Management Policies

Management Policies, Business Environment, and Issues to Address, etc.

Forward-looking statements herein are based on the Group’s judgement as of the end of fiscal year 2025 under review.

1. Basic Management Policies

Based on the management philosophy of “always aiming to become the world’s No. 1 silicon wafer manufacturer by exceeding the expectations of our customers and stockholders, by promoting the welfare of our employees, and by contributing to society,” the Group has developed advanced technological capabilities that lead the world and the ability to roll out a wide range of products in manufacturing high-quality large- to small-diameter silicon wafers used in semiconductor devices. By taking full advantage of these strengths to create a stable supply capability, the Group seeks to contribute to the advancement of society. In particular, the Group focuses on improving its technological capabilities to meet its customers’ stringent requirements for quality and cost, promoting higher-precision silicon wafers to support the evolution of various types of semiconductors. Through these efforts, the Group will try to maintain and improve its position in the silicon wafer industry and carry out CSR and sustainability promotion activities based on the SUMCO CSR Policy, considering it our corporate social responsibility to value all stakeholders, including customers, stockholders, business partners, employees, and the global environment and society as a whole.

Under these basic policies, the Group is committed to further strengthening its business foundations and meeting its mandate from stakeholders, aiming for the sustainable growth of its business.

2. Targeted Management Indicators and Medium- to Long-Term Management Strategies

Despite factors that could cause short-term fluctuations, the semiconductor silicon wafer market is expected to grow in the medium to long term with the semiconductor market’s growth on the back of an increase in data communication volume, development of generative AI technology, progress in driverless driving, technological innovation such as digital transformation (DX), and the spread of HEVs and EVs. In particular, demand for 300 mm wafers for leading-edge semiconductors, one of the Group’s strengths, is expected to continue to grow. Regarding 200 mm silicon wafers, while demand related to AI data centers is increasing, we expect overall demand to remain at the current level. Meanwhile, demand for 150 mm and smaller wafers is projected to contract in the long term.

In this business environment, the Group, for its mainstay of products, 300 mm wafers, will focus on technology development and investment in modernization to meet the demand related to the rapid growth of AI.

As for wafers of 200 mm or smaller, the Group will reorganize an appropriate production system that is commensurate with the market environment.

Given that semiconductor silicon wafers are part of business areas with a volatile market environment, the Group will continue making efforts to enhance cost competitiveness and improve profitability, as well as working on building business foundations that can promptly and effectively optimize management resources responding to changes in the demand environment.

3. Business Environment and Issues to Address

The market for 300 mm semiconductor silicon wafers is expected to see strong demand for leading-edge logic and DRAM use in AI data centers, while demand for NAND use is also projected to rise in sync with the growth of server SSDs. Regarding wafers for non-leading-edge logic use, we anticipate that customers will plan to conduct full-scale inventory drawdown and adjust their purchase volumes accordingly. In the market for silicon wafers of 200 mm and smaller, while some demand growth is seen related to AI data centers, the demand is expected to remain at the current level.

Under these circumstances, the Group is proceeding with business structural reforms. Regarding 300 mm products, given the accelerating pace of semiconductor technology innovation, we will work to leverage new plant facilities and to upgrade manufacturing facilities at existing plants, focusing on meeting demand for leading-edge products for which strong growth continues. As for 200 mm and smaller wafers, we will strive to improve efficiency and profitability through initiatives such as reorganizing our production systems. We will also continue to closely watch the impacts on the market environment from geopolitical risks and the policies of individual countries, paying special attention to the impact on demand for end products containing semiconductors.

Moreover, the Group is promoting initiatives related to sustainability and has identified issues it will address on a priority basis as materiality (key issues). These issues are intended to resolve social issues and enhance corporate value in a sustainable manner. The Group will further accelerate its activities to achieve medium- to long-term goals for promotion of the active participation of women, net-zero emissions, human resources development, etc.