OpenWork Inc.

User acquisition for "OpenWork" primarily relies on organic search traffic from search engines, creating a risk that changes in search engine operators' specifications could reduce site visitor numbers. In addition, the human resources services industry has numerous competitors with superior financial strength and brand recognition, and large-scale promotions or low-price competition by such competitors could reduce the efficiency of new user acquisition or lead to attrition of existing users. As of the end of December 2025, the company had approximately 7.75 million registered users and approximately 20.60 million pieces of review data, but the competitive environment remains severe due to the low barriers to entry.

"OpenWork Recruiting" is the company's core service, accounting for 69.8% of operating revenue in FY2025 (ending December 2025), and there is a risk that business performance could fluctuate significantly due to changes in the employment environment or changes in hiring companies' staffing plans. In a highly uncertain market environment, forecasting future business performance and formulating effective strategies is difficult, and if measures to expand client companies and sales channels fail to achieve expected effects, this could have a material impact on business development and performance. Annual operating revenue for this service in FY2025 (ending December 2025) reached ¥3,247,884 thousand, and the impact of fluctuations in this service is substantial.

"OpenWork Recruiting" is operated as a fee-charging employment placement business under the Employment Security Act (License No. 13-Yu-307725, valid until April 30, 2029), and there is a risk that new legislation, amendments to regulations, or changes in the interpretation of existing laws could require the company to obtain additional licenses or could result in license revocation or business suspension orders. Since this service is the company's core business, accounting for 69.8% of operating revenue in FY2025 (ending December 2025), any issues related to licensing would have a substantial impact on business performance. The company has established a framework for legal monitoring through collaboration with legal counsel and its Risk Management Committee to address this risk.

In the internet industry, the cycle of technological innovation and changes in customer needs is extremely rapid, creating a risk that new technologies adopted or developed by the company may fail to achieve expected effects or may become obsolete. There are also concerns regarding difficulties in securing and training highly specialized engineers, the incurrence of substantial system improvement costs, and intensified competition with competitors that have adopted new technologies ahead of the company. The company is proceeding with new technology development, including the implementation of an AI-based review screening function, but delays in responding could lead to a decline in competitiveness.

The company has positioned raising awareness of itself and its services and strengthening customer acquisition capabilities as important priorities, and is conducting advertising activities including internet advertising and television commercials, but if the cost-effectiveness of the media, timing, or content of such advertising is insufficient, this could affect business development and performance. Against the backdrop of aggressive promotional activities by competitors in the human resources services industry, ensuring the efficiency of advertising investment remains a challenge. There is also a risk that increases in advertising expenses, as upfront investments, could put pressure on profit margins.

The company holds and uses personal information of "OpenWork" service members, including names, resumes, and application information, and if personal information is leaked due to unauthorized access or other causes, this could lead to claims for damages or a decline in trust, potentially affecting business development and performance. The company has obtained Privacy Mark certification and has established and operates a personal information protection management system compliant with JIS Q 15001, and is working to raise management awareness through the development of internal regulations and training. However, given the increasing sophistication of cyberattacks, complete protection remains difficult to achieve even with countermeasures in place.

Because services are provided via the internet, there is a possibility of system failures arising from natural disasters, communication network failures, hardware/software defects, or unauthorized access by third parties. The company has implemented measures such as regular backups, monitoring of operational status, and the installation of firewalls and security software, but in the event of a failure, service suspension or delayed recovery could affect business development and performance. The company also bears obligations as an access administrator under the Act on Prohibition of Unauthorized Computer Access, and maintaining an appropriate management framework remains an ongoing challenge.

Link and Motivation Inc. held 52.70% of the total number of issued shares as of December 31, 2025, and could exert influence on fundamental matters such as the election and dismissal of directors, mergers and corporate reorganizations, amendments to the articles of incorporation, and dividends of surplus, regardless of the wishes of other shareholders. In addition, the tradable share ratio remains as low as 28.2%, creating a risk of stagnant trading or deteriorating supply-demand conditions in the market. The company makes its own independent management decisions, but the possibility that changes in the parent company's policies could affect the company's management cannot be ruled out.

The company is making upfront investments in advertising expenses, personnel costs, and other areas to expand new services and businesses centered on the enhancement of the Working Data Platform, but building a stable business foundation and achieving profitability is expected to take a certain amount of time, resulting in an anticipated temporary decline in profit margins. If the period to profitability is prolonged, or if expected results are not achieved and withdrawal costs are incurred, this could affect business performance. Operating revenue from the Alternative Data Service in FY2025 (ending December 2025) was only ¥162,263 thousand, accounting for 3.5% of total revenue, and the revenue contribution from new businesses remains at a limited stage.

Employee reviews posted by users on the "OpenWork" site may potentially infringe on third parties' reputation or privacy or violate laws, and in the event of a dispute, the company could face legal liability as well as a decline in the site's reputation. The company conducts AI-based automated screening and manual review by dedicated staff for all postings, promptly taking problematic postings offline, but complete prevention is difficult. In addition, there is a risk that damages liability could arise if the company is determined not to satisfy the requirements for limitation of liability for damages as a specified telecommunications service provider under the Act on the Provision of Information by Specified Digital Platform Operators.