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Review of Operations – Information Technology Business

The product-specific revenue growth rates for the Information Technology Business in FY25 were as follows:

Revenue Growth Rates by Product (YoY %)*

A common theme across all product categories was the rapid adoption of AI, which drove significant increases in demand for products used in AI semiconductor manufacturing, including mask blanks, as well as glass substrates for nearline HDDs and polarizing glass for optical transceivers. While all product categories delivered strong growth, Optical Solutions (formerly Imaging) achieved particularly substantial revenue gains, driven by sharply increased demand for polarizing glass as well as lenses and materials for wearable cameras.

* Growth rates are presented on a constant currency basis.

LSI

FY25 Performance

Driven by continued expansion of the AI semiconductor market, customers continued to advance process miniaturization while increasing the number of design patterns, resulting in robust growth in demand for EUV mask blanks. Sales of DUV mask blanks also saw steady growth, supported by an improved product mix of DUV blanks used in the EUV lithography process and increased demand from China.

Market Position

HOYA holds an exceptionally high market share, supported by its proven track record of contributing to semiconductor miniaturization and performance improvements through close collaboration with customers. Although customers may gradually move toward multi-sourcing for EUV mask blanks in the future, HOYA intends to maintain its leading market position by staying ahead of competitors in the most advanced process nodes. There were no significant changes in HOYA's market position during FY25.

Estimated Market Share（FY25）

Medium-Term Outlook

HOYA will maintain its position as the primary supplier for leading-edge EUV nodes while advancing technology development and expanding production capacity in line with its technology roadmap, including phase-shift masks as well as High-NA and Hyper-NA lithography. Given expected medium-term growth exceeding 10% for EUV mask blanks, HOYA has decided to construct a new plant adjacent to its existing facility in Singapore. The new plant is scheduled to commence operations in FY28, with an initial investment of approximately 42 billion yen.

FPD

FY25 Performance

Revenue increased as demand grew, driven by customers' more active design and development of new smartphone display panels. To meet this demand, HOYA increased utilization at its Chongqing plant in China. In particular, new design projects for premium foldable smartphones served as the primary driver of demand.

Market Position

Leveraging its strengths in high-precision products such as high-resolution masks and phase-shift masks, HOYA is recognized as a leading global manufacturer.

Estimated Market Share (FY25)

Medium-Term Outlook

HOYA will continue to develop and bring into volume production high-value-added products—including phase-shift masks and high-resolution masks for OLED displays—with the aim of improving its product mix and driving revenue growth. HOYA expects revenue growth broadly in line with market growth of approximately 4–5%.

HDD Substrates

FY25 Performance

Shipments of nearline HDDs increased, driven by investment in cloud data centers and growing demand for data storage associated with generative AI, resulting in solid growth in sales of 3.5-inch glass substrates.
Although sales of 2.5-inch glass substrates for consumer HDDs, including external hard disk drives, continued to decline significantly, 3.5-inch substrates accounted for the vast majority of sales, resulting in overall revenue growth for HDD substrates.

Market Position

HOYA holds a 100% share of the market for glass-based HDD substrates.

3.5-inch glass substrates for nearline HDDs
HOYA's share of the nearline HDD substrate market is estimated to be approximately 40%. Supported by the adoption of HAMR (Heat-Assisted Magnetic Recording) technology and increasing platter counts, the Company expects to expand its market share over the long term.
2.5-inch glass substrates for consumer applications
As the market consists entirely of glass substrates, HOYA holds a 100% market share.

3.5-inch Glass Substrates for Nearline HDDs
Estimated Market Share (FY25)

Medium-Term Outlook

HOYA expects its customer base for 3.5-inch substrates for nearline HDDs to expand, driving further gains in its market share in this segment over the medium to long term. To meet the resulting increase in demand, HOYA has decided to establish a new manufacturing facility in Vietnam. Preparations are underway for the commencement of operations in FY28. The initial phase of the project is expected to involve an investment of approximately 50 billion yen.

Optical Solutions (Formerly Imaging)

FY25 Performance

In addition to continued steady demand for interchangeable lenses for mirrorless cameras, strong growth was driven by a sharp increase in demand for CUPO polarizing glass for optical transceivers, as well as optical lenses and materials for wearable devices, including vlog cameras and smart glasses.

Market Position

Although no overall market share data are available for optical products due to the broad and highly fragmented nature of the end markets, HOYA has a strong position in glass-molded aspherical (GMO) lenses, which offer excellent aberration correction, and continues to maintain a high market share in this segment.

Medium-Term Outlook

As smartphone camera performance has improved, the market for conventional cameras has contracted significantly. Against this backdrop, the Optical Solutions business has long been regarded as a low-growth business. However, demand for CUPO, wearable-device applications, and products for in-vehicle sensing cameras is expected to expand over the medium term, supporting moderate growth going forward.