6627.T

2024 Full Year Financial Summary

• Record high consolidated annual revenue of 37 billion yen, a 5% increase year-over-year driven by growth in automotive test revenue
• Annual operating profit decreased 3% year-over-year to 6.95 billion yen, due to lower utilization of older existing testers from consumer/automotive inventory adjustment, increased depreciation from new server CPU/GPU tester investments, higher personnel costs, and rising electricity costs primarily in Taiwan
• ROE maintained at the same level as shareholder equity cost; ROIC maintained above WACC
• As of end-December 2024, PBR was 0.7x, PER was 7.5x; total assets were 75.4 billion yen; capital expenditures remained within free cash flow, and depreciation was kept within controlled ranges
• Capital investments were heavy in both Japan and Taiwan: Japanese investments covered new clean rooms and office buildings, while Taiwanese investments focused on advanced server CPU/GPU test equipment

2025 Strategic Initiatives (20th Anniversary of Founding)

• Strengthen AI semiconductor and related testing capabilities: Launch AI inference GPU testing at the Taiwan facility starting mid-to-late 2025, to support growing demand for server CPU/GPU and raise revenue and profit levels
• Capture Japanese government semiconductor support opportunities: Leverage government support centered in Kumamoto, Hokkaido, and central Japan to integrate new business opportunities into the company's supply chain
• Optimize cross-site tester utilization: Rotate existing test equipment between Japan and Taiwan sites. For example, older advanced-node testers previously used in Taiwan for AI GPU testing will be reallocated to automotive testing in Japan to maximize asset efficiency
• Continue targeted investments: Invest in CIS testers in Japan, and implement optimal capital allocation aligned with market demand
• Drive cross-site productivity improvement: Refine advanced production technology in Taiwan, and roll out best practices to Japanese facilities; automation such as robots has already been deployed at the Kyushu plant in Japan

Dividend Policy Update

• Changed payout base from standalone net income to consolidated net income, targeting a payout ratio of approximately 30% of consolidated net income

• 2025 (FY ending December 2025) is expected to see a recovery in revenue, operating profit, and ordinary profit starting from the Q4 2024 bottom
• Automotive segment inventory adjustment will continue through the first half of 2025; Q1 2025 automotive performance is expected to be weak or flat, with full recovery not expected until the second half of 2025, as automotive is the last segment to benefit from AI-driven semiconductor demand growth
• Some consumer semiconductor segments are expected to recover earlier than automotive in 2025
• Capital expenditure will be implemented gradually in both Japan and Taiwan, with investment decisions adjusted based on second half 2025 demand, enabled by shorter lead times for test equipment
• Profit margins are expected to improve as depreciation on older invested assets is gradually completed

1. Memory: No explicit full-year absolute revenue value provided; overall product category contribution is stable year-over-year. 2. MCU & SoC: No explicit full-year absolute revenue value provided; overall product category contribution is stable year-over-year. 3. Automotive: Full-year 2024 revenue was 2.4 billion yen higher year-over-year, reaching a peak of 5.4 billion yen in Q2 2024 before declining to 4.3 billion yen in Q4 2024 due to two rounds of customer inventory adjustment. Automotive test revenue contribution decreased by approximately 6% quarter-over-quarter in Q4 2024. 4. Server CPU/GPU: Recovered in Q4 2024, partially offsetting automotive revenue decline. New high-end testers for server CPU/GPU saw rising utilization in 2024. 5. Consumer/Industrial Semiconductor: Experienced demand decline in 2024, pulling down overall operating profit. 6. Industrial/Medical: Demand was stable year-over-year, partially offset by server CPU/GPU test growth. Full year 2024 consolidated total revenue hit a record high of 37 billion yen, 5% higher year-over-year; full year operating profit was 6.95 billion yen, a 3% decrease year-over-year. Q4 2024 consolidated revenue was 9 billion yen, a 200 million yen decrease quarter-over-quarter; Q4 2024 operating profit was 1.46 billion yen, a 13% decrease quarter-over-quarter.

• Extended inventory adjustment in automotive and consumer semiconductors could keep utilization of existing test equipment lower than expected, delaying profit margin recovery
• Rising personnel costs and electricity costs (especially in Taiwan) may continue to pressure operating margins
• AI semiconductor demand growth may be slower than forecast, limiting the contribution of new high-end test capacity to revenue and profit

No Q&A section is included in the provided transcript.