Itmedia Inc. · TSE:2148
Itmedia — H1 FY2023 Earnings Presentation
64 slides from Itmedia's earnings presentation, Oct 31, 2023
Slide 1: ITmedia Inc. Earnings Briefing
Slide 2: irmed
irmed This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translation and the Japanese original, the original shall prevail. Forward-looking statements, such as earnings outlooks, are based on information available wh
Slide 3: Understanding the Current Situation and Future Policies
re’ ITmedia ne Understanding the Current Situation and Future Policies
Slide 4: Decreased revenue and profit. Q2 slightly below expectations but improved from Q1.
Decreased revenue and profit. Q2 slightly below expectations but improved from Q1. Q1 Q2 Q2 cumulative Annual forecast Unit: million yen Revenue 1,802 (-9%) 2,039 (-8%) 3,841 (-9%) 8,320 (-5%) Operating income 414 (-34%) 637 (-16%) 1,052 (-24%) 2,400 (-18%) Net income 280 (-34%) 436 (-16%) 717 (-24%
Slide 5: Understanding the Current Situation
| Current Situation and Future Policies | Understanding the Current Situation me ‘Tmecdae. Market conditions Digital marketingsshif surrounding the ne .> i post pandemic Programmatic Ad Nee * SaaS turning point e ONS cess members ae Event. —s_® Lead CSD a Rights Reserve
Slide 6: End of the accelerated growth period triggered by COVID-19
i the Current Situation and Future Policies | Understanding the Current Situation me End of the accelerated growth period triggered by COVID-19 Growth slowdown and reactionary decline COVID-19 pandemic triggers Changes in society and work styles Changes in marketing Changes in media The shiftto The
Slide 7: Customers in Japan and foreign customers
e Customers in = = Digital Events decreased Japan : = Lead Generation , remained flat By screed | ©2023 ITmedia Inc. All Rights Reserved. 7 Foreign = customers
Slide 8: Impact of the U.S. Technology Market on the Company
| Current Situation and Future Policies | Impact of the U.S. Technology Market on the Company Customers inJapan The 50% _ Revenue Company's Composition, Market Foreign customers’ 50% business conditions COVID-19 pandemic Shift to digital @ Acceleration of DX and IT investment Pandemic ends Growing c
Slide 9: BtoC Media Business: Netolabo—Revenue and PVs
Understanding the Current Situation and Future Policies | BtoC Media Business: Netolabo—Revenue and PVs 350 300 250 200 Revenue per 1,000 PVs (yen) 150 COVID-19 pandemic Focused on establishing Change in operating policy > a brand and expanding PVs (increase in earnings) Accounting period Disorder i
Slide 10: FY17 FY18 FY19
87 83 80 68 52 46 47 FY17 FY18 FY19 FY20 FY21 FY22 FY23
Slide 11: Forecast Overview
i the Current Situation and Future Policies | Forecast Overview re’ ‘Tmecdae. Strengthen earnings development for the next fiscal year and beyond, with an eye on growth markets U.S. technology market Return to in-person activity from digital events growth slowdown (Restructuring) Programmatic Ad mar
Slide 12: FY17 FY18 FY19
87 80 83 68 52 46 47 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28
Slide 13: Medium-Term Target: X40
i the Current Situation and Future Policies | Medium-Term Target: X40 me ‘Tmecdae. X40 targets unchanged, but backtracked ‘e) 40 Operating income target hundred million yen to be achieved X40 ©2023 ITmedia Inc. All Rights Reserve 13 FY21 FY22. FY23 FY24 -FY25 3 ...... FYXX
Slide 14: FY23 Q2 Earnings Overview
re’ ITmedia ne FY23 Q2 Earnings Overview
Slide 15: Segments and Revenue Model
Introduction | Segments and Revenue Model (fe Qe Revenue model aC) 1 i ' i ' ' i ' Lead Generation revenue Digital Event revenue Ad revenue H Programmatic Ad revenue ' ' i ' Commissioned Sponsored H Revenue format + Provide sales leads m + Sales of ad slots i Ad network venu i . networks + Provide i
Slide 16: Executive Summary
i Q2 Earnings Overview | Executive Summary re’ ‘Tmecdae. Decreased revenue and profit. Q2 slightly below expectations but improved from Q1. Impact of market deterioration expected to remain throughout FY23. Earnings Decreased revenue and profit Revenue :¥3,841 million (-9%) + Lead Generationrevenue
Slide 17: Earnings
i Q2 Earnings Overview | Earnings Revenue Cumulative period Unit: million yen 4,206 /__vov 3 65 mittion (-9%) 3,841 BtoB Media Business 3,201 BtoC Media Business 72! 8 639 ig income YoY - 33 9mittion (-24%) 27.4% Operating margin 133 FY22Q2 FY23Q2 ©2023 ITmedia Inc. All Rights Reserved. FY22Q2 FY23Q
Slide 18: Operating Income - Variance Analysis
re’ FY23 Q2 Earnings Overview | Operating Income - Variance Analysis ‘Tmecdae. Decreased revenue and profit. Decreased total cost, mainly outsourcing expenses. Cumulative period Unit: million yen BtoB Media Business -279 8% BtoC Media Business -86 y -12% 1,392 other “1 Revenue decrease Cost decrease
Slide 19: Consolidated Statement of Income
i Q2 Earnings Overview | Consolidated Statement of Income re’ ‘Tmacdiaine. r- > FY22Q2 FY23Q2 Cumulative period 5 oMor Unit: million yen Amount As% of Amount Astor Increase % change Revenue 4,206 100.0% 3,841 100.0% (365) (8.7) % Total cost 2,814 66.9% 2,788 72.6% (25) (0.9)% (of which are personnel
Slide 20: Consolidated Statement of Cash Flows
i Q2 Earnings Overview | Consolidated Statement of Cash Flows Caterer FY22Q2 FY2392 | Change Cash flows from operating activities 127 11S +47 Cash flows from investing activities (12) (105) (93) Cash flows from financing activities (316) (724) (408) Change in cash and cash equivalents 398 (54) (453)
Slide 21: Consolidated Statement of Financial Position
i Q2 Earnings Overview | Consolidated Statement of Financial Position ae At the end of At the end of Unit: million yen March 2023 September 2023 Change Current assets 9,996 9,809 (187) E Non-current assets 1,161 1,319 +158 . Total assets 11,158 11,129 (28) Current liabilities 1,668 1,518 (149) z Non
Slide 22: Revenue (Quarterly)
i Q2 Earnings Overview | Revenue (Quarterly) Unit: million yen Earnings Forecast 8,092 8320 | H 6,891 i H 1 H 5,278 H 1 H 4 1 1 Q3 2,226 1,955 1,677 Q2 Feo I I 1 I 1 I 1 Qu H H Li —! i FY19 FY20 FY21 FY22 FY23 ©2023 ITmedia Inc. All Rights Reserved Decreased revenue 2 ¥2,039 million YoY change -¥187
Slide 23: Operating Income (Quarterly)
758 701 533 722 619 347 762 685 334 637 518 297 630 578 350 414 192 FY19 FY20 FY21 FY22 FY23
Slide 24: Revenue and Operating Income by Quarter
i Q2 Earnings Overview | Revenue and Operating Income by Quarter me Decreased profit, Improved compared to Q1 Revenue Operating income Accounting period Unit: million yen 2,335 ‘a an Fv22 FY21 FY23 FY21 FY23 py0 FY20 297 FYI9 FYI9 1,129 192 a Q2 3 04 a ) 3 a ©2023 ITmedia Inc. All Rights Reserved 24
Slide 25: Cost Breakdown by Quarter
FY23 Q2 Earnings Overview | Cost Breakdown by Quarter a Accounting period 1,675 Unit: million yen 1,576 2 5 1,464 1431 Total 4.3% 100% 1,349 ~ 1,387 «1,401 , Moutsourcing . 0 0 on 1,270 1,281 297 oo outsoure 18.1% 17.4% 248 [=| 235 233 We Mother 4.1% 27.8% 17 ae sos M@Personnel expenses +1.0% 54.9%
Slide 26: Employee Breakdown by Quarter
FY23 Q2 Earnings Overview | Employee Breakdown by Quarter a 425 Unit: employees a 408 4l7 416 392 Hac 370 373 354 361 337 340 = Bi Bi a® 319 325 | | Total +15 100% Bi 32 25] 10 Administrative and other +2 8.4% me @ Technical -1 4.6% 122 ADA ® Sales and planning +2 37.5% 38 5 9% 30.7 36.4% 37.5% 35.3
Slide 27: FY14Q2 FY15Q2 FY16Q2
1,615 1,469 1,361 1,184 1,077 1,002 1,005 945 816 751 582 509 469 440 359 297 276 261 FY14Q2 FY15Q2 FY16Q2 FY17Q2 FY18Q2 FY19Q2 FY20Q2 FY21Q2 FY22Q2 FY23Q2
Slide 28: FY23 Q2 Earnings Overview: BtoB Media Business
re’ ITmedia ne FY23 Q2 Earnings Overview BtoB Media Business
Slide 29: BtoB Media Business Earnings
i Q2 Earnings Overview | BtoB Media Business Earnings Revenue Cumulative period Unit: million yen 3,480 FY22Q2 Rights Re 3,201 FY23Q2 Cf BtoB Media Business ye Mrmediaie YoY 1,1 133 (4213 O 32.6% Operating margin FY22Q2 FY23Q2 29
Slide 30: Revenue by Revenue Model
Tc Q2 Earnings Overview | Revenue by Revenue Model BtoB Media Business na Cumulative period Unit: million yen 3,480 Lead Generation revenue Foreign company slows down -¥23 million (-2% YoY) Digital Event revenue Decrease due to the return to in-person activity -¥183 million (-20% YoY) Ad revenue Dec
Slide 31: Digital Event Revenue
i Q2 Earnings Overview | Digital Event Revenue me” Cumulative period Unit: million yen Established market from the pandemic, but special demand subsides YoY -¥183 million (-20%) 931 748 © ‘media virtual EXPO 2023 # Yor pb uae Sponsored -¥78 487 million (14%) Security Seminar imine, tive Week 2023 au
Slide 32: FY22 FY23 Q1 cumulative Q2 cumulative Q3 cumulative Q4 cumulative
FY22 FY23 1,612 1,472 1,346 1,182 1,065 Q1 cumulative Q2 cumulative Q3 cumulative Q4 cumulative
Slide 33: Growth of Subsidiary, Hacchu Navi Inc.
i Q2 Earnings Overview | Growth of Subsidiary, Hacchu Navi Inc. @#SE WE 4 BtoB Media Business subsidiary Specialized for system development companies Subscription-type Lead Generation services Expands the number of member companies through freemium model June 2023 4,000 companies May 2022 3,000 comp
Slide 34: FY23 Q2 Earnings Overview: BtoC Media Business
re’ ITmedia ne FY23 Q2 Earnings Overview BtoC Media Business
Slide 35: BtoC Media Business Earnings
jabusiness ell FY23 Q2 Earnings Overview | BtoC Media Business Earnings BtoC Media Business s, Cumulative period Ye Unit: million yen . (0) 726 -¥86 million (12%) J 639 259 O 35.7% Operating margin 20.8% FY22Q2 FY23Q2 FY22Q2 FY23Q2 ©2023 ITmedia Inc. All Rights Reserved 35
Slide 36: Netolabo Biology Club Exceeds 100 mil. PVs
ie Q2 Earnings Overview | Netolabo Biology Club Exceeds 100 mil. PVs BtoC Media Business me” 100mil. PVs exceeded Netolabo channels dedicated to animals 100 million page views per month in August 2023 70 mil. ibewasssas) Expansion of xX Improved content content fields production methods A 14RD PRE R
Slide 37: FY23 Earnings Forecast
re’ ITmedia ne FY23 Earnings Forecast
Slide 38: FY23 Revision of Consolidated Earnings Forecast
i Earnings Forecast | FY23 Revision of Consolidated Earnings Forecast me ‘Tmacdiaine. * The impact will remain throughout the current fiscal year, Current forecasts are decrease in revenue and profit is expected. > maintained + Progressing as expected Net income attributable to Revenue Operating inc
Slide 39: Company Business Overview
re’ ITmedia ne Company Business Overview
Slide 40: Our Mission
gk” ITmedia inc. Our Mission Contribute to Information Revolution by Innovating Professional Media * We believe profession makes media reliability * Technology leads conventional media to innovation + Providing media community as a social knowledge platform
Slide 41: Our Materiality and Contributions to Society
| a Business Overview | Our Materiality and Contributions to Society me Social innovation through technology ITmedia ino. Innovate professional media & Contribute through information Development of a sustainable society ©2023 ITmedia Inc. All Rights Reserved Al
Slide 42: One of Japan's Largest Digital Media Content Providers
| a Business Overview | One of Japan's Largest Digital Media Content Provider re’ One of Japan’s largest technology-focused VTmed digital media content provider meta Monthly “ = a 400 million pvs GreenLake Total number of members 1.2 million people Number for new monthly articles 6,000 articles 2 8
Slide 43: Customer/user scale
| a Business Overview | One of Japan’s Largest Digital Media Content Provider me Mrmediaie Customer/user scale Number of potential (Sellers) (Buyers) iv customers Number of customers = Profile members Number of readers 7,000 2,000 1.2 25 million people companies companies million people 50 million u
Slide 44: Core Company Foundations
re’ Company Business Overview | Core Company Foundations ‘Tmecdae. re One of the largest media in the BtoB technology market Contribute to digital transformation of Sales and Marketing Data on purchasing behavior for BtoB technology products One of the largest holders of data in Japan that brings te
Slide 45: Core Company Foundations
| a Business Overview | Core Company Foundations me ‘Tmecdae. One of the largest holders of data in Japan that brings technology buyers and sellers together Companies providing technology In-house Dx staff / IT buyers Engagement 7 ( Customers otentia customers 2,000 companies ug : : 1.2 million Read
Slide 46: Size of the Market for Digital Transformation of Sales and Marketing
| a Business Overview | Size of the Market for Digital Transformation of Sales and Marketing me ‘Tmacdiaine. Our company engages in the digital transformation of Sales and Marketing Market expected to expand 2.9 X over 10 years DataEra Demonstrating the superiority of digital media Average 5-year gr
Slide 47: 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 48: Growth Strategies and New Initiatives
re’ ITmedia ne Growth Strategies and New Initiatives
Slide 49: Technological Development and Our Growth
hors Strategies and,New Initiatives | Technological Development and Our Growth) | 4 / ‘Wearable; / » StI il » | / Digital shiftof, A I di eel y society and industries wy YS ei be Robotics A RRO G ye a 4 se Nes (eDigital twin | | 4 / —-_ ay ’ tefpnaeey” | Quantum |) 6% ~ Wy a Cloud (Ve computing a /
Slide 50: Engage with Growth Vectors
Growth Strategies and New Initiatives | Engage with Growth Vectors Previously Expansion on both buy-side and sell-side & Manufacturing and Innovation of society IT Electronics Increasingly sophisticated and diverse solutions 22 Innovation of marketing Lead Generation Digital Events C) Established as
Slide 51: Data Driven Concept "Campaign Central"
| Strategies and New Initiatives | Data Driven Concept “Campaign Central” me The largest BtoB holders of data that brings oe buyers and sellers together from all industries At YY “Campaign Central Concept” Centralized data management infrastructure for data driven marketing o — Implement first stage
Slide 52: New Initiatives: Image of Industrial DX
i Strategies and New Initiatives | New Initiatives: Image of Industrial DX me Expansion of mutual revenue opportunities through alliances with specialist media of various industries Medicine Bio /pharmaceuticals Construction Education Chemistry/materials Agriculture iq Public Smart energy projects M
Slide 53: Partner collaboration in Digital Events
Finance, accounts, automotive, logistics, retail, etc. Partner collaboration in Digital Events Jointly operated Account Zone with Zeimu Kenkyukai Inc. at SaaS EXPO, an exhibition- type digital event hosted by the Company
Slide 54: Global Partnerships
| Strategies and New Initiatives | Global Partnerships Leveraging partnerships with leading global media companies in industry DX Japan Enhancing translation peat EETimes, EDN of content 7 Wmediainc. oO TechTarget Japan OS Sales collaborations and joint products he A. * € INDUSTRY DIVE oO TechTarget
Slide 55: The Campaign Central Concept
re’ | Strategies and New Initiatives | The Campaign Central Concept a Campaign Central Revenue Base = Accumulated Buyer and Seller Data re’ "Tmedia Universe @ Audience data and leads from all customer campaigns are stored s ' ' J and tied to ITmedia IDs ITmedia ino. —_ tl AS B iTDev. x ee 5 ip Compa
Slide 56: Progress of Campaign Central
| Strategies and New Initiatives | Progress of Campaign Central me ‘Tmacdiaine. Completed development of infrastructure collaboration between Digital Events and Lead Generation Back-end data integration Front-end features/UI development © FY23Q2 Digital Event and Lead Generation collaboration © Deve
Slide 57: Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sep.
2,126 508 1,884 1,625 1,279 257 975 228 688 160 453 202 50 34 81 8 June July Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sep.
Slide 58: AI Application to Content Production
| Strategies and New Initiatives | Al Application to Content Production me ‘Tmecdae. Digital transformation of content production Al-assisted article creation Improvement of article production style and efficiency Competent reporters and Dedicated Al Media Development Division launched in October 20
Slide 59: Shareholder Return and Sustainability
re’ ITmedia ne Shareholder Return and Sustainability
Slide 60: Purchase of Own Shares
F seers Return and Sustainability | Purchase of Own Shares We purchased own shares Class of shares to be purchased Common shares of the Company Purchasing period From August 1, 2023 to October 20, 2023 Total shares that can be purchased 500,000 shares (actual) (Ratio to the total number of issued sh
Slide 61: FY12 FY13 FY14
56.9% 41.2% 39.3% 36.7% 30.6% 28.1% 24.9% 24.6% 30.4% 25.3% 25.3% FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
Slide 62: Sustainability
Shareholder Return and Sustainability | Sustainability me ‘Tmacdiaine. Here is a description of our quarterly progress Effective October 1, 2023 strengthened systems Establishment of a dedicated organization Strengthened management base and governance topics Board of Directors ERP renewal in October
Slide 63: <A RS
<A RS Contribute to Information Revolution - by Innovating Professional Media E : a ail : = NE:
Slide 64: ITmedia Inc. Inquiries
ITmedia Inc. Inquiries ITmedia Inc. Kioicho Building 3-12, Kioicho, Chiyoda-ku, Tokyo 102-0094 Inquiries: ir@sml.itmedia.co.jp