Financial Results for 1Q for the Fiscal Year Ending March 31, 2011 July 28, 2010 NEC Corporation (http://www.nec.co.jp/ir/en) To be a leading global company leveraging the power of innovation to realize an information society friendly to humans and the earth NEC Group Vision 2017 © NEC Corporation 2010 Index I. Financial Results for 1Q II. Summary of the Financial Forecast for FY11/3 < Reference > Financial Forecast (Appendix) Page 3 © NEC Corporation 2010 I. Financial Results for 1Q 1Q Summary of Financial Results for 1Q (Billions of Yen) 1st Quarter FY10/3 FY11/3 Actual Actual Net Sales 778.5 667.5 -14.2% Operating Loss -40.0 -23.2 16.8 % to Net Sales Ordinary Loss - -45.0 % to Net Sales Net Loss Free Cash Flow - -40.5 - -33.8 % to Net Sales 4.6 - -43.1 - -47.5 (Ref): Average exchange rate for 1Q of FY11/3 Page 5 YoY © NEC Corporation 2010 -9.3 - -42.2 5.2 1$= ¥91.88 1€= ¥120.97 Summary of Financial Results for 1Q by Segment 1Q (Billions of Yen) Net Sales IT Services Operating Loss % to Net Sales Net Sales Platform Operating Loss % to Net Sales Net Sales Carrier Network Social Infrastructure Operating Income/Loss - - 141.7 0.5 116.8 -6.0 0.4% - 57.2 -0.7 58.4 0.3 - 0.6% 194.9 8.9 193.5 -0.4 4.6% - 143.1 -24.7 57.6 -1.1 - - -9.4 778.5 -40.0 -6.0 667.5 -23.2 - - Operating Income/Loss Operating Income/Loss % to Net Sales Net Sales Others Operating Loss Elim inations/Unclassifiable expense Operating Loss % to Net Sales Net Sales Operating Loss % to Net Sales Page 6 - 80.0 -4.4 Net Sales Net Sales Total - 73.9 -14.1 % to Net Sales % to Net Sales Personal Solutions 1st Quarter FY10/3 FY11/3 Actual Actual 167.6 161.2 -0.6 -5.7 © NEC Corporation 2010 YoY -3.8% -5.1 8.3% 9.7 -17.6% -6.5 2.0% 1.0 Others 9% IT Services 24% Personal Solutions 29% Sales for 1Q in FY11/3 -0.7% -9.3 -59.8% 23.5 3.5 -14.2% 16.8 Social Infrastructure 9% Carrier Network 17% Platform 12% 1Q Results by Segment for 1Q Net Sales Operating Income/Loss (Billions of Yen) 4.1 1,001.2 IT Services 181.6 Platform 9.2 Carrier Network 3.4 778.5 Platform 112.3 167.6 Carrier Network 171.0 Social Infrastructure 59.8 Personal Solutions 235.2 -40.0 0.5 5.5 667.5 73.9 161.2 141.7 80.0 57.2 116.8 -3.9 -2.2 -1.6 -6.3 IT Services Social Infrastructure Personal Solutions 8.9 -23.2 -0.6 0.3 -5.7 -14.1 -4.4 -0.7 -6.0 -0.4 -1.1 -6.0 -24.7 58.4 194.9 Others Others 193.5 241.3 Eliminations/ Unclassifiable expenses 143.1 -9.4 57.6 FY09/3 1Q Page 7 FY10/3 1Q FY11/3 1Q FY09/3 1Q © NEC Corporation 2010 FY10/3 1Q FY11/3 1Q 1Q Sales Change (Year on Year) (Billions of Yen) FY10/3 1Q 778.5 Platform +6.1 (+8.3%) Personal Solutions -1.4 (-0.7%) IT Services -6.3 (-3.8%) Deconsolidation of semiconductor business Social Infrastructure +1.1 (+2.0%) Carrier Network -24.9 (-17.6%) Others -85.5 FY11/3 1Q 667.5 Page 8 © NEC Corporation 2010 1Q Operating Income/Loss Change (Year on Year) (Billions of Yen) FY10/3 1Q FY11/3 1Q -40.0 -23.2 Carrier Network -6.5 Platform +9.7 Eliminations/ Unclassifiable expenses Social Infrastructure +1.0 +3.5 Deconsolidation of semiconductor business Others +23.5 IT Services -5.1 Page 9 Personal Solutions -9.3 © NEC Corporation 2010 1Q Net Income/Loss Change (Year on Year) (Billions of Yen) FY10/3 1Q FY11/3 1Q -33.8 -43.1 Improvement of operating income/loss +16.8 Equity in losses of affiliates -10.5 Deterioration of non-operating loss -12.2 Loss on change in equity -6.0 business structure improvement expenses etc Deterioration of special income/loss Others -11.2 +23.5 (Deconsolidation of semiconductor business) Platform Personal Solutions Carrier Network Page 10 +9.7 -9.3 -6.5 Taxes and Minority Interests -2.6 © NEC Corporation 2010 Results by Segment 1Q IT Services Business (Billions of Yen) YoY Sales 181.6 167.6 161.2 -3.8% -7.7% Operating margin ratio -0.4% -2.1% -3.5% FY09/3 1Q Page 12 -0.6 FY10/3 1Q -5.7 FY11/3 1Q 161.2 (-3.8%) SI Services : Declined due to continual IT investment restraint Trend toward improvement in the finance and manufacturing sectors Outsourcing/Support Services : Declined in the field of support services Stable sales in the outsourcing business ▐ Operating Loss Operating Loss -3.9 ▐ Sales -5.7 (-5.1) Declined due to a decrease in sales and the increase of investment in the cloud business for growth Proportion of sales (FY11/3 1Q) 24% © NEC Corporation 2010 1Q Platform Business (Billions of Yen) YoY Sales ▐ Sales Increased mainly from virtualization related system integration and the security field. IT investment restraint continued Operating margin ratio -5.5% 73.9 Hardware : Remained at the same level as the previous year due to the steady sales in IA servers and UNIX servers 80.0 Enterprise Network : -19.1% Increased due to the gradual recovery of investment in domestic and international markets +8.3% -34.1% Operating Income/Loss ▐ Operating Loss 9.2 -14.1 -4.4 Page 13 FY10/3 1Q FY11/3 1Q -4.4 (+9.7) Significant improvement from increased sales and continued cost reduction Proportion of sales FY09/3 1Q (+8.3%) Software : 8.2% 112.3 80.0 (FY11/3 1Q) 12% © NEC Corporation 2010 1Q Carrier Network Business (Billions of Yen) YoY Sales ▐ Sales Japan : Operating margin 2.0% ratio Decreased due to passing the peak of NGN related deployment etc., while sales in the wireless area were at the same level as last year. 0.4% 171.0 -5.1% 141.7 116.8 Overseas : -17.1％ Declined due to a delay in the signing of a submarine cable system contract. -17.6% ▐ Operating Loss Operating Income/Loss 3.4 FY09/3 1Q Page 14 116.8 (-17.6%) 0.5 FY10/3 1Q -6.0 FY11/3 1Q -6.0 (-6.5) Declined due to sales decreases, mainly in submarine cable systems Proportion of sales (FY11/3 1Q) 17% © NEC Corporation 2010 1Q Social Infrastructure Business (Billions of Yen) YoY Sales Operating margin ratio -1.2% 0.6% ▐ Sales 58.4(+2.0%) Increased in the field of social systems such as transportation and fire prevention. -3.8% 59.8 58.4 57.2 ▐ Operating Income +2.0% -4.3% 0.3(+1.0) Improved due to sales increases and enhanced cost reduction activities. Operating Income/Loss -2.2 FY09/3 1Q Page 15 -0.7 FY10/3 1Q 0.3 FY11/3 1Q Proportion of sales (FY11/3 1Q) 9% © NEC Corporation 2010 1Q Personal Solutions Business (Billions of Yen) YoY Sales ▐ Sales Decreased due to intensifying competition and a sluggish Japanese market 2.4% -0.2% Mobile Terminals -17.1% -0.7% 194.9 193.5 105.8 -11.9% PC and Others Increased sales for business products (PCs, Displays) and high-value added PCs for consumers -15.1% 79.1 93.2 ▐ Operating Loss Operating Income/Loss PC and 129.4 Others 5.5 FY09/3 1Q Page 16 -21.4% 101.7 +12.5% 8.9 114.4 - 0.4 FY10/3 1Q (-0.7%) Mobile terminals: Operating margin ratio 4.6% 235.2 193.5 FY11/3 1Q (Forecast) -0.4 (-9.3) Decreased due to the sales decrease of mobile terminals and increased development costs for new devices such as LifeTouch Proportion of Sales (FY11/3 1Q) 29% © NEC Corporation 2010 Summary of Financial Results for 1Q 1Q ▐ Sales: Fell short compared to the original plan, mainly in the Carrier Network segment ▐ Operating Income/Loss: Exceeded the original plan as a company due to the increases in the Platform and Social Infrastructure segments Fell short slightly in the Carrier Network segment ▐ Accelerated the implementation of concrete measures to expand the cloud business, global business and new business, which are key areas for achieving V2012 Favorable start for achieving 1H/full year forecast Page 17 © NEC Corporation 2010 II. Financial Forecast Summary Business Operation Policy for FY2010 Forecast FY2010 is the first year toward achieving “V2012” ⇒ V2012 is a program for personal and organizational innovation ▐ In order for FY2010 to successfully move towards V2012, we need to be vigilant in our observation and improvement of 3 mid-term growth plan measures ① Expand Global business in 5 regions ② Expand Cloud business (integrated IT/NW Solution) ③ Expand New business (e.g.) automotive battery business, new personal devices etc. Aim for 100 billion yen in operating income and 15 billion yen in net income * Forecast as of July 28, 2010 (Note: Unchanged from previous forecasts of May 12) Page 19 © NEC Corporation 2010 Forecast Summary of Financial Forecast (Billions of Yen) 1st Half Full Year FY10/3 FY11/3 Actual Forecast(*) YoY FY10/3 FY11/3 Actual Forecast(*) YoY Difference from May 12 Net Sales 1,653.7 1,500.0 -9.3% 3,583.1 3,300.0 -7.9% 0 Operating Income/Loss -37.7 5.0 42.7 50.9 100.0 49.1 0 1.4% 3.0% 49.4 70.0 20.6 0 1.4% 2.1% 11.4 15.0 3.6 0 0.3% 0.5% 5.04 5.77 0.73 0.00 93.6 -50.0 -143.6 0 % to Net Sales Ordinary Income/Loss - -49.9 % to Net Sales Net Income/Loss Free Cash Flow -20.0 - -43.6 % to Net Sales Net Income/Loss per share(Yen) 0.3% - -36.0 - -21.60 29.9 7.6 - -13.85 7.75 -53.8 (Ref): Assumed exchange rate for FY11/3 1$=¥90, 1€=¥110 * Forecast as of July 28, 2010 (Note: Unchanged from previous forecasts of May 12) Page 20 © NEC Corporation 2010 Forecast Summary of Financial Forecast for 1H/Full Year by Segment (Billions of Yen) Net Sales IT Services Operating Income % to Net Sales Net Sales Platform Operating Income/Loss 1st Half FY10/3 FY11/3 Actual Forecast(*) 377.3 380.0 9.6 10.0 2.5% 166.2 -13.5 Net Sales Carrier Network Operating Income % to Net Sales Net Sales Social Infrastructure Operating Income % to Net Sales Net Sales Personal Solutions Operating Income % to Net Sales Net Sales Others Operating Income/Loss 308.6 12.4 129.7 2.7 362.3 8.2 309.6 -37.6 Operating Loss Net Sales Total Operating Income/Loss % to Net Sales -19.5 1,653.7 -37.7 4.1% 0.3 316.6 21.7 10.4% -4.2 737.7 18.9 -67.7% 37.6 661.4 -44.9 0.3% -2.5 -9.3% 42.7 -27.5 3,583.1 50.9 1.4% -0.5% -6.7 12.5% -2.9 1.9% 215.0 4.0 - 6.8% 8.7 4.8% 830.0 16.0 2.6% 1.7% 10.7 6.0% 315.0 15.0 6.9% 2.7% 2.8 2.4% 670.0 40.0 5.0% YoY 6.3% 380.0 9.0 - 0.0% -22.0 1,500.0 5.0 - 627.4 31.3 1.0% 100.0 0.0 - % to Net Sales Eliminations/Unclassifiable expense 0.5% 1.6 2.2% 400.0 4.0 2.3% 373.7 -1.7 4.5% 135.0 3.0 2.1% 6.1% 5.3% 9.5 - 310.0 14.0 4.0% 0.7% 0.4 2.6% 175.0 -4.0 - % to Net Sales YoY Full Year FY10/3 FY11/3 Actual Forecast(*) 866.3 890.0 53.2 56.0 -67.5% 48.9 1.9% -40.0 3,300.0 100.0 -12.5 -7.9% 49.1 3.0% * Forecast as of July 28, 2010 Page 21 © NEC Corporation 2010 IT Services Business Situation 1H Forecast ▐ Promote the services business, global business and create new business in tandem with the expansion of the SI business Sector Business situation Government Promote proposals for institutional reform based on the “New Growth Strategy” and “New Information and Communications Technology Strategy” Public/Medical New IT investment tends to be restrained due to decreases in tax revenues and in response to legal revisions the year after next. Focusing on proposals for core system reconstruction, and the accommodation of administrative and financial reform, including the migration to cloud systems Finance While finance sector indexes are continuously improving, the recovery of IT investment is still progressing slowly. Aim to strengthen sales of the nextgeneration store-terminal, “NAVUTE,” and to promote the service business by utilizing cooperative systems Telecom/Media Continuing IT investment restraint in both the Telecom and Media sectors in Japan. Although global telecom carriers are receptive to starting new services, deliberations are still required to make investment decisions. Strengthen new business such as cloud services for global carriers and digital signage Manufacturing Increasing international demand in such industries as automobiles and electronics. IT investment is expanding in emerging markets. Strengthen proposals for “Cloudoriented service platform solutions” as reflected in the reform of NEC’s IT systems Retail/Service Stable IT investment demand, especially in retail stores and fields close to customers. Strengthen new proposals for EC, CRM and global POS business Page 22 © NEC Corporation 2010 Carrier Network Business Overview 1H Forecast ▐ Expand new business (Wireless Broadband Access, Services & Management) ▐ Further enhance core overseas business (PASOLINK, submarine cable systems) Create business for the future ▐ Maintain and strengthen a leaner earnings structure Business situation Fixed line （in Japan) Efforts to secure investment from carriers mainly in the Service & Management field. NGN area deployment surpasses its peak Wireless (in Japan) Expand Wireless Broadband Access( LTE, WiMAX, femtocell) and the Services & Management business. Promote greater investment from carriers through smart phones demand Fixed line (overseas) Aim to receive early orders and to secure large-scale projects Wireless (overseas) PASOLINK; enhance our competitiveness by launching new products. Expand new business such as Wireless Broadband Access services. Page 23 © NEC Corporation 2010 1H Forecast Personal Solutions Business Overview Business situation Mobile Terminals Japanese market growth is expected to be almost flat year-onyear due to the continuing severe market conditions. Expect to increase sales due to the integration of the mobile terminal business and the promotion of new products. PC market size in Japan is steady and expected to expand yearon-year. PC and Others Expect to increase sales in products for enterprises ( PCs, displays, etc.) and High value-added PCs for consumers (Blu-ray disk equipment, digital terrestrial broadcast etc.) backed by the recovery of the enterprise market and consumer confidence. Developed the Android-based cloud device "LifeTouch" (7 inch screen and lightweight). Strengthen the business for liaising with BIGLOBE services and implementing vertically integrated services for enterprises. * Forecast as of July 28, 2010 Page 24 © NEC Corporation 2010 NEC Group Vision 2017 and V2012 NEC Group Vision 2017 “V2012” is a milestone for achieving the NEC Group Vision 2017 To be a leading global company leveraging the power of innovation to realize an information society friendly to humans and the earth FY17 Target Net Income 200 Billion yen ROE Approx. 15% (Overseas Sales Approx. 50%) FY12 Net Income 100 Billion yen 2 1 0 12) 2 V 20 FY09 (Actual) Net Income 11.4 billion yenb ROE 1.6% no i s Vi - nd yo e B , ies r a nd ou (2 rd wa o T r ou ROE (Overseas Sales 25%) – 0 01 (Overseas Sales 20%) Page 25 10% © NEC Corporation 2010 Aiming to be a global Top 10 company In the ICT industry <Ref.> Cloud Service Activities / Customers Cloud ▐ Cloud services launched by industry ▐ Started Ticketless services at the SHIKI THEATRE COMPANY SaaS electronic chart system for small hospitals Cloud services for hotels • Cloud services that include reservation systems, customer management systems, digital signage, voice communication systems, etc. Cloud services enabled the system to support "QR code with security functions" ▐ Providing cloud services for the asset management system for the Sumitomo Life Insurance Company Cloud services for the housing industry • Provide SaaS services with Sumitomo Forestry Co, Ltd. Cloud services for financial agencies • Provide business systems for life insurance with Sumitomo Life Information Systems Co., Ltd. Page 26 © NEC Corporation 2010 <Ref.> Global Business Activities / Customers ▐ Enhanced business structure for the Middle East and Africa Established NEC Telecommunication & Information Technology Ltd. in Turkey ▐ Launched medical solutions business in China Joint development and sale of package software for the Medical industry with Chongqing ZhongLian Information Industry Co., LTD. ▐ Won the expansion project for the APCN2 optical submarine cable system ▐ PASOLINK selected by Slovenian Broadcaster ▐ Won the POS system from the Guangzhou Baiyun International Airport in China ▐ Digital signage solutions in Korea Formed digital signage sales alliance with South Korea's leading distribution company “Shinsegae I&C Co., Ltd.” Page 27 Global © NEC Corporation 2010 new business <Ref.> New Business Activities ▐ Electrodes for automotive lithiumion batteries are in mass production Full development of the environment and energy business focused on automotive batteries ▐ Started field trial of transfer blocking system for distributed power with the Chugoku Electric Power Co., Inc. ▐ Started trials of the “LifeTouch” cloud-device with customers (Exhibited at "Interop Tokyo 2010") Android-based cloud device featuring an optimized user interface for B to B to C services (will be released in this autumn) Testing fundamental smart grid technologies Page 28 © NEC Corporation 2010 Lightweight 7 inch display < Ref. > Financial Forecast (Appendix) 1H Forecast Financial Forecast for 1H by Segment (Billions of Yen) Net Sales Operating Income/Loss 2,127.8 IT Services 13.4 416.8 1,653.7 Platform 1,500.0 229.1 377.3 Carrier Network 396.1 Social Infrastructure 148.2 Personal Solutions 454.4 9.9 Platform 6.8 Carrier Network 20.9 Social Infrastructure 1.1 380.0 308.6 129.7 9.6 10.0 12.4 2.7 8.2 14.0 3.0 4.0 -4.0 -23.7 Personal Solutions 175.0 310.0 -22.0 -37.6 135.0 Others 400.0 483.1 0.2 -1.6 5.0 -13.5 166.2 362.3 Others IT Services -37.7 Eliminations/ Unclassifiable expenses 309.6 -19.5 100.0 FY09/3 1H Page 32 FY10/3 1H FY11/3 1H (Forecast) FY09/3 1H © NEC Corporation 2010 FY10/3 1H FY11/3 1H (Forecast) * Forecast as of July 28, 2010 1H Forecast Sales Change (Year on Year) (Billions of Yen) FY10/3 1H Carrier Network IT Services +1.4 (+0.5%) +2.7 (+0.7%) Personal Solutions +37.7 (+10.4%) Deconsolidation of semiconductor business 1,653.7 Platform +8.8 (+5.3%) Social Infrastructure +5.3 (+4.1%) FY11/3 1H (Forecast) 1,500.0 Others -209.6 * Forecast as of July 28, 2010 Page 33 © NEC Corporation 2010 1H Forecast Operating Income/Loss Change (Year on Year) (Billions of Yen) Eliminations/ Unclassifiable expenses -2.5 FY11/3 1H (Forecast) FY10/3 1H 5.0 -37.7 Deconsolidation of semiconductor business Carrier Network +1.6 Platform +9.5 Social Infrastructure +0.3 Personal Solutions -4.2 IT Services +0.4 Page 34 Others +37.6 * Forecast as of July 28, 2010 © NEC Corporation 2010 1H Forecast Net Income/Loss Change (Year on Year) (Billions of Yen) FY11/3 1H (Forecast) FY10/3 1H -43.6 Deterioration of non-operating loss -36.0 -12.8 Others Platform +37.6 +9.5 Others -22.3 Improvement of operating income/loss +42.7 Page 35 © NEC Corporation 2010 * Forecast as of July 28, 2010 Forecast by Segment Forecast IT Services Business (Billions of Yen) 1H Full Year Sales Sales YoY Operating margin ratio 2.6% 2.5% Operating margin ratio 6.3% 6.1% 2.4% 5.6% 416.8 933.8 377.3 380.0 866.3 +0.7% -7.2% 890.0 +2.7% -9.5% Operating Income Operating Income 9.9 FY09/3 1H 51.8 9.6 FY10/3 1H 53.2 56.0 10.0 FY11/3 1H (Forecast) FY09/3 1H FY10/3 1H FY11/3 1H (Forecast) * Forecast as of July 28, 2010 Page 37 © NEC Corporation 2010 1H Forecast IT Services Business (Billions of Yen) ▐ Sales 380.0 （+0.7%） SI Services : Aim to increase sales through the growth of customers’ strategic investment accompanied by the economic recovery Outsourcing/Support Services : Aim for a steady increase through deployment of “cloud-oriented services” and the expansion of SaaS solution menus ▐ Operating Income 10.0 （+0.4） Expect to maintain the same level as the previous year by enhancing cost reductions and project management * Forecast as of July 28, 2010 Page 38 © NEC Corporation 2010 Forecast Platform Business (Billions of Yen) 1H Full Year Sales Sales Operating margin ratio 3.0% 2.4% YoY Operating margin ratio 2.4% -2.3% 469.4 229.1 -0.5% -8.1% 166.2 373.7 175.0 Operating Income/Loss -20.4% +5.3% 380.0 +1.7% 11.5 -27.5% 9.0 Operating Income/Loss 6.8 FY09/3 1H -13.5 FY10/3 1H -1.7 -4.0 FY11/3 1H (Forecast) FY09/3 1H FY10/3 1H FY11/3 1H (Forecast) * Forecast as of July 28, 2010 Page 39 © NEC Corporation 2010 1H Forecast Platform Business (Billions of Yen) ▐ Sales 175.0 （+5.3%） Software : Aim to increase sales by focusing on system integration through virtualization and cloud compliant datacenter business Hardware : Expect to remain at the same level as the previous year due to the increase in IA servers and UNIX servers Enterprise Network : Reduce costs and aim to increase sales by focusing on areas where customers are making investments and providing support for global business Business environment will gradually improve ▐ Operating Loss -4.0 （+9.5） Expect to significantly improve through continued cost reductions * Forecast as of July 28, 2010 Page 40 © NEC Corporation 2010 Forecast Carrier Network Business (Billions of Yen) Full Year 1H Sales Sales YoY Operating margin 5.3% ratio 6.4% 4.5% 4.0% 396.1 Operating margin ratio 807.0 5.0% 670.0 627.4 310.0 308.6 Operating Income +0.5% Operating -22.1％ Income +6.8% -22.3% 51.6 40.0 20.9 12.4 FY09/3 1H 6.0% FY10/3 1H 31.3 14.0 FY11/3 1H(forecast) FY09/3 FY10/3 FY11/3 (forecast) * Forecast as of July 28, 2010 Page 41 © NEC Corporation 2010 1H Forecast Carrier Network Business (Billions of Yen) ▐ Sales 310.0 (+0.5%) Expect to maintain the same level as the previous year by providing for data traffic increases driven by the rapid spread of smart phones and the increase in mobile subscribers in emerging countries, despite surpassing the peak of NGN investment in Japan. ▐ Operating Income 14.0 (+1.6) Aim to increase by maintaining and strengthening a leaner earnings structure based on the cost reductions that were carried out last year. * Forecast as of July 28, 2010 Page 42 © NEC Corporation 2010 Forecast Social Infrastructure Business (Billions of Yen) 1H Full Year Sales Sales Operating margin ratio 2.2% 2.1% YoY 6.9% Operating margin ratio 4.8% 0.7% 340.4 2.3% 315.0 316.6 148.2 135.0 129.7 -0.5% -7.0% +4.1% -12.5% 21.7 Operating Income Operating Income 2.7 3.0 15.0 7.9 1.1 FY09/3 1H FY10/3 1H FY11/3 1H(forecast) FY09/3 FY10/3 FY11/3 (forecast) * Forecast as of July 28, 2010 Page 43 © NEC Corporation 2010 1H Forecast Social Infrastructure Business (Billions of Yen) ▐ Sales 135.0 (+4.1%) Aim to increase sales in the field of social systems such as transportation and fire prevention. ▐ Operating Income 3.0 (+0.3) Aim to increase through the sales improvement and cost reductions from enhanced project management. * Forecast as of July 28, 2010 Page 44 © NEC Corporation 2010 Forecast Personal Solutions Business (Billions of Yen) 1H Full Year Sales Sales 2.3% Operating margin ratio YoY Operating margin ratio 2.6% 1.9% 1.0% +12.5% -0.4% +10.4% 454.4 830.0 737.7 -20.3% 400.0 362.3 Mobile 181.2 Terminals Mobile 348.1 Terminals +10.1% PC and Others 500.3 +10.6% Operating 273.2 Income/Loss 205.2 8.2 -1.6 FY09/3 1H -1.7% +35.2% 382.0 282.5 173.0 157.1 PC and Others -13.0% 848.4 FY10/3 1H 227.0 4.0 FY11/3 1H (Forecast) -1.6% Operating 455.2 Income/Loss 18.9 448.0 16.0 -14.2 FY09/3 FY10/3 FY11/3 (Forecast) * Forecast as of July 28, 2010 Page 45 © NEC Corporation 2010 1H Forecast Personal Solutions Business ▐ Sales (Billions of Yen) 400.0 (+10.4%) Mobile Terminals : Expect to increase due to the integration of the mobile terminal business and the promotion of new products PC and Others : Following 1Q, expect an increase from products for enterprises (PCs, displays, etc.) and high-value added PCs for consumers ▐ Operating Income 4.0 (-4.2) Expect to decrease due to the development costs for new devices such as LifeTouch and smart phones, despite fixed cost reductions and greater development efficiency * Forecast as of July 28, 2010 Page 46 © NEC Corporation 2010 Full Year Forecast Full Year Forecast by Segment (Billions of Yen) Net Sales Operating Income/Loss 4,215.6 IT Services 933.8 -6.2 50.9 IT Services 51.8 53.2 Platform 11.5 Carrier Network 3,583.1 100.0 56.0 3,300.0 9.0 Platform 469.4 866.3 890.0 Carrier Network Social Infrastructure 807.0 373.7 380.0 Social Infrastructure 670.0 Personal Solutions 627.4 340.4 316.6 Personal Solutions 848.4 Others 816.7 737.7 315.0 Others 31.3 40.0 51.6 21.7 7.9 △ 14.2 18.9 -1.7 -44.9 15.0 16.0 4.0 -87.1 -40.0 -27.5 830.0 661.4 -27.7 215.0 FY09/3 FY10/3 Eliminations/ Unclassifiable expenses FY11/3 (Forecast) FY09/3 FY10/3 FY11/3 (Forecast) * Forecast as of July 28, 2010 Page 47 © NEC Corporation 2010 Full Year Forecast Sales Change (Year on Year) (Billions of Yen) Carrier Network +42.6 (+6.8%) Personal Solutions +92.3 (+12.5%) IT Services +23.7 (+2.7%) Deconsolidation of semiconductor business FY10/3 3,583.1 Platform +6.3 (+1.7%) Social Infrastructure -1.6 (-0.5%) FY11/3 (Forecast) 3,300.0 Others -446.4 * Forecast as of July 28, 2010 Page 48 © NEC Corporation 2010 Operating Income/Loss Change (Year on Year) Eliminations/ Unclassifiable expense -12.5 Deconsolidation of semiconductor business Full Year Forecast (Billions of Yen) FY11/3 (Forecast) 100.0 Carrier Network +8.7 Platform +10.7 Social Infrastructure -6.7 Others +48.9 FY10/3 50.9 IT Services +2.8 Personal Solutions -2.9 * Forecast as of July 28, 2010 Page 49 © NEC Corporation 2010 Net Income/Loss Change (Year on Year) Full Year Forecast (Billions of Yen) Others +48.9 Platform +10.7 Carrier Network +8.7 Social Infrastructure -6.7 Reversal of provision for contingent loss in the previous year Deterioration of non-operating loss -28.5 Improvement of operating income/loss +49.1 Decrease of profit on sale of shares Others -17.0 FY11/3 (Forecast) FY10/3 15.0 11.4 * Forecast as of July 28, 2010 Page 50 © NEC Corporation 2010 1Q <Ref.> Financial Position Data (Billions of Yen) End of Mar End of Jun 2010 2010 2,937.6 2,510.8 -426.8 Net Assets 931.9 843.3 -88.6 Interest-bearing debt 729.5 623.1 -106.4 Shareholder's Equity 790.9 725.6 -65.3 Equity ratio(%) 26.9% 28.9% 2.0pt D/E ratio 0.92 0.86 0.06pt Net D/E ratio 0.50 0.55 -0.05pt Total Assets Page 51 Difference from Mar 2010 © NEC Corporation 2010 1Q <Ref.> Capital Expenditures and Others (Billions of Yen) FY09/3 FY10/3 Actual Actual YoY FY11/3 YoY Forecast Difference from May 12 Capial Expenditure 103.1 83.1 -19.4% 75.0 -9.7% 0 Depreciations 133.6 111.2 -16.8% 75.0 -32.6% 0 R&D expenses 346.5 276.0 -20.3% 200.0 -27.5% 0 (Billions of Yen) FY10/3 1Q Actual R&D expenses 71.8 YoY -21.4% FY11/3 1Q Actual 46.9 YoY -34.7% * Forecast as of July 28, 2010 Page 52 © NEC Corporation 2010 1Q <Ref.> Overseas sales (Billions of Yen) FY10/3 Actual Asia Europe Others Total 1st Quarter FY11/3 Actual Net Sales 70.9 38.2 To consolidated total （％） 9.1% 5.7% Net Sales 41.0 24.0 To consolidated total （％） 5.3% 3.6% Net Sales 52.0 52.0 To consolidated total （％） 6.7% 7.8% 163.9 114.2 21.1% 17.1% Net Sales To consolidated total （％） YoY Major countries and regions -46.2% China,Chinese Taipei,India, Singapore and Indonesia -41.4% UK,France,Netherlands, Germany,Italy and Spain -0.1% U.S.A -30.3% * Sales, based on the location of customers, are classified by country or region Page 53 © NEC Corporation 2010 CAUTIONARY STATEMENTS: This material contains forward-looking statements pertaining to strategies, financial targets, technology, products and services, and business performance of NEC Corporation and its consolidated subsidiaries (collectively "NEC"). 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