Abematv on April 11, 2017 Media Exceeded 16 Million Downloads OP Or Loss: -5.1 Billion Yen (Incl

0. Table of Contents

1. Overview of Quarterly Consolidated Financial Results (Jan. 2017 – Mar. 2017)

2. Business Forecast for FY2017

3. Internet Advertisement Business

4. Game Business

5. Media Business

6. Summary

7. References ・Abema TV ・Market Data

1 1. Overview of Quarterly Consolidated Financial Results

Overview of Quarterly Consolidated Financial Results (Jan. 2017 – Mar. 2017)

2 1. Overview of Quarterly Consolidated Financial Results

[Highlights] 2Q FY2017

Consolidated Marked a record high Sales and OP of existing businesses Financial Sales: 93.3 billion yen up 25.1% YonY Results OP: 7.9 billion yen (existing business* 13.7 billion yen, up15.2% YonY)

First anniversary of AbemaTV on April 11, 2017 Media Exceeded 16 million downloads OP or loss: -5.1 billion yen (Incl. AbemaTV, etc. -5.8 billion yen)

Keep high sales growth rate Ad Sales: 52.5 billion yen up 20.3% YonY OP: 5.3 billion yen up 21.4% YonY

BanG Dream! Girls Band Party!** became a new hit Game Sales: 35.8 billion yen up 29.6% YonY OP: 7.9 billion yen up 14.1% YonY

*Existing business: Advertisement, Game and Ameba in Media etc. 3 **BanG Dream! Girls Band Party! : ©BanG Dream! Project ©Craft Egg Inc. ©bushiroad All Rights Reserved. 1. Overview of Quarterly Consolidated Financial Results

[Quarterly Consolidated Sales] 93.3

Up 25.1% YonY 86.5 85.6

Record high results 76.4 74.0 74.6

69.2

63.4 60.5 61.1 57.7

52.4 51.2

43.7 42.2 単位：億円Unit: billion yen 40.8 41.3 39.2 38.0 35.9 33.7 32.1

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

4 1. Overview of Quarterly Consolidated Financial Results

[Quarterly OP] OP of existing businesses 13.7 12.9 13.1 13.0

13.7 billion yen 11.9 11.7 11.4 Record high results 9.4 9.3 9.1

6.9 6.5 6.1

4.9 4.2 4.0 7.9B 3.4 3.6 3.5 2.8

1.5 1.6

-0.44 -0.91 -0.71 -0.20 -0.14 -0.68 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q

FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 -3.4 ■OP of existing businesses ( Internet Advertisement, Game and Ameba in Media etc. ) ■OP of up-front investment (AbemaTV, Inc. etc.) Unit: billion yen -5.0 -5.7 -5.8 *OP or loss of Existing businesses and Up-front investment: Earnings incentive is excluded. 5

1. Overview of Quarterly Consolidated Financial Results

[Quarterly SG&A Expenses] 22.6 billion yen （up 40.8% YonY） 25.6

3.1 23.0 22.6

Earnings Incentives 5.2 4.4 5.2 Other 18.8 18.7 Sales related costs

Office costs 1.2 1.2 3.4 16.0 3.9 1.3 Personnel 15.6 1.4 1.5 Advertisement cost 14.4 1.5 13.5 13.4 3.5 Unit: billion yen 3.5 1.3 13.3 13.0 12.7 3.5 3.1 11.6 11.8 2.0 1.3 5.3 11.5 2.6 11.0 11.1 2.9 1.2 5.8 10.7 2.5 1.4 6.6 10.2 0.5 3.0 1.3 0.7 2.5 1.2 1.2 9.5 2.4 2.5 1.2 1.2 1.2 2.5 1.7 2.3 1.2 1.1 2.4 2.5 5.5 8.1 2.5 1.2 0.9 1.3 1.0 2.0 0.8 1.5 1.3 1.7 1.0 1.7 1.0 0.9 1.7 1.2 0.8 1.5 1.0 5.0 5.5 1.1 0.8 0.9 5.1 0.7 3.7 5.3 0.8 0.6 0.6 0.8 4.6 5.0 0.5 4.3 4.6 9.9 3.8 9.1 3.6 3.9 4.6 7.9 4.0 3.9 3.6 3.8 3.7 6.5 4.3 4.4 4.4 3.5 3.6 4.0 2.9 2.8 2.6 3.1 2.1 2.4 2.2 1.9 1.2 1.7 1.8 1.7

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 6 1. Overview of Quarterly Consolidated Financial Results

[No. of Employees] Increase 530 employees YonY by expanding businesses （up 99 employees QonQ ) 301 new employees joined in April 2017 4,153 4,054 3,971 18 Investment Development 3,894 19 19 310 Headquarters 22 296 3,6233,623 297 290 Other 3,566 301 3,511 22 21 285 35 267 Internet Ad 33 303 297 259 296 Game 3,1653,1683,1683,183 302 34 34 33 33 263 266 Media(exsisting business) 121 2,8252,862 308 322 288 Media(up-front Investment business) 2,7772,764 582 32 574 33 393 Unit people 30 30 107 Unit: ：people 103 1,560 1,633 2,4792,5112,489 117 110 510 1,539 2,423 372 523 505 1,530 24 27 22 348 373 25 92 358 93 111 92 1,392 1,401 331 328 1,993 337 336 957 1,098 1,121 1,875 23 711 772 807 22 72 717 977 981 985 70 303 621 637 635 326 604

526 490 510 642 543 567 1,253 1,272 1,267 530 439 474 473 437 1,215 1,149 1,139 688 1,090 1,132 329 955 1,011 291

1,081 1,039 926 936 954 948 1,001 977 1,018 740 430 436 440 432 636 638 412 392 372 356 414 400 82 107 148 160 182 192 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 *Segment change: The data of FY2016 were retroactively revised. 7 (Moved Internet Advertisement business, etc. of CA Mobile, Inc. from Others to Internet Advertisement business.) 1. Overview of Quarterly Consolidated Financial Results

[PL]

FY2017 2Q FY2016 2Q FY2017 1Q Unit: million yen YonY QonQ Jan-Mar 2017 Jan-Mar 2016 Oct-Dec 2016

Net Sales 93,321 74,609 25.1% 86,571 7.8%

Gross profit 30,604 27,344 11.9% 29,380 4.2%

SG&A expenses 22,651 16,090 40.8% 23,026 -1.6%

Operating profit 7,952 11,253 -29.3% 6,354 25.2%

OPM 8.5% 15.1% -6.6points 7.3% 1.2points

Ordinary profit 7,415 10,923 -32.1% 5,930 25.0%

Extraordinary income 320 1,072 -70.2% 0 92756.0%

Extraordinary loss 949 1,647 -42.4% 565 67.8%

Income before income taxes and non-controlling interests 6,786 10,348 -34.4% 5,365 26.5%

Profit attributable to shareholders of parent* 1,302 5,344 -75.6% 1,326 -1.8%

*Profit attributable to shareholders of parent: Affected by Non-controlling equity interest (minority interest) of Cygames, Inc. AbemaTV, Inc. is exempted from consolidated tax payment. 8

1. Overview of Quarterly Consolidated Financial Results

[BS]

End of End of End of Unit: million yen YonY QonQ Mar 2017 Mar 2016 Dec 2016

Current assets 110,017 95,776 14.9% 99,988 10.0%

Cash deposits 38,884 39,432 -1.4% 34,095 14.0%

Fixed assets 45,354 39,135 15.9% 44,221 2.6%

Total assets 155,372 134,911 15.2% 144,210 7.7%

Current liabilities 58,495 48,375 20.9% 50,872 15.0%

（Income tax payable） 6,924 7,777 -11.0% 1,775 289.9%

Fixed liabilities 2,206 1,769 24.7% 2,030 8.7%

Net assets 94,670 84,766 11.7% 91,306 3.7%

9 2. Business Forecast for FY2017

Business Forecast for FY2017 (Oct. 2016 – Sep. 2017)

10 2. Business Forecast for FY2017

Positioned as up-front investment period for AbemaTV 360.0 58.0 Strengthen up-front Sales 360.0 billion yen (up 15.9% YonY) investment in AbemaTV 310.6 OP 28.0 billion yen (down 23.9% YonY) 287.7 Invest in AbemaTV 254.3

36.7 38.0

205.2 32.7 Invest in Smartphone business 187.7 28.00 162.4

141.1 22.2 119.5 17.4 18.0 93.8 96.6 87.0 14.3 Sales OP 87.7 76.0 Unit: billion yen 10.3 60.1 9.3 43.2 5.5 26.7 4.3 4.6 4.4 16.2 2.6 10.8 1.7 3.2 6.3

-1.6 -0.1 -0.2 -0.1 -12.3 FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017E -2.0 11 2. Business Forecast for FY2017

[Progress rates toward earnings forecast]

売上高 Sales 179.8B 50% 360.0B

Operating営業利益 profit 14.3B 51% 28.0B

Ordinary 経常利益 profit 13.3B 50% 26.7B

Profit attributable to当期純利益 shareholders of parent 2.6B 26% 10.0B

0% 50% 100%

進捗率業績予想 12 2. Business Forecast for FY2017

[Progress rates toward OP by segments] Proceed as planned

Internet広告事業 Advertisement 10.0B 56% 18.0B

Gameゲーム事業 14.3B 51% 28.0B

メディア事業Media 1.1B 57% 2.0B

Up-front 先行投資 Investment -10.8B 54% -20.0B

0% 50% 100%

進捗率業績予想 Forecast for FY2017 28.0B 13 3. Internet Advertisement Business

Internet Advertisement

14 3. Internet Advertisement Business

[Quarterly Sales] Keep high sales growth, 2Q 52.5 billion yen（up 20.3% YonY） Smartphone ad ratio: 76% (up 8.9point YonY) 52.5

48.7 47.9 12.6 43.7 43.0 10.9 40.7 11.9 38.8

35.1 35.5 14.3 13.5 ・ 33.3 PC Others 13.7 30.9 13.5 Smartphone 29.9 28.5 12.7 Unit: billion yen 13.4 12.5 24.4 11.9 22.8 39.9 14.8 12.0 20.7 19.9 18.9 19.6 37.8 17.8 35.9 16.8 17.0 12.9 12.3 29.3 29.5 12.5 11.6 12.5 26.9 13.3 25.3 22.7 14.2 13.2 20.7 21.7 13.9 18.9 15.1 16.4 10.5 11.5 8.1 8.3 5.6 7.0 2.9 3.5 3.7

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 15 *Segment change: The data of FY2016 were retroactively revised. (Advertisement Business of CA Mobile, Inc. is added) 3. Internet Advertisement Business

[Market Comparison] Sales growth exceeds market growth

Internet Ad Market

100 2012 2013 2014 2015 2016

*Growth transition: Growth rate based on setting 2012 as “100” 16 **Internet Ad Market: “Advertising Expenditures in Japan 2016” by Dentsu, Inc. 3. Internet Advertisement Business

[Smartphone Ad] 2Q 39.9 billion yen（up 36.2%YonY） In -feed Ad and Video ad performed well 39.9 37.8 35.9

29.3 29.5

26.9 25.3

22.7 21.7 20.7 18.9

16.4 15.1

11.5 10.5

8.1 8.3 7.0 5.6 Unit: billion yen 3.5 3.7 2.9 2.0 0.8 0.1 0.4

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 17 *Segment change: The data of FY2016 were retroactively revised. (Advertisement Business of CA Mobile, Inc. is added) 3. Internet Advertisement Business

[Fortified field] In-feed Ad* 2Q 11.9 billion yen ( 1.5x YonY) Sales growth has driven by Facebook and LINE 11.9

10.8 10.7

7.7 7.7

6.1 5.8

3.4 3.1 2.6

1.9

1.3 Unit: billion yen 0.97 1.0 0.61 0.36 0.18 0.26

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

18 *In-feed Ads: Ads posted in the timeline of websites or apps, etc. Ad method used for SNS, curation, news media, etc. 3. Internet Advertisement Business

[Fortified field] Video Ad 2Q 6.7 billion yen ( 2.8x YonY) Sales growth has driven by Youtube and Facebook 6.7

5.2 5.2

2.8

2.3 1.9 1.5

0.81 0.83 Unit: billion yen 0.50 0.48 0.37 0.46 0.26 0.25 0.10 0.19 0.19

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 19 3. Internet Advertisement Business

[Quarterly OP] 2Q 5.31 billion yen (up 21.4% YonY) OPM 10.1% Keep high profit level 5.3131」

4.72 40

4.37 4.29

3.80 3.74 3.58 30

OP 3.02 2.88 2.88 2.79 OP Margin 」 Unit: billion yen 2.47 2.30 20 2.17 2.17 2.18 2.10 2.07 1.94 1.75 1.49 11.4% 10.8% 1.34 10.9% 10.7% 10.8% 9.7% 10.5% 10.1% 8.8% 9.0% 10.1% 8.8% 8.8% 8.5% 8.1% 10.0% 8.7% 8.0% 8.6% 8.1% 10 7.1% 7.2%

0.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 *OP and OPM of Internet Advertisement business: Earnings incentive is excluded. *Segment change: The data of FY2016 were retroactively revised. (Advertisement business of CA Mobile, Inc. is added) 20 4. Game Business

Game

21 4. Game Business

[Quarterly Sales] 2Q 35.8 billion yen (up 29.6% YonY, up 3.5% QonQ) While existing titles remained strong, a new hit came out 35.8 34.5 34.6

30.6 FY2017 29.7

FY2016 27.6 FY2015 26.0

FY2014

FY2013 20.8 FY2012 or before 20.4 19.7 Others* Unit: billion yen

13.7 12.7 12.7 12.9 12.6 11.7 11.3 11.1 11.4

7.7 6.4

3.3

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 22 *Others : Sales of goods etc. 4. Game Business

[Quarterly OP] 2Q 7.91 billion yen (up 14.1% YonY, up 22.6% QonQ)

8.83 8.31 7.91 7.51

6.93 6.45 6.07

4.77 4.60

3.66

2.99 2.80 Unit: billion yen 2.69 2.30 2.11 1.94 2.05 1.47 1.06 0.81 0.91 0.62

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

*OP of Game business: Earnings incentive is excluded. 23 4. Game Business

[Sales ranking] BanG Dream! Girls Band Party!*** has become one of the main titles

THE iDOLM@STER BanG Dream! CINDERELLA GIRLS Girls Band

1st STARLIGHT STAGE* Party! ***

10th

Dragon Quest 30th Monsters Super Light**

GRANBLUE FANTASY

Shadowverse

March,16 Released 100th Joker ～Gang Road～ 100 Sleeping Princes and the Kingdom of Dreams

Sengoku Enbu -KIZNA-

Sep.9月 3Mar.月 Sep.9月 3Mar.月 Sep.9 月 Mar.3月 Sep.9月 3Mar.月 2014 2015 2016 2017 * THE iDOLM@STER CINDERELLA GIRLS STARLIGHT STAGE : ©BANDAI NAMCO Entertainment Inc. It was jointly developed and is operated by ©BANDAI NAMCO Entertainment Inc. and Cygames Inc. ** Dragon Quest Monsters Super Light : © 2014-2017 ARMOR PROJECT/BIRD STUDIO/SQUARE ENIX All Rights Reserved.© SUGIYAMA KOBO Developed by Cygames, Inc. *** BanG Dream! Girls Band Party! : ©BanG Dream! Project ©Craft Egg Inc. ©bushiroad All Rights Reserved **** Sales ranking calculates the App Store top sales ranking from AppDB. Monthly average values in ranking is used. (For Apr, use average until Apr 17) 24

4. Game Business

[BanG Dream! Girls Band Party!*] Anime distributed ahead of the release from Jan. to Apr. 2017 on AbemaTV Pre-registrants exceeded half a million, 2 million downloads in 41 days from the release

■Game screen ■Game screen Adventure part Rhythm part

[New titles] 5 titles will be released in 3Q FY2017 or later

Provided by pixelfish,Inc. BlackRoseSuspects Singing in a Twilight World Provided by GCREST,Inc. with You SuspenseRPG 4/13/17 Game for women 4/20/17 Released Released

Sevens Story PRINCESS CONNECT！Re:Dive PROJECT LOST ORDER

Tactical RPG Pre- Animation RPG Real tactics game registration

Provided by WithEntertainment,Inc. Provided by Cygames,Inc. Provided by Cygames,Inc. 26 4. Game Business

[Original IP] Strengthen the brands with making games into anime

GRANBLUE Bahamut FANTASY VIRGIN SOUL** The Animation*

Aired on AbemaTV, Aired on Anime ism, TOKYO MX, MBS SAGATV since April 7, since April 1, 2017 2017

㈱ジークレスト提供

100 Sleeping Princes and the Kingdom of Dreams Short Stories

Aired on AbemaTV, official website since March 25, 2017

Provided by GCREST, Inc. *GRANBLUE FANTASY The Animation： ©GRANBLUE FANTASY The Animation Committee 27 **Bahamut VIRGIN SOUL： ©Cygames/MAPPA/BAHAMUT VIRGIN SOUL¥ 5. Media Business

Media

28 5. Media Business

[Quarterly Sales] [Quarterly OP] 2Q 6.4 billion yen (up 20.8% YonY) 2Q up-front investment -5.8 billion yen Driven by blog service, online dating service (Plan to invest 20B yen in FY2017)

Unit：billion yen 6.4

6.0 0.66 5.9 5.9 5.8 5.7 5.7 5.5 0.82 0.76 0.71 5.3 0.68 0.60 0.59 0.49 0.47 5.0 0.30

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q -0.14 -0.44 FY2015 -0.20 FY2016 FY2017 -0.91 -0.71 -0.68

ｰ3.4

Unit：billion yen ■Existing businesses ( Blog service, online dating services etc. ) ■Up-front investment (AbemaTV, Inc. etc.) ｰ5.0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q ｰ5.7 ｰ5.8 FY2015 FY2016 FY2017

29 *OP of Media business: Earnings incentive is excluded. 5. Media Business

[Existing business] Blog service Ameba Appli 2.2B PV* （up 50.6% YonY）

PV Transition of Ameba Appli アプリ2.2BPV PV Back in form NO.1 blog service by improving operation in Japan

1. DAU UP 33%* with pushing the use by non-users 2. PV per user UP 13%* by improving function

Unit：billion PV

Mar. Sep. Mar. Sep. Mar. 2015 2016 2017

*As of March, 2017（YonY comparison） 30

5. Media Business

[Existing business] Online dating service Tapple has performed well

April 12 Ranked in Top Grossing Transition of No. of matches in Tapple 40.86M App Store (Social Networking category)* matches Became Nation’s largest service

Unit：matches

May. Sep. Mar. Sep. Mar. Sep. Mar. 2014 2015 2016 2017 31 *Ranked in Top Grossing of App Store (Social Networking category): As of April 14, 2017

5. Media Business

Marked the 1st anniversary on April 11, 2017

32 5. Media Business

16M DL

Exceeded 16 million downloads in a year from the release

Recognized as App of the year 2016 of App Ape Award Recognized as Best App of Google Play’s Best of 2016 Ranking (Japan Edition)

April 11 Release

Apr. May. Sep. Dec. Mar. *App Ape Award 2016: Selected apps which represent 2016 based on monthly user growth ratio in 2016 by FULLER, Inc. 33 **Best of 2016: Popular apps in 2016 at Google Play（Japan）, selected by Google Inc. 5. Media Business

[AbemaTV]

Change of MAU* Change of WAU** 8.40 MAU about 7.5 million User base increased 4.75 Expanding steadily 7.53 By the 1st anniversary 7.24 campaign 6.86 4.11

5.93 5.85 5.83 5.45 5.04

Unit：million of user 2.67 2.69 3.64 3.50

2.48

1.18

Unit：million of user

Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May. Sep. Dec. Mar.

*MAU： Users per month measured by Google Analytics（functionally impossible to measure under the age of 18) 34 **WAU：Users per week measured by Google Analytics（functionally impossible to measure under the age of 18) 5. Media Business

[AbemaTV]

Users by age group* User attributes**

Increased user base Female ratio: 36% in a whole Age 25-34 generation of users Age 18-24

Age 35-44 ♀ 36% Age 45-54 ♂

64%

Age 55-64

Apr. May. Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar.

*Users by age group: Age of users watching for more than five minutes （functionally impossible to measure under the age of 18) 35 **User attributes: Gender of users watching for more than five minutes （functionally impossible to measure under the age of 18) as of March 2017. 5. Media Business

[AbemaTV]

January April

・Ad on News Paper（New Year’s Day） • Adapted portrait screen Mktg FUNC ・TV Commercial • AbemaVideo start

・Adapted to Life Stick* • Strengthen original programs FUNC Abema GOLDEN 9 started

• Strengthen news

PGM Long-established news show ・HIPHOP Channel open Hodo Station started PGM ・Golf Channel open • Special programs of 1st anniversary ・Start first original drama • Distributing baseball games which Tadano Hitoshi, the extraordinary assistant manager Yokohama DeNA BayStars stages February • Special Live of 1st anniversary Mktg ・Japanese Chess Channel open • Started recruiting news presenters PGM

March

・Football Channel Open

・An original program of popular

PGM comedian Gokuraku Tombo earned 3.6 million views.

36 *Life Stick : A STB device which is prepared for the apartments provided by Leopalace21 Corporation. 5. Media Business

Strengthening Function 1 Adapted to Portrait View

■Landscape screen ■Portrait screen ■Comments feed screen

Portrait view An accelerator to make watching AbemaTV a habit

37 *©AbemaTV 5. Media Business

Strengthening

Function 2 AbemaVideo has Released

In addition to linear broadcast of AbemaTV, Time shifting function AbemaVideo appeared

38 *©AbemaTV 5. Media Business

機能 Strengthening * 拡充 Function 2 AbemaVideo offers 650 titles and 6,700 episodes

Recommendation

Free Programs （1/5 of all programs） Repeat broadcasting of original programs

Pay Programs （4/5 of all programs） Need to subscribe to Premium Plan （960 yen / Month）

39 *Number of titles and episodes：At the time of service launch **©AbemaTV （The image differs from the actual screen) 5. Media Business

Enhancing An original love variety show “You can’t fool me, Mr.Wolf” Programs 1 became a big hit and acquired know-how for future

User attributes* Most of viewers were 55ー ♀ ♂ Female and young 45ー54

35ー44

25ー34

18ー24 （age）

Changes in viewers** Linear broadcast of AbemaTV and time shifting of AbemaVideo are split into 50-50

Time shifting

Linear broadcast

Ep.1 Ep.2 Ep.3 Ep.4 Ep.5 Ep.6 Ep.7 *User attributes: Gender of users who watched for more than five minutes (Average of 7 episodes) 40 **Changes in users : Changes of users who watched for more than five minutes measured by Google Analytics. ***©AbemaTV 5. Media Business

Enhancing started from April, dramas are planned after October Programs 2 Abema GOLDEN 9

Sun. MondayMon. TuesdayTue. 9pm 9pm 9pm Cast: Cast: Cast: GENERATIONS OgiYahagi Rino Sashihara from EXILE Black Mayonnaise TRIBE

Wed. Thu. Fri. Sat. 9pm 9pm 9pm 9pm Cast: Cast: Cast: Cast: Yuuki Himura Gokuraku Bakarhythm Keiji Kuroki Tombo （EXILE/EXILE THE SECOND）, DJ SOULJAH

Enhancing Strengthen the News Programs 3

Hodo Station of TV Asahi started on AbemaTV

AbemaTV marked the 1st anniversary , and Started recruiting news presenters

[Competitive Advantage]

1 TV-quality programs

Technical capability to create service 2 with high usability

Financial stability to invest backed by 3 healthy existing businesses

43 5. Media Business

Road Map 10M WAU Up-front investment

Expand content for young and female viewers

Data traffic Background Prepare for Aim playback 5steps approach Monetization To be Launched Compatible Portrait Message Officially With TV devices screen Function Expand functionality Mass 2016 2017 media April April Penetration of Free Premium Plan time shifting service Abema Video 1M Operation and expansion My Premium of pay programs Video members 44 6. Summary

Summary

45 6. Summary

Develop Media Business as a main pillar in the mid/long term

Media Establish AbemaTV for mass media

Aim to increase growth rate Ad in excess of market growth

Create multiple hit titles Game and expand our market share

46 6. Summary

[Operating Profit (Image)]

Media To accumulate profit through the AD Business and Business Game Business, invest in the Media Business, and grow it as a pillar in the mid to long terms.

Game Business

AD Business

47 6. Summary

Management index DOE 5% or more as a guide

Shareholders’ ※※ Dividend Ratio OP Net Profit equity ROE DOE 39.4% 14.7 100.0 24.4% 40% 20% 36.7 15 24.0% 24% 36.0 13.6

32.7 21.7%

12 80.0 77.1 19.1% 18.9% 30% 10.5 More than 66.7 26.6% 9.5

22.2 23.1% 9 8.5 60.0 ％ 54.5 5 21.0% 21.2%

20% 10% 17.4 18.0 45.5 12% 41.7

6 40.0 7.5%

5.8% 10.3 5.0% 5.2% 10% 4.4%

3 20.0

0.0 0 0.0 0% 0% 0%

*The total dividend amount for the term ended Sep. 2014 includes a commemorative dividend of 20 yen/share. **Net profit: Profit attributable to shareholders of parent. 48 ***DOE=ROE×Dividend Ratio ****The unit of OP and net profit, shareholders’ equity: billion yen Aim to be a company that is supported in the medium to long term

49 7. References

References

50 7. References : AbemaTV

What is AbemaTV?

April 11, 2016 Official launch

51 7. References : AbemaTV

AbemaTV 4 features

24H About 30 Target FREE Operation channels Younger １２３４Generation AbemaTV 4 Strengths

Device 0 sec play Various TV like by device Watch contents quality UI・UX smoothly

１２３４52 7. References : AbemaTV

News News About 30 Channels Variety Variety SPECIAL Shows shows Mid-night Family Nostalgic Anime Anime Anime Anime 24/7 Anime New Anime Korean・ Reality Drama Drama Chinese Shows Fighting Golf Surf Snow Sports Sports Skate Football

Fishing Mar-jong MTV CLUB SPACE Japanese Pet Documentary Hobbies SHOWER Chess

HIPHOP etc. 53 7. References : AbemaTV

Trend in TV watching time Internet[Internet video video audience audience** ]

People in their 10s to 40s watch TV less frequently 2010 2015 ■ Do not watch ■ Watch than before. 13% Trend in TV watching time weekday 16~29 33% ■ years old 60% 67% more than 15 min/day* 87% 100%

60s 19% 90% 50s 30s 50% 50% 81%

80% 40s

10s 30% 30s 41% 40s 59% 70% 20s 5970%%

60% 1995 2000 2005 2010 2015 28% 50s 47% 53 72% *Trend in TV watching time weekday more than 15 min/day: % Calculate using “National life time research 2015” by NHK Broadcasting Culture Research Institute Media Research & Studies 54 **Internet video audience: Survey by NHK “Japanese people and TV 2015”; 35% of those who watch TV several days or more per year watch TV one day or more per week.

7. References : AbemaTV

“Best App” Award in Google Play’s App Ape Award “App of the year 2016” “Best of 2016” Ranking (Japan Edition)

The “Best of 2016” in Japan is The “App Ape Award” is a ceremony organized by Google’s program to select and Fuller, Inc. with “App Ape” the app analytics recognize with awards the titles platform to celebrate and fete developers of the that was popular in Japan most popular applications in 2016. during the year. Among the other 100 apps, Abema TV received AbemaTV received "Best App “App of the year 2016” as the most notable apps in 2016" from among 39 that received massive popularity in terms of new nominated applications subscription .

Survey of video streaming services used, Good Design Award 2016** th Ranked 4 *

Ranked Item Percentage of votes Reasons AbemaTV received the award 1 YouTube 89.9% Unlike previous TV apps, the broadcast begins effortlessly as soon as the app is launched, 2 Amazon Video 55.4% with controls nearly the same as an ordinary TV. 3 niconico 50.8% Also, the design utilizes the advantages of a smartphone, 4 Abema TV 37.9% such as quickly changing channels with a side swipe, or 5 Netflix 30% controlling the program listings with a touch. The service style is also new, combining 24-hour streaming 6 Hulu 28.6% of paid on-demand content, and free live streaming.

55 *Survey of video streaming services used: AV Watch 9/26/2016 **Good Design Award 2016 : The “General Design Recommendation System” sponsored by the Japan Institute of Design Promotion

7. References: Market Data

Market Data

56 7. References: Market Data

[Variation in Ad Cost by Media] Internet Ad market growth accelerated, exceeded 1.3 trillion yen

2,041.1 2,016.1 1,998.1 1,909.2 1,834.7 1,808.8 1,837.4 1,775.7 1,791.3 TV 1,713.9 1,732.1 1,723.7

Up 13.0% 1,310.0 YonY 1,159.4 Internet 1,051.9 938.1 868.0 774.7 806.2 698.3 706.9 600.3 482.6 Newspapers 377.7

Magazines

Unit: billion yen Radio

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

*Variation in Ad Cost by Media: “Ad cost in Japan in 2016” of Dentsu Inc. 57 ** The Internet ad cost: Ad production expenses are included.

7. References: Market Data

[Smartphone Ad Market] [Our share] 801.0 YonY Up23.7%

647.6 YonY Up30.1%

497.9 21％

Smartphone Ad Market 345.0 2016

207.3

Unit：billion yen

80.0

2012 2013 2014 2015 2016 2017E

58 *Smartphone Ad Market: Internet Ad Market Size Estimate (Jan-Dec 2016) – Originally estimated by D2C/CCI 7. References: Market Data

[In-feed Ad Market] [Our share]

301.3

285.4

YonY 268.4 Up11.9% 247.6

YonY 221.2 Up18.0%

187.5 YonY 27％ Up33.8% In-feed Ad 140.1 Market 2016 YonY Up82.4%

76.8

Unit：billion yen

38.0

2014 2015 2016 2017E 2018E 2019E 2020E 2021E 2022E

[Video Ad Market] 291.8 [Our share]

262.5

230.9

YonY 192.6 Up25.9% 19％

YonY 153.0 Up29.9% Video Ad Market YonY 117.8 2016 Up39.9%

YonY 84.2 Up57.4%

53.5 Unit：billion yen

31.7

2014 2015 2016E 2017E 2018E 2019E 2020E 2021E 2022E

[Smartphone Game Market] [Game Market by Country]

YonY Up2.2% Rank Country Revenue 945.0 925.0 895.0 1 China 243 United 2 235 States Smartphone Game Market 3 Japan 124 Our share 560.0 Unit：billion yen 4 Germany 41

5 South Korea 41

6 United Kingdom 39

7 France 28 261.0 13.1% 10.2% 8 Canada 18 8.4% 8.0% 6.2% 9 Spain 18

48.0 10 Italia 17 0.8% 0 0.0% Unit：billion USD 2011 2012 2013 2014 2015 2016E

*Smartphone Game Market: Yano Research Institute Ltd. “ Result from a survey of Smartphone game market 2015”, 61 **Game Market by Country: Newzoo “global game revenue estimates for 2016” The financial results for 3Q FY2017 are scheduled to be released at 15:00 or later on Thursday, July 27, 2017. [Notes] The future information, such as earnings forecast, written in this document is produced based on the available information at that time, and our company does not guarantee that they will come true. Actual performance, etc. may be differed according to various factors. We would appreciate your understanding.