TOKYO ELECTRON ANNUAL REPORT 2013

PAGE

19

CONTENTSCONTENTS

Financial Highlights

Business Overview

Top Message

Financial Review

Review of Operations
and Business Outlook

Special Feature

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Corporate GovernanceConsolidated Balance Sheets

Corporate CitizenshipIntellectual Property

Consolidated Statements of Income

Consolidated Statements of Cash Flows

Corporate Data

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Financial Review
Sales and Income

Sales

Research & Development

Net sales in fiscal 2013 decreased 21.4% year on year to ¥497.3

R&D expenses were down 10.1% year on year to ¥73.2 billion. As

During fiscal 2013, Tokyo Electron posted interest and dividend

Operating Environment

billion. This was mainly due to significantly reduced sales in mainstay

Tokyo Electron continues to view R&D as a source of growth, theincome of ¥1.7 billion and revenue from grants of ¥2.7 billion, but

During fiscal 2013, there was widespread unease about the state

semiconductor production equipment and FPD production equip-Company aggressively invested not only in strengthening existingalso incurred a net foreign exchange loss of ¥1.5 billion. Afterof the world economy due to extended financial problems in

ment, reflecting the influence of the stagnant business environment.

business areas, but also in new areas that are expected to support

including lesser items, other income (expenses), net amounted toEurope and financial issues in the United States as well as slowing

Domestic sales fell 30.8% year on year to ¥118.5 billion, while

future growth. As a percentage of net sales, R&D expenses rose

an income of ¥5.2 billion.

growth in emerging countries including China. Near the end of theoverseas sales fell 18.0% to ¥378.8 billion. Overseas sales as aperiod, economic conditions staged a gradual recovery. The

share of total consolidated sales came to 76.2%, up 3.3 percent-Japanese economy received a boost from the rapid depreciation

age points from 72.9% in fiscal 2012.

Other Income (Expenses) and Net Income

from 12.9% to 14.7%.

This contributed to ¥17.8 billion in net income before taxes andR&D investment in semiconductor production equipment

minority interests, down 70.7% from the previous fiscal year. Net

strengthened new product development in each product category

income totaled ¥6.1 billion, down 83.5%. Net income per share

Orders received during the fiscal year under review decreased

to respond to diversifying technologies. The Company focused on

was ¥33.91, compared with ¥205.04 in fiscal 2012.

of the long-term effects of the high yen and concern over the slow-

by 16.7% compared to the previous year, to ¥450.6 billion. The

the development of process technology and equipment needed foring of the worldwide economy, however, the broader domesticorder backlog at the end of March 2013 was ¥180.8 billion, downsuch next-generation devices as 3D structure devices, advanced

Comprehensive Income

economy was restrained during the fiscal year, with recovery

16.5% year on year.

packaging technology and low-power-consumption technology

In fiscal 2013, Tokyo Electron posted comprehensive income of

responding to demand for lower energy use and environmental¥15.8 billion, a 57.2% year-on-year decrease. The decrease was

Gross Profit, SG&A Expenses and Operating Income

friendliness. Other areas of R&D investment included next-genera-

due to a significant year-on-year drop in net income, despite an

spread of smartphones gathered momentum, helping to drive theCost of sales for the period under review decreased 19.7% year

tion memory manufacturing technology and development of equip-¥8.8 billion gain on foreign currency translation adjustments due toindustry. However, sales of PCs and TVs were slow. This worsenedon year to ¥338.5 billion, only partially compensating for thement for next-generation 450mm wafers.

the yen’s rapid depreciation late in the period.

the supply-demand balance of memory chips and LCD panels,

decrease in net sales, leading to a cost of sales ratio of 68.1%, aleading to restrained capital investment by Tokyo Electron’s semi-

full 1.5 percentage points worse than in fiscal 2012.

of the yen in the latter half of the fiscal year. Against the backdrop

remaining slow.
In the electronics industry, in which Tokyo Electron operates, theAs a result, gross profit was down 24.9% year on year to ¥158.8

conductor and flat panel display (FPD) manufacturing customers.

billion, with the gross profit margin falling to 31.9% from 33.4% in
fiscal 2012.

Corporate Acquisitions

R&D investments in FPD/PV production equipment were concentrated on development of OLED production equipment and fur-Dividend Policy and Dividends

ther improving the conversion efficiency of thin-film silicon

It is the policy of Tokyo Electron to pay dividends on the basis ofphotovoltaic panel production equipment.

business performance and earnings results. The dividend payout

In fundamental R&D, development focused on various core

Tokyo Electron made four corporate acquisitions in fiscal 2013:

SG&A expenses fell 3.2% year on year to ¥146.2 billion.

TEL NEXX, Inc. (formerly NEXX Systems, Inc.), TEL FSI, Inc.

However, the ratio of SG&A expenses to consolidated net sales­(formerly FSI International, Inc.), TEL Solar Holding AG (formerly

increased to 29.4% from 23.9% in fiscal 2012. Meanwhile, in the

Oerlikon Solar Holding AG), and TEL Magnetic Solutions Ltd.

year under review, group-wide measures were taken to reduce­(formerly Magnetic Solutions Ltd.). TEL Solar Holding AG is reflect-

fixed costs by approximately ¥16.0 billion to improve profitability.

ratio has been set at approximately 35% of consolidated nettechnologies aimed at achieving differentiation, including processincome. In fiscal 2013, as Tokyo Electron entered its 50th year, thetechnologies for further miniaturization and new materials.

Company paid annual dividends of ¥51, including a commemorative dividend of ¥20, for a combined ratio of 150.4%.

Consequently, operating income decreased by 79.2% year on

ed only in the consolidated balance sheet for fiscal 2013, and will
be fully included in all other consolidated financial statements

year to ¥12.5 billion, and the operating margin declined from 9.5%

beginning in fiscal 2014. The influence of the other three corporate

to 2.5%.

acquisitions conducted in fiscal 2013 on the financial results of theyear under review was minimal.
For additional information concerning these acquisitions, seeNote 20 to Consolidated Financial Statements, Business
Combinations, on pages 31 to 33.

110,497

136,888

151,002146,206

Operating income (loss)

14,711(2,181)

97,87060,443

12,549Operating margin

2.9%(0.5)%

14.6%

9.5%

2.5%

Income (loss) before income taxes and minority interests

9,637(7,768)99,57960,602

17,767

Net income (loss)

7,543(9,033)71,92436,726

6,076

2.9

200

09
 Domestic
 Overseas

0

10

11

12

40

5

20

0

0

-5

-20

71.9

97.9
25

0

10

13

2.5

-25

09

6.1

122,69760

36.7

Selling, general and administrative expenses

15

-0.5

10

 Operating Income (Loss) Operating Margin

11

12

13

-9.0

31.9%

80

7.5

158,755

33.4%

12.5

211,44535.1%(Billions of yen)

9.5
60.4

234,758

25.9%

50

-2.2

108,316

27.0%

75

14.7

137,408

(%)
20

378.8

Gross profit
Gross profit margin400

Net Income (Loss)

14.6

118.5

¥497,300

171.4

2013

¥633,091

182.2

2012

¥668,722

256.0

2011

¥418,637

162.6

2010

¥508,082

208.9

2009

Net sales

Sales and Income

299.2

600

461.7

Millions of yen

497.3

100
633.1

(Billions of yen)

800
486.6 668.7(Billions of yen)

418.6

Operating Income (Loss) andOperating Margin

508.1

Domestic and Overseas Sales

09

10

11

12

13

TOKYO ELECTRON ANNUAL REPORT 2013

PAGE

20

CONTENTSCONTENTS

Financial Highlights

Business Overview

Top Message

Financial Review

Review of Operations
and Business Outlook

Special Feature

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Corporate GovernanceConsolidated Balance Sheets

Corporate CitizenshipIntellectual Property

Consolidated Statements of Income

Consolidated Statements of Cash Flows

Corporate Data

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Financial Review
Performance by Segment

M FPD/PV (Flat Panel Display and Photovoltaic Panel)

M Electronic Components and Computer Networks

M Other

In fiscal 2013, demand was weak in the domestic electronic com-

Other sales mainly include group-wide logistics services, facility

M Semiconductor Production Equipment

Capital investment in small- and medium-sized FPD panels for mobile

ponents market for both consumer and industrial electronics.

maintenance and insurance. Net sales to external customers

Driven by advanced mobile devices such as smartphones and tab-devices was firm. However, as demand for flat panel TVs in developed

However, the cloud computing market, including data centers,

amounted to ¥0.4 billion, almost unchanged from the previous fis-lets, logic-related semiconductor capital investment was relatively

countries settled down, capital investment was pushed out, and theshowed underlying notes of expansion.

cal year.

firm. However, against a backdrop of slow PC shipments, memo-

FPD production equipment market contracted considerably.

Production Equipment

Segment net sales to external customers decreased 0.2% year

Segment net sales to external customers decreased 71.2% year

on year to ¥84.7 billion. Segment net sales including intersegment

on year to ¥20.2 billion. Segment net sales including intersegment

sales or transfers were down 1.0% to ¥85.5 billion. Segment profit

sales or transfers also decreased 71.2% to ¥20.2 billion. Segment

fell 44.5% compared to fiscal 2012, to ¥1.3 billion, and the seg-on year to ¥392.0 billion. Segment net sales including interseg-

loss totaled ¥6.4 billion, compared with segment profit of ¥2.3 bil-ment profit margin fell from 2.7% in fiscal 2012 to 1.5%.

ment sales or transfers were down 18.0% to ¥392.1 billion.

lion in fiscal 2012. FPD production equipment sales made up near-

Segment profit fell 45.4% compared to fiscal 2012, to ¥48.6 bil-ly 100% of segment sales.

ry-related semiconductor capital investment continued to shrink in
the fiscal year under review.
Segment net sales to external customers decreased 18.0% year

For a business overview of this segment, please see page 13.

Orders in this segment increased 18.1% year on year to ¥22.0

lion, and the segment profit margin fell from 18.6% in fiscal 2012billion. The order backlog as of March 31, 2013 was up 72.0% toto 12.4%.

¥24.4 billion.

Orders in this segment dropped 21.7% to ¥342.5 billion. The

For a business overview of this segment, please see page 13.

order backlog as of March 31, 2013 was down 24.9% year on
year, to ¥141.6 billion.
For a business overview of this segment, please see page 13.

Millions of yen
Reportable Segment

Segment Information2013:

Semiconductor
production
equipment

FPD/PV
production
equipment

Electronic
components &computer
networks

Other

Total

¥392,027¥20,160¥84,665¥   448¥497,300

43

—

813

10,613

11,469(11,469)—

392,070

20,16085,478

11,061

508,769(11,469)

497,300

Eliminations
andCorporate

Consolidated¥¥497,300

Net sales
Sales to external customers
Intersegment sales or transfers
Total

Selling, General and Administrative
Expenses and Ratio to Net Sales（%）(Billions of yen)

200

40

—

Segment profit (loss)

48,600(6,355)

1,283

1,321

44,849(27,082)

17,767

Segment assets

223,956

49,48947,5571,550

322,552

452,976775,528

Depreciation and amortization

12,330

462

448

78

13,31813,313

26,631

Amortization of goodwill

1,038

—

103

—

1,141

—

1,141

Capital expenditures, including intangible andother assets

13,464

1,661

482

54

15,661

9,834

25,495

R&D Expenses

Cash Dividends per ShareTotal Assets

Working Capital andCurrent Ratio(Billions of yen)

(Yen)

(Billions of yen)(Billions of yen)

100

125

1,000

600

Receivable Turnover andInventory Turnover(Times)(Days)

6

150

5

125

4

100

20

25

200

482.3

433.8

3.8

4.9
414.8

300

400

50
51

10

400

416.4

4.6
775.5

783.6

809.2
696.4

669.0

600

80

70.6

40

75

4.9

500

800

476.2

151.0

20

54.1

60

73.2

100
81.5

80

121
100

96
92 87

109
3

86

86

75

74

74

200

2

50

100

1

25

0

0

0

0

09

10

11

12

13

 Selling, General and Administrative Expenses
 Ratio to Net Sales

0

12

24

50

23.9
20.5
136.9

110.5

122.7

100

24.1

146.2

26.4

30

61.0

29.4

150

114

5.7

0

09

10

11

12

13

09

10

0

11

12

13

0

09

10

11

12

13

09
 Working Capital Current Ratio

10

11

12

13

09

10

 Receivable Turnover
 Inventory Turnover

11

12

13

TOKYO ELECTRON ANNUAL REPORT 2013

PAGE

21

CONTENTSCONTENTS

Financial Highlights

Business Overview

Top Message

Financial Review

Review of Operations
and Business Outlook

Special Feature

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Corporate GovernanceConsolidated Balance Sheets

Corporate CitizenshipIntellectual Property

Consolidated Statements of Income

Consolidated Statements of Cash Flows

Corporate Data

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Financial Review
Financial Position and Cash Flows

M Liabilities and Net Assets

Capital Expenditures1 and Depreciation and Amortization2

Cash Flows

Current liabilities decreased by ¥18.1 billion from the end of fiscal

Capital expenditures were ¥21.8 billion in fiscal 2013, a 44.9%

Cash flows from operating activities totaled ¥84.3 billion, up ¥54.6

Assets, Liabilities and Net Assets

2012, to ¥106.7 billion. This reflected decreases of ¥10.7 billion in

year-on-year decrease, as a number of investments for futurebillion from fiscal 2012. Major contributors were ¥17.8 billion in

M Assets

trade notes and accounts payable and ¥7.4 billion in customer

development and manufacturing site expansions were completed

income before income taxes and minority interests, a ¥57.5 billion

Current assets decreased by ¥85.5 billion from the end of the pre-advances. The balance of interest-bearing debt as of March 31,

in fiscal 2012.

decrease in trade notes and accounts receivable, ¥26.6 billion invious fiscal year, to ¥521.5 billion, reflecting decreases of ¥49.8 bil-2013 was ¥3.8 billion, compared with ¥4.4 billion at the end of theTokyo Electron purchased evaluation equipment, mainly forlion in trade notes and accounts receivable, ¥13.8 billion inprevious fiscal year. The debt/equity ratio declined to 0.6%, 0.2

areas of high growth potential in the semiconductor production

inventories. Major negative factors included a ¥15.5 billion

inventories, and ¥7.5 billion in liquidity on hand (cash, cash equiva-

percentage points lower than at the end of March 2012.

equipment and FPD/PV production equipment businesses. The

decrease in notes and accounts payable and a ¥12.5 billion

Company also invested in development and evaluation equipment

decrease in customer advances.

Non-current liabilities increased ¥3.5 billion year-on-year tolents and short-term investments). The turnover period for tradedepreciation and amortization, and a ¥20.3 billion decrease innotes and accounts receivable decreased from 87 days in fiscal¥63.7 billion, mainly as a result of a ¥2.0 billion increase in accrued

for its new research and development sites that began operations

Net cash used in investing activities was ¥141.8 billion, a con-2012 to 74 days in fiscal 2013, and the inventory turnover period

pension and severance costs. Total liabilities stood at ¥170.4 bil-in fiscal 2013, Technology Center Tsukuba, and the process devel-siderable increase from ¥8.4 billion in the previous fiscal year. This

increased from 86 days in fiscal 2012, to 100 days in fiscal 2013.

lion, down ¥14.6 billion compared with the end of fiscal 2012.

opment center in Hwaseong, South Korea.

included ¥66.1 billion outflow from a net increase in short-term

Net property, plant and equipment increased by ¥8.8 billion year

Net assets came to ¥605.1 billion, up ¥6.5 billion from the endon year, to ¥135.7 billion, due in part to ¥21.8 billion in fixed assetof fiscal 2012. This was mainly because of the ¥9.3 billion in divi-

acquisitions and ¥26.6 billion in depreciation and amortization.

dends paid, exceeding net income of ¥6.1 billion and resulting in a

Depreciation and amortization increased 10.1% to ¥26.6 billion.

investments; ¥19.0 billion used in the payment for purchase ofproperty, plant and equipment; and ¥55.1 billion used in four cor-

1. Capital expenditures represent only the gross increase in property, plantand equipment.
2. Depreciation and amortization does not include amortization of goodwill
or losses on impairment.

porate acquisitions by cash.
Cash used in financing activities came to ¥10.6 billion, com-

Investments and other assets increased ¥68.7 billion to ¥118.3¥3.3 billion decrease in retained earnings, as well as an ¥8.7 billion

billion, mainly due to an increase of ¥38.4 billion in goodwill and an

decrease in loss on foreign currency translation adjustments due

increase of ¥16.8 billion in intangible assets resulting from theto the devaluation of the yen. As a result, the equity ratio rose 1.6

acquisition of four overseas companies. As a result, total assets aspercentage points from 74.9% at the end of March 2012 to 76.5%

The balance of cash and cash equivalents at the end of Marchof March 31, 2013 stood at ¥775.5 billion, down ¥8.1 billion year

at the end of March 2013. ROE dropped to 1.0% from 6.3% in fis-

2013 stood at ¥85.3 billion, a decrease of ¥73.5 billion from theon year.

cal 2012.

end of fiscal 2012. Total liquidity on hand, which consists of cash,

pared with ¥27.3 billion in fiscal 2012, due mainly to ¥9.3 billion in
dividends paid.

cash equivalents and short-term investments, decreased by ¥7.5
billion year on year, to ¥240.1 billion at the end of March 2013.

Millions of yen

Total current assets

Millions of yen

2009

2010

2011

2012

2013

¥505,687¥552,939¥644,231¥607,051¥521,501

Financial Position

2009

2010

2011

2012

2013

Cash flows from operating activities¥ 81,030¥ 48,285¥ 83,239¥ 29,712¥ 84,267

Cash Flows

Net property, plant and equipment

99,906

92,128112,552

126,885

135,698

Cash flows from investing activities(160,622)

9,613(35,882)(8,352)(141,769)

Total investments and other assets

63,40551,28552,422

49,675

118,329

Cash flows from financing activities(46,016)(288)(5,237)(27,335)(10,625)

Total assets

668,998

696,352

809,205

783,611775,528

Cash and cash equivalents at end of year

65,883

123,940

165,051

158,776

85,314

Total current liabilities

89,272

119,162

168,038

124,794

106,670

Total liabilities

139,733

172,982

224,403

185,008

170,401

Total net assets (Total shareholders' equity)529,265

523,370

584,802598,603605,127

Capital Expenditures andDepreciation and Amortization

Total Liquidity on Hand

(Billions of yen)(Billions of yen)

40

300

20

3

600

15

15

39.1
25

1.4

0

12

0

13

0

09

10

11

12

1.0

0

10

11

12

13

10

26.6

24.2
20.0

23.1

12

13

100

0

09

11

12

13

ROA = (Operating income + Interest and dividend income) /Average total assets x 100
ROE=

10

150

50

-5

09

 Equity Equity Ratio

1.8

17.7

2.3
-0.2

-5

13

20

5

-1.8
0

11

200
7.7

6.3

0.6

0

13.1
10

50

200

250

30

14.9

572.7

13.3
10

0.8

1.0
0.7

 Interest-Bearing Debt
 Debt-to-Equity Ratio

75

5
1

10

76.5

3.8

3.8

1.4

2

09

400

511.8

2

4.4

4

518.4

5.1

73.5

74.9

18.1

70.8

593.0

77.5

586.8

6

240.1

（%）

20

247.6

（%）

100

243.9

（%）

800

210.2

(Billions of yen)

4

285.1

ROA

8.0

8

ROE

21.8

（%）

(Billions of yen)

Equity and Equity Ratio

39.5

Interest-Bearing Debt, D/E Ratio

0

09

10

11

 Capital Expenditures Depreciation and Amortization

12

13

09

10

11

Total liquidity on hand = Cash and cash equivalents +Short-term investments

TOKYO ELECTRON ANNUAL REPORT 2013

PAGE

22

CONTENTSCONTENTS

Financial Highlights

Business Overview

Top Message

Financial Review

Special Feature

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Review of Operations
and Business Outlook

Corporate GovernanceConsolidated Balance Sheets

Consolidated Statements of Cash Flows

Corporate Citizenship

Consolidated Statements of Income

Intellectual Property

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Financial Review
BUSINESS-RELATED AND OTHER RISKS(3) Impact From Research and Development(6) Impact of Intellectual Property Rights(9) Other Risks

Through ongoing and proactive R&D investment and activities in

In order to distinguish its products and make them more competi-Tokyo Electron is actively engaged in reforming its corporate struc-

The following risks may have a material impact on Tokyo Electron’s

cutting-edge technologies—miniaturization, vacuum, plasma, ther-tive, Tokyo Electron has promoted its R&D strategy for the earlyture so that it can generate profits even when markets contract.

business performance, stock price, or financial position.

mal processing, coating/developing, cleaning, wafer-transfer anddevelopment of cutting-edge technologies together with its busi-

These reforms have entailed creating new high-growth and high-clean technologies—Tokyo Electron has created advanced tech-ness and intellectual property strategies. This approach has

return businesses and pursuing higher earnings from existing busi-(1) Impact From Changes in the Semiconductor Market

nologies. At the same time, by quickly bringing to market new

enabled Tokyo Electron to obtain sole possession of many proprie-nesses. At the same time, Tokyo Electron has promoted activities

Tokyo Electron has achieved a high profit margin by concentratingproducts incorporating these technologies, Tokyo Electron hastary technologies that have been instrumental to the Company’s

to preserve the environment and worked to restructure its compli-

resources in high-tech fields, including semiconductor production

successfully captured a high market share in each of the productability to capture a high market share and generate high profit mar-ance, risk management and information security management sys-

equipment, where technological innovation is rapid but Tokyo

fields it has entered and generated a high profit margin. However,gins in each of its product fields. Tokyo Electron’s products incor-

tems. However, as long as it conducts business activities, as with

Electron can effectively use its strengths. Although technologicaldelays in the launch of new products and other factors could

porate and optimize many of these proprietary cutting-edge

peer companies or companies in different industries, Tokyo Electronchange is responsible for the semiconductor market’s rapid

adversely affect Tokyo Electron’s business performance.

technologies. There may be cases in which, by avoiding the use ofis subject to the effect of many other factors. These include thethird-party technologies and intellectual property rights, Tokyo

world and regional economic environments, natural disasters, war,

Electron’s business performance could be adversely affected.

terrorism, infectious diseases and other unavoidable occurrences,

growth, Tokyo Electron has actively undertaken structural reforms
to be able to generate profits under any circumstances, including(4) Safety-related Impact

when the market contracts temporarily due to imbalance of supply

Tokyo Electron’s basic philosophy is to always bear in mind safetyand demand. However, order cancellations, excess capacity andand health in the execution of business activities, including devel-(7) Impact of Fluctuating Foreign Exchange Rates

chains, market conditions for products and real estate, the ability

personnel and increased inventories resulting from an unexpected-

opment, manufacturing, sales, services and management. In

Success in the development of overseas operations has increased

to recruit personnel in Japan and overseas, competition over stan-

ly large market contraction, losses from bad debts resulting fromaccordance with this philosophy, Tokyo Electron works actively

the share of sales generated overseas. As a rule, Tokyo Electron

dardization, and loss of key personnel. Any of these factors could

the worsening of a customer’s financial position, and supply short-and continuously to improve the safety of its products and to elimi-

conducts export transactions on a yen basis to avert exposure toadversely affect Tokyo Electron’s business performance.

ages resulting from the worsening of a supplier’s management sit-nate any harmful impact on health. However, harm to customers,

foreign currency risks. However, some exports are denominated inuation, could adversely affect Tokyo Electron’s businessorder cancellations or other circumstances resulting from safety or

foreign currencies. In these cases, Tokyo Electron hedges foreign

performance considerably.

other problems related to Tokyo Electron’s products could

currency risk by using a forward foreign exchange contract whenadversely affect Tokyo Electron’s business performance.

an order is received or by other means. However, foreign

financial or stock markets, government or other regulations, supply

exchange rate risks can arise from fluctuations in prices due to(2) Impact From Concentration of Transactions on(5) Impact From Quality Issues

sudden foreign exchange movements, which could have an indi-

Tokyo Electron has been successful at increasing transactions with

Tokyo Electron actively develops outstanding, cutting-edge tech-rect adverse effect on Tokyo Electron’s business performance.

the leading semiconductor manufacturers worldwide, including

nologies for incorporation in new products that are brought quickly

those in Japan, through the provision of products featuring out-

to market. At the same time, Tokyo Electron works to establish(8) Influence of Corporate Acquisitions

standing, cutting-edge technology and of services offering a higha˛quality assurance system, efforts that include obtaining ISO 9001

As part of its business strategy, Tokyo Electron conducts corpo-

level of customer satisfaction. However, Tokyo Electron’s sales may

certification, as well as to establish a world-class service system.

rate acquisitions in order to expand into new business areas,from time to time be temporarily concentrated on particular custom-

These actions have resulted in a large number of customers

secure new technologies and business platforms, and strengthen

ers due to the timing of large capital investments of major semicon-

adopting Tokyo Electron’s products. However, because Tokyo

the competitiveness of existing businesses. The Company con-ductor manufacturers. The resulting escalation in sales competition

Electron’s products are based on cutting-edge technologies, andducts due diligence and carefully deliberates each specific acquisi-

could adversely affect Tokyo Electron’s business performance.

due to other factors, many of the technologies developed are intion. However, in the event that the results following an acquisition

unfamiliar fields. The occurrence of unforeseen defects or other

do not meet expectations, Tokyo Electron’s business performanceissues could adversely affect Tokyo Electron’s business performance.

could be adversely affected.

Particular Customers

Corporate Data