Slides
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KDDI IR Day 2026 Presentation September 15, 2026 KDDI Corporation
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2 KDDI IR Day 2026 Value created by the “Digital Belt” AI Integration Progress of Mid-Term Management Strategy Business Growth Strategy Connectivity DC Part 1 Part 2 Hiromichi Matsuda President, Representative Director, CEO Hiroaki Hosoi Director, Managing Executive Officer, Executive Director, Business Solution Core Sector Takashi Kimura Executive Officer, Executive Director, Business Solution Growth Sector
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Progress of Mid-Term Management Strategy Part 1
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4 Progress Highlights FY27-03 Q1 results exceeded the plan in each area. Considering various options for the mid-term 【+α】 1 trillion yen in growth investments / Flexible share buybacks 【Base / Organic】 Consolidated Operating Income (Adjusted) 5.0% CAGR growth • Telecom Core: 3% CAGR growth • Personal Growth: 10% CAGR growth • Business Growth: 20% CAGR growth • CAPEX management • Leverage • Disciplined growth investments and portfolio review • Maintain and improve ROE/ROIC spread • Dividend payout ratio over 40% • Stable dividend growth, flexible share buybacks - Mid-Term Management Strategy (FY27-03 - FY29-03) - ⚫ Stabilization of mobile communication revenue structure ⚫ Upside in Rakuten Roaming revenue (From FY27-03 H2 onwards) ⚫ Generating investment capital through divestment and advancement of lean business structuring ⚫ Strengthening growth investment review system and expanding pipeline Key progress
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5 Toward Mid-term Growth of Telecom Core Organic growth and ID increases are on track; mobile communication revenues are in a stable growth phase Impact of service revisions FY26-03 mobile communication revenues ID ID increase (Churn rate reduction) ARPU Stable structure of mobile communication revenues FY27-03 growth image +2% ~ Organic growth Brand mix improvement / increase in high-tier plan subscriptions -FY27-03 Q1 Results- ⚫ Mobile communication revenues 491.5 billion yen (YOY+4.6%) ⚫ Mobile ARPU 4,400 yen (YOY+3.8%) ⚫ Smartphone subscriptions 33.30 million (YOY+0.39 million) ⚫ Smartphone churn rate 1.17% (YOY -0.06pt)
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6 KDDI's Unique Winning Pattern Generating a growth virtuous cycle through value creation as an industry "first mover" au Value Link Plan Service revision in August 2025 au Starlink Direct au 5G Fast Lane, etc. Improvement in brand mix Increase in high-tier plan subscriptions Churn rate reduction Maintaining net increase Technology discernment + Partnering + Commitment to deliver on our promises Core competence High-quality NW High-value-added services Infrastructure investment and partnering toward next cycle Virtuous cycle for sustainable growth in mobile communication revenues Price reflecting the Value Strengthening multi-brand Strengthening CF generation and economic zone
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7 Core Competence A first mover in value creation through discernment and partnerships while looking ahead to the next era 3G (2002~) 5G (2020~) Note: “First in industry (the first in Japan’s mobile telecommunications industry) and “First in Japan” claims are based on KDDI research. * Service area: Outside of au 5G/4G LTE coverage area within Japan (including territorial waters, contiguous zones, and ferry routes). On supported devices, data communication is available for certain apps. Voice calls are not supported (as of September 2026). When using satellite signals, functions such as voicemail and call forwarding are unavailable. Connection may be restricted depending on the usage environment Using Starlink for au base station backhaul lines SpaceX The only operator in Japan to introduce CDMA2000, superior data transmission Qualcomm 4G (2012~) Nationwide expansion of fixed-line services through alliances Making video viewing on smartphones mainstream CATV operators Netflix Mobile phone flat-rate service First in industry Connecting the Unconnected wherever you see the sky* "au Starlink Direct" Content bundled planFixed-line + mobile phone set discount "au Smart Value" First in Japan First in Japan First in Japan "EZ Flat" "Netflix Pack"
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8 Growth Investments Steadily building growth investment pipeline and CF maximization in accordance with capital allocation Pipeline expansion Building new structure for growth investmentsStrengthening cash generation capability to support growth Note) Figures exclude Financial Business *1 Core FCF = Operating CF - CAPEX - Leasing + Net interest paid after tax *2 Includes pending sales. Based on the latest proposal amounts. As of August 7, 2026 Strengthen ability to identify investment opportunities Executing investments that contribute to future +α growth Strengthen capital allocation management Core FCF*1 454.5 465.5 FY26-03 full-year FY26-03 Q2 to FY27-03 Q1 YOY +10.9 billion yen (+2.4%) Sourcing Project formation Analysis and verification Investment decision Divestment (As of Financial Results for FY27-03 Q1) 11 cases in total, generating approx. 150 billion yen in cash*2 + FY26-03 full-year FY26-03 Q2 to FY27-03 Q1 (Unit : billions of yen) Core FCF Margin (FY26-03 full-year vs. FY26-03 Q2 to FY27-03 Q1) Operating CF Margin (FY26-03 full-year vs. FY26-03 Q2 to FY27-03 Q1) 8.0% (+0.1pt) 21.6% (±0.0pt) Gather specialized talent from each business and CVC department Explore a wide range of domestic and overseas project candidates across the entire company Rebuilding the investment decision-making and oversight system through two layers, executive side under the CEO and the Board of Directors
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Value created by the “Digital Belt” Part 1
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10 AI-Native Society From “era using AI” to “era where AI is embedded in everyday life” A society where AI accelerates efficiency and enhances value creation across businesses Commoditization in the long term In AI - pervasive society, “AI - resilient and hard - to - replace value” becomes a key source of competitive advantage. HRInfrastructure Customer touchpoints
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11 Digital Belt Initiative Building resilient social infrastructure by integrating Land, Sea and Sky telecom networks Satellite communications / Drones Nationwide telecom network + AI infrastructure Submarine cables / Landing stations Land Sea Sky
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12 Refining Assets to be the Preferred Choice Toward Japanese social infrastructure that evolves alongside AI industry Nationwide telecom networks (Mobile/fixed-line network ) Submarine cables Satellite ground stations Land Sea Sky Telecom infrastructure + AI infrastructure [Domestic] [Overseas] [Space] Ever - increasin g demand for AI computing resources Ever - increasing traffic with hyperscalers Space data centers, etc. d eveloping industries and data
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13 Utilization of base stations Nationwide Telecom Network + AI Infrastructure Creating new value by integrating AI infrastructure with nationwide telecom networks Roll out success know-how from Sakai for rapid deployment Early launch through utilization of existing assets Expansion in Tokyo, Nagoya, and Osaka Deployment in high-demand urban areas Tokyo (Tama + 23 Wards) Tokai (New s ite ) Osaka Sakai Center Oyama Center Miyazaki Tano Center In the 6G era, approx. 100K locations to become sensing hubs Land Kansai (New s ite )
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14 Total know-how from installation to maintenance Submarine Cables / Landing Stations Contributing to strengthening Japan‘s competitiveness through the development of resilient international telecom networks Cable ship Japan’s first international optical submarine cable* Nationwide landing stations Installation technology End-to-end expertise from installation to maintenance 99% of Japan's international communications are carried by submarine cables Sea Note) Source of submarine cable map: TeleGeography, “Submarine Cable Map”. https://www.submarinecablemap.com/ * Japan’s first installation of an international submarine optical cable. Based on KDDI research
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15 Deploying drone ports nationwide Establishing rapid response system for normal and emergency times through remote operation New social infrastructure using drone portsExpansion of ground stations supporting satellite business Satellite Communications / Drones Supporting the emerging sky business safely and securely with differentiated assets *1 Source: Cabinet Office, Office of National Space Policy materials *2 Source: KDDI, as of September 2026 Number of satellite launched approx. 20 times (2016 → 2025)*1 Utilizing ground stations owned by KDDI, including one of Japan's largest*2 ground stations (Yamaguchi) Terrestrial network Space communication base required Initial confirmation of disaster conditions Infrastructure inspection Patrol Sky
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16 CAPEX Management Efficient CAPEX Maximize Core FCF generation with disciplined CAPEX to Sales FY25-03 FY26-03 FY27-03(E) 682.9 679.0 720.0 11.7% 11.2% 11.2% CAPEX to Sales (%)CAPEX (billions of yen) 12% Maintain CAPEX to Sales of 12% or less Actively invest in Digital Belt Of which, 1.2 trillion yen / 3-year Digital Belt investment Of which, 300 billion yen / 3-year domestic and overseas DC investment 2.2 trillion yen / 3-year scale CAPEX management
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17 Capital Allocation Focus on disciplined execution and create +α for mid-term growth Capital Allocation Policy (Excluding Financial Business) FY27-03 - FY29-03 Cash Generation Cash Allocation Sustainable profit growth / expand Core FCF* Net Debt EBITDA Control at approx. 2.0x Review our business portfolio with discipline Operating CF Divestment Leverage Investment in Growth Areas (M&A, etc.) CAPEX / Leasing Shareholder returns Share buybacks Dividend Core FCF Secure necessary CAPEX for business operations Control CAPEX to Sales ratio at 12% or less Stable dividend growth aligned with business growth Compare with growth investments based on returns Actively considering with discipline * Core FCF = Operating CF - CAPEX - Leasing + Net interest paid after tax Repayment of principal and interest in Cash Allocation part is omitted from above description. 1.3 trillion yen scale 4.4 trillion yen scale 2 trillion yen scale 1 trillion yen scale 2.2 trillion + 0.5 trillion （leasing） scale
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18 Toward AI Social Implementation Creating new businesses that support AI-Enhanced Workforce / AI-Enhanced Lifestyle on Digital Belt AI - Enhanced Lifestyle AI - Enhanced Workforce Contributing to “our customers’ business growth” Transforming “our customers’ lifestyles and experiences” Digital Belt Our company’s data / partner dataCustomer data Inspection and monitoring RobotaxiCustomer inquiriesProduct sorting Lifestyle Consultation Local information Health support Good value/ Entertainment Social implementation capabilities Physical Intelligence Lifestyle Intelligence Up next: Business Growth Takashi Kimura Executive Officer, Executive Director, Business Solution Growth Sector Hiroaki Hosoi Director, Managing Executive Officer, Executive Director, Business Solution Core Sector
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Business Growth Strategy Part 2
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20 Growth Trajectory of Business Services Double-digit CAGR growth in both operating revenue and income during the previous mid-term period Expertise of group companies (Cybersecurity, DC, BPO, etc.) Customer First / Thorough execution + Customer base of approx. 400K companies -Strengths built up-Previous mid-term plan period (FY23-03 - FY26-03) (Unit: billions of yen) Operating revenue Operating income 191.5 217.0 235.3 263.9 FY23-03 FY24-03 FY25-03 FY26-03 CAGR 11.3% 1,132.2 1,289.6 1,405.8 1,527.9 FY23-03 FY24-03 FY25-03 FY26-03 CAGR 10.5% 24/7 maintenance and operation system
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21 Commitment to Further Growth through "Business Growth" Defining five focus areas for social implementation of "AI-Enhanced Workforce / AI-Enhanced Lifestyle" starting from customer needs Connected Solutions Cybersecurity AI Integration AI-BPO Data Center Five focus areas for Business Growth AI - Enhanced Lifestyle AI - Enhanced Workforce Contributing to “our customers’ business growth” Transforming “our customers’ lifestyles and experiences” Digital Belt Our company’s data / partner dataCustomer data Inspection and monitoring Robotaxi Customer inquiriesProduct sorting Lifestyle consultation Local information Health support Good value/ entertainment Social implementation capabilities Physical Intelligence Lifestyle Intelligence
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22 Sustainable Growth of Business Services Refining and expanding telecom to create value in five growth areas. Solving challenges for AI-Native Society Mobile Network Fixed-line voice AI-BPO Connected Solutions Data Center Cybersecurity AI Integration Solving customers’ management issues Supporting customers’ business infrastructure Growth Core Expansion of customer touchpoints Enhancement of value-added services Long-term use of Core / LTV improvement Creation of investment capacity / resource shift
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23 Driving Transformation to Achieve Growth Promoting effective transformation to address identified challenges for further growth Commercializing internal expertise Effectiveness of group and organizational collaboration Shortage of resources and HR for new domains -Challenges- Consolidating and leveraging group capabilities Launch of AI business company for social implementation Strengthening HR development
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24 Launch of AI Business Company Bringing together engineering talents internally and externally, a company focused on AI social implementation has been established AI development infrastructure System enabling AI to comprehend, make decisions, and take actions Digital Belt (Telecom infrastructure + AI infrastructure) AI - Enhanced Lifestyle AI - Enhanced Workforce ⚫ Consolidate expertise and technical capabilities of KDDI Group ⚫ Integrate approx. 100 HQ sales/consulting personnel ⚫ Strengthen comprehensive proposal capabilities from telecom to AI /system solutions AI agents / App development LLM development / AI service Organizational transformation to achieve results with AI AI-Ready data infrastructure AI × Communication Platform
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25 Accumulating AI Related Track Record Increasing advanced cases leveraging group strengths, confirming new growth opportunities Composite project leveraging group capabilities (Ministry of Defense) Sophistication and workforce optimization of Japan Ground Self-Defense Force security with AI video analysis* * Jointly contracted by KDDI and SECOM from the Ministry of Defense (February 26, 2026 KDDI News Release) Anomaly detection AI System construction and installationAI drone patrol Overall management and network construction Building environment for AI social implementation (METI GENIAC) Providing large-scale AI training environments Conducting real-world data collection and robot control demonstrations Enabling real-world deployment of "AI Enhanced-Workforce" Large-scale data collection and technology utilization development Building a robot foundation model for real-world applications
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26 Capability Enhancement Consolidate and utilize group capabilities. Create new value through strengthening HR development Building a framework for developing and strengthening specialized HR Growth Core HR rotation Add-on skills HR rotation × HR development academy New graduate / Career recruitment Improve expertise in five areas × human skills AI + development / operationsConsulting Expanding and Strengthening functions toward AI-Native society Further strengthening (JV with Nomura Research Institute) Consulting AI (JV with Accenture) Development / operations
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27 Segment Mid-term Targets Accelerate growth in AI-Native Society. Aim for double-digit growth in both operating revenue and income Business Growth expansion Operating income 78.0 FY26-03 FY29-03(E) Operating revenue 627.1 FY26-03 FY29-03(E) CAGR 20% +65.0 bil. yen scale CAGR double-digit growth - Five areas capturing growth markets driven by AI* - (Unit: billions of yen) Overseas Connectivity DC Connectivity DC Market CAGR Approx. 19% (2025-2030) AI-BPO Digital BPO business Market CAGR Approx. 20% (2026-2028) Connected Solutions IoT communications and peripheral services Market CAGR Approx. 10% (2026-2028) Security services for NW and software Cybersecurity Market CAGR Approx. 10% (2026-2028) Market CAGR Approx. 18% Domestic public cloud market (2025-2030) AI Integration Approx.38%Generative AI market (2024-2029) * Internal analysis based on industry reports
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AI Integration Part 2
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29 Value Chain in AI-Native Society AI alone does not create value Telecommunications, data/computing infrastructure, and business implementation & operations connect to drive customer business value AI - Enhanced Lifestyle AI - Enhanced Workforce Contributing to “our customers’ business growth” Transforming “our customers’ lifestyles and experiences” Digital Belt Our company’s data / partner dataCustomer data Inspection and monitoring Robotaxi Customer inquiries Product sorting Lifestyle Consultation Local Information Health Support Good value/ Entertainment Social implementation capabilities Physical Intelligence Lifestyle Intelligence Social implementation capabilities Telecommunications Connecting site and data securely and safely AI/data infrastructure Business implementation & operations Customer business growth and operational transformation
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30 Business Growth “AI-Enhanced Workforce + AI-Enhanced Lifestyle” Customer business growth and operational transformation Business Growth Focusing on growth in five areas that enhance AI social implementation capabilities in Mid-Term Management Strategy AI Integration AI-BPOData CenterConnected Solutions Cybersecurity Connecting sites and data securely and safely Business implementation & operationsAI/data infrastructure Five areas that enhance social implementation capabilities Solving issues with data and AI Business support with data and AI Connecting data and AIProtecting connected data Connecting field data
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31 78.0 FY26-03 FY27-03 FY28-03 FY29-03 FY32-03 Business Growth Mid-term Targets Operating income growth (Unit: billions of yen) Accelerating Growth CAGR20% +65 billion yen scale Current Mid-term Grow all 5 areas Next Mid-term Expand cross-selling of 5 areas AI Integration Connected Solutions DC Cybersecurity AI-BPO "AI-Enhanced Workforce + AI-Enhanced Lifestyle" Customer business growth and operational transformation Integrate and deliver value Mobile/network/fixed-line voice Connection value / customer touchpoints Cultivate fundamental strength of five areas during the current mid-term period and accelerate growth in AI-Native Society
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32 AI Integration Embedding AI into business operations and services - Support for value creation in business - Supporting cloud migration to enable AI utilization Using AI to improve the efficiency of system development - Support for in-house development- Supporting efficiency improvements through AI utilization, and business growth through AI implementation, based on cloud environment construction
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33 Target Markets Aiming to deepen existing cloud domains and expand into AI/data utilization domains Corporate investment accelerating with AI adoption Expanding into AI/data utilization domains System of Insight Capturing demand growth and expanding SoE/SoI*3 domains Front-office system Data/AI utilization Deepening existing domains Cloud Integration Domestic public cloud market*1 CAGR 17.6% (2025-2030) Generative AI market*2 CAGR 38.1% (2024-2029) 2025 2026 2027 2028 2029 2030 10.1 trillion yen 4.5 trillion yen 2024 2029 2024 2029 0.4 trillion yen 2.0 trillion yen 32.4 billion yen 730.0 billion yenCAGR 86.8% Of which, AI agentsGenerative AI Sales/back-office AI operational support AI customer support, etc. AI behavioral analysis AI dashboards, etc. *1 IDC, Japan Public Cloud Service Market Forecast, 2026-2030, Doc #JPJ53498826, March 2026 *2 Fuji Chimera Research Institute, Inc., “2026 AI Market Comprehensive Survey: Leaping Forward with Generative AI/AI Agents, Market Edition.” The generative AI market includes the entire related market, such as software, system development, data infrastructure, cloud, and GPU etc. necessary for corporate use of generative AI. *3 SoE (System of Engagement), SoI (System of Insight) System of Engagement
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34 Two Growth Opportunities Environmental changes driven by AI bring opportunities for market share expansion and strengthening of new domains Customers’ management challenges for AI utilization Cloud lift of proprietary data from on-premises systems Most proprietary data is on on-premises systems AI-driven development for lighter and in-house development (Delivery time/cost reduction, operational simplification) Customer needs for development Conventional SIer-type development based on person-month- based approach 4.5% 11.5% 44.0% 14.7% 18.7% 6.6% Fully In-House Increase In-House Development Hybrid (In-House & Outsourcing) Increase Outsourcing Fully Outsourced Others - Approx. 60% of companies are considering in-house development* - Cloud-first approach for new system development Partnering with cloud engineers with know- how and track record Migration of proprietary data to cloud-ready state is essential Shift from person-month-based approach and large-scale development focus * JUAS "Corporate IT Trends Survey Report 2026" (FY2025 survey, 957 companies including those listed on Tokyo Stock Exchange)
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35 Core Company for Business Promotion KDDI iret leads the market as one of Japan's premier cloud integrators 2003 2013 20262019 AWS Premier Consulting Partner Certification (First in Japan*1) Google Cloud Premier Service Partner Certification Customer companies 2,500 Number of Projects Over 4,300 Operations Over 10,000 units CAGR 19.3% 34.9 45.3 53.7 63.9 70.7 Achieving business growth through multi-cloud capabilities that support from information systems to mission-critical systems KDDI iret standalone operating revenue (Unit: billions of yen) iret founded "KDDI iret" launched * Recognized as one of Japan’s first APN Premier Consulting Partners (now AWS Premier Tier Services Partner) under the AWS Partner Network (APN) on June 4, 2013. FY22-03 FY23-03 FY24-03 FY25-03 FY26-03
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36 Abundant Human Resources and Track Record Supporting customers‘ cloud migration with multi-cloud technology of top-class certification track record Col um n 2 Col um n 3 Col um n 4 Col um n 5 Col um n 6 Company C Top 2 position with AWS, our strong point Company A Company B First in Japan*1 Global AWS AI Hero AWS AWS Premier Tier Services Partner AWS Certifications held Over 5,100 2026 Japan AWS Top Engineers 15 selected Google Cloud Google Cloud Premier Partner Co-sell and Services path certification acquired Google Cloud Certifications held Over 3,100 Google Cloud Partner Top Engineers 2026 33 selected Oracle Oracle Partner Network Cloud Sell Track Oracle Japan Award 2026 and Oracle Certification Award 2026 winner 2026 OCI Top Partner Engineers 4 selected Group’s cloud technology and HR FY25 AWS Resale sales ranking* Company D *1 First recognition in Japan as an AWS AI Hero under the AWS Heroes Program of Amazon Web Services (AWS), as of November 2025 *2 Source: Created based on the resale ranking (FY2025) in Fuji Chimera Research Institute, Inc.‘s “2026 Cloud Business Market Status and Future Outlook: Partner Business Edition.” Based on individual company (no group consolidation) Strengthening multi-cloud environment for further growth
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37 Growth Strategy Promoting initiatives for end-to-end provision of Digital Belt ~ AI-Enhanced Lifestyle/AI-Enhanced Workforce Refining AI solutions 3. Sakai DC utilization/ Sovereign environment construction Unit Price Customer Base Expansion of Multi- Cloud offerings 1. Expansion of cloud infrastructure 2. Integration, maintenance and operation (AI, systems, cloud) Accelerate AI implementation Toward KDDI’s corporate customer base of 400k companies Toward end-to-end provision of Digital Belt ~AI-Enhanced Lifestyle/AI-Enhanced Workforce
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38 Addressing Challenges for Growth Maximizing KDDI iret's capabilities and building track record are key challenges (2) Building development experience(1) Expansion of sales structure
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39 (1) Expansion of Sales Structure Transforming sales and development structures to expand cloud foundations and strengthen integration capabilities Company A Company B Company C Company D 400k companies 2,500 companies Expanding to KDDI’s customer base Customer base expands to rival leading IT service providers* Sales collaboration with KDDI / Transition to push-based model Previously: Primarily pull-based Strengthen structure by gathering elite sales personnel from various industries within KDDI Manufacturing / Construction Logistics / Mobility Sales / Public Sector Financial business / Energy business etc. KDDI's diverse industry customer relations * Source: Prepared by the Company based on publicly available materials and company disclosure materials. The definition of the number of corporate customers varies by company.
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40 (2) Building Development Experience Sharpening execution capabilities through customer-zero initiatives within the Group's business foundation AI-driven development based on customer base of approx. 70k Group employees + approx. 400k companies / 30 million IDs Business process improvement through AI utilizationCloud lift AI service development ⚫ OCI design and construction support ⚫ Execution phase management Balancing quality and efficiency across the project Multi-cloud/know-how enhancement Track record of AI-driven scratch development ⚫ Construction of AI agent functions/ task APIs/ content management DB, etc. (Buffmee) AI integration of CRM SaaS services Support for KDDI mission-critical systems ⚫ End-to-end management including customer sales negotiations, contracts, and inquiry responses Process efficiency improvement through AI-driven development
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41 Competitive Arena Clarifying the areas where our strengths can be best leveraged and strengthening composite proposals centered on front-line sales Focus on system layers where our strengths lie during this Mid-term Large-scale systems where SIers have strengths Ultra-large, company-wide core system renewals / Large -scale public systems /Long-term, complex system construction, etc. Systems below medium scale that SIers do not strategically reach AI implementation / Data utilization & business transform / Cloud & Security / Operations, etc. Focus Packaging successful use cases and roll out across industries Cross selling centered on front-line sales Examples • Food industry: Help desk renewal (AI-BPO) → Operator support, customer service agent (AI implementation) • Mining industry: Communication dead zone countermeasures (Connected Solutions) → On-site data utilization system (AI Integration) Small (Up to tens of millions of yen) Medium (Hundreds of million of yen scale) Large (Several billion yen and above) Project scale Specialized functions Cybersecurity AI-BPOAI Integration Customers’ priority issues Front-line sales teams coordinate with specialized functions Common functions Enterprise
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42 Solid Start towards Mid-term Expansion of cloud foundation and accumulation of track records as a source of growth are progressing AI Integration operating revenue Accumulation of track records FY26-03 Q1 FY27-03 Q1 Of which, cloud foundation sales YOY +30% or more Number of new projects before and after the launch of KDDI iret*2 approx. 3 times FY27-03 Q1YOY+29% Business expansion through stable structure with high recurring ratio *1 CI (Cloud Integration), SI (System Integration) *2 Monthly comparison before and after the launch of KDDI iret (March, June 2026) Flow Approx. 30% Recurring Approx. 70% Multi-Cloud introduction and operation Tokyo Gas Co., Ltd. Coud foundation of visualization/ analysis of factory IoT data Connehito Inc. (Ministry of Health, Labour and Welfare project) Migration of information provision Web to government Cloud AI/Data utilization RIKEN AI analysis cloud foundation for medical science research Kita Ward First among local governments introduced generative AI search Cloud infrastructure(resale)/ operations & maintenance CI/SI etc.*1
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43 FY26-03 FY27-03(E) FY28-03(E) FY29-03(E) AI Integration Business Growth Expand business scale and build profit-generating business structure in the current mid-term, creating underlying business strength and driving segment growth Operating Revenue AI Integration + Cybersecurity (Unit: billions of yen) Create underlying business strength in business domains +20 billion yen or more in profit growth Next Mid-termCurrent Mid-term Toward CAGR 20% or more Expand cross-selling Further acceleration of profit growth Value integration across domains through AI Integration 170.1 AI Integration + Cybersecurity domain growth AI Integration Connected Solutions DC Cybersecurity AI-BPO Integrate and deliver value
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Connectivity DC Part 2
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45 DC Strategy Aiming for business growth and accelerated infrastructure building through our strong Connectivity DC Strategic PillarOverseas Domestic Leveraging expertise for Digital Belt building Connectivity DC assets and expertise through global operations Growth through AI inference demand and DC expansion AI
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46 Telehouse Operating Connectivity DCs in major cities for years, with proven expertise and track record London North London North 2 London East London West London South Istanbul Turkey Frankfurt (6 locations) Germany Paris Magny Paris Voltaire (7 locations) France Hanoi Vietnam Thailand Singapore Singapore Beijing, Shanghai, Hong Kong China Tokyo, Osaka 18 locations in 6 cities Japan Bangkok NY Teleport NY Chelsea Los Angeles USA Toronto (3 locations) Canada Europe AsiaNorth America UK Japan Expanded to over 45 locations across major global cities Over 35 years of Connectivity DC expertise and track record Approx. 3,000 customers worldwide Note) As of the end of August 2026
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47 C ontent s Positioning of Connectivity DC Providing a place for interconnection between cloud/content providers and telecom carriers Hyperscale DC Urban SuburbanServer Hub "Content Creation" Network Hub "Distribution Point" Connectivity DC End u sers (Corporate/Individual) Cloud/Content Providers Company A Company G Company M T elecom carriers Aggregation of connectivity providers for cloud providers
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48 Business Model Comparison Leveraging expertise and track record to focus on the stable, high-return Connectivity DC Investment and return Investment Scale Large Medium Contract Unit Price Low High Usage Period Depends on contract period Long Features Large-scale dependency ○: CF predictable within contract period ▲: Large investment amount Stable through small-lot diversification ○: High profitability, low churn rate ▲: Time and expertise required for customer aggregation (high barriers to entry) Connectivity DC Investment: Analyze connectivity demand in target regions Return: Aggregate many customersReturn: Large-scale, long-term contract base Over 35 years of expertise and track record Hyperscale DC Investment: Hyperscaler demand
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49 Telehouse Strengths Realizing a competitive low-latency environment through locations near urban areas and customer aggregation (1) Proximity to urban areas (2) Customer aggregation
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50 (1) Proximity to urban areas Accumulating first-mover advantages close to urban areas and expertise. Expanding business through advantageous site selection Early business expansion close to urban areas and end users Locations close to urban areas Site selection expertise DC expansion in London Distance between data centers Securing multiple fiber routes Cultivated customer base and negotiation power Selection focused on connectivity value in low-latency environments Urban area Other companies ‘ DC a rea 30-35 km Telehouse London DC expansion in London
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51 (2) Customer aggregation Network effects accelerate customer aggregation, enhancing profitability and reducing churn Acceleration of customer aggregation *1 Source: Structure Research 2025 (August 2025) *2 Source: peeringdb.com Connection with numerous operators in a low-latency environment — Customer aggregation by network effects — Highly connected DCs attract more providers Customer needs 3rd in the world 1st in telecom carriers 26.6% 13.4% 8.3% Connections Share*1 (Global) 1st DC specialized firm A 2nd DC specialized firm B 7th Domestic telecom carrier C London World No.1*2 1,026 companies (Opened in 1990) Paris France No.1*2 410 companies (Opened in 1996) Toronto Canada No.1*2 145 companies (Acquired in 2023) Bangkok Thailand No.1*2 61 companies (Opened in 2023)
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52 High profitability compared to competitors KDDI Company A Company B Company C KDDI Company A Company B Company C Revenue scale* Operating income per MW* (Unit: billions of yen) (Unit: billions of yen/MW)103.7 45.9 Operating revenue EBITDA Performance and Profitability Established a high-profit business model and achieved steady business growth Overseas connectivity DC performance FY26-03FY25-03 (Unit: billions of yen) FY22-03 FY23-03 FY24-03 Operating revenue CAGR 18.8% EBITDA margin Over 40% * FY26-03 results. Estimates by the Company based on materials published by each company
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53 CAGR approx. 19% 2025 2026 2027 2028 2029 2030 Market Evolution Connectivity demand changes according to customers in each era. The market is expected to continue expanding Customer evolution according to connectivity demand in each eraConnectivity DC HS-DC Increase in cloud demand 1990 2000 2020 2010 2030 Telecom IX C loud AI IoT * Based on Structure Research 2025 data, estimated and prepared by the Company. Global including Japan. Customer evolution Connectivity DC Market Trends* AI demand is increasing in addition to conventional cloud demand Market size is expected to more than double from 2025 to 2030 Approx. 7 trillion yen Approx. 15 trillion yen Company A Company G Company M Cloud/Content Providers
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54 Expansion of AI Inference Demand Telehouse's low-latency environment aligns with demand. Capturing opportunities for sustainable growth Factors required in DC by inference providers Capturing AI inference demand Acquired inference orders in multiple regions including France and Canada 4 Points*1 (1) Securing locations and power (2) High interconnectivity: Connection with cloud and NW (3) Low latency by customer aggregation (4) Decentralization of inference infrastructure: Utilizing inference infrastructure in edge environments Telehouse Strengths Overseas Connectivity DC FY27-03 Q1 Operating revenue YOY+20.6% Telehouse's low-latency environment aligns with demand *1 Results of interviews with Gartner analyst Mark Jaggers (conducted in June 2026) *2 Calculated based on the ratio of AI inference usage in new orders on a MW basis Approx. 60% FY26-03 Q1 FY27-03 Q1 AI Inference usage share of new orders*2 No orders Inference demand becoming apparent
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55 Expansion in Existing and New Area Promoting DC infrastructure expansion to strengthen the current earnings base and for mid- to long-term growth Expansion and entry into new areas for future growth Early investment recovery and business growth of existing DCs Bangkok, Thailand Toronto, Canada Paris, France Opening Year 2023 Acquired in 2023 Opening of Magny 5th building in 2025 DCs opened in the previous mid-term period continue to operate at high utilization. Serving as a cash source for the current medium-term period Marseille, France Existing DC expansion (FY26~) Entry into new areas ➢ Frankfurt, Germany (6th building) ➢ Paris (Magny), France (6th building) ➢ London, UK (6th building) ➢ Bangkok, Thailand (2nd building), etc. Connections* Domestic No.1 Domestic No.1 Domestic No.1 Accumulating competitive DCs Forming an ecosystem * Source: peeringdb.com
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56 103.7 billion yen DC Business Growth Allocate resources with a focus on returns, capturing AI demand for sustainable growth Overseas Connectivity DC Operating Revenue /EBITDA FY26-03 FY29-03 (E) Expand in regions with competitive advantages Aim for early investment recovery Focus resources on growth areas with a focus on returns FY26-03 EBITDA Domestic and overseas Approx. 300 billion yen Mid-term CAPEX (FY27-03 - FY29-03) DC business portfolio Optimize assets using key performance indicators Concentrate investment in growth areas Operating revenue Accelerating Growth Aim for double-digit CAGR growth over the medium term in both operating revenue and EBITDA 45.9 billion yen Accelerating Growth FY29-03 (E)
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57 Toward Building Digital Belt Accelerate infrastructure construction for the AI era by leveraging connectivity DC expertise cultivated overseas Leveraging Telehouse expertise cultivated overseas for Digital Belt construction Connecting nationally distributed AI-DCs via Connectivity DCs Converted a bank building into DC and opened in Paris in 2021 within a short period January 2026 Achieved early opening in 1/3 of the normal construction period Overseas DC Osaka Sakai AI-DC Accelerating Digital Belt construction Accelerating AI-DC construction
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Disclaimer Statements made in these documents with respect to the KDDI Group‘s performance targets, projected subscriber numbers, future forecasts and strategies that are not historical facts are forward-looking statements about the future performance of the KDDI Group, based on company’s assumptions and beliefs in light of the information available at the time they were made. They therefore include certain risks and uncertainties. Actual results can differ from these statements due to reasons including, but not limited to, domestic and overseas situation, economic trends, competitive position, formulation, revision or abolition of laws and ordinances, regulations or systems, government actions or intervention and the success or lack thereof of new services. Consequently, please understand that there is a possibility that actual performance, subscriber numbers, strategies and other information may differ significantly from the forecast information contained in these materials or other envisaged situations.