SpiderPlus & Co.

The Group's core product, "SPIDER+," is specialized for the construction industry. If the construction market contracts or software investment appetite declines sharply or over the long term, deteriorating business conditions or the emergence of counterparties at risk of bankruptcy could affect the Group's financial position and operating results. Currently, DX needs are robust against a backdrop of expanding construction investment and chronic labor shortages, but the risk of a sudden change in market conditions cannot be ruled out. As countermeasures, the Group is promoting market share expansion, growth in the number of IDs per customer, improved option penetration rates, and strengthening of the customer base through Professional Service.

The Group's structure is heavily dependent on a single segment and single product, "SPIDER+," which accounts for the majority of the Group's net sales. If a serious problem arises with this service, or if competition with competitors or new entrants intensifies, this could have a material impact on business development and operating results. Although the subscription-based model tends to have low cancellation rates, the limited availability of alternative revenue sources heightens the risk. The Group is diversifying its service scope through platform expansion under the "SPIDER+ Workspace Concept," but the degree of dependence remains high at this time.

If powerful competitors with financial strength and brand power invest even greater resources into strengthening their service offerings, this could affect the Group's financial position and operating results. Although there are time and financial barriers to securing engineers and sales personnel well versed in construction industry business know-how, the risk of entry by major corporations cannot be denied. As countermeasures, the Group aims to maintain its competitive advantage through proactive marketing and strengthened sales capabilities, enhancement of its customer success framework, and strengthening of its intellectual property strategy.

The pace of technological innovation surrounding cloud services and AI technology is rapid, and if difficulties arise in acquiring the knowledge and know-how needed to continue providing services that meet cutting-edge needs, this could lead to a decline in competitiveness, technological capability, and service quality, thereby affecting the Group's financial position and operating results. In particular, at major general contractors, compliance with proprietary security check standards and audits is increasingly becoming a prerequisite for service selection and continued use, and there is also a risk of increased compliance costs. The Group addresses this by focusing on recruiting and training engineers, developing its development environment, and acquiring technical knowledge.

The Group's services depend on external cloud servers, and if a cloud server outage occurs due to system errors, natural disasters, malicious acts, computer viruses, or intrusion by hackers, this could result in damage to customers, additional cost burdens, and damage to the Group's brand, thereby affecting its financial position and operating results. There is also a risk that termination of contracts with external cloud server providers could make it impossible to continue using existing servers. The Group addresses this through a continuous monitoring system and a framework for prompt recovery upon detection of signs of failure.

As a result of over 15 years of operation and repeated modifications since the product's launch, the system has become complex, requiring more time than necessary for modifications, failure response, and employee onboarding. At the end of the fiscal year ended December 2024, the Group changed its policy regarding the development platform and has begun new development; however, if unexpected defects arise in system development based on the new policy, this could affect business development and operating results due to an inability to respond to customer requests or service disruptions. The Group addresses this through thorough testing at the time of feature releases and multifaceted examination by cross-departmental project teams.

In a subscription-based business model, a significant decline in the retention rate or failure to achieve expected increases in ARPU, upselling, or cross-selling would directly affect the Group's financial position and operating results. A decline in service appeal, reduced competitiveness relative to competitors, and reduced satisfaction with additional features or support could be major causes of a decline in the retention rate. The Group aims to maintain and improve the retention rate and increase customer unit price through additional feature development and strengthening of its customer support and customer success frameworks.

The Group utilizes sales partner companies for sales intermediation and receivables collection, and as of the end of the consolidated fiscal year under review, 55.1% of trade receivables were owed by Japan Guarantee Service Co., Ltd. If it becomes difficult to continue transactions with major sales partner companies, or if there is a switch in contracts to competitors or credit risk arises, this could affect business development, financial position, and operating results. The Group strives to build stable, long-term business relationships by strengthening sales and technical support, including through regular monthly information exchange sessions.

The Group has continued to prioritize net sales growth rate and has made ongoing upfront investments, and expects to achieve full-year profitability in FY2026 (ending December 2026). However, if rapid changes in the business environment or the materialization of other risks prevent these upfront investments from producing the expected results, this could affect the Group's business and performance. In addition, the Group has tax loss carryforwards as of the end of the consolidated fiscal year under review, and if performance does not progress as planned under the medium-term management policy, this could also affect tax planning. The Group's policy is to pursue business growth accompanied by profitability while continuing to invest in acquiring new customers, strengthening customer success, product development, and responding to overseas expansion.

The Group is a personal information handling business operator that deals with registration information and other data of service users. If important information such as personal information is leaked outside the company due to unauthorized external access or other causes, this could affect the Group's financial position and operating results due to reputational damage, loss of social credibility, and claims for damages. The risk of information leakage due to increasing cyberattacks is also rising. The Group has implemented organizational, technical, and physical safety management measures, including obtaining ISO27001 certification, establishing regulations for handling personal information, managing access rights to file servers, implementing measures to prevent physical connection of external storage media, and providing information security education to all officers and employees.