Cybozu, Inc.

Business Overview and Financial Results Briefing
for the Fiscal Year Ended December 2021

February 24, 2022
Cybozu, Inc.

About Cybozu

Cybozu, Inc.
Business

Develop, sell and operate groupware/Methodology consulting business

Representative
Director and President

Yoshihisa Aono

Established

August 1997

Head Office

Tokyo Nihombashi Tower, 2-7-1 Nihombashi, Chuo-ku, Tokyo

LocationsTokyo, Osaka, Matsuyama, Nagoya, Fukuoka, Hiroshima, Sendai, Sapporo, Yokohama,Omiya, Shanghai, Shenzhen, Taipei, Ho Chi Minh, San Francisco, Sydney, Bangkok,Kuala Lumpur, etc.

Capital Stock
Listed Exchange
Employee Headcount613 million JPYTokyo Stock Exchange, First Section (Stock code: 4776)* Plan to move to the new Prime section in April 2022

Consolidated: 969 employees, Non-consolidated: 737 employees* As at end of December 2021
* Open-ended contract (permanent) employees only (executives and auditors not included)Our vision since 2020
PurposeCreate a society brimming with teamwork
Culture

Share a common vision

Create a common vision that resonateswith all members and guides theiractions

Embrace individuality

Embrace individual differences and tap
into each other’s strengths

Be transparent

Build a foundation for open trust

Be yourself, takeresponsibility

Cultivate independence andgenerate progress throughdiscussion

Information sharing and teamwork
Data, information, and communication isseparated by team, making it impossible to share
information outside one’s teamInformation is siloed, cutting theworkplace off from the data
it needs to innovate

Information shared openly on one platform.
Workplace-driven business improvement.

Information sharing boosts
teamwork and helps the entire
organization to evolve

Cybozu’s cloud services
Groupware

Easy and simple
groupware forSMEs

Business app development platform

Platform for implementing
no-code/low-code businesssolutions
Mail-sharing application

Groupware for large andmid-sized organizations

Centralized managementof team email
correspondence

The Cybozu ecosystem strategy
Extend product functionality with third-party service integrations and plug-ins

Core features

Database

Extend functionality with plug-ins andthird-party service integrations
Process
management

Core features

Communication

More on extending functionality with plug-ins and integration services: https://kintone-sol.cybozu.co.jp/integrate/search/

The Cybozu ecosystem strategy

Surround ourselves with partners and users that can grow with us
Product partners

Product partners

User

User

User

User
community

Consultingpartners
Productpartners

User

Consultingpartners

User

User

User

Consolidated sales and operating profit
Sales

Operating profit(Million JPY)

(Million JPY)

20,00018,00016,00014,00012,00010,000
8,000
6,000
4,000
2,000
0

Non-consolidated sales
Group sales
Consolidated operating profit

2,500
2,000
1,500
1,000
500
0-500

Consolidated financial results
Consolidated Financials( U n i t :m i l l i o n

J P Y )Sales

FY2020(Actuals)

FY2021(Actuals)

FY2022(Forecast)

15,674

18,48921,730Operatingprofit

2,270

1,441

345

Ordinary

profit

2,272

1,468

401

Current net profit

1,435

551

- 429

Net profit per share

31.30 JPY

12.03 JPY

- 9.35 JPY

Dividend per share

11.00 JPY

12.00 JPY

13.00 JPY

Detailed results FY2021
Consolidated PL(Unit:million

JPY)

FY2020
Actuals

FY2021
Actualss

15,674

18,489

Cost of sales

1,086

1,339

Labor

5,502

6,315

Sale

costs

Advertisingexpenses

2,673

4,907

Os

4,143

4,487

Operating profit

2,270

1,441ther

Consolidated sales+2,815 million JPY YoY(+18.0%)Aggressively invested inadvertising and promotion
Operating profit- 829 million JPY YoY(-36.5%)

Ramped up advertising and promotion
Leveraged cloud business growth and aggressively invested in advertising to increase productawareness
Expected to pay off in the long run
Aired TV commercials to promote product awareness. We expect these campaigns to takeseveral years to yield substantial business returns, due to the nature of our product
Positive impact on existing users and partners
Motivated existing customers into taking full advantage of Kintone, nurturing Kintone’s
brand image, making our sales partner ecosystem more dynamic
Positive impact on recruiting
Increased awareness among students and their families, higher number of applicants
after watching our TV ads and other campaigns

Financials
Consolidated BS(Unit: million JPY)

FY2020

FY2021

YoYs

12,235

14,037+ 1,802-Cash & deposits

3,956

4,805+ 849

L i a b i l i t i e s

5,829

7,665

+ 1,836-Short-term debt

−2,200+ 2,200

a s s e t s

6,405

6,371

−34

-Treasury stock-1,800-1,800−052.4%

45.4%

−7.0%

139.63 JPY

138.88 JPY-0.75 JPYAsN e tset

Shareholder equity ratio

Net assets per share

Extra funds for
active investment

Cloud business still growing 10 years after our shift to the cloud
Consolidated sales (on-premises/cloud)(Million JPY)
20,00018,000On-premises

8,000
6,000
4,000
2,000
0・Kintone released
・ Setting our sights on the low
code/no code market・Stable revenue stream frommaintenance agreements
・Release of enterprise groupware
・Start of partner sales

14,00010,000Shift to cloud-based business

Sales network development

16,00012,000

Cloud

Initial period

・Company launched by threefounders in an apartment in
Matsuyama City
・Web Direct Sales

Cloud-related sales
YoY

+26%

Slump

・On-premises
sales plateau

Cloud share of
total consolidated
sales

81%

* Figures are non-consolidated until 2010 and consolidated from 2011. * Six month-fiscal period in 1999, 11-month fiscal period in 2012

Business expansion through our ecosystem
Partner sales revenue increasing every year
Partner sales accounted for 60% of cloudsales in 2021

Partners

Integrations services

360

Over

Aboutcompanies* As at end of December 2021

300services* As at end of December 2021

Revamped partner program

Direct sales/Indirect sales ratio - cloud* Japan sales only
Direct sales

Partners

Indirect sales

ConsultingProduct
2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

Distributor

Customers

Establish a business model that generates profits through synergies and benefits society

Sales by product * As at December 2021

Package

20112012

Cloud2013

Package

2012

2013

2014

2015

2016

2017

2018

2019

20202021

Cloud2014

2015

2012

2013

2014

Package

2016

2017

2018

2019

2020

2021

2015

2016

2017

2018

2019

2020

2021

Cloud

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Number of customers who have deployed our products(as of December 2021)

23,000 companies
72,000 companies
6,400 companies
11,800 companies* Kintone: Domestic companies signed up to Kintone (Kintone is cloud only)* Other products: Total number of domestic companies who have deployed product on-premises or in the cloudAround70

Updating Kintone’s functionality and UI/UXExampleEnhanced control of apps and spaces

updates
performed in2021New Kintone admin setting
Block users from creating apps not
associated with a specific Kintonespace

OFF (blocked)
Setting isOFF

Kintone platform

New Space setting
Only allow spaceadministrators to createapps

Users blocked fromcreating apps notbelonging to a space

All users with permission are allowed to create apps
(Good for spaces where users need to easily test different apps)

OKNew
featureNewfeatureOKOK×OK

Not in a space

A testing ground for users to practice building apps
Only the space administrators can create apps
(Good for spaces that require strict regulation of app building)

Setting isOKON×Space 1
Spaceadministrator

OKOKSpace 2×OK××

Space 3

Other users

Support IT admin governance for enterprise users to drive organization-wide uptake of Kintone

Integration plug-ins create newpossibilities
Use Garoon
with Kintone

About47%.

* 2021 User Survey(Cloud version Garoon user responses)

Use Garoon
with Microsoft 365

About50%.

* 2021 User Survey(All responses from Garoon cloud users)

Numerous plug-ins released by our partners
Garoon-Kintone schedule integration plug-in
Garoon-Kintone workflow integration plug-in
Microsoft 365 Teams integration plug-in
Zoom scheduling integration plug-in
Cloud signing integration plug-in
Video conferencing plug-in

Plug-ins provided by Cybozu
Email misfire warning plug-in
Survey plug-in

Additional scheduling improvements and APIaugmentation

Registered as ISMAP compliant(security evaluation standard for government information systems)
The cloud service infrastructure cybozu.com as well as Garoon and Kintone (both hostedon cybozu.com) are registered in the ISMAP-certified cloud service directory.

cybozu.com common authentication (log/user management/authentication features)cybozu.com infrastructure (servers, storage, OS, middleware)

Accelerate the provision of reliable and secure cloud services to government agencies

Third-party commendations

Nikkei Computer, Sept. 2, 2021 edition
Customer Satisfaction Survey 2021-22
Cloud Infrastructure Services
IaaS/PaaS category – No. 1 for 3
consecutive years

Nikkei BP Government Technology
Fall 2021 edition
Municipal Government IT System
Satisfaction Survey 2021-2022
Groupware/Business Chat category – No. 1

Nikkei Computer, Feb. 17, 2022
editionPartner Satisfaction Survey 2022
Cloud Information SystemServices category No. 1 for 2 consecutive years

Growing Kintone as a tool for workplace-driven business
improvements
Total Kintone customer volume

23,000 companies

Customer breakdown by sector

deploying Kintone in their

not inthe IT department
organizations are(As of December 2021)

Average number ofcompanies installing Kintone

Department of customer stakeholders
driving Kintone deployment(Subject: Customers active
as at December 31, 2021)

550 companies/month(2021 average)
Share among companies listed on thefirst section of the TSE/TYO

Installed at

93% of stakeholders

1 in every 4companies(As of June 2021)(As of December 2021)

Enterprises
Kintone perfect for corporate digital transformations (DX)
Rapid business improvement done in-house, thanks to Kintone

Collaboration between IT/DX department and business divisions
Business improvement powered by workplace-driven app development andrapid solution building by the IT/DX department based on workplace
feedback
Business divisions

Responding to business changes

Kintone is a no-code/low-code tool whereusers can build flexible and efficient solutions
that can respond to business changes

IT/DX department

Collaboration

Systemdevelopment

Systemdevelopment

Systemdevelopment

Enterprises
DX division and business divisions collaborate to rapidlybuild new business solutions and improve operations
 Operations digitized by the DX
department can be instantly
implemented in the workplace.
Providing a digital environment
from the get-go translates to acontinuous "build, scrap, and build"cycle.
 By directly listening to feedback
from the workplace, the requested
features are immediately developedand refined. By building solutions
on the spot, users gain a deeper
understanding of KintoneDX
Promotion
OfficePublic Sector

Expanding the use ofKintone in local governments

TokyoKintone used throughout the Tokyo Metropolitan Government (TMG),including for managing inoculation of healthcare workers against
COVID. Tokyo’s public roadmap for streamlining its operations explicitly
mentions Kintone as a tool to be utilized.
Kanagawa PrefectureManaging transport of COVIDpositive patients
Hiroshima City
Coordinating the distribution of COVID
vaccines to medical institutions
Kitakyushu City
Cooperation Agreement on promoting
DX across entire agency

Number of municipalities
using Kintone
in 2021:
About150120

TMG
Managing vaccination of healthcare workers against
COVID(2) Input required data inKintone to consolidate
healthcare worker
informationTokyo140

Healthcare workers

9060300

Medical institutions
2019

20202021(3) Medicalvouchersrequired for
vaccination canbe printed outfrom Kintone(1) Collect data from medical
institutions and issue Kintone licenses

Public Sector“Share DX" for local governments, made possible by Kintone
Mutual sharing of know-how and bestpractices between local governments

Govtech Kintone Community
Connecting local governments
Main features of the community

Local
government A
Kintone used byentire agency

Local
government B
Break frompaper-based
cultureLocal
government C
Transitioning todatabases

Local governments turn their solutions into app
templates that can be duplicated by other local
governments on their Kintone platform.
Existing apps can be replicated by other local
governments to build solutions with minimal use ofresources

Customer stories fromlocal governments

Best-practice templates

Seminars, documentation,and videos for local
governments

Open forum for sending
questions to other local
governments and Cybozu

Online/offline events

All local government employees can participate.
More than 500 officials
from 200 local governments are currently participating.

BanksPartnership scheme with regional banks to grow new partner channels
Business model for cooperation with regional banks
Deliver Kintone
RegionalbankCustomers

Backup & support

Business matching
Local sales staff

Official Cybozu
partners

Kintone training/study sessions
for bank employees

Proposal andconsulting services

Consultation

Business improvement
consultation
Consulting specialists
ICT consulting group

Seminars to support awareness campaigns

BanksEngaging local businesses regional banks have close community ties with tobuild dynamic regional economies
Regional bank partnerships

Partnership withnationwide

10 regional banks

Another 13 banks are affiliatedwith Cybozu via our partners.

Consulting by regional banks - Track record
300

After approx. 4 years, 200

around 300
100
companies have0
adopted our software

2018

2019

2020

2021

Initiatives to improve Kintone consulting skills
Cybozu manages a community for banks
to improve and share their consulting andpitching skills

Propose IT solutions to boost the productivity of local SMEs and transform them into companies
that are great places to workExpanding the Cybozu way
Disaster recovery support with Kintone"Disaster DX"

Seminars: 149Utilize Kintone at disaster sites because it can improve operations fromthe bottom-up
 A flexible solution that can be updated according to the situation on
the ground to rapidly share information about the extent of thedamage, relief supplies, volunteer recruitment and other vital data.
 Cloud computing allows information to be shared regardless oflocation or device, enabling remote support to disaster areas.

Training and consulting
assignments:

87

160
120

Expanding Disaster
Prevention Agreements
nationwide

Training/consulting

80


400

20182019

20202021



Chofu City
Nagano Prefectural Council ofSocial Welfare
Shizuoka Prefectural Council ofSocial Welfare
Hiroshima Prefectural Council ofSocial Welfare
Yokohama City CSW
Ibaraki Prefectural Council ofSocial Welfare, etc.

More offices and increased hiring
Bolstered our product, sales, and marketing support organizations
April 2021

Sapporo Office opened

800700

May 2021

Fukuoka office relocated &expanded

600
500

January 2022

Hiroshima office opened

400
March 2022

Omiya Office opened
February 2021

Yokohama Customer Center opened
January 2021

Okinawa Customer Center relocated &expanded

300

Headcount and turnover rateHeadcount at end of FY (nonconsolidated)
Turnover rate: %.

3025201510200
100050Global expansion
YoY+ 7.2%

With the opening of ourrepresentative office in Bangkok
in Oct. 2020, our strategy
focusing on local Thaicompanies is going well.
YoY+ 25.3%

Greater China

1,190

companies

Shift targeting local
companies into high gear
Half of new deals are localcompanies.
Improve sales and support toincrease customer
satisfaction.
Marketing initiatives also
being stepped up.

YoY+ 30.8%

US680 SDs

ASIA940

companies

Received Honorable Mention in the US businessmagazine Fast Company’s“2021 Next Big Things in Tech”* As of December 2021 (Total number of companies in Greater China and ASIA; number of subdomains under contract in the U.S.)Enhanced user approach with hands-on support
Kintone enables people on the frontline in workplaces to improvebusiness operations from the bottom-up

US Market Trends
Booming aPaaS market

Kintone Corp.
Hands-on proactive support (“companion runner service”)

Initially considered mere shadow IT, aPaaS is
becoming mainstream due to growing
awareness and utilization in IT departments

Provide continuous customer-focused support centered on their issues
from the pre-sales stage, with a market-in mindset rather than relying
on product out.

Lots of new competitors emerging

High customer ratings
Improved business operations thanks to Kintone’s product flexibility andproactive, hands-on support.

As the market expands, so does funding for
aPaaS companies

Companies are exploring new businessmodels

While our customer base is growing,
differentiation from existing IT system building
models and customer support in line with
subscription-based billing will be key toachieving successVolvo Trucks
North America

Growing number of positive reviews on G2, areview and comparison site for businesssoftware

Dedicated in-house training
staff can use Kintone tomanage training programs
and learning progress.
https://www.g2.com/products/kintone/reviews

Boosting sales base in Southeast Asian markets
Press release on Feb. 24, 11:00 a.m. (Japan time)
March 2022 Cybozu establishes first Southeast Asiansales office in Kuala Lumpur, the capital of Malaysia
Thailand
Bangkok
Representative Office

Malaysia subsidiary
Kintone Southeast Asia Sdn. Bhd.

Kintone Southeast Asia Sdn. Bhd.
Office building

Ramping up initiatives in English-speaking countries tocomplement our operations in Thailand, where we have arepresentative officeAggressively investing in future cloud growth
Sales

Operating profit(Million JPY)
25,000(Million JPY)
2,500

20,000

Sales (consolidated)
Operating profit

2,000(consolidated)

1,500
15,0001,000
10,000500
5,00000

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022(Forecast)△ 500

New TV ad airing from Feb. 7

Active investment inadvertising promotions
and other awarenessmeasuresMore server equipmentfor domestic cloudservices

Investing in hiring andoffice expansion

Next-gen cloud infrastructure to support future cloud business growth
Ten years after releasing cybozu.com in 2011, we are revamping our cloud infrastructure to prepare
for future growthcybozu.com (cloud services platform)

Current cloud infrastructure ("Forest”)

Problems with scaling andoperational overhead

Next-gen cloud infrastructure ("Neco”)

High capacity

Elastic

Maintenance without
downtime

ResilientPricecompetitive

Boost service development capabilities with stable infrastructure that can handle large userand data volumes

Updated corporate blueprint

DXCX

Digital Transformation

Corporate Transformation
 New advisory process for all employees togive feedback on management decisions
 Nominating candidates for Board of Directors’
positions from within Appointing Outside Directors in accordancewith the revised Companies Act

Saturday, March 5, 1:00 p.m. - "Cybozu Shareholders' Meeting 2022" will be held online.
IR event to solicit advice from viewers, including shareholders, on Cybozu's future corporate governance