Infomart Corporation

The Group's revenue depends on growth in the number of client companies using its services and increases in average monthly revenue per client. If the acquisition of new client companies or the continued use by existing client companies does not proceed as planned, this may affect operating results and financial condition. Since usage fees for the BtoB Platform constitute the main revenue source, maintaining and improving customer satisfaction and promoting the adoption of additional systems are essential. As a countermeasure, the Group continuously develops and provides functions and services to respond promptly to changes in business practices and customer needs.

If systems go down due to natural disasters, accidents, malware infection, hacking, data center failures, or excessive access concentration, service provision may be suspended, affecting operating results and financial condition. Since the business depends on both servers and communication networks, the scope of impact in the event of a failure can be extensive. As a countermeasure, the Group has obtained SOC 1 Type 2 and SOC 2 Type 2 reports, verifying through third-party organizations the design and operating effectiveness of internal controls related to security, availability, processing integrity, and other matters.

Information obtained from client companies in the course of providing services includes personal information, and if information leakage or misuse occurs, this may affect operating results and financial condition through damages claims or loss of credibility. As a personal information handling business operator under the Act on the Protection of Personal Information, the Group also faces the risk of penalties in the event of violations. As a countermeasure, the Group has obtained JIS Q 27001:2025 (ISO/IEC 27001:2022) and JIP-ISMS517-1.0 (ISO/IEC 27017) certifications, and implements measures such as establishing information management regulations, providing training for all employees, and concluding confidentiality agreements with outsourcing partners.

The Group is subject to a wide range of laws and regulations, including the Telecommunications Business Act, the Electronic Bookkeeping Act, the invoice system, and the Act on the Protection of Personal Information. Delays in responding to changes in requirements under the invoice system or the Electronic Bookkeeping Act could lead to a decline in service competitiveness and customer attrition. In addition, the tightening of data privacy regulations could lead to increased system modification costs and operational constraints. If the Group fails to respond promptly to significant changes in the legal system, this may affect its business development, operating results, and financial condition.

If competitors acquire patents, this could intensify competition or lead to litigation against the Group, potentially affecting operating results and financial condition. In addition, if the Group's intellectual property rights are infringed by third parties, or conversely, if the Group is alleged to have infringed the intellectual property rights of third parties in connection with technology or content it uses, there is a risk of incurring response costs, damages, or restrictions on service provision. The Group seeks to protect its intellectual property through trademark registrations and five patents obtained, but complete protection cannot be guaranteed.

The Group actively pursues M&A and capital and business alliances aimed at expanding existing businesses and incorporating advanced technologies. However, if post-merger integration (PMI) does not proceed as planned, or due to sudden changes in the market environment or the target company's failure to achieve its business plan, the anticipated synergies or profits may not be realized. In such cases, the Group may need to recognize valuation losses on investment securities held or impairment losses on goodwill related to consolidated subsidiaries, which could have a material impact on operating results and financial condition. As a countermeasure, the Group conducts careful due diligence on the target company's business content, financial condition, legal risks, and other matters.

Due to the rapid evolution of AI technologies including generative AI, if the Group is slow to respond to dramatic functional improvements made by competitors, its relative product competitiveness may decline, resulting in a loss of market share. In addition, as automation driven by AI advances, the value currently provided and the revenue model may become obsolete, potentially forcing a fundamental business transformation. There is also a risk of incurring liability for damages arising from copyright infringement, privacy issues, hallucinations, and other AI-related problems. As a countermeasure, the Group is advancing joint research with universities, strengthening the hiring and development of AI specialist personnel, and building AI governance through the formulation of "AI Usage Guidelines."

Against the backdrop of a declining working population due to the aging society and falling birthrate, and intensifying competition for IT talent, if the Group is unable to secure personnel as planned, this may cause delays in product development and weakening of the customer support system, resulting in lost growth opportunities. If the outflow of highly market-valued specialist personnel progresses, this may lead to the loss of accumulated know-how and a decline in overall organizational productivity due to increased workload on remaining employees. As a countermeasure, the Group is strengthening employer branding, improving compensation and treatment, building an organizational culture with high psychological safety, and developing an educational system including training by job level.

The Group has maintained profitable results for 23 consecutive fiscal years since the fiscal year ended December 2003. However, if changes in the circumstances of client companies force a change to the revenue model based on accumulating system usage fees, this may affect operating results and financial condition. In addition, if continuous software development investment aimed at improving convenience and providing new services fails to generate the expected returns in the expansion of existing businesses or development of new businesses, there is a risk that investment recovery will become difficult. Since the stability of the revenue model depends on subscription-based monthly usage fees, an increase in the cancellation rate has a structure that directly leads to deterioration in business performance.

The BtoB-EC market size in 2024 reached ¥514,400,000 million, up 10.6% year on year, with an EC penetration rate of 43.1%. However, if unforeseen regulatory changes or technological innovations prevent the market from expanding as expected, the growth premise underlying the Group's business may be undermined. Furthermore, even if the market does expand, if competition intensifies with existing competitors and new entrants offering internet-based systems, the Group may be unable to grow at a comparable pace. The Group seeks to differentiate itself through price competitiveness achieved via cost-sharing with standardized systems and comprehensive, interconnected services, but continuous responses are required to address changes in the competitive environment.