QAs from earnings release meetings and others | Investor Relations

June 28, 2023: The 31st Ordinary General Meeting of Shareholders

(*) This is a summary of questions and answers took place at the Briefing.

Question: IIJ continues to show strong financial results with increased revenues and profits, and the company is expanding in size. However, I am concerned whether IIJ may suffer from the big company diseases such as lacking an entrepreneurial spirit.: Answer: We take your comments sincerely. We believe that it is extremely important to continue to maintain a humble attitude and execute our growth strategy especially in the current tailwind business environment with DX in Japan finally taking off. Although 30 years have passed since our establishment, we feel that our open corporate culture and vigorous spirit of challenge are still well alive. Our employees are taking voluntary initiatives, such as the creation of "Backbone of IIJ," a guiding principles for employees to realize IIJ's business philosophy, by younger volunteer members across departments, and the "IIJ Bootcamp," a hands-on training program launched voluntarily by engineers. In order to maintain and improve our commitment to continue taking initiatives, we shall actively work to promote "provide meaningful opportunities for growth to our employees" which is also stated in our business philosophy.

Question: An equity method investee, DeCurret Holdings, Inc. ("DeCurret"), continues to be in deficit as they are in the phase of service launch preparation. Please tell us about the current business situation and future prospects.: Answer: Currently, DeCurret is preparing to launch its digital currency platform service ("PF service") which revenue is to be recognized starting FY2024. In addition, DeCurret is executing various demonstration experiments (*1) in the Digital Currency Forum, for which DeCurret DCP, a subsidiary of DeCurret, serves as the secretariat. Although we refrain from making a comment on a specific business scale because it depends on external factors such as the spread of digital currency in Japan, we assume that revenues and profits should grow along with such penetration and others. As for revenues, through their patented "the Two-tiered Digital Currency Platform" (*2), they expect transaction fees from issuers who will be using "common area," systems construction and operation and maintenance fees as well as transaction fees from enterprise users who will be using "business process area" and others.

(*1)Demonstration experiments can be found in press release
(*2)Details of "the Two-tiered Digital Currency Platform" can be found in the press releaseand White Paper.

Question: What are your thoughts on diversity management, including promotion of female managers?: Answer: Regardless of gender or other attributes, IIJ has been practicing the utilization and promotion of human resources with an emphasis on ability. As of April 2023, the percentage of female managers was 6.3% (IIJ non-consolidated), achieving FY2024 target of 6% one year ahead of schedule, and our next target is 8% or more in FY2027. About 70% of employees on the consolidated basis are engaged in engineering and services, and most of them are recruited from universities and other institutions specializing in science and engineering, where the percentage of female students is low. Due to this structural reason, the percentage of male employees is high, yet the percentage of female among hires in recent years has increased to approximately 27%, and we expect the percentage of female in management positions to continue to increase over time. As for directors, among the total of eighteen directors and auditors, there are one female director and one female auditor as of June 30, 2023.

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