Briefing on the Investigation Results of the Special Investigation Committee

Investigation Results and Impact on Earnings

A fictitious circular transaction involving the advertising agency business at a subsidiary within the KDDI Group was confirmed, and the report from the Special Investigation Committee was received. Consequently, the retrospective restatement of past results from fiscal year March 2023 and earlier through fiscal year March 2026 was made, recording an impairment loss of JPY 64.6 billion related to BIGLOBE’s goodwill and others. While the FY March 2026 Q1-3 period showed year-over-year increases in revenue and profit, considering the impact of the fictitious circular transactions, the full-year earnings guidance was revised to net sales of JPY 6,060 billion (down 4.3% from initial forecast), operating income of JPY 1,090 billion (down 7.5%), and net income attributable to owners of parent of JPY 698 billion (down 6.7%).

Recurrence Prevention Measures and Future Outlook

To clarify managerial responsibility, voluntary salary reductions and resignations of key executives were implemented, and employees involved were dismissed. The entire group is promoting recurrence prevention measures including strengthening client management, enforcing separation of duties, enhancing risk management for new businesses, and reviewing internal audit systems. There is no impact on telecommunication services. Civil lawsuits and criminal complaints are being considered to recover externally leaked amounts. The FY March 2026 full-year financial results and next medium-term management strategy announcement will be conducted without delay, aiming to strengthen the management foundation for sustainable growth.