ functionality」

「R&D expenses for the three months ended the first quarter were ¥68.554 million. Major R&D activities were as follows. (Digital Industry Business) We conducted the following development and research in the smart factory field, which supports digitalization in manufacturing and logistics, and the connected field, where development focuses primarily on the automotive industry: • Technology research for Connected CI TM • Technology research in the connected field」

「R&D expenses for the consolidated fiscal year were ¥256.278 million. Major R&D activities were as follows.」

「R&D expenses for the nine months ended the third quarter were ¥140.677 million. Major R&D activities were as follows. (Digital Industry Business) We conducted the following development and research in the smart factory field, which supports digitalization in manufacturing and logistics, and the connected field, where development focuses primarily on the automotive industry: • Development to expand ANIoTⓇ functionality • AI technology research • Development of AI-related services • Research to identify needs for the SimuFieldⓇ series and functionality development • WiseImagingⓇ technology research and additional functionality development • Development to add functionality to Visual FactoryⓇ • Product development for CI/CD and test automation support services • Development to expand LogiPullⓇ functionality • Additional functionality and functionality enhancement development for cleardoxⓇ」

「R&D expenses for the six months ended the second quarter were ¥75.433 million. Major R&D activities were as follows. (Digital Industry Business) In the smart factory field, which supports digitalization in manufacturing and logistics, we conducted the following development and research: • Development to expand ANIoT® functionality • AI technology research • Development of AI-related services • Research to identify needs for the SimuField® series • WiseImaging® technology research and additional functionality development • Development to add functionality to Visual Factory® • Product development for CI/CD and test automation support services • Development to expand LogiPull® functionality」

「• Development to expand ANIoT® functionality • AI technology research」

「• Additional development of upgrade functionality for WiseImagingⓇ • Development to expand LogiPullⓇ functionality • Development of SimuFieldⓇ-AS and related products • Development to expand Visual FactoryⓇ functionality • Additional development of upgrade functionality for cleardoxⓇ • Development to expand PlusLocationⓇ functionality • Development to expand RaLCⓇ functionality • AI technology research • Development of AI-related services」

「• Additional development of upgrade functionality for WiseImagingⓇ • Development to expand LogiPullⓇ functionality • Development of SimuFieldⓇ-AS • Development to expand Visual FactoryⓇ functionality • AI technology research • Development of AI-related services」

「In particular, in the priority business area of the Digital Industry Business, we conducted a demonstration test to obtain indoor and outdoor location data by integrating our LogiPull® ICT solution for improving logistics efficiency with a major telecommunications company's location-data service. By visualizing trucks' current locations, the initiative aims to support customers' logistics DX, including labor savings and automation of warehouse operations.」

「• Additional development of upgrade functionality for WiseImagingⓇ • Product development for ANIoTⓇ • Development of next-generation logistics service solutions • Development to expand LogiPullⓇ functionality • Development of new PlusLocationⓇ functions • Development to expand FacteyeⓇ functionality • Development to expand Visual FactoryⓇ functionality」

「• Additional development of upgrade functionality for WiseImagingⓇ • Product development for ANIoTⓇ • Development of next-generation logistics service solutions • Development to expand LogiPullⓇ functionality • Development of new mobility service functions • Development to expand FacteyeⓇ functionality • Development to expand Visual FactoryⓇ functionality」

「In particular, in the Digital Industry Business, we expanded new products and services, including PlusLocationTM, an application that uses smartphones and location data, ANIoTTM, an IoT development support tool, and services supporting in-vehicle software development.」

「(Digital Industry Business) In the smart factory field, which supports digitalization in manufacturing and logistics, we conducted the following development and research: • Additional development of upgrade functionality for WiseImagingⓇ • Development related to IoT service platforms • Development of next-generation logistics service solutions • Development to expand LogiPullⓇ functionality • Development to expand FacteyeⓇ functionality • Development to expand Visual FactoryⓇ functionality」

「Specifically, we conducted the following activities, focusing on strengthening the competitiveness of our products, including new product development, and strengthening our technological capabilities to provide ICT services that deliver value to customers. (Digital Industry Business) In the smart factory field, which supports digitalization in manufacturing and logistics, we conducted the following development and research: • Development related to the use of AI in data analysis • Additional development of upgrade functionality for WiseImagingⓇ • Development of next-generation logistics service solutions • Development to expand LogiPullⓇ functionality • Development related to service platforms using location data • Development related to in-vehicle software simulation • Development related to I/O sensing • Development of upgrade functionality for cleardoxⓇ」

「• Development of upgrade functionality for cleardoxⓇ」

「In the smart factory field, which supports digitalization in manufacturing and logistics, we conducted the following development and research: • Research and development in image processing using machine learning technology • Development related to the use of AI in data analysis • Development of next-generation logistics service solutions • Development related to service platforms using location data • Development related to in-vehicle software simulation • Development related to I/O sensing」

「In addition to streamlining the training functions of the high-precision image inspection system WiseImaging® using AI and deep learning, we began providing EdaGlass®, an application service that supports workplace transformation at factories through the use of smart glasses, thereby expanding services supporting factory digitalization.」

「In particular, in the priority smart factory and security services businesses, we worked to further expand the functionality and product lineups of internally developed products and services and strengthen collaboration with partner companies, thereby promoting business expansion.」

「In particular, in the priority smart factory and security services businesses, we worked to further expand the functionality and product lineups of internally developed products and services and strengthen collaboration with partner companies, thereby promoting business expansion.」

「In the priority smart factory and security services businesses, we focused on further expanding the functionality and product lineups of internally developed products and services, promoting business expansion.」

「In the smart factory field, which supports the digitalization of manufacturing sites, we conducted the following development and research: • Development of an application for visualizing factory IoT data • Development of applications and a platform for smart glasses specialized for manufacturing sites • Research and development in image processing using machine learning technology • Development of the LogiPull™ ICT solution for improving truck loading and unloading efficiency • Development of the cleardox™ document diagnostic tool」

「(Digital Industry Business) • Development of an application for visualizing factory IoT data • Research and development in image processing using machine learning technology • Development of the LogiPull™ ICT solution for improving truck loading and unloading efficiency • Development of the cleardox™ document diagnostic tool」

「Research and development activities during the six months ended the second quarter were conducted primarily by the Company, with the aim of creating distinctive products and services that address changing customer needs. As a result, the following 3 products were released: • Visual Factory® A system development service that visualizes IoT (Internet of Things) data from equipment, personnel and materials, supporting improved QCD at production sites and rapid decision-making. • SecureCross Factory™ A solution that addresses security challenges associated with smart factories and the use of IoT (Internet of Things). • SmartFollow™ A work-support system for factories that is compatible with smartwatches and mobile devices.」

「In the Digital Industry business, we worked to strengthen promotional activities for various products and services in the Smart Factory-related field, which supports the digitization of manufacturing sites, and to deepen relationships with existing customers. In terms of performance, the Smart Factory business remained strong, led by sales of the core products “Facteye®” (Facteye) and “RaLC®” (RaLC), while systems development for manufacturers and IoT-related businesses using advanced technologies also grew. As a result, revenue increased ¥962 million, or 27.6%, year on year, to ¥4.455 billion, and operating profit increased ¥470 million, or 99.7%, to ¥942 million.」

「We enhanced the functionality of the factory IoT platform product “Facteye®” (Facteye), enabling data collection and analysis in environments where new and legacy equipment from multiple manufacturers coexist. In the security services business, we began providing the new service “Kantan e-Security” for small and medium-sized businesses, and achieved further functional enhancements through stronger collaboration with partner companies, including integrated log management for local governments using the “SmartSESAME®” (SmartSESAME) office security solution series and the realization of a secure printing platform for diverse printing environments. We also announced the new “WorkStyle suite™” (WorkStyle Suite) service supporting workplace reform, laying the groundwork for future business expansion.」

「Specifically, in the Industry Automation business, we made the following R&D investments: ・Expansion of the functionality of the “CS QompassTM” quality management system, which contributes to improved software quality in embedded software development ・R&D on the business use of wearable devices in the Smart Factory business」

「・Development of a “factory information platform” for the Smart Factory business ・Expansion of the functionality of the “QS Commpus” quality management system, which contributes to improved software quality in embedded software development」

「In the Industry Automation business, we worked to strengthen promotional activities for various products and services centered on “Facteye®,” a core product in the Smart Factory-related field.」

「In the Industry Automation business, in addition to strengthening promotional activities for “Facteye®” (Facteye), a core product in the Smart Factory-related field, we began providing new services, including the high-precision image inspection system “WiseImaging®” (WiseImaging), which uses deep learning, and the “Smart Logger®” system for analyzing work patterns to improve labor productivity in factories.」

「In the Industry Automation business, we began providing new services in the Smart Factory-related field, which supports factory automation in the manufacturing industry toward the realization of Industry 4.0, and focused on strengthening promotional activities for existing products and services in this field.」

「Expansion of the businesses of new products and services announced in the previous fiscal year, and the creation of additional new products and services」