Amazia,inc.

The majority of the Group's revenue derives from app billing and advertising revenue through the two platforms operated by Apple Inc. and Google Inc., creating a structure directly exposed to shifts in the business strategies of these two companies and to changes in their fee rates. If the Group's manga apps or accounts were removed due to a change in policy by the platform operators, this could have a serious impact on the continuity of the business. The Group actively gathers information on new advertising systems and strives to secure stable revenue, but the high degree of dependency remains a structural risk.

The domestic e-book market (e-books plus e-magazines) is estimated at approximately ¥670.3 billion in fiscal 2024 and remains on an expansionary trend, but barriers to entry stemming from laws, regulations, and patents are low, and intense competition continues. If improvement in ARPU (average revenue per user) and user acquisition do not proceed as planned due to intensifying competition, this could affect the Group's business performance. The Group is working to expand and differentiate its services in terms of functionality and content, but there remains a risk that market growth may fall short of expectations.

The Manga App Business accounts for the majority of the Group's sales, creating a structural risk whereby a contraction of this business would directly affect overall performance. The Group is working to diversify its revenue structure by cultivating the IT Solutions Business, the cross-border e-commerce business, and other businesses, but if these new businesses do not grow as anticipated, this could have a material impact on business performance and future business development. The high degree of dependency on a single business also directly translates into low resilience to changes in the external environment.

The Group has entered into copyright licensing agreements with numerous copyright holders for the distribution of digital comics, but dependency on certain business partners has increased due to user preferences. If, for any reason, contract renewals are hindered, or if royalty rates for the use of copyrighted works fluctuate, this could affect the Group's business performance. The Group strives to build good relationships of trust with its business partners, but its plans for service expansion inherently depend on the assumption of continued contracts, which entails this risk.

The Group's business is heavily dependent on communication networks and internally developed IT systems, and if a system failure occurs due to a natural disaster, accident, unauthorized intrusion by hackers, computer viruses, or other causes, this could affect the business, business performance, and the appropriateness of the financial reporting system. In addition, some financial figures are based on reports generated by internally developed IT systems, so a system failure also carries a risk that could extend to the reliability of financial reporting. The Group implements appropriate security measures and strives to prevent unauthorized access from outside, but risks arising from unpredictable factors cannot be eliminated.

Technological innovation is occurring continuously in the internet services field, and appropriate response to new technologies such as big data, AI, IoT, and blockchain is considered essential for sustained growth. If the Group is slow to respond to changes in new technologies or fails to make sufficient use of them, this could result in a decline in competitiveness and affect its financial position and business results. The Group is working to create efficient business models and provide added value by utilizing these new technologies, but keeping pace with the speed of technological change remains a challenge.

Character-related and other hobby-related products handled in the cross-border e-commerce business are subject to rapidly changing trends and are susceptible to supply-demand conditions and economic fluctuations, and revenue concentration in specific product groups makes the business strongly susceptible to market trends. If a significant discrepancy occurs between sales plans and actual results, this could result in the recognition of inventory valuation losses due to obsolescence of product inventory, which could have a material impact on financial position and business results. In addition, part of the advertising revenue of the Manga App Business and the sales of the cross-border e-commerce business are denominated in foreign currencies, which also entails market risk from foreign exchange rate fluctuations.

The distribution of pirated versions of e-book content causes disadvantages to publishers and copyright holders, and if large-scale intellectual property infringement occurs over a prolonged period, the resulting loss of opportunity could have a material impact on the Group's business performance. In addition, since e-book sales represent a relatively new business format, there is also a risk that third parties may allege intellectual property infringement due to future changes in laws, changes in interpretation, or the increasing complexity of rights processing arising from overseas expansion. The Group addresses this through consultation with outside counsel and by formulating response policies through its risk management committee, but if litigation or similar matters arise, this could affect its financial position and business results.

Representative Director Ryosuke Sakuma has played a central role in determining management policy and business strategy since the company's founding, and Director and CTO Motoaki Eguchi plays an important management role as the officer with ultimate responsibility for system and infrastructure development. If, for any reason, either of these two individuals becomes unable to continue executing their management duties, this could affect the Group's business development and business results. The Group is working to develop a structure that eliminates excessive dependency on specific individuals by promoting information sharing and delegation of authority at the Board of Directors and management meetings, but at present the degree of dependency remains high.

The Group's number of employees stood at 53 as of the end of September 2025, a small scale, and its internal control system remains commensurate with this scale. If rapid business expansion outpaces the development of an adequate internal control system, this could make appropriate business operations difficult and have a material impact on the business and business results. In addition, if the Group is unable to secure and develop excellent personnel meeting its hiring criteria as planned, this also entails a risk of affecting business expansion and business results.