TOKYO ELECTRON ANNUAL REPORT 2015

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CONTENTSCONTENTS

Financial Highlights

Business Overview

Review of Operations
and Business Outlook

To Our Stakeholders

Message from the CEO

Corporate Governance

Financial Section

Corporate Data

Message from the COO

To Our Stakeholders Message from the COO

As Technology
Advances, New
Opportunities
Arise

Expanding our Competitive
Strengths
to Maximize Growth
Opportunities

I am pleased to have assumed the position ofrepresentative director, senior executive vicepresident and COO in June 2015. I would like tothank our shareholders and other stakeholders fortheir support and confidence.
The internet of things (IoT), which will connect not
only conventional PCs and mobile devices, butalso various other objects, is nearly upon us.
According to Cisco Systems, a U.S.-based networking equipment manufacturer, the number ofdevices connected to the internet is expected togrow from 14.5 billion in 2014 to 50 billion in2020, and annual global IP traffic is thus expected
to grow an average of 21% per year from 2013 to2018. Technological innovation in semiconductors

Under a new executive framework designed to maximize
Tokyo Electron’s strengths, we are pursuing world-classproduct competitiveness and profitability and thus seeking
to enhance corporate value.

has an important part to play in the arrival of thisnew era, as do the cutting-edge production
equipment technologies that support such innovation.
The semiconductor industry is now right on thebrink of the most important inflection points in its
history. Until now, semiconductors have developed through ongoing miniaturization. However,as miniaturization progresses, we are encountering various technological barriers that cannot beovercome by existing technologies. To breakthrough these barriers, innovative new technologies are emerging. These include 3D structuredevices, such as 3D NAND flash and FinFET, theuse of new semiconductor materials, and multiple
patterning that realizes finer patterns by using
etch and deposition with current lithography
technology. By developing products suited forthese new technologies, Tokyo Electron raised its
market share in every one of its product categories in 2014. We regard technological inflection
points as unparalleled opportunities for businessexpansion.
Going forward, under a new organizational structure, we will focus on our mainstay semiconductor production equipment (SPE) and flat panel
display (FPD) production equipment businesses
to further enhance product competitiveness. First,
we are forcefully implementing our region andaccount management structures to construct anorganizational system that can better respond to
customers’ needs by quickly offering sophisticated solutions. Furthermore, as technologicaldemands grow more advanced, process control
across product categories grows more important.
Tokyo Electron will therefore leverage the strengthof its large and diverse product lineup to develop
higher-added-value products. We are concentrating resources in areas that are expected to growand streamlining development to accelerate theimplementation of our product strategies.
As a market leader in the fields of SPE and FPD
production equipment, we seek to contribute to
the creation of a bright future for the world and, in
doing so, continue to increase Tokyo Electron’s
corporate value. To make Tokyo Electron a truly
global company, we will do our utmost to achieve
world-class profitability and product competitiveness. To succeed, I ask for your continued support and confidence as we continue to move
forward.

June 2015

Toshiki KawaiSenior Executive Vice President & COO