2002 年 2 月 13 日
株式会社インターネットイニシアティブ IR 室
Tel. 03-5259-6500
Fax. 03-5259-6311
Email: ir@iij.ad.jp
本資料は日本の方々の便宜性のために作成した簡易版です。7 ページ目より正式決算発表資料（英文）が続きますので、そちらもあわせてご参照いただけますよう、お願い申し上げます。

IIJ2001 年度第 3 四半期（10-12 月）決算発表について―― 対前年同期比 35.7%の売上成長および営業利益幅の拡大を実現 ――
本決算発表に伴うカンファレンス・コールの模様を本決算発表に伴うカンファレンス・コールの模様を 2002 年 2 月 13 日 23:00 よりインターネット上（）で公開しております。
ット上（URL: www.vcall.com）で公開しております。
2001 年度第 3 四半期 (10-12 月) 決算発表 要約z

売上高は 99 億円（前年同期比 35.7%増、前期比 4.3%増）を達成。第 3 四半期の見込みをわずかに下回ったが、これはあるシステム・インテグレーション(SI)契約の第 3 四半期計上が出来なかったためで、第 4 四半期に売上高として実現出来る見込み。

z

コスト削減の最大ターゲットである国際バックボーンコストは、前年同期比で 62.4%減、前期比で14.0%減に。

z

粗利益率は引き続き改善し、14.7%（前年同期は 6.7%、前期は 14.1%）へ。事業分野別にみると、接続及び付加価値サービスの粗利益率は 15.0%（前年同期は 3.9%、前期は 12.7%）と上昇し、SI における粗利益率は 15.5%（前年同期は 13.1%、前期は 16.5%）となった。

z

営業損益は 151 百万円の営業利益となり、黒字幅が拡大（前年同期は 779 百万円の営業損失、前期は 16 百万円の営業利益）。EBITDA も引き続き改善し 904 百万円へ（前年同期は 126 百万円の赤字、前期は 712 百万円の黒字）。

z

税引前当期損益は 38 百万円の黒字化へ（前年同期は 285 百万円の損失、前期は 414 百万円の損失）

z

第 4 四半期の売上高は 105 億円 – 110 億円を達成する見込み。これは前年同期比で 14.1%19.6%、前期比で 5.7-10.7%の成長率となる。営業利益は 150 百万円 – 300 百万円となり、
EBITDA は 900 百万円 – 1,050 百万円となる見込み。

z

結果として、2001 年度通期の売上高は 383 億円 – 388 億円となり、前年比 20.1% - 21.7％の成長率となる見込み。同営業利益は 18 百万円 – 168 百万円、
同 EBITDA は 2,893 百万円 –3,043
百万円を予測。

第 3 四半期の概要と第 4 四半期見込みについて＜概況＞ 日本経済の低迷や、季節要因によりシステム・インテグレーション(SI)事業が減少する期であったにもかかわらず、第3四半期は継続的な売上成長と利益率の改善という見込みに沿った結果となった。
＜コスト＞ 国際バックボーンコストは日米回線の調達交渉の結果、前年同期比62.4%減、前期比14.0%減と、更なる削減を実現した。上昇傾向にあった国内バックボーンコストは、調達市場の需給関係の変化により、対前期比で若干の減少。2001年度通期のバックボーンコスト総額（国際バックボーンコストと国内バックボー
ンコストの合計）は2000年度通期の同コスト総額を下回り、利益率は着実に改善する見込み。
2001 年度第 4 四半期の 2001 年度通期見込み
第 4 四半期
売上高10,500 − 11,000
営業利益
150 − 300
EBITDA
900−1,050（百万円）
2001 年度通期
38,295 − 38,795
18 − 168
2,893−3,043

（ご参考）統計値について
表 1. 契約数

IP サービス

64kbps – 128kbps
192kbps – 768kbps
1Mbps – 2Mbps
3Mbps – 1.2Gbps

IIJ FiberAccess/F(*1)
IIJ T1 スタンダード 1.5Mbps
IP Service 合計

IIJ エコノミー
IIJ DSL/F(*2)

64kbps – 128kbps
1.5Mbps（最大）

3Q01
176
46
269
131
25
681

2Q01
213
49
258
123
2
690

3Q00
330
90
221
102
n/a
494

1,328

1,335

1,237

1,060
750

1,171
286

1,253
n/a

専用線接続サービス 合計
3,138
2,792
2,490
(*1)
IIJ FiberAccess/F は 2001 年 8 月サービス開始 (*2) IIJ DSL/F は、2001 年 5 月サービス開始

IIJ4U (個人向けダイアルアップ接続サービス)
その他 ダイアルアップ接続サービス

91,924
114,676

94,104
86,123

95,25764,854

ダイアルアップ接続サービス 合計

206,600

180,227

160,111

127

119

83

3Q01
2,990

2Q01
3,081

(百万円)
3Q00
2,969

348

350

324

インターネットデータセンターサービス契約数
表 2. 専用線サービス内訳
IP サービス(IP サービス、
サービス、IIJ T1 スタンダード、
スタンダード、IIJ FiberAccess/F)
IIJ エコノミー + IIJ DSL/F
表 3. 契約帯域数の総和

3Q01
専用線接続サービス(単位: Gbps)
3Q00

2Q01

7.7

6.4

3Q01
536
772

2Q01
623
805

3Q01
904
804
783

2Q01
712
931
726

表 4. バックボーンコスト
国際バックボーンコスト
国内バックボーンコスト
表 5. その他
EBITDA
設備投資（capitalized
leases を含む）
設備投資（
減価償却費

3.1
(百万円)
3Q00

1,424
663
(百万円)
3Q00
(-)126749678

注意事項：この資料には、1995 年米国民事証券訴訟改革法（Private Securities Litigation Reform Act of 1995）の「セーフハーバー」規定に定義する「将来性の見通しに関する記述（forward-looking statements）」に該当する情報が記載されています。このプレゼンテーション資料の記載のうち、過去または現在の事実に関するのも以外は、将来の見通しに関する記述に該当します。将来の見通しに関する記述は、現在入手可能な情報に基づく IIJ 経営陣の仮定および判断に基づくものであり、これには既知または未知のリスクおよび不確定性が内在しています。IIJ の実際の活動または業績は、今後、将来の見通しに関する記述に示されたところと大きく異なる可能性があります。投資家の皆様におかれましては、1934 年米国証券取引法（Securities Exchange Act of 1934）に基づく今後の報告書等において IIJ が行う開示をご参照ください。

株式会社 インターネットイニシアティブ
四半期連結損益計算書（米国会計基準）

Appendix 1

2001年
年12月期、
月期、2000年
年12月期、
月期、2001年
年9月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、前年同四半期比較
2001年12月期
USD (1)
営業収益：
インターネット接続及び付加価値サービス収入：
専用線接続サービス
ダイヤルアップ接続サービス
付加価値サービス：
データセンタサービス
その他付加価値サービス
付加価値サービス合計
その他
インターネット接続及び付加価値サービス収入合計

JPY

対営業収益
%

JPY

2000年12月期
対営業収益%

対前年同四半期%

JPY

前四半期比較
2001年9月期
対営業収益 対前四半期%%

25,476
6,744

3,338,370
883,698

33.6%
8.9

3,293,327
1,074,291

45.0%
14.7

1.4%
(17.7)

3,431,156
932,653

36.0%
9.8(2.7%)
(5.2)

4,478
3,258
7,736
2,893
42,849586,816
426,895
1,013,711
379,1885,614,967

5.9
4.3
10.2
3.8
56.5

341,914
239,656
581,570
114,303
5,063,491

4.6
3.3
7.9
1.6
69.2

71.6
78.1
74.3
231.7
10.9

506,775
378,815885,590
303,4815,552,880

5.3
4.0
9.3
3.2
58.3

15.8
12.7
14.5
24.9
1.1

25,8797,078
75,806

3,391,122
927,545
9,933,634

34.2
9.3
100.0

1,955,499
303,294
7,322,284

26.7
4.1
100.0

73.4
205.8
35.7

3,352,363
623,064
9,528,307

35.2
6.5
100.0

1.2
48.9
4.3

36,43821,8686,356
64,662

4,774,788
2,865,601
832,972
8,473,361

48.1
28.8
8.4
85.3

4,863,920
1,698,594
270,316
6,832,830

66.4
23.2
3.7
93.3

(1.8)
68.7
208.1
24.0

4,847,467
2,799,940
534,575
8,181,982

50.9
29.4
5.6
85.9

(1.5)
2.3
55.8
3.6

5,606
3,765
618
74,651

734,623
493,327
80,946
9,782,257

7.4
5.0
0.8
98.5

763,189
431,143
74,447
8,101,609

10.4
5.9
1.0
110.6

(3.7)
14.4
8.7
20.7

819,799
426,792
83,7369,512,309

8.6
4.5
0.8
99.8

(10.4)
15.6
(3.3)
2.8

営業利益（損失）

1,155

151,3771.5(779,325)(10.6)(119.4)

15,9980.2

846.2

その他の収益（費用）(868)(113,705)(1.1)

494,7176.7(123.0)(430,259)(4.5)(73.6)

税引前当期利益（損失）287

37,6720.4(284,608)(3.9)(113.2)(414,261)(4.3)(109.1)

法人税等、住民税及び事業税
少数株主損益持分法による投資損失(1,177)(30)(9,293)(154,239)(3,985)(1,217,755)

(1.5)
0.0
(12.3)

37,972
128,920(785,391)

0.5
1.7(10.7)(506.2)(103.1)55.1

1,266,458(5,533)(1,398,509)

13.3
(0.1)
(14.7)(112.2)(28.0)(12.9)

当期損失(7,859)(1,029,829)(10.4%)(979,051)(13.4%)

5.2%(3,084,761)(32.4%)(66.6%)

システムインテグレーション
機器販売
営業収益合計営業費用：
インターネット接続及び付加価値サービス原価システムインテグレーション原価
機器販売原価
売上原価合計
販売費
一般管理費
研究開発費
営業費用合計

1株あたり当期損失
米国預託証券１単位あたり当期損失
期中平均発行済株式総数
期中平均発行済米国預託証券総数(45,811)(22.91)
22,48044,960,000(43,552)(21.78)22,48044,960,000

注記(1): 2001年12月期につきましては、米ドル換算レート131.04円=1米ドル(2001/12/31)にて参考表示しております。

(137,222)(68.61)
22,48044,960,000

株式会社 インターネットイニシアティブ
四半期累計連結損益計算書（米国会計基準）

Appendix 2

年12月期累計、
月期累計、2000年
年12月期累計
月期累計
2001年
月期累計、
千円単位、USD/千米ドル単位
千米ドル単位 (1)JPY/千円単位、千円単位、前年同四半期累計比較

2001年12月期累計
USD (1)
営業収益：
インターネット接続及び付加価値サービス収入：
専用線接続サービス
ダイヤルアップ接続サービス
付加価値サービス：
データセンタサービス
その他付加価値サービス
付加価値サービス合計
その他
インターネット接続及び付加価値サービス収入合計

JPY

2000年12月期累計

対営業収益
%

JPY

対営業収益
%

対前年同四半期%

77,506
21,366

10,156,438
2,799,812

36.5%
10.1

9,426,086
3,389,855

41.6%
14.9

7.7%
(17.4)

12,0809,138
21,218
8,660
128,750

1,582,976
1,197,441
2,780,417
1,134,795
16,871,462

5.7
4.3
10.0
4.1
60.7

804,884
631,247
1,436,131
330,934
14,583,006

3.5
2.8
6.3
1.5
64.3

96.7
89.7
93.6
242.9
15.7

68,85914,500212,1099,023,339
1,900,038
27,794,839

32.5
6.8
100.0

7,430,766
662,242
22,676,014

32.8
2.9
100.0

21.4
186.9
22.6

112,097
57,843
12,780182,720

14,689,111
7,579,795
1,674,735
23,943,641

52.9
27.3
6.0
86.2

13,909,353
6,507,555
573,614
20,990,522

61.3
28.7
2.5
92.5

5.6
16.5
192.0
14.1

18,11010,372
1,918
213,120

2,373,208
1,359,149
251,280
27,927,278

8.5
4.9
0.9
100.5

2,492,240
1,248,945
220,645
24,952,352

11.0
5.5
1.0
110.0

(4.8)
8.8
13.9
11.9

営業損失

(1,011)(132,439)(0.5)(2,276,338)(10.0)(94.2)

その他の収益（費用）(4,620)(605,448)(2.2)

772,643

3.4(178.4)

税引前当期損失(5,631)(737,887)(2.7)(1,503,695)(6.6)(50.9)

法人税等、住民税及び事業税
少数株主損益持分法による投資損失

9,458
254
(29,270)

1,239,416
33,316(3,835,479)

4.4
0.1(13.8)(829,608)
162,400(2,835,630)

(3.6)
0.7
(12.5)(249.4)(79.5)
35.3

当期損失(44,105)(5,779,466)(20.8%)(3,347,317)(14.8%)

72.7%

システムインテグレーション
機器販売
営業収益合計営業費用：
インターネット接続及び付加価値サービス原価システムインテグレーション原価
機器販売原価
売上原価合計
販売費
一般管理費
研究開発費
営業費用合計

1株あたり当期損失
米国預託証券１単位あたり当期損失
期中平均発行済株式総数
期中平均発行済米国預託証券総数(257,094)(128.55)
22,48044,960,000

注記(1): 2001年12月期につきましては、米ドル換算レート131.04円=1米ドル(2001/12/31)にて参考表示しております。

(148,902)(74.45)22,48044,960,000

株式会社 インターネットイニシアティブ
四半期連結貸借対照表（米国会計基準）

Appendix 3

2001年
年12月期、
月期、2000年
年12月期、
月期、2001年
年9月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、USD (1)

2001年12月期
JPY

2000年12月期
JPY
%

資産の部
流動資産：
現金及び現金同等物
短期投資
売掛金
棚卸資産
前払費用
その他流動資産85,211044,496
1,740
6,155
3,246

11,166,077
0
5,830,688
228,063806,515425,411

25.9%
0.0
13.5
0.5
1.9
1.0

14,602,816
3,154,110
3,958,597
198,618
417,912324,340

26.7%
5.8
7.2
0.4
0.8
0.6

11,411,967
0
5,939,468
1,012,403
403,982
390,966

25.5%
0.0
13.3
2.3
0.9
0.9

流動資産合計140,848

18,456,754

42.8

22,656,393

41.5

19,158,786

42.9

関連会社投資等
その他投資
有形固定資産等
敷金保証金
その他資産

79,26636,73858,0689,644
4,874

10,386,964
4,814,114
7,609,238
1,263,819
638,652

24.1
11.1
17.6
2.9
1.5

15,074,638
8,856,642
6,477,689
826,847
714,993

27.6
16.2
11.9
1.5
1.3

11,608,736
4,727,410
7,585,480
890,444664,675

26.0
10.6
17.0
2.0
1.5

資産合計

329,438

43,169,541

100.0%

54,607,202

100.0%

44,635,531

100.0%

28,237
26,161
2,236
5,317
9,157
14,7173,700,214
3,428,098
292,996696,682
1,200,000
1,928,505

8.6%
7.9
0.7
1.6
2.8
4.5

6,110,000
6,294,412
265,374
308,386
90,0001,590,709

11.2%
11.5
0.5
0.5
0.2
2.9

3,770,445
4,526,061
222,003
365,625
1,000,000
1,853,146

8.5%
10.1
0.5
0.8
2.2
4.2

85,825

11,246,495

26.1

14,658,881

26.8

11,737,280

26.3

長期借入金
転換社債
長期リース債務退職給付引当金
その他固定負債

27,473
114,469
22,659962
261

3,600,000
15,000,000
2,969,253
126,085
34,238

8.3
34.7
6.9
0.3
0.1

2,400,000
15,000,000
2,613,916
142,455
525,620

4.4
27.5
4.8
0.2
1.0

3,800,000
15,000,000
2,939,079
125,099
26,306

8.5
33.6
6.6
0.2
0.1

負債合計

251,649

32,976,071

76.4

35,340,872

64.7

33,627,76475.3

少数株主持分

7,814

1,023,897

2.4

673,546

1.2

1,019,912

2.3

54,047130,253(126,235)
11,9107,082,336
17,068,353(16,541,800)
1,560,684

16.4
39.5
(38.3)
3.6

7,082,336
17,068,353(9,409,429)
3,851,524

13.0
31.3
(17.2)
7.0

7,082,336
17,068,353(15,511,971)
1,349,137

15.9
38.2
(34.7)
3.0

資本合計

69,9759,169,573

21.2

18,592,784

34.1

9,987,855

22.4

負債、少数株主持分及び資本合計

329,438

43,169,541

100.0%

54,607,202

100.0%

44,635,531

100.0%%

2001年9月期
JPY%

負債及び資本の部
流動負債：
短期借入金
買掛金及び未払金
未払費用
その他流動負債
1年以内に期限到来の長期借入金
短期リース債務
流動負債合計

資本：
資本金
資本準備金
欠損金
その他有価証券評価差額金等

注記(1): 2001年12月期につきましては、米ドル換算レート131.04円=1米ドル(2001/12/31)にて参考表示しております。

株式会社 インターネットイニシアティブ
四半期連結キャッシュフロー計算書（米国会計基準）

Appendix 4

2001年
年12月期、
月期、2000年
年12月期、
月期、2001年
年9月期
月期
月期、
月期、
JPY/千円単位、
千円単位、USD/千米ドル単位
千米ドル単位 (1)千円単位、2001年12月期
USD (1)
JPY

2000年12月期
JPY

2001年9月期
JPY

営業活動によるキャッシュフロー：当期損失
減価償却費等持分法による投資損失
少数株主損益
為替差損（差益）
投資有価証券評価損
売掛金の減少（増加）額
買掛金及び未払金の増加（減少）額
棚卸資産の減少（増加）額
法人税等調整額
その他
営業活動によるキャッシュフロー(7,859)
5,977
9,293
30
(2,895)2,285
1,338(8,419)5,986(1,218)(62)
4,456(1,029,829)
783,194
1,217,755
3,985(379,315)
299,428
175,291(1,103,244)
784,340(159,611)(8,113)583,881(979,051)
678,247
785,391(128,920)(521,644)
676,871
1,419,009
117,133
33,831(190,254)
1,890,613(3,084,761)
726,278
1,398,509
5,533
178,577
28,824(566,601)
513,802(748,850)
1,264,707
388(283,594)

投資活動によるキャッシュフロー：有形固定資産等の取得による支出
関連会社への投資および貸付
短期投資の取得による支出
その他投資の取得による支出
短期投資の売却による収入
敷金保証金の（返還）支出
その他
投資活動によるキャッシュフロー(1,243)(133)(2,850)(59)(4,285)(162,852)(17,497)-(193,373)(2,897,700)(5,297,122)(311,500)
8,366,650
21,279(107,242)(419,008)(393,770)(321,094)

財務活動によるキャッシュフロー：長期借入金による収入
長期借入金の返済による支出
リース債務の元本返済による支出
短期借入金の純減額
少数株主の増資引受けによる払込額
財務活動によるキャッシュフロー(4,048)(536)(4,584)(530,423)(70,231)(600,654)

1,200,000(200,000)(475,647)(900,000)

1,400,000(375,647)(494,991)(1,249,555)
375,000
30,454

現金及び現金同等物に係る換算差額

2,536

332,421318,649(171,738)

現金及び現金同等物の減少額(1,877)(245,890)

1,414,607(1,162,777)

現金及び現金同等物の期首残高

87,088

11,411,967

12,970,293

12,574,744

現金及び現金同等物の期末残高

85,211

11,166,077

14,384,900

11,411,967-(373,471)(7,718)(561,538)-

注記(1): 2001年12月期につきましては、米ドル換算レート131.04円=1米ドル(2001/12/31)にて参考表示しております。

-

(100)
-

(2,794)(20,141)(737,899)

Internet Initiative Japan Inc.
February 12, 2002
Page 1

CONTACT IN JAPANInternet Initiative Japan Inc.
Junko Higasa
Investor Relations/Media Relations
ir@iij.ad.jp
81-3-5259-6500

For Immediate Release

CONTACT IN THE UNITED STATESThomson Financial / Carson
Mami Ogawa
Investor Relations
mami.ogawa@tfn.com
212-701-1824

IIJ Announces the Result of 3rd Quarter 2001-- Reports 35.7% YOY Revenue Growth and Improved Profitability -Tokyo, February 12, 2002 – Internet Initiative Japan Inc. (Nasdaq: IIJI) (“IIJ”), one of Japan’s leading Internet
access and comprehensive network solutions providers, today announced its financial results for the 3rd quarter
ended December 31, 2001. On February 13 at 9:00am (EST), the Company will host a conference call, which
will be simultaneously webcasted at www.vcall.com. Replay will also be available at the same URL.

The 3rd Quarter of FY2001 Results Summaryz

Total revenues were JPY9.9 billion, an increase of 35.7% from 3Q00 and of 4.3% from 2Q01,
which were slightly below the expected range of JPY10.0 billion to JPY10.5 billion due to thedeferral of a Systems Integration (SI) project, which is expected to be realized in 4Q01.

z

International backbone costs, the Company’s largest cost reduction target, further declined by
62.4% from 3Q00 and by 14.0% from 2Q01, through the Company’s continuous focus on cost
reduction initiatives to improve profitability.

zGross margin continued to improve, reaching 14.7% as compared to 6.7% in 3Q00 and 14.1% in
2Q01.

z

The Company improved its operating income to JPY151 million, versus a loss of JPY779 million
in 3Q00 and a profit of JPY16 million in 2Q01. EBITDA also continued to improve, reaching
JPY904 million, from a negative of JPY126 million in 3Q00 and a positive of JPY712 million in
2Q01. The results of Operating income and EBITDA are within ranges of the Company’s targets
for the 3rd quarter.

z

Income before income tax expense turned positive to JPY38 million from a loss of JPY285 million
in 3Q00 and a loss of JPY414 million in 2Q01.

z

For 4Q01, IIJ expects total revenues to be between JPY10.5 billion and JPY11.0 billion,
representing approximately 14.1%-19.6% growth from 4Q00 and approximately 5.7%-10.7%
from 3Q01. Operating income is expected to be between JPY150 million and JPY300 million, and
EBITDA between JPY900 million and JPY1,050 million.

z

For fiscal 2001, IIJ expects revenues to amount to between JPY38.3 billion and 38.8 billion,
representing 20.1-21.7% growth from fiscal 2000. Operating income is expected to be between
JPY18 million to JPY168 million, and EBITDA between JPY2,893 and JPY3,043 million.

(*)

EBITDA represents operating income (loss) plus depreciation and amortization.

Internet Initiative Japan Inc.
February 12, 2002
Page 2
Overview and Business Outlook
Overview of the 3Q Results and Business Outlook“Our results in this quarter continue to prove our commitment to further growth and improved
profitability,” said Koichi Suzuki, President and CEO of IIJ. “Due to a deferred SI project during thequarter that is now expected to be realized in 4Q01, revenues in 3Q01 were slightly less than
anticipated. Despite this rescheduling, coupled with the prolonged economic recession in Japan andthe typical seasonal weakness of the SI business in the 3rd quarter in Japan, we still grew our revenues
by 35.7% year-over-year and further improved our profitability.”“We continued to improve our cost structure, as expected,” said Yasuhiro Nishi, CFO of IIJ.
“International backbone costs declined by 62.4% from 3Q00 and 14.0% from 2Q01. Domestic
backbone costs have begun to level off, as we realize the benefits of competition-driven pricereductions in the domestic bandwidth procurement market. For full fiscal 2001, we remain confident ofour previous projections: a decline of approximately 50% in international backbone costs and total costof connectivity services lower for the last fiscal year. With profitability steadily improving, we
reaffirm our expectation of positive operating income for the full fiscal 2001 year, the first time since
our IPO.”
Anticipated Financial Performance for the 4th Quarter
4th Quarter of Fiscal 2001
Revenues
10,500 to 11,000
Operating Income (Loss)
150 to 300
EBITDA
900 to 1,050(JPY in millions)
Full Fiscal 2001
38,295 to 38,795
18 to 168
2,893 to 3,043

Industry LandscapeThe network infrastructure industry in Japan continues to be driven by the broadband boom.
According to the Ministry of Public Management, Home Affairs, Posts and Telecommunications(MPHPT), the number of ADSL subscribers reached 1.5 million at the end of December 2001, a
significant increase from 9,723 ADSL subscribers at December 2000 year-end. The ADSL figuresurpassed the number of CATV Internet users, which was 1.3 million at the end of December 2001.
In the corporate market in Japan, demand for network restructuring remains strong. Companies haveexperienced a rapid increase in data traffic and, as a result, have had to constantly upgrade their
network bandwidth. As upgrading networks can be costly, companies are taking advantage of various
new types of access lines, such as ADSL and Ethernet-interfaced-lines, which are more cost-effectivemeans to upgrading network bandwidth than conventional telecommunications lines.
IIJ Strategies
IIJ continues to benefit from the growth in Japan’s broadband era by leveraging its large network scaleand network-engineering capabilities. In particular, the new generation network infrastructure andservices of its 37.9% affiliate Crosswave Communications (Crosswave) have started to become
integrated into the IIJ group’s total network solutions as key network components. The synergies
realized with Crosswave have resulted in a clear differentiation at the points of cost, scale andextensibility in the IIJ group total network solutions, especially when compared to that of conventional
telecommunication carriers. Although equity accounting for Crosswave’s net loss has largely
attributed to IIJ’s net loss, IIJ believes that synergies with Crosswave are a critical factor in effectively
competing against telecommunications carriers in Japan and IIJ continues to actively realize synergies
with Crosswave through joint marketing and service development. In addition to the key functions ofdata centers as network hubs for the IIJ group’s various network solutions, the launch of the Omnibus
service and the development of new IIJ CDN networks (both of which are discussed below)
demonstrate these synergies with Crosswave.

Internet Initiative Japan Inc.
February 12, 2002
Page 3Strategies for capturing Japan’s broadband traffic
In February 2002, IIJ announced the launch of new CDN (Content Distribution Network) businesses inJapan, the IIJ CDN Platform as of April 2002. Through the new CDN business, IIJ aims to provide
integrated content transmission platform services while enhancing its network infrastructures
optimized for new broadband age. At the initial stage, IIJ will build a full-mesh tera-bit backbone
network centered around the nine IIJ Internet data centers throughout Japan, setting in place theinfrastructure for full-scale broadband content transmission. To expand the scope of the reach of its
network, IIJ plans on extending its broadband network to NTT East’s and West’s ADSL networks,
together with the 30 CATV stations currently participating in IIJ’s HSMN (High Speed Media
Network) broadband platform. IIJ expect to reach one million households by the end of April 2002,
and six million households by the end of December 2002 though 100 CATV stations nationwide at
HSMN and various broadband access networks. IIJ will strive to leverage the scalability of IIJ group’s
network infrastructure and its operational know-how in large-scale networking, data centers andsystems integration business to capture a greater share of Japan’s growing broadband traffic. IIJ alsoplans to use the enhanced network platform to develop its network businesses.
Strategies for integrating customers’ networks through IIJ total network solutions approach
In February 2002, IIJ launched its new network management solutions “Omnibus” service, which wasdeveloped specifically to enable corporate customers to integrate their various network systems, such
as Internet, Intranet and VPNs, by interconnecting them at IIJ Internet data centers. The Omnibus
service also integrates customers' security systems, including firewalls and intrusion detective systems.
IIJ expects Omnibus to increase the usage of its various network services, such as Wide-area Ethernet
Platform Service offered by Crosswave, the A-Bone VPN Service provided by its 26.7% affiliate Asia
Internet Holding, as well as to deepen its customer relations by managing such networks seamlessly.
IIJ expects to include Internet application services as part of the Omnibus solutions in the future.
Strategies for enhancing relations with corporate customers
As announced in December 2001, IIJ was awarded the title “the best service provider of year 2001” inall three qualifying categories, namely dedicated access, dialup access and data center services througha major annual survey conducted by Nikkei Communications, a leading telecom industry trademagazine in Japan. This award underscores users’ appreciation of IIJ's high service quality andperformance. Based on its corporate philosophy of consistently ensuring high quality services that earn
the trust of customers, IIJ will continue to leverage its advanced IP technology expertise, and tostrengthen its position in the marketplace as a provider of comprehensive network solutions.
Status of Overview and Business Outlook
This Overview and Business Outlook contains forward-looking statements and projections that are subject to known
and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or
implied by these statements. These risks and uncertainties include, but are not limited to the factors noted at the end of
this release and to the risk factors and other information contained in IIJ’s filings on Form 20-F or Form 6-K as wellas other filings and documents furnished to the Securities and Exchange Commission. IIJ plans to keep this press
release publicly available on its Web site (www.iij.ad.jp) but may discontinue this practice at any time. IIJ intends topublish its next Overview and Business Outlook in its 4Q01 earnings release, presently scheduled for May 21, 2002.
In conjunction with the 3Q01 earnings announcement, IIJ will hold a webcasted conference made available to the
public for listening over the Company’s website.

The 3rd Quarter of FY2001 Operating Highlights
Eight New Service Developments under the Total Network Solutions Approach
In 3Q01, as part of its “Total Network Solutions Approach,” IIJ launched five new services, introduced
a new equipment series, and introduced two service upgrades providing new variations to existing
lineups. In terms of new Internet connectivity services, IIJ commenced “IIJ Ethernet Standard
Service,” a 10Mbps dedicated-line connectivity service over Ethernet-interfaced access lines forInternet Initiative Japan Inc.
February 12, 2002
Page 4
corporations. IIJ also introduced new connectivity services for individuals, namely “IIJmio DSL/De
Service,” a 8Mbps ADSL Internet service, and “IIJmio DSL/SF,” another 8Mbps ADSL Internet
service which includes one fixed IP address per contract. Amongst IIJ’s new Value-added services, IIJ
launched the trial of “IIJ Download Site Service,” a new hosting service for corporations for highvolume Internet content downloads. IIJ also commenced its “IIJmio Safety Mail Service,” a new email
service with an anti-virus function for individual users. In terms of new equipment series, IIJ launched
a new high-performance router, the “SEIL/neu” Series, designed specifically for new generation
networks including Ethernet-based wide-area networks, VPNs (Virtual Private Network) and IPv6
(Internet Protocol Version 6) networks.
Two New Lineups for IPv6-Capable Services
As the first commercial service in the world employing dual stack technology, a key component inpromoting IPv6 connectivity, IIJ launched IPv6/IPv4 Dual Stack Service in November 2001. The
service allows users to send and/or receive both IPv6 (next generation Internet Protocol Version 6) andIPv4 (current Internet Protocol Version 4) packets over a single connectivity line, without a separate
network environment dedicated to IPv6 transmission. Also in this quarter, in addition to corporate
users, IIJ extended IPv6 service availability to individual users.
New Tie-up to Leverage Total Network Solutions
IIJ group established a tie-up with Japan Research Institute (JRI), a leading Japanese “think-tank,” todevelop a one-stop data center business to provide corporate reengineering solutions. In January 2002,
the data center business was formally launched. The tie-up combines JRI's data center facility in Tokyoand their expertise in both strategic consulting and in construction of large-scale corporate
administrative systems, with IIJ's Internet network solutions and Crosswave's nationwide fiber-optic
network services.
Network Infrastructure and Internet Data Center Development
In terms of network infrastructure development, IIJ upgraded its Japan-US backbone lines to 1.8Gbps
from 1.65Gbps during 3Q01. Also, within Japan, IIJ upgraded four of its major lines, as well as
established a new link to JPNAP’s Osaka Internet exchange point, which is operated by its 26.0%
affiliate Internet Multifeed. Within Japan, IIJ also increased the number of its dial-up access points to77 from 75.
As for Internet data center development, IIJ opened its ninth Internet data center in Japan by procuring
facilities from Crosswave in Kyoto. “Ayalaport Makati,” a joint venture company between the IIJ
group and the Ayala Group, one of the Philippines' largest conglomerates, launched a full-fledged data
center services in the Philippines in October 2001. A number of companies, including one of thePhilippines' largest financial institutions, have already contracted with the new data center.
IIJ Group Companies Developments
Crosswave Communications (Crosswave), 37.9% affiliate specializing in data communications
Through a tie-up with IIJ, Crosswave introduced the first one-stop combination of Wide-area Ethernet
Platform service and Internet connectivity service offered in Japan. The combination of Wide-area
Ethernet and Internet connectivity enables the seamless administration of private and public network
segments. Also in the quarter, Crosswave began construction of its Yokohama data center, which will
be one of Japan's largest data centers, with 40,000 square meters of floor space in total.
Asia Internet Holding (AIH), 26.7% affiliate specializing Asian-wide Internet backbone services
During the quarter, AIH tied up with China Unicom Corporation, one of China's leading telecom
carriers, to launch A-Bone VPN (Asia-wide Virtual Private Network) service in China throughapproximately 300 access points located nationwide in China. Also in the quarter, AIH tied up with
Indosat Mega Media, one of Indonesia's major multimedia service providers, to launch the A-Bone
VPN service in Indonesia through 25 access points located throughout Indonesia. AIH currently

Internet Initiative Japan Inc.
February 12, 2002
Page 5provides A-Bone VPN Service to a total of eight countries, namely Japan, Singapore, Malaysia,
Thailand, Philippines, Korea, China and Hong Kong, as well as to Indonesia.
IIJ Media Communications (IIJ-MC), 50.1% subsidiary specializing in web-media content services
During the quarter, IIJ-MC began its new outsourcing service for email-magazine distribution called“Mail Operator Service”, as well as upgraded its “Streaming On-Demand Channel Service”, abroadband hosting service designed specifically for streaming content transmission.
The 3rd Quarter of FY2001 Financial Results
Revenues
Revenues in 3Q01 totaled JPY9,934 million, up 35.7% compared with 3Q00, and up 4.3% comparedwith 2Q01.
Connectivity services and value-added services revenues increased 10.9% from 3Q00 to JPY5,615
million in 3Q01, and grew by 1.1% from 2Q01.
Dedicated access services increased 1.4% from 3Q00 to JPY3,338 million in 3Q01, and decreased
2.7% from 2Q01. The decrease from 2Q01 was mainly due to a customer shift from primarily IP
services to data center connectivity services. During the quarter, IIJ DSL/F service and IIJ
FiberAccess/F services increased rapidly, which helped to offset a decline in the IIJ Economy service.
Dial up access service decreased 17.7% from 3Q00 to JPY884 million in 3Q01, and declined 5.2%
from 2Q01. These declines were due to the decrease in conventional dial-up services revenues, andIIJ4U revenues, as IIJ4U’s subscriber switched their dial up access lines to ADSL lines, in which case,
IIJ offers IIJ4U services at a low fixed monthly price.
Value-added services increased 74.3% from 3Q00 to JPY1,014 million in 3Q01, and was up 14.5%
from 2Q01. Data center services and security-related services were particularly strong.
Systems integration services revenues increased 73.4% from 3Q00 to JPY3,391 million in 3Q01, andby 1.2% from 2Q00.
Table 1. Number of Contracts
Internet Access Services
IP Service

64kbps – 128kbps
192kbps – 768kbps
1Mbps – 2Mbps
3Mbps – 1.2Gbps
IIJ FiberAcess/F(2)IIJ T1 Standard 1.5Mbps
Total IP Service
IIJ Economy
64kbps – 128kbps(3)
IIJ DSL/F
Maximum 1.5Mbps
Total Dedicated Access Services Contracts
(2)
(3)

3Q01
176
46
269
131
25
681
1,328
1,060
750
3,138

2Q01
213
49
258
123
2
690
1,335
1,171
286
2,792

3Q00
330
90
221
102
n/a
494
1,237
1,253
n/a
2,490

91,924
114,676
206,600

94,104
86,123
180,227

95,25764,854160,111

127

119

83

IIJ FiberAccess/F is a new service launched in August 2001.
IIJ DSL/F is a new service launched in May 2001.

IIJ4U (dialup service for individuals)
OthersTotal Dial-up Access Services Contracts
Total Data Center Services Contracts

Internet Initiative Japan Inc.
February 12, 2002
Page 6
Table 2. Revenue Breakdown in Dedicated Access Services
3Q01
Total IP Service
2,990(IP Service, IIJ T1 Standard, and IIJ FiberAccess/F)
IIJ Economy + IIJ DSL/F(*3)348(3)(JPY in millions)
2Q01
3Q00
3,081
2,969
350

324

IIJ DSL/F is a new service launched in May 2001.

Table 3. Contracted Bandwidth
3Q01
Dedicated Access Services

7.7(Unit: Gbps)
2Q01
3Q00
6.4
3.1

Cost and expenses
Cost of total revenues increased 24.0% from 3Q00 to JPY8,473 million in 3Q01, and by 3.6% from
2Q01.
International backbone costs decreased 62.4% from 3Q00 to JPY536 million in 3Q01, and by 14.0%
from 2Q01. These decreases on both a year-over-year and sequential basis reflect IIJ’s continuous
effort in reducing the costs of the Japan-US backbone lines. The monthly unit backbone cost declined
by approximately 70% in the year-over-year comparison, and by approximately 20% in the quarterover-quarter comparison.
Domestic backbone costs increased 16.5% from 3Q00 to JPY 772 million and decreased 4.0% from
2Q01. The quarter-over-quarter decrease was due to revised downward pricing of the domestic
backbone network. Other connectivity costs, INS line cost in particular, decreased 13.7% from 2Q01,
consistent with the decrease in dial up access services.
Table 4. Backbone Costs
International Backbone Costs
Domestic Backbone Costs

3Q01
536
772

2Q01

(JPY in millions)
3Q00
623
1,424
805
663

Sales and marketing expenses decreased 3.7% from 3Q00 to JPY 735 million in 3Q01, and were down
10.4% from 2Q01. This decrease was due to a decrease in advertising cost.
General and administrative expenses increased 14.4% from 3Q00 to JPY 493 million in 3Q01, andwere up15.6% from 2Q01, mainly as a result of an increase in recruiting cost.
As a result of IIJ’s overall cost reduction effort, and in particular the reduction in international anddomestic backbone cost, operating income increased to JPY 151 million in 3Q01, compared to loss of
JPY 779 million in 3Q00, and to income of JPY 16 million in 2Q01. The operating income ratio
against revenues for 3Q01 was 1.5%, compared to (-)10.6% in 3Q00, and to 0.2% in 2Q01.
Other income (expenses)
Other expenses for 3Q01 were JPY 114 million, compared to other income of JPY 495 million in 3Q00,
and to other expenses of JPY 430 million in 2Q01. IIJ recorded a foreign exchange gain of JPY 379
million in 3Q01, compared to a gain of JPY 522 million in 3Q00 and to a loss of JPY 179 million in
2Q01. IIJ also incurred a JPY299 million impairment loss on a marketable equity security investment
and net interest expense of JPY126 million, which more than offset this foreign exchange gain.
Income tax expense (benefit)
Income tax benefit for 3Q01 was JPY154 million as a result of a decrease in the valuation allowancefor deferred tax assets attributable primarily to the income tax effect of unrealized gains in the quarteron certain available-for-sale securities. This compared to income tax expenses of JPY38 million inInternet Initiative Japan Inc.
February 12, 2002
Page 73Q00 and expenses of JPY1,266 million in 2Q01.
Equity in net loss of affiliated companies
Equity in the net loss of affiliated companies was JPY1,218 million in 3Q01, compared to losses of
JPY785 million in 3Q00, and JPY1,399 million in 2Q01, mainly resulting from the equity loss in
Crosswave.
Net loss
Net loss was JPY 1,030 million in 3Q01, compared to JPY 979 million in 3Q00 and JPY 3,085 million
in 2Q01. Basic net loss per ADS equivalent was JPY(-)22.91in 3Q01, compared to JPY(-)21.78 in
3Q00 and JPY(-)68.61 in 2Q01.
Table 5. Other Financial Statistics
3Q01
EBITDACAPEX, including capitalized leases
Depreciation and amortization(4)
(4)

904
804
783

(JPY in millions)
2Q01
3Q00
712
(-)126
931
749
726
678

Depreciation and amortization includes amortization of issuance cost of convertible notes.

Company Information
Internet Initiative Japan Inc. is one of Japan’s leading Internet-access and comprehensive Internet solution providers
primarily targeting high-end corporate customers. Founded in 1992, IIJ has built one of the largest Internet backbone
networks in Japan and between Japan and the United States. IIJ and its group of companies provide total solutions
ranging from new generation network services over optical-fiber infrastructure optimized for data communications toconstruction of Asia-wide IP backbone networks, high-quality Internet access, security system services,hosting/housing, content design and systems integration.
Statements made in this press release that state IIJ’s or management’s intentions, beliefs, expectations, or predictions
for the future are forward-looking statements that are based on IIJ’s and managements’ current expectations,assumptions, estimates and projections about its business and the industry. These forward-looking statements are
subject to various risks, uncertainties and other factors that could cause IIJ’s actual results to differ materially fromthose contained in any forward-looking statement. These risks, uncertainties and other factors include: IIJ’s ability tocontinue to increase subscribers to its connectivity services, particularly at higher bandwidths; IIJ’s ability togenerate significant revenues from its other services such as systems integration; the success of IIJ’s investments in
Crosswave; the ability to compete in a rapidly evolving and competitive marketplace; the impact of technologicalchanges in its industry; and other risks referred from time to time in IIJ’s filings with the United States Securities andExchange Commission.

Tables to follow

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED STATEMENTS OF OPERATIONSAppendix 1

For the Three Months Ended Dec 31, 2001, Dec 31, 2000 and Sept 30, 2001
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD) Except for Per Share and ADS Data) (1)Year-over-year Comparison
Dec 31, 2001

USD (1)
Revenues:
Connectivity and value-added services:
Dedicated access services
Dial-up access services
Value-added services:
Internet datacenter services
Other value-added services
Total value-added services
Other
Total connectivity and value-added services

JPY

% of
Total
Revenues

JPY

Dec 31, 2000
% of
Total
Revenues

YOY
Chg %

Sequential Comparison
Sept 30, 2001
% of
Total
QOQ
JPY
Revenues
Chg %25,476
6,744

3,338,370
883,698

33.6%
8.9

3,293,327
1,074,291

45.0%
14.7

1.4%
(17.7)

3,431,156
932,653

36.0%
9.8(2.7%)
(5.2)

4,478
3,258
7,736
2,893
42,849586,816
426,895
1,013,711
379,1885,614,967

5.9
4.3
10.2
3.8
56.5

341,914
239,656
581,570
114,303
5,063,491

4.6
3.3
7.9
1.6
69.2

71.6
78.1
74.3
231.7
10.9

506,775
378,815885,590
303,4815,552,880

5.3
4.0
9.3
3.2
58.3

15.8
12.7
14.5
24.9
1.1

25,8797,078
75,806

3,391,122
927,545
9,933,634

34.2
9.3
100.0

1,955,499
303,294
7,322,284

26.7
4.1
100.0

73.4
205.8
35.7

3,352,363
623,064
9,528,307

35.2
6.5
100.0

1.2
48.9
4.3

Costs and expenses:
Cost of connectivity and value-added services
Cost of systems integration revenues
Cost of equipment sales
Total costs

36,43821,8686,356
64,662

4,774,788
2,865,601
832,972
8,473,361

48.1
28.8
8.4
85.3

4,863,920
1,698,594
270,316
6,832,830

66.4
23.2
3.7
93.3

(1.8)
68.7
208.1
24.0

4,847,467
2,799,940
534,575
8,181,982

50.9
29.4
5.6
85.9

(1.5)
2.3
55.8
3.6

Sales and marketing
General and administrative
Research and development
Total costs and expenses

5,606
3,765
618
74,651

734,623
493,327
80,946
9,782,257

7.4
5.0
0.8
98.5

763,189
431,143
74,447
8,101,609

10.4
5.9
1.0
110.6

(3.7)
14.4
8.7
20.7

819,799
426,792
83,7369,512,309

8.6
4.5
0.8
99.8

(10.4)
15.6
(3.3)
2.8

Operating income (loss)

1,155

151,3771.5(779,325)(10.6)(119.4)

15,9980.2

846.2

Other income (expenses)(868)(113,705)(1.1)

494,7176.7(123.0)(430,259)(4.5)(73.6)

Income (Loss) before income tax expense (benefit)

287

37,6720.4(284,608)(3.9)(113.2)(414,261)(4.3)(109.1)

Income tax expense (benefit)
Minority interests in consolidated subsidiaries
Equity in net loss of affiliated companies(1,177)(30)(9,293)(154,239)(3,985)(1,217,755)

(1.5)
0.0
(12.3)

37,972
128,920(785,391)

0.5
1.7(10.7)(506.2)(103.1)55.1

1,266,458(5,533)(1,398,509)

13.3
(0.1)
(14.7)(112.2)(28.0)(12.9)Net loss(7,859)(1,029,829)(10.4%)(979,051)(13.4%)

5.2%(3,084,761)(32.4%)(66.6%)

Systems integration revenues
Equipment sales
Total revenues

Basic Net Loss Per Share
Basic Net Loss Per ADS Equivalent
Weighted Average Number of Shares
Weighted Average Number of ADS Equivalents(45,811)(22.91)
22,48044,960,000(43,552)(21.78)22,48044,960,000(137,222)(68.61)
22,48044,960,000

Note (1):The translations of Japanese yen amounts into US dollar amounts with respect to the three months ended Dec 31, 2001 are included solely for the convenience of readers outside Japanand have been made at the rate of JPY 131.04 =$1, the approximate rate of exchange on Dec 31, 2001.

Appendix 2

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Nine Months Ended Dec 31, 2001 and Dec 31, 2000
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD) Except for Per Share and ADS Data) (1)Year-over-year Comparison
Dec 31, 2001

Dec 31, 2000
% of

% of
USD (1)
Revenues:
Connectivity and value-added services:
Dedicated access services
Dial-up access services
Value-added services:
Internet datacenter services
Other value-added services
Total value-added services
Other
Total connectivity and value-added services

JPY

Total
Revenues

JPY

Total
Revenues

YoY
Chg %

77,506
21,366

10,156,438
2,799,812

36.5%
10.1

9,426,086
3,389,855

41.6%
14.9

7.7%
(17.4)

12,0809,138
21,218
8,660
128,750

1,582,976
1,197,441
2,780,417
1,134,795
16,871,462

5.7
4.3
10.0
4.1
60.7

804,884
631,247
1,436,131
330,934
14,583,006

3.5
2.8
6.3
1.5
64.3

96.7
89.7
93.6
242.9
15.7

68,85914,500212,1099,023,339
1,900,038
27,794,839

32.5
6.8
100.0

7,430,766
662,242
22,676,014

32.8
2.9
100.0

21.4
186.9
22.6

Costs and expenses:
Cost of connectivity and value-added services
Cost of systems integration revenues
Cost of other equipment sales
Total costs

112,097
57,843
12,780182,720

14,689,111
7,579,795
1,674,735
23,943,641

52.9
27.3
6.0
86.2

13,909,353
6,507,555
573,614
20,990,522

61.3
28.7
2.5
92.5

5.6
16.5
192.0
14.1

Sales and marketing
General and administrative
Research and development
Total costs and expenses

18,11010,372
1,918
213,120

2,373,208
1,359,149
251,280
27,927,278

8.5
4.9
0.9
100.5

2,492,240
1,248,945
220,645
24,952,352

11.0
5.5
1.0
110.0

(4.8)
8.8
13.9
11.9

Operating loss

(1,011)(132,439)(0.5)(2,276,338)(10.0)(94.2)

Other income (expenses)(4,620)(605,448)(2.2)

772,643

3.4(178.4)

Loss before income tax expense (benefit)(5,631)(737,887)(2.7)(1,503,695)(6.6)(50.9)

Income tax expense (benefit)
Minority interests in consolidated subsidiaries
Equity in net loss of affiliated companies

9,458
254
(29,270)

1,239,416
33,316(3,835,479)

4.4
0.1(13.8)(829,608)
162,400(2,835,630)

(3.6)
0.7
(12.5)(249.4)(79.5)
35.3

Net loss(44,105)(5,779,466)(20.8%)(3,347,317)(14.8%)

72.7%

Systems integration revenues
Equipment sales
Total revenues

Basic Net Loss Per Share
Basic Net Loss Per ADS Equivalent
Weighted Average Number of Shares
Weighted Average Number of ADS Equivalents(257,094)(128.55)
22,48044,960,000(148,902)(74.45)22,48044,960,000

Note (1):The translations of Japanese yen amounts into US dollar amounts with respect to the year ended Dec 31, 2001 are included solely for the convenience of readers outside Japanand have been made at the rate of JPY 131.04 =$1, the approximate rate of exchange on Dec 31, 2001.

INTERNET INITIATIVE JAPAN INC.
CONSOLIDATED BALANCE SHEETSAppendix 3

As of Dec 31, 2001, Dec 31, 2000 and Sept 30, 2001
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD)) (1)USD (1)ASSETS
Current Assets:
Cash
Short-term investments
Accounts receivable, net
Inventories
Prepaid expenses
Other current assets

Dec 31, 2001
JPY%

Dec 31, 2000
JPY%

Sept 30, 2001
JPY%

85,211044,496
1,740
6,155
3,246

11,166,077
0
5,830,688
228,063806,515425,411

25.9%
0.0
13.5
0.5
1.9
1.0

14,602,816
3,154,110
3,958,597
198,618
417,912324,340

26.7%
5.8
7.2
0.4
0.8
0.6

11,411,967
0
5,939,468
1,012,403
403,982
390,966

25.5%
0.0
13.3
2.3
0.9
0.9

140,848

18,456,754

42.8

22,656,393

41.5

19,158,786

42.9

79,26636,73858,0689,644
4,874

10,386,964
4,814,114
7,609,238
1,263,819
638,652

24.1
11.1
17.6
2.9
1.5

15,074,638
8,856,642
6,477,689
826,847
714,993

27.6
16.2
11.9
1.5
1.3

11,608,736
4,727,410
7,585,480
890,444664,675

26.0
10.6
17.0
2.0
1.5

329,438

43,169,541

100.0%

54,607,202

100.0%

44,635,531

100.0%

Short-term borrowings
Accounts payable
Accrued expenses
Other current liabilities
Long-term borrowings-current portion
Capital lease obligations-current portion

28,237
26,161
2,236
5,317
9,157
14,7173,700,214
3,428,098
292,996696,682
1,200,000
1,928,505

8.6%
7.9
0.7
1.6
2.8
4.5

6,110,000
6,294,412
265,374
308,386
90,0001,590,709

11.2%
11.5
0.5
0.5
0.2
2.9

3,770,445
4,526,061
222,003
365,625
1,000,000
1,853,146

8.5%
10.1
0.5
0.8
2.2
4.2

Total current liabilities

85,825

11,246,495

26.1

14,658,881

26.8

11,737,280

26.3

Long-term Borrowings
Convertible Notes
Capital Lease Obligations-Noncurrent
Accrued Retirement and Pension Costs
Other Noncurrent Liabilities

27,473
114,469
22,659962
261

3,600,000
15,000,000
2,969,253
126,085
34,238

8.3
34.7
6.9
0.3
0.1

2,400,000
15,000,000
2,613,916
142,455
525,620

4.4
27.5
4.8
0.2
1.0

3,800,000
15,000,000
2,939,079
125,099
26,306

8.5
33.6
6.6
0.2
0.1

251,649

32,976,071

76.4

35,340,872

64.7

33,627,764

75.3

7,814

1,023,897

2.4

673,546

1.2

1,019,912

2.3

Shareholders' Equity:
Common stock
Additional paid-in capital
Accumulated deficit
Accumulated other comprehensive income

54,047130,253(126,235)
11,9107,082,336
17,068,353(16,541,800)
1,560,684

16.4
39.5
(38.3)
3.6

7,082,336
17,068,353(9,409,429)
3,851,524

13.0
31.3
(17.2)
7.0

7,082,336
17,068,353(15,511,971)
1,349,137

15.9
38.2
(34.7)
3.0

Total shareholders' equity

69,9759,169,573

21.2

18,592,784

34.1

9,987,855

22.4

Total liabilities and shareholders' equity

329,438

43,169,541

100.0%

54,607,202

100.0%

44,635,531

100.0%

Total current assets
Investments in and Advances to Affiliated Companies
Other Investments
Property and Equipment, net
Guarantee Deposits
Other Assets
Total assets
LIABILITIES ANDSHAREHOLDERS' EQUITYCurrent Liabilities:

Total liabilities
Minority Interest

Note (1): The translations of Japanese yen amounts into US dollar amounts with respect to Dec 31, 2001 are included solely for the convenience of readers outside Japanand have been made at the rate of JPY131.04 =$1, the approximate rate of exchange on Dec 31, 2001.

INTERNET INITIATIVE JAPAN INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSAppendix 4

For the Three Months Ended Dec 31, 2001, Dec 31, 2000 and Sept 30, 2001
(Expressed in Thousands of Japanese Yen (JPY) and U.S. Dollars (USD)) (1)

Dec 31, 2001
USD (1)JPY

Dec 31, 2000
JPY

Sept 30, 2001
JPY

Operating Activities:
Net loss
Depreciation and amortization
Equity in net loss of affiliated companies
Minority interests in consolidated subsidiaries
Foreign exchange losses (gains)
Write down of other investment
Decrease (increase) in accounts receivable
Increase (decrease) in accounts payable
Decrease (increase) in inventories
Deferred income tax
Other
Net cash provided by (used in) operating activities(7,859)
5,977
9,293
30
(2,895)2,285
1,338(8,419)5,986(1,218)(62)
4,456(1,029,829)
783,194
1,217,755
3,985(379,315)
299,428
175,291(1,103,244)
784,340(159,611)(8,113)583,881(979,051)
678,247
785,391(128,920)(521,644)
676,871
1,419,009
117,133
33,831(190,254)
1,890,613(3,084,761)
726,278
1,398,509
5,533
178,577
28,824(566,601)
513,802(748,850)
1,264,707
388(283,594)

Investing Activities:
Purchase of property and equipment
Investments in and advances to affiliated companies
Purchase of short-term investments
Purchase of other investments
Proceeds from redemption of short-term investments(Payment) refund of guarantee deposits-net
Other
Net cash used in investing activities(1,243)(133)(2,850)(59)(4,285)(162,852)(17,497)-(193,373)(2,897,700)(5,297,122)(311,500)
8,366,650
21,279(107,242)(419,008)(393,770)(321,094)(100)

Financing Activities:
Proceeds from long-term borrowings
Repayments of long-term borrowings
Principal payments under capital leases
Net decrease in short-term borrowings
Proceeds from issuance of common stock of a subsidiary
Net cash provided by (used in) financing activities(4,048)(536)(4,584)(530,423)(70,231)(600,654)

1,200,000(200,000)(475,647)(900,000)

1,400,000(375,647)(494,991)(1,249,555)
375,000
30,454

Effect of Exchange Rate Changes on Cash

2,536

332,421318,649(171,738)

Net Increase (Decrease) in Cash

(1,877)(245,890)

1,414,607(1,162,777)

Cash, Beginning of Period

87,088

11,411,967

12,970,293

12,574,744

Cash, End of Period

85,211

11,166,077

14,384,900

11,411,967-(373,471)(7,718)(561,538)--(2,794)(20,141)(737,899)

Note (1): The translations of Japanese yen amounts into US dollar amounts with respect to the three months ended Dec 31, 2001 are included solely for the convenienceof readers outside Japan and have been made at the rate of JPY131.04 =$1, the approximate rate of exchange on Dec 31, 2001.