Amendment to Annual Securities Report: Term 27

CyberAgent’s fiscal year 2024 performance, ending September 30, reflects a period of significant growth alongside rigorous efforts to rectify past governance lapses. The company achieved a strong financial outcome, with consolidated net sales reaching 801.2 billion yen—an 11.4% increase year-over-year—and operating profit rising by 79.3% to 40 billion yen. This growth was driven by the expansion of the internet advertising segment, the robust performance of the ABEMA media platform, and successful titles within the gaming division. Despite these gains, the company recognized a 5.6 billion yen impairment loss across various segments and continues to navigate legal challenges, most notably a patent infringement lawsuit filed by Konami Digital Entertainment against its subsidiary, Cygames, regarding the game Uma Musume Pretty Derby.

The primary catalyst for this reporting cycle is the submission of an amendment to the 27th Annual Securities Report, necessitated by the discovery of improper revenue recognition at the subsidiary CyberOwl, totaling 3.73 billion yen. Following an internal investigation and subsequent audit, the company has restated its financial statements to ensure transparency. To prevent future occurrences, CyberAgent has reinforced its corporate governance through the adoption of an audit and supervisory committee structure, the establishment of a nomination and compensation advisory committee, and the implementation of a clear separation between management oversight and business execution.

Looking forward, the company remains committed to long-term shareholder value, adopting a dividend policy based on a dividend-on-equity (DOE) ratio of 5% or higher. Strategic priorities include continued investment in ABEMA, the integration of artificial intelligence to drive productivity, and inorganic growth through acquisitions, such as the recent purchase of Nitroplus. While managing a complex capital structure that includes convertible bonds and established credit lines, the company maintains a focus on internal controls and risk management to address the evolving regulatory and operational challenges inherent in the digital media and gaming sectors.