Network Solution Business
June 12, 2024
Yukinobu Noguchi, Senior Vice President
NEC Networks & System Integration Corporation(TSE: NESIC, 1973)© NEC Networks & System Integration Corporation 2024

Progress of Medium-Term Management Plan

* Forecast figures are as of April 26, 2024

FY25/3 targets have been revised in light of the business environment.
■ Results and forecasts (¥ Bn.)
97
79.2

83.1

80.0

25
Telecom.
carriers
etc.

Net sales

Gross profit margin

Socialinfrastructure

23.8%⚫ Structural reform of telecom carrier businesscompletedPlanning to improve gross margin in FY25/3- Cross-BU resource shift

72- Streamlining including in-house production andconsolidation of floors

14.0(14.4%)⚫ Aiming for targeted growth of the social
infrastructure business

21.5%
Operating income(to sales)29.8(12.4%)

9.4(11.3%)

9.0(11.3%)

FY23/3(Result)

FY24/3(Result)

FY25/3(Forecast)© NEC Networks & System Integration Corporation 2024

FY25/3(Medium-termtarget)

Overview of the Network Solutions (NWS) Business
Basic Policies
Providing highly reliable network systems with multi-vendor SI by leveraging comprehensive SI
capabilities for diverse network systems to meet high-level demand from customers, together withnationwide maintenance and operation systems

Strengths of the business⚫ ICT infrastructure comprising highly-skilled engineers(No. of beyond 5G professionals: over 1,000)(i) Network business⚫ Industry expertise through collaboration with NEC(ii) Beyond 5G business⚫ Ability to provide comprehensive solutions in a
one-stop manner, from SE to maintenance andoperations
3Business area(iii) Social infrastructure business© NEC Networks & System Integration Corporation 2024 *Beyond 5G: Most advanced radio network technologies including 5G, 6G, high-speed WiFi, LPWA, etc.

Business Strategy
Maximizing the NWS business by focusing on the business of co-creation with customers
using unique technologies through cooperation with venture firms
in addition to pursuit of deeper cooperation with NECNetwork business✓ Telecom. carrier infrastructure✓ Local NCC✓ Governments and public areas

Beyond 5G business✓ 5G social implementation

Social infrastructure business✓ Space and national securities✓ Marine
4✓ Media© NEC Networks & System Integration Corporation 2024

⚫ Pursuing open system business area, such as O-RAN and Whitebox,
in greater depth⚫ Making it a service business by providing operation DX solutions⚫ Entering the mission-critical areas by using large-scale network-SI
technologies cultivated through the telecom carrier business⚫ Launching the business of co-creation with customers by providing
industry-specific solutions based on characteristic infrastructure
products and wireless technologies⚫ Entering the area of direct sales in addition to pursuing cooperation
with NEC in greater depth⚫ Expanding from dedicated machines to the open system area byusing multi-vendor SI technologies

Network Business
Expanding the business volume by entering new network-SI areaTelecom carrier: O-RAN

Governments and public areas: Mission-critical areas

Nationwide deployment ofwireless x cloud computing technologies

Making the network more advanced for the DX of operations
Postalservices[Areas where we serve]
Relay stations andGC stations
Tens of thousandsof bases across Japan⚫ Areas where we build networks- Cloud environment- Site systems- Verify and evaluate⚫ Maintenance- Services provided in fields- Various documents- 24/7 year round

Entries to some deployedbusinesses completedElectricpower5© NEC Networks & System Integration Corporation 2024

* K&N System Integrations Corporation

To integrated SI

Network for digitalized control of electric power systems(Power plants and substations across Japan)- Advancing the private communication
network of control systems- DX of operations in power plants andsubstations

Ministries
and agencies

Cross-telecom-carrier deployment
through cooperation with KNSI*

Common network infrastructure(24,000 offices across Japan)

Differentiation with operation
solutions in addition to optical
x local 5G

Prefectural information network(physical and virtual infrastructures)
Fully integrated services with a nationwide system

Network Business: Local NCC
Accelerating expansion into new areas, including the businesses of supporting worksite DX
based on maintenance and operations (equipment management, visualization, automation
with AI, etc.) and local DC, in addition to optical network infrastructures
Segregated management (vertical)
Field data

Existing
systemDX-platform for operational integration✓ Scattered data (hard to collect)✓ Managed by different persons(dependent on individual skills)✓ Non-real-time management(erroneous judgments)

6

Creating new value with synergy

Open dataOperation
DX solutions

Networkopensolutions

Platform-based management✓ Data integration and management✓ Real-time visualization✓ Prompt data utilization

Facilities control

Geographicalinformation

Facility
information

Design data

Task history

Disasterinformation

Further expansion ofsolutions based onoperations

Vendor lock-in network

Making the network open

Pursuing the area in greater depth
by taking advantage of multi-vendor SI

Expensive/Not flexible/
Not expandable[Whitebox]

System selection + SI + Maintenance and operations© NEC Networks & System Integration Corporation 2024

Beyond 5G Business
Focusing efforts on launching a market for the social implementation of nextgeneration networks, by using characteristic products and companywide assets
Lineup of products tailored to purposes
NEC Magnus

HFR (South Korea)[High-output and integrated][Expandable and discrete]

All-in-one local 5G system integrated
with the core network

Portable high-performance base station,with all elements integrated in a single box✓ One-box✓ Non-SI✓ Powerful✓ Compact and✓ Low price✓ Compatible withpower-saving
outdoor use7

© NEC Networks & System Integration Corporation 2024

Thoroughly eliminating barriers to the introduction oflocal 5G to encourage customers to experience theimplementation

SI modelPreparing to offer rental
equipment in addition toone requiring initialinvestment

Co-creation model
Implementation of local 5G
in practical operations(Small starts)

Local 5G evaluation andvalue verification
Expanding areas of applications
while checking the effects

Central and local governments
NEC market and others

Manufacturing, construction, electric
power, transportation, and othersBeyond 5G Business: Use Cases
Industry-specific local 5G solutions developed through co-creation with the customers
in markets where demand for next-generation networks has been actualized
Use case (1): Manufacturing industry

Use case (2): Construction industry

Manufacturing siteConstruction site

SurveillancecameraManufacturing
line

Construction
IoT

Communication- Manufacturing and quality control- Centralized management of events- Real-time data sharing

8© NEC Networks & System Integration Corporation 2024

Drone

Heavymachinery
Communication

Integrated command system- Checking conditions of remote control, etc.
- Workers’ communication- Management of design and work data

Social Infrastructure Business: Space and National Securities (1)Expanding the business on an ongoing basis by pursuing cooperation with NEC in greater depth
in light of the activation of the security area
Further, expanding the direct sales area with open systems, aiming to maximize the business of the GroupKey point- Construction of
infrastructure facilities⚫ Development of engineers(Open system engineers, PM, and SE)- SI of NEC systems- SI of open systems(network and IT systems)⚫ Conforming to security standards
on our own(Information and physical security frameworks)⚫ Accelerating the development andproposal of a solution lineup(Lineup related to local 5G and energy)

9© NEC Networks & System Integration Corporation 2024

Further expansion of SI areas

Reinforcing the framework for taking
actions in response to market activation
and business expansion

National security
business

Coordination with NEC- Undertaking SI projects en bloc
- Expanding the area of maintenanceand operations

SL business-Enhancing the resilience ofsecurity bases→ Expanding areas of digitalization
Multi-vendor SI- Deployment to national security
related companies

Social Infrastructure Business: Space and National Securities (2)Expanding high-quality, cost-competitive solution business by taking advantage of our capability ofidentifying qualities and multi-vendor SI capabilities, which were cultivated through cooperation with NECSatellite ground station
Total solutionAntennas

System integration
RadomeMulti-vendor

Shelter
Optical transmission
Peripheral equipment
10© NEC Networks & System Integration Corporation 2024

To space-relatedcompanies(Newspace)

Focus- Discovering and partnering with global vendors- Ability to control vendors- Acquiring high-level product knowledge- Ability to make proposals in new areas

Social Infrastructure Business: Marine
Leveraging marine-related experience spanning more than five decades
together with the technological capabilities to enhance activities targeting
new growth markets, including offshore wind power generation
Growth of new markets

Existing businesses

Ability to manage large-scale
projects cultivated throughcooperation with NECCommunication
Observation
11System construction- Route surveys- Cable landing station
construction- Laying of communication cables

System development- Earthquake prediction- Submarine communications
extension equipment⚫ Offshore wind market(Cable work + O&M)

Initiatives for new areas
Entering projects from the designphase by taking advantage ofHDD* method*HDD：Horizontal Directional Drilling⚫ Development of multi-routesubmarine cables⚫ Protection and multi-regionalizationof cable landing stations⚫ Improving the resilience of nationallands (disaster prevention and mitigation)⚫ Resource exploration / expansion ofundersea surveillance© NEC Networks & System Integration Corporation 2024

Utilizing construction expertise,
expanding direct sales

Horizontal deployment ofobservation solutions

Increasing the Competitiveness of the Entire Company with
Advanced Network Technologies
Capturing leading-edge network technologies ahead of others,
thus helping differentiate all businesses of the company
Example: Smart security services for electric companies using local 5G technologies
Expertise inDX technologies and use of DX(workstyle innovation forenterprise)

DX Solutions
Business(DXS)

Expertise in the publicindustry /social
implementation capability

Next-generation networking
technological capabilities withhigh quality and reliability

Environmental & Social
Solutions Business(ESS)

Network SolutionsBusiness(NWS)
Companywide businessfoundation
12© NEC Networks & System Integration Corporation 2024

(Foundation for nationwide support services)

NEC Networks & System Integration Corporation will be committed to increasing
customer value by redesigning future communications from the user's perspective.

nesic13© NEC Networks & System Integration Corporation 2024

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