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We will now begin the financial results briefing of KDDI Corporation for the first quarter of fiscal year ending March 2024. I am Nakoji of Corporate Communications Division and will serve as the moderator today. This briefing will be held in this venue and also broadcast live on the Internet. Three financial results related materials are posted on our IR website as well as the two TSC disclosure and two news release. For the attendees in the venue, please check your handout. Let me introduce the four participants today. Makoto Takahashi, President, Representative Director, and CEO. Nanae Saishoji, Managing Executive Officer, CFO, and Executive Director of Corporate Sector. Kenji Aketa, Executive Officer and Executive Director of Corporate Management Division. Shigeru Ezoe, General Manager of Accounting Department. President Takahashi, please.

Thank you very much. Now, let me go over the financial results of the first quarter of fiscal year ending March 2024. Today, I will explain about three items shown on the slide. First of all, on the consolidated results of the first quarter fiscal year ending March 2024. In the first quarter of March 2024, Both consolidated operating revenues and operating income progressed as expected against the full-year forecast. On the left, the operating revenues were 132.6 billion, achieving 23% of the full-year forecast. On the right, operating income was 266.7 billion yen, 24.7% of the full-year forecast. Next, let me explain about the factors for change in the operating income. From the left, group MVNO revenues and roaming revenues dropped by 10.5 billion yen. Multi-brand communications ARPU revenues went down by 2.9 billion. DX increased by 1.7 billion, while financial business fell by 12.9 billion yen. Financial business suffered a negative impact of accounting change in the previous fiscal year of 18.2 billion yen, but excluding that, it would have enjoyed a growth of 5.2 billion yen. So due to decline in roaming revenues and impact from accounting change in the previous fiscal year, which had been anticipated at the beginning of the fiscal year, we did see a drop of 30.6 billion yen in operating income, but achieved solid results in focus areas. Next, let me move on to the power to connect or our efforts in communication networks. KDDI's mission is to connect or connecting 24 by 7 for 365 days. In addition to monitoring and automation shown on the left, we are proceeding with efforts to strengthen infrastructure to support connecting. One of such efforts is shown on the right. It's a steady implementation of additional investments of around 50 billion yen for the midterm. Those include virtualization of core facilities, AI-based operations and congestion detection, and enhancement of organizations and HR development. Based on the fortified and resilient infrastructure, KDDI will continue to connect lives, livelihoods, and hearts. Furthermore, in the era of communications integrating into society, we will strengthen tsunagu, or connecting with partners. As shown on the left, we signed a disaster agreement with Kanto Regional Development Bureau for Disaster Response Cooperation. In the middle, you can see we started to provide secondary line services to prepare for outages and disasters working with other carriers. On the right, vehicle-mounted portable shipboard base stations deployed using Starlink are expected to total about 200 units by the end of March 2024. By strengthening Tsunagu, or connecting, we will contribute to building safe and secure society. We will leverage the satellite telecommunication service Starlink to connect here, there, everywhere throughout Japan. To the left, Starlink will be used as backhaul lines for AU base stations to expand the communication areas to include 100 famous mountains and tourist destinations in Japan. 5G will be deployed by the end of this fiscal year as well. on the right is expansion of coverage recently high speed large capacity communication service was made available for maritime use as well we will seek to make customers experience more comfortable as well mountain hut wi-fi makes safety confirmation information gathering and cashless payment possible In festivals where many users gather in locally concentrated manner, we can expect it to help mitigate congestions in communication lines. Now let me go on to discuss satellite growth strategy and strengthening of management. First on the communication area, ARPU revenues have shown steady growth. Multi-brand total ARPU revenues increased year-on-year, as shown on the left. On the right, multi-brand communications ARPU revenues reached a negative year-on-year growth of 2.9 billion yen. We will continue to aim for a rebound during the first half of this fiscal year. Multi-brand ID and 5G penetration rate was a steady growth. Multi-brand IDs increased by 190,000 year-on-year. On the right, 5G penetration rate showed steady growth, with about 60% of the customers of multi-brand having 5G available. Based on the situation, we'll seek to enhance the attractiveness of AU further. Popular contents with high data demand are included in AU communication service plans reasonably. In June, we launched a new partnership with Picoma, an e-cartoon service with MAU over 10 million. AU monthly data usage has increased steadily by 25% year-on-year, as you can see on the right. In particular, when changing models, about 80% of the customers choose the unlimited plan. Going forward, in response to the growing data demand, we will strive to enhance the attractiveness of unlimited plans.

Next is business segment performance. Next Core is driving growth, and performance is progressing within expectations. On the left, operating revenues totaled 281.3 billion yen, of which Next Core was 106 billion yen, up by 21.8% year-on-year. Right side shows Q1 topics. NextCore achieved double-digit top-line and bottom-line growth. In particular, BusinessDX drove revenue and profit growth, especially in IoT. IoT connections expanded steadily by 8.5 million year-on-year. As for business infrastructure services, we expanded our connectivity data center and integrated our contact center and BPO services. Next is connectivity data center business. On the left, telehouse's strength lies not only in its space and equipment, but also in its ability to provide an interconnected environment. It provides an optimal connection environment with the accumulation of hyperscalers in favorable locations where traffic is concentrated in response to customer needs for direct connection near users without delay. As shown on the right side, Telehaus has been expanding the number of global connections with such connectivity as a strength. It ranks fourth in the world and first among telecom carriers. Next is data center business strategy. The strategic direction can be broadly categorized into connectivity data center and hyperscale data center. Connectivity data center is highly profitable and does not require large investments. Telehealth will focus on this area to capture market growth and achieve further business growth. Based on this strategy, we signed a business transfer agreement with Canada's number one connectivity data center in June of this year, as shown on the right. We will work to enhance our value further by enhancing connectivity and expanding the space offered. Our data center business is expanding globally. In addition to Europe, including London, which is number one in the world in terms of connectivity, we established a three-pillar structure, opening one in Bangkok in Asia in May and in Canada in North America. As shown in the pie chart on the right, overseas sales account for about 70% of our data center business sales. Next is contact center and BPO business. Relia Communications and KDDI Evolva will launch a new company, Altius Link on September 1st through a management integration based on the spirit of equality. Altius Link's strengths include one of the largest contact centers in Japan and global expansion including North America and Asia. In addition, the capabilities of Mitsui and Company and KDDI Group will be leveraged to provide total solutions. Through this management integration, we became the second largest player in the industry as shown on the right. Going forward, we aim to become a leading digital BPO company by integrating the strengths of both companies. We are expanding our initiative on connected. Left side, we are expanding our business in seven regions around the world with the number of IoT lines installed in connected cars exceeding 20 million. Right side shows our efforts with Toyota, with whom we have built the foundation of this business together. We have worked together for over 20 years, starting with collaboration on car telematics service in 2002. Going forward, we will continue working together to build a next-generation global communication platform and develop the global tsunagu connecting infrastructure. Next is financial business. Left side, our customer base is steadily expanding. Transaction volume of settlement and loan totaled 3.9 trillion yen. The number of AU Paycard members reached 8.8 million, and the number of AU Jibun Bank accounts reached 5.3 million. In June, mortgage loans disbursement by AU Jibun Bank exceeded 3 trillion yen on a cumulative basis. We are receiving support from many customers. Right side shows the effectiveness of promoting the financial business. It not only helps the growth of AU Financial Group, but also has synergies with AU, contributing to the telecom business. Synergies for AU include contribution to value-added ARPU revenue and churn rate reduction. Left side. Finance-related value-added ARPU revenue was up by 13.7% year-on-year. Right side shows that the use of multiple financial services reduces churn rate. We will continue to promote cross-use of financial services to achieve growth of the entire group. Next is on our Regional Co-Creation Initiative business. Today, we announced the transfer of our CATV-related business to JCOM in January 2024. By consolidating our CATV-related business with JCOM, We will maximize the business by leveraging the strength of both companies and reinforcing our support for CATV operators, thereby contributing to industry development and regional co-creation. Next is generative AI. We will promote its internal use with a view to commercialization. In May, we introduced KDDI AI Chat to 10,000 employees. In addition, we established a company-wide cross-functional organization to create and share best practices internally and link to commercialization. To achieve this, we need to develop AI R&D human resources. As shown on the right side, in addition to providing AI specialized training at KDDI DX University, we offer development practice through participation in the company-wide cross-functional organization. Regarding carbon neutrality, We are deploying renewable energy business and accelerating initiatives to net zero carbon emissions. Left side, Gunma Prefecture, KDDI, and AU Renewable Energy signed an agreement in June to promote GX. We will strengthen our cooperation to promote renewable energy and VPP. We began operating sustainable base stations in May, as shown on the center, to achieve net zero carbon emissions 24-7, 365. Furthermore, right side, we joined RE100 in July with a goal of 100% renewable energy across the group by 2050. The last slide is today's summary. Regarding consolidated results, the progress of Q1 of fiscal year ending March 2024 is within expectations. Profit was affected by roaming revenue decrease and impact of accounting treatment the previous year, but focus areas showed solid results. We will strengthen Tsunagu, connecting through infrastructure improvement and partner collaboration. In satellite growth strategy and strengthening of management, communications ARPU revenues progressed steadily toward first half rebound. In the business segment, next core drove the growth. Leveraging its strength, we will further promote connectivity, data center, digital BPO, and connected. Financial business achieved growth, synergizing with AU. We consolidated CATV business into JCOM to contribute to industry development and regional co-creation. In addition, we will promote initiatives toward a decarbonized society and utilization of generative AI. We will promote our initiatives for a medium to long-term sustainable growth. Thank you very much for your kind attention. Thank you for waiting. We will now begin the financial results briefing and Q&A of KDDI Corporation for the first quarter of fiscal year ending March 2024. Thank you very much for taking time out of your busy schedule to join us today. I am Miyakawa of Investor Relations Department and will serve as the moderator today. This briefing will be broadcast live on the Internet with simultaneous Japanese to English interpretation. The presentation will be available on demand on our IR website at a later date. Thank you for your understanding in advance. Let me introduce the participants today. Amamiya, executive vice president and executive director of personal business sector. Yoshimura, senior managing executive officer, CTO and executive director of technology sector. Kuwahara, Senior Managing Executive Officer and Executive Director of Solutions Business Sector Matsuda, Director and Executive Director of Business Exploration and Development Division Saishoji, Managing Executive Officer, CFO and Executive Director of Corporate Sector Aketa, Executive Officer and Executive Director of Corporate Management Division Today, three financial results related materials and two TSE disclosures, a total of five materials, are posted on our IR website. Please refer to the disclaimer in the material regarding statements made in these documents, performance targets, and projected subscriber numbers, etc., explained in the Q&A session today. Managing Executive Officer Saishoji will first explain the financial results summary, followed by Q&A. Ms. Saishoji, please. Thank you very much for taking time out of your busy schedule to attend KDDI's financial results briefing today. Before the Q&A session, Let me share with you the summary of the financial results for the first quarter of fiscal year ending March 2024 and our initiatives. In the first quarter of fiscal year ending March 24, both operating revenues and operating income progressed as expected against the full year forecast. Left side, operating revenues were 1 trillion 332.6 billion yen. 23 percent progress against the full-year forecast and operating income on the right side was 266.7 billion yen with a progress rate of 24.7 percent next i will explain the factors behind the decrease in operating income of 30.6 billion yen From the left, group MVNO and roaming revenues were down by 10.5 billion yen. Multi-brand communications ARPU revenues were down 2.9 billion yen. DX revenues were up 1.7 billion yen, and the financial business was down 12.9 billion yen. Excluding the negative 18.2 billion yen accounting change impact of the previous fiscal year, the financial business posted an increase of 5.2 billion yen. The decrease in roaming revenues and the accounting change impact year-on-year, which were expected from the beginning of the fiscal year, led to profit decline, but the focus areas remained solid. This is the summary of the financial results for Q1 of fiscal year ending March 2024 and our initiatives. I just explained the consolidated results. We will strengthen Tsunagu, connecting through infrastructure improvement and partner collaboration. In satellite growth strategy and strengthening of management, communications ARPU revenues progressed steadily toward first half rebound. In the business segment, Next Core drove the growth. leveraging its strength, we will further promote connectivity data center, digital BPO, and connected. Financial business achieved growth, synergizing with AU. We consolidated CATV business into JCOM to contribute to industry development and regional co-creation. In addition, We will promote initiatives toward a decarbonized society and utilization of generative AI. We will promote our initiatives for a medium to long-term sustainable growth. Thank you very much again for today.