Nec Corp Unsp/Adr New

Fujigawa will begin to explain. So thank you very much for your participation today. I would now like to cover the financial results for Q1 fiscal year ending March 31st, 2026 that were announced today. This is the agenda that I would like to cover today. And as we announced in our press release on the 18th of July, Starting from Q1 of fiscal year ending March 2026, we have revised our segments. For fiscal years ending March 2024 and 2025 as well, we have discussed numbers in accordance with the revised segments. Next, I would like to cover the outline of our Q1 results. Please reference page 4. These are the key takeaways for financial results for Q1. So for Q1, revenue was 715.7 billion yen. Non-GAAP operating profit was 40 billion yen. Revenue year-on-year was an increase of 3.7% and for non-GAAP operating profit vis-a-vis last year, 2.5 times. For domestic IT, specifically around Booth-Steller, We are seeing the emergence of various profitability initiatives, and we are seeing a strong result. The results will be explained in detail later on. For domestic IT, order intake is still strong. So, for performance for 1Q... We believe that this is a solid platform for us to attain our full-year plan. Page 5, please. We are showing you the main indices. For adjusted operating profit, we stand at 41.7 billion yen, and this is an increase of 29 billion yen from the previous year. On the right side, this is a breakdown by segment. IT services and social infrastructure both saw an increase in revenue and profit. Please reference page 6. This is adjusted non-GAAP operating profit year-on-year change. So for the year ending March 2025, Q1 adjusted operating profit was 12.7 billion yen. Non-GAAP operating profit was 16.3 billion yen. IT services and social infrastructure saw a dramatic increase. and internal AI usage and cybersecurity investments increased as well, and all in all, 23.7 billion yen operational improvements were seen. Therefore, for the Q1 non-GAAP operating profit was 40 billion yen. For the non-GAAP adjusted items, 1.7 billion yen was acknowledged through asset sales, and adjusted OP stands at 41.7 billion yen. For GAAP profit to non-GAAP profit adjusted items, please refer to the appendix material pages 21 and 22. Moving on to page 7. This is a breakdown per segment. I will start with IT services. For domestic. We saw a strong bookings for public, and this drove our increase in revenue from the previous financial year. For adjusted OP, again, Blue Stellar and public enterprise saw strong profitability enhancements, and subsidiary cost improvements also contributed to this strong revenue increase. For international DGDF, KMD's termination of low-profit business resulted in a revenue decrease. However, operating profit increased due to reversal impact from restructuring expenses in the previous fiscal year. Page 8, please. This depicts domestic IT service status. We have broken it down between Blue Stellar and base business. Blue Stellar Enjoying the high demand for DX, we are seeing an improvement in revenue and profit as well. Year-on-year, a 14.4% increase in revenue, 4.1 billion yen profit, and hence contributed to the revenue and profit increase for domestic IT for base business. inclusive of high-profit projects and efficientizing costs, as well as the reversal impact of one-time costs from the last year, as well as acknowledging the sell-off gains from our subsidiary we enjoyed. an increase from the fiscal year previously of 18.5 billion yen. Page 9 shows the domestic IT services booking status. For domestic IT services, we had impacts from the previous fiscal year's large projects as well as transfer for corporate PC sales. We saw a slight decline. However, if we exclude these impacts, versus year-on-year, we see an increase of 11%, and the DX demand continues to be strong. When we look at by area, for public, we did have a large project last year, but for standardization of municipal government platforms and firefighting and disaster preventions, these contributed to a stable growth. For enterprise... Retail and services, if we exclude the large project from last year impact, we have been able to sustain a high level of performance. For the previous fiscal year, the large bookings were skewed towards the first half, but for this fiscal year, we are assuming that they will be skewed towards the second half. And for... Subsiders, etc., being consulting, is increasing by 14% vis-a-vis last year and continues to be strong. As for bookings, we will continue to place emphasis on profit and steadily propel forward.

Page 10. Next, social infrastructure. Telecom services' IT domain trended robustly. Also, due to the reduction of development cost and the bringing forward of some projects, OP increased. Steady delivery of projects by ANS led to increase in both revenue and OP. Next, forecast for FY ending March 2026. Page 12, forecast for FY ending March 2026. No changes from the announcement made on April 28th. Q1 actual exceeded our plan, but... Due to the changes in macroeconomic environment, including tariffs, we made no changes to the full year forecast. Page 13, Revenue and Adjusted OP by Segment. Page 14, IT Services. Figures for domestic IT and international DGDF are shown here. Regarding the domestic IT, we expect there will be a decrease in revenue. This is due to the transfer of the sales functions of business PCs and termination of some businesses of NEC platforms. Centering around Blue Stellar, we believe that there will be improvement in profitability and we expect adjusted OP to increase. Assisted review of international DGDF is expected to increase due to the Avalok's profitability improvement and elimination of one-off expenses from FY March 2025. Page 15, social infrastructure. Pages for telecom services and ANS. Firstly, telecom services. Factoring in the shift to software, we expect a decline in equipment sales leading to a fall in revenue. Also, rebound from one-off factors in FY March 25 will drive a decrease in adjusted OB. ANS increase in revenue is expected to boost adjusted OB. Also, the elimination of one-off expenses in submarine systems incurred in FY March 25 will push up both revenue and adjusted OB. As the ANS, we plan to increase our investment to capture future businesses. Lastly, topics. Phase 17, Blue Stellar. The experience and achievement under Client Zero, our concept of test-bedding our own DX initiatives have been highly appreciated by stakeholders, leading to the expansion of partnership business and the acquisition of large projects based on multiple Blue Stellar scenarios. Lastly, page 18, upcoming events. NEC IR Day will be held on November 13th. Blue Stellar and National Security, the hope topics among the investors will be highlighted by our domain experts. NEC Innovation Day is scheduled It is targeted at mass media, IT analysts, and the investors. NECs, R&D, and our strategy to create business values will be explained. The details of the schedule as well as the program and how to participate will be provided to you in a separate notice. I hope all of you will participate. And this ends my presentation. Thank you very much for your attention.