FY2024/5 Financial Results for Q2

GunosyGunosy Inc.
TSE Prime (6047)

6047

INDEX

1. New Management Structure

P 03

2. Financial Highlights (Including Full-Year Forecast)

P 08

3. Financial Results for FY2024/5 Q2

P 15

4. Business Overview by Division

P 19• Investment• Media Business• Game8

5. Other Topics

P 41

6. Reference Materials

P 44

C

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2

New Management StructureC

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3

Representative Director Structure
Shinji Kimura will continue to lead the entire Group. Kentaro Nishio will be responsible for all of theGroup's non-investment businesses.

Representative Director andChairman, Group Chief
Executive Officer (CEO)Shinji Kimura

He graduated from the Department of Physics,
Faculty of Science, The University of Tokyo.
After joining DREAM INCUBATOR Inc., hefounded Atlantis Co., Ltd. (now Glossom, Inc.)in March 2007 and sold it to GREE Inc. in 2011.
He assumed the position of Representative
Director of Gunosy Inc. in 2013 and resigned in
2014. In June 2016, he founded AnyPay Inc.
and became Director in May 2018. After
assuming the position of Director of Gunosy inAugust 2017, he was appointed Representative
Director and Chairman, Group Chief Executive
Officer (CEO) in June 2020.

Representative Director
and President

Kentaro Nishio

He graduated from the Faculty of Systems
Design, Tokyo Metropolitan University. He cofounded Labit Inc. while still a student andbecame Representative Director in 2013. Aftertransferring the business to a subsidiary ofRecruit Holdings, he founded Game8 Inc. andcurrently serves as Representative Director andChairman. He joined Gunosy Inc. in 2015 after
Game8 became a subsidiary of Gunosy. In
December 2023, he assumed the position ofRepresentative Director and President ofGunosy Inc. after serving as Corporate Officer
since September 2018 and Director sinceAugust 2020.

Primary Role

Make decisions for the continued
growth of the entire Group
Allocate management resources with an awareness of theGroup's overall business portfolio and grow investment
businesses

Primary Role

Drive growth in media, Game8
and new businesses
Expand and launch non-investment businesses

C

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4

Overview of the New Management Structure
Effective December 1, we implemented a new management structure. Given the significant changes in thebusiness environment in the 11 years since our founding, we are creating a structure that will enable us to
manage multiple business portfolios and achieve Group-wide growth.

Board of Directors
New
struc
ture

Two Representative Directors
Representative Director and Chairman, Group Chief Executive Officer(CEO)(Shinji Kimura)

Representative Director and President(Kentaro Nishio)
New
posit
ion

Group Corporate Officers(Shunsuke Sawamura, Tatsuyuki Iwase, Toyohiro Shibukawa)C

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5

Our Management TeamThe management structure as of December 1, 2023 is as follows.
(*) N&C (Nomination and Compensation Committee)

N&C

Representative Director andChairman, Group Chief Executive
Officer (CEO)Shinji
KimuraRepresentative
Director andPresident

SuguruTomizuka

Director and Chief
Investment Officer (CIO)

Director

Director

Yuki
ManiwaYuya
Taketani

Masaaki
Nose

KentaroNishioN&C

Director (Outside)

N&C

New

N&C

Director (Outside)

Junichi
Shiroshita

N&C

Director (Outside)

Hirokazu
Mashita

Director (Outside)

Lei-Isabelle
NakaoC

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6

New Corporate Officers of the Group
Three new Corporate Officers have been appointed to accelerate the execution of the Group's business.

Corporate Officer of the Group (Group Chief Operating Officer)

Shunsuke Sawamura
He graduated from the School of Business Administration, Kwansei Gakuin University and joined
Game8 Inc. in September 2018. After serving as COO and Director and COO, he assumed theposition of President and CEO of Game8 Inc. in June 2022. In December 2023, he joined Gunosy
Inc. as Corporate Officer and COO.
Corporate Officer of the Group (Group Chief Financial Officer)

Tatsuyuki Iwase
He graduated from the Faculty of Business and Commerce, Keio University. He joined Gunosy Inc.
after working at Bank of Tokyo-Mitsubishi UFJ (currently MUFG Bank), Deloitte Tohmatsu
Consulting LLC. and PricewaterhouseCoopers Arata LLC. In June 2021, he was appointed
Corporate Officer. In August 2022, he assumed the position of CFO.
Corporate Officer of the Group (Head of Technology Division)

Toyohiro Shibukawa
He started his career as an engineer and became CTO of Genequest Inc. before joining RPA
Holdings Inc. as CXO. He was also involved in organizational design, new business launches and DX
promotion at several other companies before joining Gunosy Inc. as Corporate Officer in April 2022.

C

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7

Financial Highlights

C

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8

Executive Summary (1/2)

business

Consolidated operating loss decreased significantly QoQ
due to the recovery of the profitability of programmatic
advertising in the Media business and the sales growth inGame8. Full-year consolidated operating profit forecast has
been raised.

Media
business

Profitability has recovered since the second half ofOctober and continues to improve across the Mediabusiness.

Game8business

At Game8, as previously announced, overseas eCPM
continues to be strong, contributing significantly to the
upward revision of the full year results.

Investment

At slice, our subsidiary, AUM is growing steadily, resulting
in a significant improvement in the share of losses
accounted for using the equity method.

OverallC

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9

Executive Summary (2/2)
Q2 (Sep-Nov 2023)

Net sales

1,849

Operating profit-20

million yen

million yen

YoY

YoY

92.4

---

(Million yen)

Net sales

Operating profit

Gunosy

1,129

-115

Game8

501

111

Others218-16(Million yen)

Net sales

Operating profit

Gunosy

2,298

-381

Game8

957

203

Others473-28

Q1-2 (Jun – Nov 2023)

Net sales

3,729

Operating profit-205

million yen

million yen

YoY

YoY

94.9

---

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10

Revision of FY2024/5 Results Forecast (Consolidated)
Regarding the forecast for consolidated results for the full year, operating profit was revised upwardfrom -0.5 billion yen in the original forecast to -0.26 billion yen, taking into account the consolidated
results for the second quarter. On the other hand, the amount of loss for ordinary profit and profit
increased from the original forecast due to an increase in the share of losses of entities accounted forusing the equity method (see page 13 for details).
(Million yen)

FY2024/5
1Q-2Q(Jun – Nov 2023)

Initial forecast(full-year)

Revisedforecast(full-year)

Increase /decrease

Progression
rate

Net sales

3,729

7,880

7,200

-8.6%

51.8%

Operatingprofit

-205

-500

-260

-

-

Operatingmargin

-

-

-

-

-

Ordinary
profit-751-999-1,304---1,018-1,070-1,648--

Profitattributable toowners ofparentC

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11

Background of Revision of Results Forecasts: Operating
Profit (Consolidated)
Operating profit(Million yen)(Consolidated)

POINT

0
-260
1

-500

156

1
•

300

2
•

204
149
2
-569
Initial forecast

GunosySales decline•
GunosyCost reduction

Reductionofadvertisingexpenses

Reductionof othercosts

ProfitincreaseincludingGame8business

Operatingprofit afterrevision

Non-consolidated operating
profit of Gunosy exceeds
forecasts
Sales were lower than forecast due
to tough advertising market
environment and lower profitability
from Q1 to mid-Q2.
On the other hand, Gunosy's nonconsolidated operating profit
exceeded the initial forecast by 84
million yen due to successful controlof advertising investments andflexible cost reductions.

Performance of Group
companies, including Game8,
exceeded forecasts.
Game8 sales exceeded forecasts
and were the largest contributor.

C

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12Equity Method Investment Gains/Losses of slice
The organic growth of the business continues with appropriately controlled marketing investments,
resulting in a decrease in the amount of losses. Equity method investment losses are also on a declining
trend. (See pages 20-31 for details of slice business).

Equity method investment gains/losses of slice
FY2023/5(Million yen)

Q1

Q2

Q3

FY2024/5
Q4

Q1

Q2

0

-218

-225

-286
-373

300

-337

Factors behind the increase inequity method investment losses
compared to the forecast at the
beginning of the fiscal year

Increase in ESOP-related
expenses on a non-cash
basis, etc.

-549

Product transition
period(Sep-Dec 2022)

600

Releasenew
product(Dec 2022)

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13

Progress towards Achieving Operating Profitability(Consolidated and Non-consolidated) in FY2025/5

1

After the transition to the new management structure, we will continue
to pursue our basic policy of returning to profitability on aconsolidated and non-consolidated basis in FY2025/5.

2

We are making steady progress toward achieving profitability on aconsolidated basis, with the operating loss narrowing to -20 million
yen in Q2, driven by the growth of Game8.

3

We have changed our original plan to achieve operating profitability of Gunosy Inc.
on a non-consolidated basis by expanding the scale of sales through advertising
investment. Going forward, we aim to return to profitability by improving
productivity while implementing measures to improve profitability with advertising
investments appropriately controlled within the IRR threshold.

4

We will announce our business policy in July 2024 when we release
our financial results for FY2024/5.
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14

Financial Results for FY2024/5 Q2CGunosy Inc. All Rights Reserved.

15

FY2024/5 Consolidated Results for 2Q
In addition to the strong sales of Game8, advertising investments in the Gunosy app were reduced. As
a result, the loss in Q2 was significantly reduced.

(Million yen)

QoQ
FY2024/5
2Q

YoY

FY2024/5 1Q

FY2024/5
1Q-2Q

QoQ

(Jun – Nov 2023)(Sep – Nov 2023)

FY2023/5
1Q-2Q(Jun – Nov
2022)

YoY

1,849

1,880

98.3%

3,729

3,928

94.9%

Operating profit

-20

185

-

-205

-162

-

Operating margin

-

-

-

-

-

-

Ordinary profit

-226

525

-

-751

-929

-

Profit attributable toowners of parent

-304

714

-

-1,018-160-

Net salesC

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16

Breakdown of Net Sales*1

Game8 sales increased both YoY and QoQ.
In Gunosy Ads, the profitability of programmatic advertising bottomed out and started to increase in midOctober, but not in time to avoid QoQ sales decline. We expect Gunosy Ads to maintain its postrecovery profitability levels from 3Q onwards.
OthersGame8
ADNW
Gunosy Ads*2(Million yen)

2,400

221
203

366
1,600

800

246

375

371

192

168

262

275

435

441

267

451

254

260

1,267

1,198

1,189

Q1

Q2

Q3

1,526

1,403

153

390

227

194

457

420

247

1,334

1,352

Q2

Q3

257

1,492

295

142

203

369

381

470

445

201

168

140

119

244

1,214

1,248

1,209

1,197

Q1

Q2

Q3

Q4

295

271

456

501

110

88

1,018

987

Q1

Q2

0

FY2021/5

Q4Q1

FY2022/5

Q4

FY2023/5

FY2024/5*1: Sales of Gunosy Ads, ADNW and Game8 are presented on a nonconsolidated basis. Internal trade adjustments are included in Others*2: Sales of Gunosy Ads are the total of “Gunosy”, “NewsPass”, “au Service Today” and “LUCRA” (Service ended in FebruaryC Gunosy Inc. All Rights Reserved.
2023).

17

Cost Structure
Advertising expenses decreased QoQ as they were restrained in view of Gunosy's profitability. Other
costs were tightly controlled and did not change significantly.

(Million yen)

2,304

2,400

2,135

2,048
1,866

1,600

1,090

810
779
153
94

800

1,974

583
128
278

0

Q1

920

540

370

2,085

515

334

561
348

389

550

639

668

673
628

419

330

331

301

307

238
230

575

607

109

114

195

118

114

186

168

181

186

107
146

120
125

116
102

116
87

108
79

112
64

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

36

39

513

518

515

121

111

115

182

187

Q2

Q3

FY2021/5

1,869

580

538

64

535

537

2,080 2,110 2,118 2,066

39

375

152
88

2,010

227
39

318

371

153
93

2,187 2,176

FY2022/5

197
37

288
40

39

629

624

630

282

FY2023/5

297

317

36

36

603

610

193
38
601

Others
Revenue sharing*

Advertising expenses
Rent expenses onland and buildings
Personnel e xpenses
Se rver expe nse s
Ad network costs

FY2024/5* “Revenue sharing” included in “Others” in FY2021/5 and earlier, but separated from “Others” from FY2022/5 Q1.
“Live video production expenses” is included in “Others” from FY2022/5 Q1.

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18

Business Overview by Division

Investment(slice)C

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19

Relationship with “slice”

slice

Since 2019, we have invested a cumulative total of over 3 billion yen in slice. In April 2022, we
dispatched a director, making it an equity-method affiliate.

2015 Jun

GaragePreneurs Internet Pvt Ltd., which operates"slice" established
Percentage of ownership by the
Gunosy Group2019 Sept

Initial investment

2020 Jun

Second investment

2021 Jun

Third investment (approx. 15 million USD)

Nov

2022 Feb

17%

Enterprise value exceeds $1.5

billion in Series B1 round"slice" achieved unicorn status by raising
significant funds in its Series B funding round

Became our affiliate

4th investment (approx. 10 million USD)

Our CIO was dispatched as

Jun

Became an equity method investee of Gunosy by dispatching a
director“slice” raised approx. $50 million in its Series B1 round

Sep

Digital Lending Guidelines issued by RBI *1

Dec

New products released in compliance with Digital Lending
Guidelines (December 1-)

Aprapprox.

a director.

Director and Chief
Investment Officer (CIO)

Yuki Maniwa

To strengthening thecollaboration between
the two companies,“slice” became an
equity-method affiliateof the Gunosy Group.

*1: For more information on regulations governing personal credit, see:https://rbidocs.rbi.org.in/rdocs/notification/PDFs/GUIDELINESDIGITALLENDINGD5C35A71D8124A0E92AEB940A7D25BB3.PDF

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20

Company Overview

sliceFoundation

Amount raised to date2015

Approx.

(Cumulative amount)

GunosyMost recent financial statements(P/L and B/S) (FY2023/3)
Sales

Profit (loss)
before income
taxes

15.2 billion
yen-7.1 billion
yen$290 million
TIGER
GLOBAL

INSIGHTPARTNERS

Number of employees

Over 1,500

YoY 296%

Total assets

33.9 billion yen
CGunosy Inc. All Rights Reserved.

21

Company History

sliceFounded in 2015, “slice” expanded its digital payments business by focusing on BNPL (Buy Now Pay
Later), which was not widely used in India at the time. Since then, slice has grown dramatically and finallybecame a unicorn in December 2021.

Transforming the financial
experience for billions of Indians
Before founding slice, Rajan launched Mesh, a furniture startup that allowed customers to rent items for asmall monthly fee and buy them whenever they wished. Later, he joined the product team at Flipkart, theIndian e-commerce giant now owned by Walmart, where he helped launch the Marketplace, thecompany's fastest-growing major business at the time. Through these experiences, Rajan came tounderstand the importance of credit cards as a financial tool, which led him to found "slice" to help highly
motivated young people like himself.
An alumnus of IIT Kharagpur, Rajan was named to the Forbes Asia 30 under 30 list for 2021 and theForbes India 30 under 30 list for 2022.In his personal life, he is a basketball enthusiast and a passionate
fan of the NBA's Los Angeles Lakers.

CEO

Rajan Bajaj
Founding phase
Started rental business ofgaming consoles, cameras
and bicycles, etc.

Pivot phase
Integrate buy-now-pay-later(BNPL) into existing rental
services to give customers
BNPL experience.

Expansion phase
Company's valuation
exceeded $1 billion andbecame a unicorn.

Current state
In December 2022, newproduct was released incompliance with RBI's Digital
Lending Guidelines. In
October 2023, RBI approval
was obtained to merge with alocal bank.
C

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22sliceslice inc. Business Description"slice" is India's leading fintech company providing payment services. It offers intuitive and easy digital
payments and is highly supported by Millennials and Gen Z, the largest segment of the population. With
more than 15 million users, slice is the market leader and growing its business.

Service overview

slice account• Add money to your slice account and pay by card or UPI• Get instant and valuable rewards on all transactions• Pay bills, set up subscriptions and view details of yourspending

slice borrow• Complete the application process online and the loan will beprocessed• No interest if repaid within one month• Borrow up to 1 million rupees (approximately 1.8 million yen),
repayable in 36 months• Flexible repayment options. Repay early, which can help you saveinterestC

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23

slice Business Environment

slice

In India, credit card penetration is low compared to other countries, leaving significant room formarket growth.

Digital payment transactions
volume in India

Credit card penetration

Digital consumer lending

Number of digital
payments growing

Credit card penetrationis only around 6% ofTotal digital consumer
lending expected to

rapidly

the population*1

triple by 2030

1,346(100 million payments)

USD 720 billion

CAGR
45%

CAGR

22%
Penetration

6%

207

2017

2018

2019

2020

2021

2022

Source: The Press Information Bureau of India

Penetration
Over

80%

USD 190 billion

2022
Source: Mynavi and GAO

2030

Source: nc42

*1 Total Population of India in 2022: Ministry of Foreign Affairs
Number of credit cards issued: Statistical figures released by Reserve Bank of India in December
Number of credit cards issued (81,186,874) / Total population of India (1,417.17 million)

C

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24slice’s Strengths

slice”slice” boasts a strong brand image that is highly supported by the Millennial Generation Z, thevolume segment of the population. Low default rate is achieved through its unique credit expertise.

1

Appeal to the younger generation, the volume segment of the
population, with the strength of its brand through its unique andsuperior products.

2

Extend credit with low default rates to those who have been
unable to obtain credit cards in the past through its uniquecredit underwriting expertise.

3

A management team that includes professionals who have held
key positions at major global companies and are capable ofdelivering high performance on both offense and defense.

C

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25slice P&L: Sales and Profit /Loss before Income Taxes

slice(Million yen)

15,273

Sales
Profit (loss) before income taxes

FY2023/3 highlights

Sales
CAGR

211%
FY2019/3 – FY2023/3

174

YoY

17

FY2020/3

Million yen

296

Profit (loss) before income taxes-7,123

148

Gunosy made an
initial investment
in Sep. 2019
FY2019/3

5,155

1,200

715

162

15,273

Million yen

YoY

4,392
7,123
FY2021/3

FY2022/3

CAGR (FY2019/3 – FY2023/3)

211%

FY2023/3

For simplicity, exchange rates as of November 30, 2023 are applied across the board.
Source: https://www.mca.gov.in/mcafoportal/getCertifiedCopies.do https://www.sliceit.com/corporate-governance/C

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26

sliceslice B/S (As of the End of FY2023/3)

Total assets as of March 31, 2023 were 33.9 billion yen. The company is in sound financial condition, withan equity ratio of more than 50%.

As of March 31, 2023 (Million yen)
Current asset

30,448

Liabilities

16,728
Total assets: 33.9 billion yen
Equity ratio: Over 50%
Net assets

17,172
Non-current assets

3,453

Total assets: 33,901
For simplicity, exchange rates as of November 30, 2023 are applied across the board.
Source: https://www.mca.gov.in/mcafoportal/getCertifiedCopies.do https://www.sliceit.com/corporate-governance/C

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27

AUM

slice

The customer base was significantly expanded through marketing investments until the first half of2022. Since the launch of a product compliant with the Digital Lending Guidelines in December 2023,
organic growth has continued while keeping burn rates under strict control.

Response to
guidelines
22/9-12

Rapid growth through marketing investments based onabundant funds raised

Resumption of organic growth

AUM (assets under management)
Acquire full PPI
licenseLaunch new
product

2021

2022

11

10

9

8

7

6

5

4

3

2

1

12

11

10

9

8

7

6

5

4

3

2

1

12

11

10

Organic
growth

9

8

7

6

5

4

3

2

1

Rapid
growththroughmarketinginvestmen
ts

2023
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28

Future Growth Plans

slice

We aim to achieve significant growth by providing customers with a comprehensive digital financial
experience through the merger with NESFB, while continuing to steadily increase AUM through organic
growth.

Continue organic growth
1

2

Aim to achieve operating profitability on amonthly basis

The merger with NESFB allows us to operate "slice" under abanking license

We are ready to expand our financial products
under the banking license

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29

(Reference) Overview of Merging with slice

sliceThis merger is an extremely important step in increasing slice's growth potential.
Gunosy will continue to support slice as a corporate shareholder after the merger.

Overview of the merger

NESFB

Small finance bank operating primarily
in northeastern India••

Company nameNorth East Small Finance Bank Ltd.

Head office

1st & 3rd Floor, Fortune Central , Basisthapur, Bye lane 3, Beltola
Guwahati, Assam 781028,India

Representative

Rupali Kalita Managing Director & CEO

Business

Banking service

Capital3,468 million Indian rupees (as of June 26, 2023)

Founded in July 2016, with revenues of INR 3,352 million and total
assets of INR 27,104 million in FY2023/3.
Small Finance Banks are a specific type of financial institution createdby the RBI in 2014 with the objective of providing financial services tosmall businesses and others in the underserved and unbanked areas ofIndia in an inclusive manner.

Comment
Director and Chief
Investment Officer (CIO)

Yuki Maniwa

Merger will deliver a morecomprehensive digital financial
experience

1. Prior to this RBI approval, we had acquired a 10% stakein NESFB to strengthen our relationship.
2. RBI approval acquired for the merger.
3. The merger will become effective only after obtaining
the approval of the National Company Law Tribunal(NCLT) and the shareholders as required under the
Indian Companies Act. Upon* completion of theseprocesses, the merger will be consummated.
4. The merger will enable "slice" to operate under abanking license, which is expected to significantly
enhance its growth potential in the medium to long term.
(e.g. issuance of credit cards under its own brand,
management of deposit accounts, etc. will become
possible).
5. Gunosy will also acquire shares in the post-merger
company. Dilution of shares as a result of the merger is
expected to be limited.

The digitization of the business will enable the delivery of a high level of "user experience" services tousers across India. It will also enable advanced risk management using data science technology. As aresult, we expect to be able to leverage the strengths of both companies to create an unparalleledposition in India.
C

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30

slice(Reference) Schedule since Guideline Release

Changes were made to ensure that the product experience was compliant with the Reserve Bank ofIndia's (RBI) Digital Lending Guidelines, and the new product was released on time. The transition to thewent smoothly with no major issues.

September 2, 2022

Digital Lending Guidelines issued

November
2022
2022 1130,30

Deadline for updates to adhere to the Guidelines

From December 1,
2022

New product experience launched that complies with theDigital Lending Guidelines

C

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31

Business Overview by Division

Media BusinessC

Gunosy Inc. All Rights Reserved.

32

Total Number of Active Users* (MAUs)Media BusinessIn Q2, MAUs declined QoQ due to a lack of high-impact news stories that attracted broad user interest,
as well as restrained advertising investment in the Gunosy app.

LUCRA(Service ended in February 2023)
NewsPass + au Service Today
GunosyQ1

Q2

Q3

FY2021/5

Q4

Q1

Q2

Q3

FY2022/5

Q4

Q1

Q2

Q3

Q4

FY2023/5*Average for each quarter of MAUs (monthly active users) of "Gunosy", "NewsPass", "au Service Today" and "LUCRA".

Q1

Q2

FY2024/5

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33

Media Business

Progress Summary of Gunosy's Key KPIs

Sales per DAU increased QoQ as DAU started to recover from mid-October 2023 due to successfulalgorithm improvements.
DAU increased YoY as retention rate remained high, but declined slightly QoQ due to reduction inadvertising expenses.
Gunosy SalesDAU *1
YoY

101

Sales/DAU

QoQ

95

YoY

87

102

QoQ

Retention rate *2

Cumulative downloads
YoY

106

YoY

102

QoQ

101

QoQ

98

Product side

Good

Marketing*1: Daily Active Users*2: The app retention rate refers to the percentage of newusers who activate the app after a certain period of time.

AdImp/DAU

*3

*4

CPM

(Not disclosed)(Not disclosed)

Improved

Sales side

Sales activities*3: Number of ads served per daily active user
*4: Cost Per MilleC

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Media Business

Gunosy: Advertising Expenses and Estimated IRR

While product KPIs remained stable, estimated IRR remained below criteria through September due tolower profitability. Profitability began to improve in October due to reduced advertising investment andalgorithm improvements, and exceeded IRR criteria in November.
Advertising expenses (actual)

Estimated IRR and advertising expenses

Estimated IRR(Three-year IRR estimated from acquisition costs (CPI)and estimated marginal profit per user)

POINT

Product KPIs
maintained postCriteria

improvement levels.
The estimated IRR
exceeded the criteria
in November due to

2022

Nov

Oct

Sep

Aug

Jul

Jun

May

Apr

Mar

Feb

Jan

Dec

Nov

Oct

Sep

Aug

Jul

Jun

May

Apr

Mar

the recovery of S/D.

2023
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35

Media Business

Advertising Investment in Gunosy

Profitability has improved steadily since mid-October and the IRR on advertising investment has improved.
We intend to keep our advertising investments within the IRR criteria from Q3 onwards and at thesame level as in October.
Advertising expenses
Plan
Results

From FY2025
onwards
The investment amount isdetermined based on the
Jun

Jul

Aug

FY2023

FY2024 Q1

Status of media

Advertising investments

Oct

Nov

FY2024 Q2

Dec

Jan

Feb

Mar

Apr

May

FY2024 Q3 and beyond

assumption that operating
profit will be achieved on aconsolidated and nonconsolidated basis.

Policywere made as product KPIs
and acquisition efficiency
remained positive, in
addition to the expected

MeasuresSep

future improvement in(To be determined based on a

PolicyRaise IRR
criteria andcurb
investments

comprehensive consideration of

IRR improved due to improved
profitability. Taking profit and loss
into account, we invest within the
IRR criteria.

profitability, profit/loss status and IRR)

profitability.

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Media Business

Ad Network (ADNW)

Impressions remained unchanged QoQ, while cost per mille (CPM) remained weak.

Number of Impressions and CPM(Million imp)

45,000¥20

imp

30,000¥12.59¥11.48¥11.91 ¥11.87¥11.14¥11.22¥11.86¥10.87¥7.99

15,000

¥7.25

¥6.81

¥6.58

29,432
21,037 23,941
22,489 21,892 22,763 23,165
20,493

0

Q1

Q2

Q3

FY2021/5

Q4

Q1

Q2

CPM

Q3

Q4

FY2022/5* CPM (cost per mille): Price per 1,000 impressions of advertisement

25,228 23,513 20,915 18,392

Q1

Q2

Q3

Q4

FY2023/5¥5.30
21,249Q1¥4.70
21,241Q2¥0

FY2024/5

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37

Business Overview by Division

Game8

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38

Game8 (Sales and Operating Profit)

Game8

Sales in the domestic media solutions business remained strong as in the first quarter, and profitability inthe overseas media business also improved. As a result, Game8 posted record sales.

Sales
Operating profit(Million yen)

600

435
400

200

366

108

441

451
390

375

111

151

127

136

97

420

109

470

457
369

0

Q1

Q2

Q3

FY2021/3

Q4

Q1

Q2

Q3

FY2022/3

Q4

123

Q1

456

87

91

Q4

Q1

381

129
28

445

501

48

Q2

Q3

FY2023/3* Nonconsolidated results (before consolidated adjustment). Results of Smarprise, our subsidiary is not included.
FY2024 Q1 results are for the period from April to June 2023 due to a gap with the parent company's consolidated
accounting period.

111

Q2

FY2024/3

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39

Key KPI of Game8

Game8

*

Both PVs and RPMs, key KPIs, remained strong.

PVs

RPM

Although there was some volatility
depending on game title sales, pageviews remained strong.

Q3

Q4

FY2023/3•

Q1

Q2

RPM remained strong, partly due toimproved profitability in overseas
media business.

Q3

FY2024/3
RPM (Revenue per Mille): Revenue per 1,000 impressions of advertisement

Q4

Q1

FY2023/3

Q2
FY2024/3

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Other Topics

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41

New Business

LLM (Udekiki)

As previously announced, "Udekiki" was officially released in November 2023. In addition to using
GunosyAI to enhance the product, we will continue to improve the product based on customer feedback
and aim to achieve PMF.

Use AI as your powerful assistant!

Topics in Q2•

Over 20 new skills introduced to support business operations•

Dedicated development team established to provide services using
generative AI•

An internal text-based response feature will be released
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42

New Business

YOU IN"MOOD PAIRING BATH awai", a bath additive, was released for users who want to enjoy a "mood pairingexperience" in various scenes. In addition, our mood pairing tea "LOVE YOUR BODY" was certified as amaternity food.

"MOOD PAIRING BATH awai“ (bath additive) released

Wellness initiatives

What is the Maternity Food
Certification Mark?
It is a mark indicating that the foodor menu is recommended forpeople in the maternity period(expectant mothers, pregnant
women, and nursing mothers).
The Maternity Food Mark is
granted by the Japan Maternity
Food Association based on the
Dietary Reference Intakes for the
Pregnancy Period developed by
the Japanese Ministry of Health,
Labor and Welfare and thestandards established under thesupervision of registered dietitians..

MOOD PAIRINGBATH awai

LOVE YOUR
BODY

Powdery bath additive
with fluffy fine bubbles

A light, caffeine-free
blend of rose hip androoibos teasC

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43

Reference Materials

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44

MISSION

Optimally deliver
information to people
around the world

C

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45

November 2021
Achieved unicorn status in the
fintech sector by raising
significant funds in its Series B
funding round

June 2016“NewsPass” released

November 2012

July 2018
Established Gunosy Capitaland started investment
business

Established Gunosy Inc. in
Roppongi, Minato-ku, Tokyo

2012

2015

2016

April 2015
Listed on the Mothers
Section of the Tokyo Stock
Exchange
December 2015
Game8 Inc. became
subsidiary

2017

2018

2019

2021

December 2017
Changed markets from Mothers
Section to First Section of theTokyo Stock Exchange

2022

April 2022
Became an equity
method investee by
dispatching a director(Currently listed on TSE Prime)

September 2019
Started investment in
GaragePreneurs
Internet Pvt

April 2021
Launched "au Service
Today" service

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46

Gunosy Group Business Portfolio

Medium- to long-term growth driven by three businesses
12Media business•••

GunosyNewsPass
Au Service Today

3

Game8 group
•
•

Game8
Smarprise

DATA

Investment
•

•
•
•

New
businesses

Gunosy Capital

•
•

LLM
YOU INNew

Data accumulated since the inception of the company
Knowledge of algorithms
Media and advertising expertise, etc.

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47

Growth Image

Increase corporate value through growth of existing businesses anddevelopment of new businesses

Aim for group-wide growth with a market
to long-term target

Investment

capitalization of 100 billion yen as a medium-

Game8Media business

EstablishedC

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48

Overview of Gunosy Inc.

Basic Information
Company name:Gunosy Inc.

Representative:

Shinji Kimura

Representative Director and Chairman,
Officers: Group Chief Executive Officer (CEO),
Shinji Kimura

Yuya Taketani

Representative Director and President,
Kentaro Nishio

Established:

November 14, 2012

Director and Chief Investment Officer (CIO),
Yuki Maniwa

Fiscal year end:May

Director, Yuya Taketani

Capital:Director, Masaaki Nose

Stock Code:4,099 million yen (as of the end of
November 2023)
6047 (TSE Prime)

Audit corporation:

Ernst & Young ShinNihon LLC

Director (Outside), Junichi Shiroshita

Number of
employees:244(as of the end of November 2023, on aconsolidated basis)2-24-12 Shibuya, Shibuya-ku, Tokyo

Director (Outside), Hirokazu Mashita

Head office:Business:

Development and operation of information
curation service and other media

Director (Outside), Suguru Tomizuka

Director (Outside), Lei-Isabelle Nakao
Corporate Auditor, Masakazu Ishibashi
Corporate Auditor (Outside), Kenji Shimizu
Corporate Auditor (Outside), Kengo WadaC

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49

From “Gunosy Way” to “Gunosy Pride”
The concept of "Gunosy Way", which had been defined as a milestone for Gunosy to follow, wasredesigned as "Gunosy Pride“, which inherits the original thoughts and concepts.

1“Triple win” philosophy
Benefit the customer, the user, and the world. Benefit yourself, others, andyour fellow employees. We will continue to create a cycle of goodness not
only outside the company and society, but within our company as well.

2

Creating opportunities with science
We will use data and technology to accelerate innovation with facts. We will
also use science to solve social issues.

3

Centennial quality
We do not stop working until we feel that this is the best we can do, rather
than thinking that this is good enough. We will face the work in front of us
with sincerity and honesty, seeking quality that will endure for a hundredyears.

4

Respond to adversity in a positive way
There are as many adversities as there are challenges. However, we
believe that it is the adversity that brings us the opportunity for growth. We
will not run away from the obstacles in front of us, but rather we will
aggressively pursue our business in adversity.

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50

Status of the Estimated Value ofthe Investment Portfolio (Disclosed on July 14, 2023)

investment

Investment
ratio

FY2019/5

FY2020/5

FY2021/5

FY202/5

FY2023/5

0.98

0.99

1.11

5.36

5.16

(Million yen)

26,54625,741*1

Accumulated investment*2“Accumulated
investment” and“Estimated value + Sale
price”

Estimated value + Sale price

253

249

813

808

1,867 2,068

5,140

4,805

Japan

30

259

770

880

1,090

(accumulat
ed)

India

223

553

1,097

3,924

4,049

Market
value

Japan

30

259

776

1,037

1,357

India

218

547

1,291

24,70325,188Investment(accumu
lated)*1. Accumulated investment: Calculated in yen at the exchange rate at the time of investment. Includes investments in issues already sold.
*2. Estimated value: Value that we estimated as the price at which shares, etc. would be transferred in an arm's-length transaction, based on the following method. Note that such estimatedvalue is generally not based on the results of a valuation report by an external third party or an audit by an accounting auditor, but is calculated by us at our own discretion.
(1)
(2)
(3)

Issues that raised funds in a recent funding round: The estimated valuation is the valuation at the time of the relevant round, with a 20.7% illiquidity discount applied.
Issues for which an external third-party valuation was previously obtained: The estimated valuation is based on such valuation.
Other issues: Valued at book value at the time of investment. For those acquired in foreign currency, the value is converted at the most recent exchange rate.

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