FY25Q3 Financial Results (Slide Presentation with transcript) & Summary of Q & A

Q3 Financial Results Briefing for the Fiscal Year Ending March 2026 February 10, 2026

(Total: 38 minutes, Presentation: 10 minutes, Q&A: 28 minutes)

Hidenuki Mayumi Corporate Strategy Division Deputy Division

Head

Ryota Washimori PR & IR Department General Manager

Hiroharu Watanabe SMBC Nikko Securities

*Analysts that SCRIPTS Asia was able to identify from the audio who spoke during Q&A or whose questions were read by moderator/company representatives.

First, I would like to introduce today's participants. Hidenuki Mayumi, Deputy Division Head of the Corporate

Strategy Division. Ryota Washimori, General Manager of the PR & IR Department, Corporate Strategy Division. We plan to conclude at 2:00 PM.

Today's briefing will begin with Mr. Mayumi providing an overview of the financial results and the full-year outlook, followed by a Q&A session, during which Mr. Washimori will also respond to questions.

With that, I would now like to hand the floor to Mr. Mayumi.

I will walk you through the cumulative Q3 results and the full-year earnings outlook in the following slides.

Here are the financial highlights.

Cumulative net sales through Q3 were JPY87.2 billion, and business profit was JPY31.4 billion, representing higher sales but lower profit YoY.

Looking at the overall picture, there was a significant YoY difference due to the termination last year of phosphor films. In addition, for anti-reflection films for automotive applications, sales were weighted toward the first half last year due to the buildup of new program launches, so compared with that period, this resulted in a decline. On the other hand, optical semiconductors and pre-cut ACF increased, resulting in overall sales growth.

Regarding business profit, there was a negative impact from lower sales of phosphor films and other products, as well as an increase in fixed costs associated with growth investments in optical semiconductors. However, this was offset by increased sales of high-value-added products, and excluding FX effects, we achieved an increase in profit.

As for the full-year outlook, we are maintaining our previous forecast of net sales of JPY114.0 billion and business profit of JPY39.0 billion. The yen has been weaker than our initial assumptions, but we recognize the challenging environment, including higher memory prices and intensified competition in the Chinese automotive market. Although our assumptions have changed somewhat since the November announcement, we are keeping our full-year forecast unchanged and will work to achieve the revised outlook.

Regarding shareholder returns, there is no change from the initial plan. We plan to pay an annual cash dividend of JPY58 per share. In addition, we repurchased shares totaling JPY5.0 billion at the end of last year and completed the cancellation of all of those shares in January this year.

Next, I will explain the results in more detail.

This shows market trends in the major applications where our products are used, as well as our sales trends. Starting this quarter, we have added photonics.

In terms of market conditions, markets were generally in line with the previous fiscal year, except for notebook PCs and optical semiconductors. Replacement demand for notebook PCs continues, and in optical semiconductors, demand for optical transceivers for data centers is expanding.

As for our performance, in notebook PCs, in addition to the impact of the termination of phosphor films at the end of the first half of last year, anti-reflection films were negatively impacted by a partial delay in delivery timing, particularly for high-end models.

In smartphones, sales increased due to progress in the replacement of conventional products with pre-cut ACF for camera module applications.

In automotive, sales declined compared with the first half of last year, which had benefited from the buildup of new anti-reflection film programs.

In optical semiconductors, sales increased as shipments of our high-speed response photodiodes to a major optical transceiver manufacturer, which began in the second half of last year, expanded.