TRANSLATION -FOR REFERENCE ONLY-

Financial Briefings
for the Fiscal Year Ended March 2024
(April 2023 to March 2024)
May 10, 2024
KOKUSAI ELECTRIC CORPORATION
KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

Disclaimers
This document and the information presented in this document were created for the purpose of disclosing corporate information, etc.,
and do not constitute a solicitation of an offer to subscribe for shares or other securities of the Company, either domestically orinternationally.
 Forward-Looking Statements
The Group’s business plans and forecasts stated in this document are prepared by the Group based on information available at the time of
preparation and do not guarantee future results or performance. Actual business results and performance may differ significantly from the plans
and forecasts due to changes in various internal and external factors. The Company does not undertake any obligation to update or revise any
information contained in this document based on future events, except as required by applicable laws or stock exchange rules. The key risks that
may significantly affect the Group’s business results, financial position and cash flows are stated in the annual securities report of the Company.
 Currency Risk
The Group has a high proportion of overseas revenue. In addition, the valuation of the Group's assets and liabilities denominated in foreign
currencies is affected by fluctuations in exchange rates. Most export sales of group products are denominated in yen, but some are denominatedas foreign-currency sales or expenses, and so may be affected by fluctuations in foreign exchange rates.
 Key Performance Indicators
To understand the trends in business results to improve corporate value, the Group uses Adjusted Operating Profit and Adjusted (quarterly) Net
Income as key performance indicators. The calculation methods are stated in the earnings report. Adjusted operating profit and adjusted
quarterly net income may differ from management indicators of other companies that use the same or similar names, and so may not becomparable.
 Accounting Standard
The Company prepares its consolidated financial reports based in accordance with International Financial Reporting Standards (IFRS) since
FY2021/3.
 Rounding Convention
Except in certain cases, amounts presented in this document have been rounded to the nearest hundredth million, and accordingly the sum of
the amounts may not be equal to the total of the individual items.
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2

Consolidated Financial Summary for FY24/3

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Highlight
Consolidated Financial Summary for FY24/3
 We recognized the market bottomed out, although some makers of semiconductor devices, particularly NAND,

have continued to restrain investment.
Capital investment in mature nodes increased in China, while investment in cutting-edge product development
continued worldwide.
 Although our FY24/3 revenue and profit decreased YoY, we saw a remarkable recovery after bottoming out in 1Q.
Active investment continued to meet increasing medium- to long-term demand.

Consolidated Earnings Forecast for FY25/3
 We expect the recovery of semiconductor-related market conditions to continue, and capital investment in

cutting-edge products worldwide to begin recovering in 2H of FY25/3.
 Both equipment and service have been recovered, we forecast an increase in both revenue and profit
compared to FY24/3.

Management Policy and Strategy
 The semiconductor-related market continues to recover and there is no change in our view that it will achievesignificant growth in the medium-to long-term.
 We are extending its technological advantages gained through 3D NAND to DRAM and Logic.
We also aim to grow power device into one of our pillars.
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Consolidated Results Summary
Although full-year results showed a decrease in revenue and profit YoY due to the sluggish NAND market, the recovery trend
from 2Q continues.
Gross profit margin for full year increased YoY.
FY23/3

FY24/3

1Q

2Q

3Q

4Q

Full Year

1Q

2Q

3Q

4Q

YoY

Full Year

56.0
23.1

64.4
27.5

65.2
26.4

60.1
23.9

245.7
100.8

32.7
14.3

45.0
19.9

54.0
21.7

49.2
19.1

-18.2%

Gross profit-20.1%

180.8
75.0(JPY bn)
Revenue

Previous
Forecast
180.0-26.4%
73.7-25.6%
YoY

40.9%

Gross profit margin

41.2%

42.7%

40.4%

39.7%

41.0%

43.6%

44.2%

40.3%

38.8%

-1.0pts

41.5%+0.4pts

Adjusted operating profit

14.7

18.1

17.2

14.3

64.3

5.6

11.0

12.4

8.8

-38.5%

37.8-41.1%

36.3

Adjusted operating profit margin

26.2%

28.1%

26.3%

23.8%

26.1%

17.2%

24.5%

23.0%

17.9%

-5.9pts

20.9%-5.2pts

20.1%

Adjusted net income

10.8

12.5

12.2

10.5

46.0

3.8

7.3

9.1

7.1

-32.4%

27.3-40.6%

25.2

Adjusted net income margin

19.3%

19.4%

18.7%

17.5%

18.7%

11.6%

16.2%

16.9%

1 ４ .５ %-3.1pts

15.1%-3.6pts

14.0%

Operating profit

13.0

16.4

15.5

11.1

56.1

4.0

9.4

10.7

6.7

-40.0%

30.7-45.2%

29.1

Operating profit margin

23.2%

25.5%

23.8%

18.6%

22.8%

12.2%

20.9%

19.8%

13.6%

-5.0pts

17.0%-5.8pts

16.2%

Income before income tax

12.9

16.4

15.7

10.9

55.9

3.7

9.1

10.7

6.1

-43.6%

29.8-46.8%

28.3

Income before income tax margin

23.0%

25.5%

24.0%

18.1%

22.7%

11.4%

20.3%

19.9%

12.5%

-5.6pts

16.5%-6.3pts

15.7%

9.6

11.3

11.1

8.3

40.3

2.7

6.2

7.9

5.6

-32.3%

22.4-44.5%

20.2

17.1%

17.5%

17.0%

13.9%

16.4%

8.1%

13.7%

14.7%

11.5%

-2.4pts

12.4%-4.0pts

10.2%

2.7
0.7

3.3
2.9

2.9
2.2

3.5
0.8

12.4
6.6

2.9
5.1

3.0
2.1

3.1
10.5

3.7
2.8

+3.8%

-

X3.4

12.7
20.5

+2.1%

Capital expenditures

X3.1

-

Depreciation & amortization

2.5

2.6

2.6

2.6

10.3

2.6

2.7

2.8

2.8

+8.9%

10.9

+6.2%

-

-

-

-

-

-

-

-

-

11

-

11

-

11

Net income
Net income margin

R&D expenses

Dividend per share(JPY)

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4Q FY2024/3 Results: Factors for Changes
Revenue decreased by JPY10.9 bn YoY, mainly due to restrained investment in NAND.
Adjusted operating profit declined by JPY5.5 bn YoY, mainly due to the impact of sales decrease.

Revenue(JPY bn)

Adjusted Operating Profit(JPY bn)

NAND -12.9
DRAM +8.3
Logic/Foundry +1.3
Others -2.9

60.1

Sales volume decrease -4.3
Gross profit margin decline -0.5

14.3
49.2

-6.2
-4.8

+0.2

-4.8

8.8

-0.9

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FY2024/3 Results: Factors for Change
Revenue decreased by JPY64.9 bn YoY, mainly due to restrained investment in NAND.
The impact of the decrease in sales was partly offset by an improvement in gross profit margin, resulting in a decrease inadjusted operating profit by JPY26.5 bn YoY.
Revenue

Adjusted Operating Profit(JPY bn)(JPY bn)
NAND -58.2
DRAM +13.2
Logic/Foundry -6.5
Others +0.3

245.7

64.3
Sales volume decrease-26.6
Gross profit margin decline +0.8

180.8

-51.2

+0.4

-13.7
-25.8

37.8

-1.0

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Quarterly Revenues by Business
Revenue composition ratio from 3Q was sustained due to recovery of equipment sales.
65.2

64.4

(JPY bn)

60.1

56.0

54.0
49.2

45.0
69%

71%

70%

66%

32.7

70%
58%

73%

57%

Equipment
34%

31%

29%

7c

30%

43%

42%

FY23/330%

Service27%

FY24/3(JPY bn)

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

Equipment

36.8

45.4

45.0

42.3

18.5

26.2

37.5

36.1

Service

19.2

19.0

20.2

17.8

14.2

18.8

16.4

13.1

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Revenues by Business
In FY24/3, the ratio of Service business increased due to a decrease in equipment sales.

245.4

245.7

(JPY bn)

180.8

178.0
74%

69%
65%

72%

Equipment
Service28%
FY21/326%

FY22/331%

FY23/335%

FY24/3

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Quarterly Revenues by Application (300mm Equipment Only)
In 4Q, while investment in NAND continued to be restrained, investment in DRAM and Logic/Foundry, including mature nodes,
was strong, with 12% NAND, 44% DRAM, and 44% Logic/Foundry+Others.

(JPY bn)

45.4

45.0

7%

5%

11%

36.8
7%

42.3

27%

37.5

33%

36.1

12%

5%

34%

39%

30%
29%

26.2

17%
22%
22%

14%
18%

Logic/Foundry

18.5
16%

33%

DRAM

45%

50%

41%

42%

41%

Others

40%

44%

14%

12%

3Q

4Q

NAND

41%
25%
14%

12%

FY23/3
1Q

2Q

FY24/3
3Q

4Q

1Q

2Q

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Revenues by Application (300mm Equipment Only)
In FY24/3, with the impact of restrained investment in NAND, normal levels of sales in DRAM and Logic/Foundry, including
mature nodes, were maintained and so the ratios of DRAM and Logic/Foundry increased.

181.8
2%

(JPY bn)

169.5
7%

31%

127.7

30%

2%

118.3
11%

24%
30%
19%

20%

37%

Others
Logic/Foundry
DRAM

55%

37%

43%

39%

NAND

13%
FY21/3

FY22/3

FY23/3

FY24/3

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Revenues by Region
In FY24/3, the ratio of Chinese sales expanded due to the deterioration of NAND market conditions worldwide and increased
investment activity in China.
In the future, the ratio of Chinese sales will return to its previous level as investment in cutting-edge products recovers
worldwide.
(JPY bn)

178.0
30%
11%

245.4

245.7

38%

34%

7%
1%
20%

1%

6%

180.8
2%

Europe and Others

46%

24%
17%

17%

21%

6%

3%
13%

11%

13%

10%
6%
12%

FY21/3

FY22/3

FY23/3

FY24/3

3%

Other Asian countries

23%
4%

19%

China

1%

Korea
TaiwanU.S.A.
Japan

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Trends in Order Backlog
Projects with long delivery times included in the backlog are being shifted to sales and order backlogs normalized.
Orders received bottomed out in 2Q and began to recover from 3Q, and 4Q is generally in line with plans.

(JPY bn)

194.0

194.4

193.4

182.4

189.3
166.3

157.2

163.7
149.7

109.4

FY22/3End of 3Q

End of 4Q

FY23/3End of 1Q

End of 2Q

End of 3Q

FY24/3End of 4Q

End of 1Q

End of 2Q

End of 3Q

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End of 4Q

13

Balance Sheet
Total assets increased by JPY1.9 bn from the end of FY23/3 due to increase in inventories and property, plant and equipment,
despite decrease in cash, trade and other receivables. Total liabilities decreased by JPY24.6 bn from the end of FY23/3 due todecrease in trade and repayment of interest-bearing liabilities.
Total equity increased by JPY26.5 bn from the end of FY23/3, mainly due to an increase in retained earnings.
Assets(JPY bn)

356.5

373.5

106.1

273.8

(JPY bn)

375.4
92.6

108.4
32.0

40.0
41.7

Liabilities・Equity

50.6

356.5
Cash andcash equivalents

Inventories

99.2

93.0

Interest-bearing liabilities(Loans payable + Leaseliability)

59.4

Trade and other payables+ Contract liabilities

35.6

Others

187.4

Equity

71.1
125.8

68.7
42.4

67.2

38.7

51.6

16.2

16.0

18.8

35.4

69.0

63.0

57.0

Intangible assets

59.1

59.1

59.1

59.1

Goodwill

3.0

6.4

8.9

11.7

Others

75.1

375.4

123.2

Trade andother receivables

46.0
87.7

273.8

373.5

Property, plantand equipment

45.2
50.4
32.6

160.9
119.5

End of FY21/3 End of FY22/3 End of FY 23/3 End of FY24/3

64.9

End of FY21/3 End of FY22/3 End of FY23/3 End of FY24/3
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Equity Ratio / Cash and Cash Equivalents / Interest-bearing Liabilities
The equity ratio was 50% at the end of FY24/3.
Net debt at the end of FY24/3 was JPY0.4 bn. Interest-bearing liabilities were reduced as planned.

Cash and Cash Equivalents / Interest-bearing Liabilities

Total Asset / Total Equity / Equity Ratio
Total asset

Total equity(JPY
4,000bn)

Equity ratio

375.4

373.5

356.5
3,500
3,000

Cash & cash equivalents
60%

273.8

43.1%
33.5%

2,000

1,000

125.8

106.1

187.4

119.5

64.9

500
0

End of FY21/3 End of FY22/3 End of FY23/3 End of FY24/3

99.2
92.6 93.0

40%

160.9
23.7%

Interest-bearing liabilities

123.2
108.4

49.9% 50%

2,500

1,500

(JPY bn)

30%

20%

40.0

10%

0%

End of FY21/3 End of FY22/3 End of FY23/3 End of FY24/3
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Quarterly Cash Flows
Operating cash flows recovered in 4Q as revenue recovered.
22.1 20.5(JPY bn)
13.2
10.1

9.9 8.6
2.4-2.1 -0.2

-1.0
-0.1

-2.0

-1.7

-22.4

-0.2
-2.4

-2.9

-3.4

0.1

-2.0

-7.4 -5.3

-3.1

-2.0
-4.1

-5.4

-3.2

-3.3

-0.9

-1.3
-3.0

Cash flows from operating activities
Cash flows from investing activities-12.6

Cash flows from financing activities
Free cash flow
FY23/3

FY24/3(JPY bn)

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

CF from operating activities
CF from investing activities
CF from financing activities
Free CFCash and cash equivalents

-2.0
-1.0
-0.1
-2.9
106.5

22.1
-1.7
-2.4
20.5
124.2

-3.4
-2.1
-0.2
-5.4
118.4

13.2
-3.1
-22.4
10.1
106.1

-7.4
-5.3
-0.2
-12.6
94.5

-2.0
-2.0
-3.2
-4.1
87.6

2.4
-3.3
0.1
-0.9
86.5

9.9
-1.3
-3.0
8.6
92.6

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Cash FlowsDue to the decrease in sales revenue, operating cash flows decreased, and free cash flows also decreased.
70.3(JPY bn)

47.8
73.6

22.2

51.1
30.0

2.9

Cash flows from operating activities-3.3

Cash flows from investing activities

-3.3

-3.5

-7.8

-25.1

-9.0

-12.0

-6.3

-48.3

Cash flows from financing activities
Free cash flows(JPY bn)
CF from operating activities
CF from investing activities
CF from financing activities
Free CFCash and cash equivalents

FY21/3

FY22/3

51.1
-3.3
-48.3
47.8
40.0

FY23/3

73.6
-3.3
-3.5
70.3
108.4

FY24/3

30.0
-7.8
-25.1
22.2
106.1
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2.9
-12.0
-6.3
-9.0
92.6
17

R&D Expenses / Capital Expenditure / Depreciation Expense
Continue to invest in R&D and capital equipment in anticipation of medium- to long-term demand expansion.
R&D expenses remained at the same level as the previous fiscal year. Capital investment increased 3.1 times YoY. Depreciation
expenses increased slightly YoY.
R&D Expenses
140
120

R&D expenses
R&D expenses ratio

Large-scale capital investment (new factory construction,
demonstration room expansion, etc)
Regular capital investment

7.0%
6.0%

200

20.5

Depreciation expense

5.1%(JPY bn)

5.0%

4.2%
4.0%

(JPY bn)

14.0

150

4.0%
12.4

60

12.7
3.0%

9.9
40

250

7.0%

100
80

Capital Expenditure / Depreciation Expense
8.0%

7.6

100

9.6

20

0.0%
FY22/3

FY23/3

FY24/3

10.9

2.1
2.6

1.0%

0

10.3

6.6

2.0%
50

FY21/3

10.0

3.3

2.6

3.3

FY21/3

FY22/34.5

6.4

0
FY23/3

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FY24/318

Consolidated Earnings Forecast for FY25/3

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Highlight
Consolidated Financial Summary for FY24/3
 We recognized the market bottomed out, although some makers of semiconductor devices, particularly NAND,

have continued to restrain investment.
Capital investment in mature nodes increased in China, while investment in cutting-edge product development
continued worldwide.
 Although our FY24/3 revenue and profit decreased YoY, we saw a remarkable recovery after bottoming out in 1Q.
Active investment continued to meet increasing medium- to long-term demand.

Consolidated Earnings Forecast for FY25/3
 We expect the recovery of semiconductor-related market conditions to continue, and capital investment in

cutting-edge products worldwide to begin recovering in 2H of FY25/3.
 Both equipment and service have been recovered, we forecast an increase in both revenue and profit
compared to FY24/3.

Management Policy and Strategy
 The semiconductor-related market continues to recover and there is no change in our view that it will achievesignificant growth in the medium-to long-term.
 We are extending its technological advantages gained through 3D NAND to DRAM and Logic.
We also aim to grow power device into one of our pillars.
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FY2025/3 Earnings Forecast
Revenue is expected to increase by about 20% from FY24/3, as well as gross profit by about 24%, adjusted operating profit by
about 35% and adjusted net income by about 30%. Annual dividends are expected to increase by JPY5 per half year to JPY32
per year.
(JPY bn)

FY23/3

FY24/3

YoY

180.8

217.5

20.3%

100.8

75.0

92.7

23.7%

41.0%

41.5%

42.6%

1.1pts

Revenue

245.7

Gross profit
Gross profit margin

FY25/3(forecast)

Adjusted operating profit

64.3

37.8

51.0

34.8%

Adjusted operating profit margin

26.1%

20.9%

23.4%

2.5ptsAdjusted net income
Adjusted net income margin

Operating profit
Operating profit margin

46.0

27.3

35.6

30.4%

18.7%

15.1%

16.4%

1.3pts

56.1

30.7

44.8

45.7%

22.8%

17.0%

20.6%

3.6ptsIncome before income tax

55.9

29.8

44.0

47.9%

Income before income tax margin

22.7%

16.5%

20.2%

3.7pts

Net income

40.3

22.4

29.0

29.9%

16.4%

12.4%

13.3%

0.9pts

-

11*1

32

5.0JPY /half year

-

11.4%

25.7%

14.3pts

Net income margin

Dividend per share (JPY)Dividends payout ratio*1 Regarding the dividend per share for the year ending March 31, 2024, we plan to pay the amount for half a year as a year-end dividend, given the listing was in 2H of the year.
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FY2025/3 Earnings Forecast: 1H and 2H
In 1H, legacy equipment included in Services business is expected to boost sales revenue.
In 2H, sales of legacy equipment will calm down, and we are cautious about sales for China. On the other hand, our forecasts
are based on the assumption that global demand for advanced equipment will begin to recover from 2H.

29%

Service business
42%

Equipment business (for China)
40%

Equipment business (except China)

28%

29%

1H
FY24/331%

2H
FY24/3

1H (Reference)
FY25/3 (Forecast)

2H (Reference)
FY25/3 (Forecast)

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22

FY2025/3 Earnings Forecast: Factors for Change
For FY25/3, expect an increase in adjusted operating profit due to a recovery in sales, mainly for DRAM and Logic/Foundry, andan increase in gross profit margin.

Revenue

Adjusted Operating Profit+17.7(JPY bn)(JPY bn)

51.0
-3.4

+30.6

+6.1

217.5
37.8

180.8

-1.2

Sales volume increase +15.2
Gross profit margin increase +2.5

NAND+DRAM +About 20.0
Logic/Foundry+Others +About 10.0

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23

Revenue Forecast by Business
Both equipment and services revenues are expected to increase from FY24/3, sustaining normal sales composition by business.
Equipment revenue for FY25/3 is expected to grow about 26% over FY24/3, with services revenue expected to grow about 10%
over FY24/3.
245.4

245.7

(JPY bn)

217.5
180.8

178.0
74%

69%
68%
65%

72%

Equipment business28%
FY21/326%

FY22/331%

FY23/335%

32%

FY24/3

FY25/3(Forecast)

KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

Service business

24

Revenue Forecast by Application (300mm Equipment Only)
In FY25/3, sales are expected to increase for all applications, with no significant change in the sales composition ratio by
application.
Brisk capital investment in China will contribute to DRAM and Logic/Foundry sales, with NAND sales expected to recover at theend of FY25/3, mainly for development use.
181.8

(JPY bn)

2%

169.5
7%

148.9

31%

127.7

30%

2%

118.3
11%

24%
30%
19%

20%

Others
Logic/Foundry

37%

DRAM
NAND

55%

37%

43%

39%

13%
FY21/3

FY22/3

FY23/3

FY24/3

FY25/3(Forecast)

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25

Management Policy and Strategy

KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

Highlight
Consolidated Financial Summary for FY24/3
 We recognized the market bottomed out, although some makers of semiconductor devices, particularly NAND,

have continued to restrain investment.
Capital investment in mature nodes increased in China, while investment in cutting-edge product development
continued worldwide.
 Although our FY24/3 revenue and profit decreased YoY, we saw a remarkable recovery after bottoming out in 1Q.
Active investment continued to meet increasing medium- to long-term demand.

Consolidated Earnings Forecast for FY25/3
 We expect the recovery of semiconductor-related market conditions to continue, and capital investment in

cutting-edge products worldwide to begin recovering in 2H of FY25/3.
 Both equipment and service have been recovered, we forecast an increase in both revenue and profit
compared to FY24/3.

Management Policy and Strategy
 The semiconductor-related market continues to recover and there is no change in our view that it will achievesignificant growth in the medium-to long-term.
 We are extending its technological advantages gained through 3D NAND to DRAM and Logic.
We also aim to grow power device into one of our pillars.
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27

Business Environment
Market conditions bottomed out in FY24/3 and are expected to continue to recover. No change in the outlook for significant
growth over the medium- to long-term.

Outlook for Semiconductor Device Market

Our Business Environment■ The semiconductor device market bottomed out in CY23 andInvestment in cutting-edge products worldwide will begin to recoverfrom 2H of CY24.
■Active capital investment for mature nodes in China is expected tocontinue for the next few years.
■ In the medium- to long-term, significant growth is expected due toincreasing demand for electronic equipment, expansion of data
centers, and investment in reducing environmental impact (GX).

■As the semiconductor device market recovers, We expect thatdemand for cutting-edge equipment will begin to recover in the
global market from 2H of FY25/3.
■Although demand for equipment for mature nodes in China is
expected to continue for the next few years, we are taking acautious approach from the middle of FY25/3 onwards.
■The size of the WFE*1 market in CY24 is expected to be at thesame level as CY23 or slightly increase, but is expected to grow toaround USD 110-120 billion over the next few years.

Global Market Size for Semiconductor Devices and Semiconductor Manufacturing Equipment (USD Bn)
2010
Global market size for semiconductor
devicesGlobal market size for semiconductor
manufacturing equipment

2022

2023

2027(Forecast)

296.7

613.9

559.1

813.4

30.4

97.7

99.0

132.6

Source: TechInsights Inc. Semiconductor Forecast (March 2024)
Source: TechInsights Inc. IC MANUFACTURING EQUIPMENT MARKET HISTORY AND FORECAST (2018-2028) (March 2024)*1 WFE：Wafer Fab Equipment

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28

Equipment Business Strategy
We aim for sales growth exceeding the WFE market growth by focusing on the R&D, acquiring new POR*1 and expanding sales forbatch ALD equipment and treatment equipment which are technologically superior, in response to the multi-layering and threedepersonalization of semiconductor devices.

1 (CY2022)

Worldwide Market Share No.

*2

 Batch deposition equipment that can process dozens or more wafers at once and compatible

Batch ALD
compatible
deposition equipment

to ALD technology, and it is capable of archiving both highly difficult deposition and highproductivity.
 Needs grow as devices become more complex
 ALD

is abbreviation for Atomic Layer Deposition. We refer to a technique for thin-film
deposition at an atomic layer level involving a process of cyclical supply of multiple gases as“ALD.”

Batch
Deposition
Equipment
Batch CVD
compatible
deposition equipment
Batch Oxidationcompatible
deposition equipment

Mini batch deposition“TSURUGI-C²® 剱®”

Large batch deposition“AdvancedAce®-300”

 Batch deposition equipment that can process dozens or more wafers at once and compatible

to CVD or Oxidation technology. Characterized by high productivity.
 CVD is abbreviation for Chemical Vapor Deposition. Multiple gases are simultaneously flowed

into a chamber, react in the gas phase. We mainly focus on Low Pressure CVD.

Large batch deposition“VERTEX®-Revolution”

2 (CY2022)

Worldwide Market Share No.

Treatment(Film Property
Improvement)

Equipment

Single-wafer
treatment
equipment*3 Treatment equipment that can improve film quality after deposition by using plasma or heating,and its unique plasma technology makes it possible to achieve excellent isotropy and step
coverage.

Single-wafer treatment“MARORA®” Needs grow as devices become more complex
 Demand for treatment in low-temperature environments has grown as well.

Single-wafer treatment“TANDUO®”*1 POR: An abbreviation for Process of Record, which refers to the qualification of manufacturing equipment in a customer's semiconductor manufacturing process.
*2 Source: TechInsights Manufacturing Analysis Inc.（VLSI）“TI_ALD Tools_YEARLY” 2023 (April)*3 We define “RTP and Oxidation / Diffusion” by Gartner’s WFE segment as “Treatment”, Source: “Gartner®, Market Share: Semiconductor Wafer Fab Equipment, Worldwide, 2022, Bob Johnson, Gaurav Gupta, Menglin Cao, 17 April, 2023”）
GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved. Gartner does not endorse any vendor, product or service
KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research
Copyright© KOKUSAIELECTRIC
2024.
rights reserved.
organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressedor implied,with respect
to this Corporation
research, including
anyAllwarranties
of merchantability or fitness for a particular purpose.

29

Batch Deposition Equipment: Accelerating Batch ALD Demand
As devices become more complex, productivity challenges have become more apparent and highly difficult film deposition
turned critical.
Batch ALD has gained market share as a solution combining high difficulty film deposition and high productivity.
Deposition onto 2D NAND
Gas

By-product Reduced gas travel distancedue to the large gas reaction
space.
 Structure that requires small
surface area for depositionand low aspect ratio.

Increased demand for batch ALD that can achieve both highproductivity and highly difficult film deposition

ALD Technology
High Difficulty・High Quality

Batch Deposition
High Productivity

Gas reacts
on the surface

Process dozens ormore wafers
simultaneously

Deposition onto 3D NAND
Gas

Gas

By-product Increased time required fordeposition as larger surface
area and longer gas travel
distance is required.
 Raised deposition difficulty
due to expanded surface area
and increased aspect.

Wafer

Wafer
for illustrative purposes

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30

Treatment Equipment: Demand Expanding as well
Treatment (film property improvement) in a wide range of temperatures by plasma and heating is possible.
A solution that achieves high productivity with excellent isotropy and step coverage.
Treatment on NAND/DRAM (Film Property Improvement)

generated after deposition
1 By-products
in low temperature environment

Excellent isotropy
and step coverage

2 Remove impurities with abundant radical

Improved film quality by after-deposition
process with abundant radical produced byour unique plasma method.

High productivity and quality treatment (filmproperty improvement) for complex device
structures.



Expanding applicable area from NAND to
DRAM.

RadicalTreatment on Logic (Film Property Improvement)
Pre-treatment(base modification)

Selective
deposition

Post-treatment(film property improvement)

treatment (film property
3 After
improvement)

Si
Si
Si

Single-Wafer Treatment Equipment

MARORA®

Si
Si
Si

Si

Si
Si
Si

Single-Wafer Treatment Equipment



By combining MARORA® and selective
deposition, the etching process is shortened
and damage to the film is avoided.



Ideal selective deposition is possible bypretreatment (base modification) and posttreatment (film property improvement) by
MARORA.®

MARORA®
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31

Application-specific Initiatives
We are aiming for balanced growth in NAND, DRAM, and Logic/Foundry by expanding the leading technological advantages of
3D NAND to DRAM and Logic. We intend to grow power device into one of the pillars of our business.
Business Environment

Our Initiatives

DRAM

・Demand for equipment for China will drive our performance until
mid-25/3.
・Global demand for equipment for cutting-edge products will
recover strongly from 2H of FY25/3.
・Demand for equipment for cutting-edge products is expected toincrease as demand for HBM*1 expands due to the spread ofgenerative AI.

・Acquired new POR with high-difficulty film deposition of cuttingedge DRAM.
・TAM*2 will expand with the second generation, as we aim forfurther new POR acquisition.
・As the structure of 3D DRAM devices become more complex,
we aim to expand our market share as we did with 3D NAND.

Logic/Foundry

・Demand for equipment for mature nodes in China will support
performance until mid-25/3.
・In 1H of FY25/3, demand for equipment for cutting-edge
products will recover strongly, following that for DRAM.

・Acquired newly developed POR with GAA*3.
・TAM will expand with the second generation, as we aim forfurther new POR acquisition.
・We aim to expand our market share as the batch film deposition
process increases with CFET*4 (1.4 times that with FinFET*5).

NAND

・Currently, demand for development equipment is continuing.
・Global demand for cutting-edge equipment will begin to recoverat the end of FY25/3, and full-fledged recovery in FY26/3.

SiC Power Devices(Service Business)

・There is a growing need for high-temp activation annealing
equipment.
・Demand is expected to increase as device wafer size shifts from
150mm to 200mm.

・With our large batch and mini-batch film deposition systems, wehave already secured a dominant market share in the 3D NAND
film deposition process.
・Demand is expected to grow as the market recovers anddevices become increasingly multi-layered.
・In FY25/3, sales of existing products are expected to grow as
new high-temp activation annealing products are introduced.
・We expect sales of new products with high-temperature
activated annealing to increase from FY26/3.

*1 HBM：High Bandwidth Memory *2 TAM：Total Addressable Market *3 GAA：Gate All Around *4 CFET：Complimentary Field Effect Transistor *5 FinFET：Fin Field-Effect Transistor
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32

Service Business Strategy
As a business that is less subject to market fluctuations and can expect stable demand, we provide after-sales services tailoredto customer needs in line with the increase in the number of unit in operation. We also aim to expand our business by focusing
on sales of legacy equipment.
 We

provide after-sales services, including parts sales, maintenanceservices, repair, and equipment relocation and modification, throughout
the entire life cycle of the semiconductor manufacturing equipment
manufactured and sold by our group.

Parts Sales

 In Parts Sales and Maintenance, steady > around 10% YoY growth of

Repair

Maintenanceinstalled base in FY17/3-FY23/3, contributing to stable and recurring
service revenue growth.
 With “Design for Service Business” concept, parts sales and maintenanceprices are also increase.

Designfor Service BusinessMoving andModifying Equipment

 Utilizing the sales network of group companies, also focusing on sellinglegacy equipment (new and used equipment) with wafer sizes of 200 mm
or less.

An example of the effects of Design for Service BusinessConventional
products

Series of
TSURUGI

Sales per unit in parts sales &maintenance

x1

x4~

CAGR in parts sales &maintenance (FY17/3 to FY23/3)

About 20%

About 75%

LegacyEquipment Sales

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33

Expansion of Production, Development, Sales, and Service Systems
With the start of operations at the Tonami Plant in the fall of 2024, production and development capacity will expand significantly.
We will strengthen after-sales services and sales in Asia by establishing a subsidiary in Singapore.
Group Network
Sites in Japan

Capacity*1,2 of Production and Development

Overseas Sites

Kokusai Electric
Semiconductor Service Inc.

New plant to be built in Toyama(Scheduled to commence operations
in fall of 2024)

Kokusai Semiconductor
Europe GmbH

Kamiichi Works

Kook Je Electric Korea Co., Ltd.
(Kokusai Electric Korea Co., Ltd.)
Head Office, Main Factory
Pyeongtaek Factory

KOKUSAI ELECTRIC CORP.
Toyama Technology &Manufacturing Center
Tonami Plant (provisional name)Germany

Kokusai Electric
Semiconductor Service Inc

South Korea

Tokyo

Kokusai Semiconductor
Singapore Pte. Ltd.

KOKUSAI ELECTRIC CORP.
Head office

Kokusai Electric
Asia Pacific Co., Ltd.

FY22/3

FY23/3

Kokusai Semiconductor
Equipment Corporation

Singapore

FY24/3

FY25/3E

FY26/3E

Part of production line at the Toyama plant wastransferred to the new plant. Enhanced
development capabilities

KE Semiconductor
Equipment (Shanghai) Co., Ltd.

Production*1 Max. production volume per month *2 No. of evaluation equipment *3 In comparison to FY21/3

FY21/3

United States

ShanghaiTaiwanDistribution

Service
FY21/3
FY22/3
FY23/3
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Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

FY24/3

FY25/3E

FY26/3E

34

ESG Initiatives : Materiality
Based on our corporate philosophy, we are moving into a phase of upgrading the level of sustainability management groupwide,
and will strengthen our efforts in both business and ESG aspects while becoming even more aware of our corporate social
responsibility.
Materiality / Priority Themes

Activity Items

 Contribution to society through creativity and innovation

Creation of new technologies andnew products
Enhancement of customer
satisfaction
Enhancement of economic
performance

Development of advanced underlying
technologies and promotion of joint
development with external institutions
Provision of products, technologies, andservices attuned to the VOC*1
Improvement of business results, investment,
etc. and confirmation of the return on
investment

Materiality / Priority Themes Human resources management as a source of innovation

Respect for diversity of humanassetsDevelopment of human resources
who learn on their own, think on theirown and act on their own
Maintenance and enhancement ofhealth and safety

Thorough management of energy
Reduction of environmental impact

Contribution to the environment
through technology and products
Promotion of sustainableprocurement

Thorough management of waste andhazardous substances
Thorough management of water andwastewater
Development of environmentally friendly
products
Strengthening of supply chain management

Promotion of diversity equity & inclusion
Development of global human resources andsecuring of excellent human resources
Strengthening of occupational health andsafety management

 Strengthening of the governance system to realize sustainability management

 Creation of a sustainable society and conservation of the global environment

Reduction of greenhouse gas emissions

Activity Items

Strengthening of governanceThorough management of major
business risks
Ensuring of managementtransparency

Strengthening of corporate governanceThorough compliance
Strengthening of SCR*2 / CR risk
countermeasures and BCP
Strengthening of information security risk
countermeasures and BCP
Timely and appropriate disclosure to internaland external parties

 Respect and consideration of human rights

Respect for human rights

Promotion of the understanding andawareness of employees about human rights*1: VOC: Voice of Customer *2. SCR: Super Clean Room

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35

Summary
Short-, medium-, and long-term growth drivers exist in a well-balanced way.

Long-term
Mid-term
Short-term Increase of demand for DRAM and
Logic/Foundry, including mature nodes
 NAND market recovery

NAND

Batch
Deposition

FinFET*1

Treatment
Power Device*1 Fin Field-Effect Transistor*2 Gate All Around Further demand expansion for our
technology due to the shift towards
3D DRAM and Logic CFET*3
 Achieving more balanced portfolio

1-3 years

3-5 years

200-500 Layers>500 Layers

Advanced 2D DRAM

DRAM
Logic

 Demand expansion for our technology due
to the shift to Logic GAA*2 generation
 Demand expansion for cutting-edge DRAM
 Growth for SiC power device

3D DRAM

GAA*2

CFET*3

Low Temperature / Complex device structures
Si

SiC*3 Complimentary Field Effect Transistor

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Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

36

Information on IR Day (for institutional investors and analysts)

Date and Time: June 18, 2024(Tue) AM(JST)Event format: Hybrid event planned

Place: Bellesalle Yaesu
103-0028
First financial building, 1-3-7, Yaesu Chuo-ku, Tokyo, Japan

Contact： PR&IR Department, Corporate Strategy Division
KOKUSAI ELECTRIC CORPORATION
prir.ke@kokusai-electric.com

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Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

37

Appendix

KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

KOKUSAI ELECTRIC at a Glance
History

Overview of Financials (FY24/3)
Revenue

Gross Profit Margin

Adjusted Operating Profit
MarginJPY 180.8bn

41.5%

20.9%

KOKUSAI ELECTRIC CORPORATION was formed through company split
as a specialty manufacturer in semiconductor manufacturing equipment

Adjusted Earnings
per Share

Adjusted ROE

Equity Ratio

Listed on the TSE Prime Market

118.12yen

14.0%

49.9%

1949

Established “Kokusai Electric Co., Ltd.”

2000

Kokusai Electric Co., Ltd., Hitachi Denshi and Yagi Antenna
merged to form “Hitachi Kokusai Electric Inc.”2017

KKR joined as a shareholder through a takeover

2018
2023

Overview of Company
Company Name

KOKUSAI ELECTRIC CORPORATION

Category of Industry

Electric Appliances

Securities Code6525

Fiscal Year Ending

March 31

Representative Director

Fumiyuki Kanai

Financial Accounting Standards

International Financial Reporting Standards (IFRS)

Number of Employees*1

Consolidated: 2,472, Non-consolidated: 1,125

Number of shares per unit

100

Overview of BusinessSpecialty manufacturer of semiconductor manufacturing equipment,with strengths in “Deposition" in the Front-end process
Key Business Areasin the Front-end Process
Deposition /Treatment

Recent Awards

Lithography2024 Win-Win Cooperation DAY
Intel EPIC Distinguished
TechInsights
Grand Prize for Outstanding
Supplier Award 2024
Cooperating Company Award 10 BEST Suppliers 2023

Etching /Cleaning

Revenue Breakdown
by Business (FY24/3)

Revenue Breakdown
by Application (FY24/3)

11% 13%35%

JPY
180.8bn

Equipment

JPY
65%

Service

37% 118.3bn

NAND
Logic / Foundry

39%

DRAM
Others*1 As of March 31, 2024

KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

39

Management Policy
Based on the “KOKUSAI ELECTRIC Way” (corporate philosophy), pursue economic value and environmental and social value
from both aspects of business activities and ESG initiatives, contribute to the achievement of SDGs, and continue to support a
future where creation and innovation are born.
“KOKUSAI ELECTRIC Way”

KOKUSAI ELECTRIC Way

Technology & Tai-wa
for Tomorrow
Purpose

Purpose
VisionVisionValue /
MissionMateriality

Contribute to the realization of a sustainable society
and the achievement of SDGs

The KOKUSAI ELECTRIC Group supports afuture where creativity and innovation are bornout of Technology and Tai-wa.

Your Trusted Partner To Bring
Technology Dreams to Life
Our Technology

Value / Mission

Sustainability management

 Refine technology
 Create technology

Expanding corporate value and sustainable development

Business activities

Environmental &Social activities

 Advance technology
 Captivate with technology

Our Tai-wa

Strengthening governance Tai-wa with cutting edge technology
 Tai-wa with the natural environment
 Tai-wa with social issues
 Tai-wa with ourselves

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Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

40

Income Statement, R&D Expenses, Capex and D&A expenses
FY23/3(JPY mn)

FY24/3

1Q

2Q

3Q

4Q

Full Year

1Q

2Q

3Q

4Q

Full Year

Revenue

56,03564,38565,21660,085

245,72132,71044,99553,95649,177

180,838

Gross profit

23,09027,48926,35923,867

100,805

14,27519,89021,741

19,05974,965

41.2%

42.7%

40.4%

39.7%

41.0%

43.6%

44.2%

40.3%

38.8%

41.5%

14,70018,102

17,154

14,29564,251

5,614

11,035

12,4008,790

37,839Gross profit margin

Adjusted operating profit
Adjusted operating profit margin

Adjusted net income
Adjusted net income margin

Operating profit
Operating profit margin

Income before income tax

26.2%

28.1%

26.3%

23.8%

26.4%

17.2%

24.5%

23.0%

17.9%

20.9%

10,796

12,473

12,193

10,52345,985

3,782

7,304

9,101

7,109

27,296

19.3%

19.4%

18.7%

17.5%

18.7%

11.6%

16.2%

16.9%

12.6%

15.1%

12,984

16,407

15,527

11,14656,064

3,990

9,383

10,6896,683

30,745

23.2%

25.5%

23.8%

18.6%

22.8%

12.2%

20.9%

19.8%

13.6%

17.0%

12,901

16,42915,667

10,89855,895

3,727

9,145

10,742

6,143

29,757

Income before income tax
margin

23.0%

25.5%

24.0%

18.1%

22.7%

11.4%

20.3%

19.9%

12.5%

16.5%

Net income

9,605

11,297

11,064

8,339

40,305

2,655

6,158

7,914

5,647

22,374

Net income margin

17.1%

17.5%

17.0%

13.9%

16.4%

8.1%

13.7%

14.7%

11.5%

12.4%

R&D expenses

2,688

3,293

2,912

3,532

12,425

2,932

3,023

3,062

3,666

12,683

736

2,853

2,151

828

6,568

5,077

2,071

10,4782,828

20,454

2,529

2,563

2,600

2,612

10,304

2,637

2,671

2,792

2,845

10,945

Capital expenditures
Depreciation andamortization

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Copyright © KOKUSAI ELECTRIC Corporation 2024. All rights reserved.

41

Reconciliation of Adjusted Items

1Q
12,984-30
23

2Q
16,407-30
88

FY23/3
3Q
15,527-191
41

4Q
11,146-19
1,410

Full Year
56,064
-270
1,562

1Q
3,990
-30
45

2Q
9,383
-110
33

FY24/3
3Q
10,689
-285
19

4Q
6,683
-254
390

Full Year
30,745
-679
487

1,592
105

1,593
16

1,592
156

1,592
76

6,369
353

1,592
1

1,592
10

1,593
203

1,592
9

6,369
223

26

28

29

90

173

16

127

181

370

694

Total adjustments
Adjusted Operating Profit

1,723
14,700

1,637
18,102

1,777
17,154

1,758
14,295

6,895
64,251

1,609
5,614

1,729
11,035

1,977
12,400

1,971
8,790

7,286
37,839Net income
Other income
Other expenses(Adjustments)
Purchase price allocation amortization
Stand-alone related expenses

9,605
-30
23

11,297-30
88

11,064
-191
41

8,339
-19
1,410

40,305
-270
1,562

2,655
-30
45

6,158
-110
33

7,914
-285
19

5,647
-254
390

22,374
-679
487

1,592
105

1,593
16

1,592
156

1,592
76

6,369
353

1,592
1

1,592
10

1,593
203

1,592
9

6,369
223

26

28

29

90

173

16

127

181

370

694

-525
10,796-519
12,473-498
12,193-965
10,523-2,50745,985

-497
3,782

-506
7,304

-524
9,101

-645
7,109

-2,172
27,296(JPY mn)
Operating profit
Other income
Other expenses(Adjustments)
Purchase price allocation amortization
Stand-alone related expenses
Stock-based compensation (except for
performance-linked stock compensation)

Stock-based compensation (except for
performance-linked stock compensation)
Tax adjustment to total adjustments
Adjusted Net Income

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42

Quarterly Balance Sheet
Total assets, inventories and tangible fixed assets are on an increasing trend.
Total liabilities, interest-bearing debt decreased. Total equity, increased due to retained earnings.

Assets(JPY bn)

382.3

394.9

359.0

106.5

124.2

118.4

56.8

373.5

106.1

50.6

Liabilities・Equity

356.9

360.0

94.5

87.6

29.0

33.6

371.2

375.4

86.5

92.6

37.2

32.0

(JPY bn)

Cash andcash equivalents

121.0

61.9

65.5

68.3

67.2

16.0

17.6

18.7

18.8

23.2

24.3

33.6

35.4

Property, plantand equipment

67.7

66.2

64.9

63.0

61.4

59.9

58.5

57.0

Intangible assets

86.8

87.7

Inventories

59.1

59.1

59.1

59.1

59.1

59.1

59.1

6.7

7.8

8.8

8.9

9.5

9.3

9.6

11.7

FY24/3End of 1Q End of 2Q End of 3Q End of 4Q End of 1Q End of 2Q End of 3Q End of 4Q

84.1

356.9

360.0

99.2

96.0

99.2

71.1

61.1

69.6

35.4

130.7
59.1

373.5

123.3

79.2
86.3

121.0

Trade andother receivables

41.2

80.3

394.9

359.0

42.0

FY23/3

382.3

40.4

141.6

37.1

152.7

42.4

31.4

160.9

165.3

371.2

375.4

96.0

93.0

Interest-bearing liabilities(Loans payable + Leaseliability)

59.4

Trade and other payables+ Contract liabilities

35.6

Others

187.4

Equity

62.2

59.0

32.7

32.9

172.1

180.4

Goodwill
Others

FY23/3

FY24/3End of 1Q End of 2Q End of 3Q End of 4Q End of 1Q End of 2Q End of 3Q End of 4Q
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Key Balance Sheet Items(JPY mn)
Assets Current

Cash and cash equivalents

AssetsTrade and other receivables

FY21/3
FY22/3
FY23/3
FY24/3(JPY mn)
End of 4Q
End of 4Q End of 4Q End of 4Q
Liabilities Current
40,039108,399
106,053
92,619Liabilities
41,73245,97350,61731,99438,65951,64967,197

87,682Other current assets

311

478

2,053

2,619

Total Current assets

120,741

206,499

225,920

214,914

Noncurrent

Property, plant and equipment

16,172

15,99818,77535,382

AssetsGoodwill

59,06559,06559,06559,065Intangible assets

75,07569,04962,968Other non-current assets

2,716

5,921

6,811

Total non-current assets

153,028150,033

147,619

273,769

356,532

373,539

Inventories

Total Assets

FY21/3
FY22/3
FY23/3
FY24/3End of 4Q End of 4Q End of 4Q End of 4Q
Loans payable + Lease liability
3,343
4,968
6,596
8,019
Trade and other payables

46,42649,901

41,79036,667

Contract liabilities

4,000

18,76029,28322,719Others11,972

24,90423,784

20,138

Total current liabilities

65,741

98,533

101,453

87,543

Non-

Loans payable + Lease liability

122,417

118,223

92,61084,999current

Others

20,66820,257

18,595

15,503

Total non-current liabilities

143,085

138,480

111,205

100,502

208,826

237,013

212,658

188,045

64,943

119,519

160,881

187,388273,769

356,532

373,539

375,433

Liabilities
56,995 Total Liabilities
9,077 Total Equity

160,519 Total Liabilities
375,433 and Equity

Equity ratio

FY21/3End of 4Q

FY22/3End of 4Q

FY23/3End of 4Q

FY24/3End of 4Q

23.7%

33.5%

43.1%

49.9%

Debt equity ratio

1.9

1.0

0.6

0.5

Net cash(JPY mn)- 85,721- 14,792

6,847

- 399

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Cash Flow Statement

FY23/3(JPY mn)

FY24/3

1Q

2Q

3Q

4Q

CF from operating activites- 1,950

22,120- 3,351

13,174

CF from investing activities- 982- 1,657- 2,069- 2,932

20,463- 120

Free CF
CF from financing activites
Cash and cash equivalents
at beginning balance
Cash and cash equivalents
at end of the quarter

Full Year

1Q

2Q

3Q

29,993- 7,365- 2,030

2,443

9,894

2,942

- 3,117- 7,825- 5,278- 2,037- 3,321- 1,314- 11,950- 5,420

10,05722,168- 12,643- 4,067

- 878

8,580

- 9,008- 2,425- 163- 22,405- 25,113- 167- 3,17170- 3,044- 6,312108,399

106,464

124,198

118,403457,464

106,053

94,49387,55086,498374,594

106,464

124,198

118,403

106,053455,118

94,49387,55086,49892,619361,160

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4Q

Full Year45

Quarterly R&D Expenses / Capital Expenditure / Depreciation Expense
The ratio of R&D expense to revenue increased temporarily due to the continued investment in next-generation equipment
development. The ratio will normalize as sales recover.
Large-scale capital investments with long-term amortization, such as new factory construction and demonstration room
expansion are increasing.
R&D Expenses

Capital Expenditure / Depreciation Expense

R&D 40expenses

35(JPY bn)

30

3.7

3.5

R&D expenses ratio(%)

9%

9.0

3.3
2.9

2.9

2.7

10%

3.1

3.0

7.5
6.7

25

5.9

5.1

20

7%

5%

6.9
(JPY bn)

4%

15

4.2

3%

10

2.5

2%

5

1%

0

0%

R&D expenses

1Q
2.7

FY23/3
2Q
3Q
3.3
2.9

4Q
3.5

1Q
2.9

FY24/3
2Q
3Q
3.0
3.1

4Q
3.7

Ratio to revenue

4.8%

5.1%

5.9%

9.0%

6.7%

7.5%

(JPY bn)

Depreciation expense

6%

5.7

4.5

4.8

8%

Large-scale investment (new factory construction,
demonstration room expansion, etc)
Regular capital investment

4.5%

5.7%

0
0.7

2.6

2.6

1.2

0.5

1.6

1.7

2.6

2.6

2.8

2.7
1.1

3.6

2.8
1.9

0.4
0.5

0.8

1.0

1.0

Capex total

1Q
0.7

FY23/3
2Q
3Q
2.9
2.2

4Q
0.8

1Q
5.1

FY24/3
2Q
3Q
2.1
10.5

4Q
2.8

Ratio to revenue

1.3%

4.4%

3.3%

1.4%

15.5%

4.6%

19.4%

5.8%

Depreciation

2.5

2.6

2.6

2.6

2.6

2.7

2.8

2.8

Ratio to revenue

4.5%

4.0%

4.0%

4.3%

8.1%

5.9%

5.2%

5.8%

(JPY bn)

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46

Key Activities for FY2024/3
Business Activities
 Received the 2024 EPIC Distinguished Supplier Award from Intel Corporation. (March 2024)
 Established an office in Yokohama for R&D of elemental technologies related to next-generation semiconductors, with plans to start full-scale

operation at end of FY2024. (January 2024)
 Exhibited at semiconductor industry exhibitions held in various regions, including: SEMICON® China (March 2024), SEMICON® Korea (January2024), SEMICON® Japan (December 2023), SEMICON® Europa 2023 (November 2023), SEMICON® Taiwan 2023 (September 2023),
SEMICON® West 2023 (July 2023), and SEMICON® China 2023 (June 2023).
 Held the completion ceremony of the demonstration evaluation area of the Korean production base. (November 2023)
 The Integrated Green-niX Consortium for Research and Human-Resource Development (Green-niX), in which KOKUSAI ELECTRIC participates,

selected among Ministry of Education, Culture, Sports, Science and Technology’s Initiatives to Establish Next-generation Novel Integrated Circuits
Centers (X-nics). (July 2023)
 Received the 2023 EPIC Distinguished Supplier Award from Intel Corporation. (June 2023)
 Recognized in Customer Satisfaction Survey by TechInsights as one of the “10 Best Suppliers” for the 26th consecutive year, and won “The BEST

Suppliers” award for excellent semiconductor manufacturing equipment by product type. (May 2023)

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Key Activities for FY2024/3
ESG Initiatives
 Recognized for the 3rd consecutive year as the 2024 Certified Health & Productivity Management Outstanding Organization (Large Enterprise

Category). (March 2024)
 Signed an official partner agreement with professional soccer club Kataller Toyama, supporting them for the 6th consecutive year. (February 2024)
 Toyama Technology & Manufacturing Center received Silver Status in RBA VAP audit. (January 2024)
 Increased the use of Toyama Mizu-no-Sato Denki renewable energy at Toyama Technology & Manufacturing Center to 20% of total. (January2024)
 Selected as Best Deal in the IPO category of Nikkei Veritas’ Deal of the Year 2023. (January 2024)
 Formulated KOKUSAI ELECTRIC Group Sustainable Procurement Guidelines, disseminated and explained them to suppliers. (October 2023)
 Sponsored the “Owara Kaze no Bon” festival in Yatsuo, Toyama City, where the Toyama Technology & Manufacturing Center islocated.(September 2023)
 Received “Kurumin Certification” from the Minister of Health, Labour and Welfare, recognizing our initiatives to support childcare. (July 2023)
 Held open-air environmental classes at nursery facilities as part of community contribution activities. (June 2023)
 Enhanced the “Compliance Whistleblower System” on the company website to strengthen compliance in our supply chain. (June 2023)
 Signed the Women’s Empowerment Principles (WEPs), which offer guidance to businesses actively promoting women’s empowerment in theworkplace. (April 2023)

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KOKUSAI ELECTRIC CORPORATION and its Affiliates Proprietary
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