■Review of the second year of MEX26

In fiscal 2025, the second year of MEX26 (Maximum Excellence 2026), net sales came to 129.4 billion yen and operating profit to 7.9 billion yen, both falling short of our initial plan. Our outlook for fiscal 2026 also points to net sales of 143.0 billion yen and operating profit of 10.0 billion yen, again short of the MEX26 targets. We take seriously our failure to meet the expectations of our stakeholders.
　Looking back on fiscal 2025, the first major factor behind the shortfall against our profits plan was the underperformance of our semiconductor DMS business. When formulating the plan, we had expected the market to recover, but shipment volumes of semiconductor manufacturing equipment, primarily the general-purpose models that account for the bulk of our business, deviated sharply from our initial assumptions, resulting in a substantial decline in revenue. Going forward, we will further enhance our scrutiny of customer forecasts and our gathering of market intelligence under our new management structure. The second major factor was a sharp, larger-than-expected rise in the price of silver, the key material in the micro batteries used in medical devices and watches. This impact exceeded what we could absorb through our own efforts alone, and we have been working to reflect it in our selling prices with the understanding of our customers. However, the recent sharp swings in precious metal prices have led us to reflect cost changes in our prices even sooner than before, so as to minimize the impact on our profits for the period.
　At the same time, our growth businesses, such as primary batteries for medical devices, heat-resistant coin-type lithium batteries for TPMS, and coated separators, have progressed largely as planned, and the businesses we are making deliberate efforts to grow continue to deliver steady results.
　In addition, we made significant progress in reforming our portfolio, in line with our strategy of becoming a front-runner in the highly-reliable small battery sector that will drive Maxell's future growth. For example, we transferred our EF2 (electro fine forming) business, which had been struggling to grow sales, to a partner company, in light of its performance and future market trends, while also acquiring the primary battery business from Murata Manufacturing.

■Established the new corporate byline "Micro batteries. Maximum impact."

Maxell has long provided value to a wide range of industries that demand precision and high reliability, drawing on technologies that support society behind the scenes centered on small batteries. Even so, many stakeholders still associate us with cassette tapes and video tapes, a perception that has grown out of step with what we actually do today in our B-to-B businesses.
　We have now established a new corporate byline to clearly communicate what kind of company Maxell is: "Micro batteries. Maximum impact." The idea that "micro-sized batteries generate a major impact that supports industries around the world" reflects our public declaration that we are transforming ourselves into a value-providing company with batteries as our main growth driver.
　This corporate byline is not meant to apply only to our battery business. Our functional materials and optics & systems businesses adhere to the same concept: small components and materials that deliver great value to our customers' products. Every one of our businesses shares the spirit of "Maximum impact" and is building a stronger presence in its respective field.
　Batteries are our founding product as well as the origin of our company name, and this is a field where technological innovation will continue to create new needs. In the highly-reliable small battery sector, including all-solid-state batteries, Maxell aims to become the global No. 1 in both scale and advanced technology.

■Advancing our growth strategy for small batteries

To expand our global share in the small battery sector, we will focus on strengthening our highly-reliable primary batteries and all-solid-state batteries.

Primary batteries: Expanding scale and strengthening competitiveness through M&A
　In March 2026, we acquired the primary battery business from Murata Manufacturing Co., Ltd. and established Maxell Sakura Co., Ltd. This has expanded our small battery production network, adding Maxell Sakura's plant in Koriyama, Fukushima Prefecture, alongside our existing Ono Works in Ono, Hyogo Prefecture. We plan to maximize production efficiency across these two sites, drawing on Koriyama Works' strength in silver oxide batteries and Ono Works' strength in coin-type and cylindrical-type manganese dioxide lithium batteries.
　We will seek to generate synergies in both the short term and the medium- to long-term. In the short term, we will make use of Koriyama Works' production capacity to strengthen supply of products such as batteries for medical devices, where we cannot fully meet demand even at full production. In the medium- to long-term, we will raise our product development capabilities through technical exchange among engineers, laying the groundwork for a big step in our next mid-term management plan. For fiscal 2026, we plan to achieve net sales of 53.0 billion yen and an operating profit margin of 5.8% in the Energy segment, setting the stage for further significant growth beyond that.

All-solid-state batteries: Moving into the mass-production phase and market expansion
　Our all-solid-state battery business moved into the full-scale mass-production phase in the second half of fiscal 2024. In addition to selling battery units on their own, mainly for applications in environments where conventional batteries could not be used, we are now also offering power modules that integrate the surrounding circuitry, with the aim of promoting the replacement, in existing robots and PLCs* used for backup purposes, of primary batteries with all-solid-state batteries. We are seeing encouraging results.
* Programmable Logic Controller (PLC): An industrial computer that automatically controls machinery and equipment according to a pre-set program.
　Sales of all-solid-state batteries in fiscal 2026 will remain in the range of several hundred million yen, but this is consistent with our priorities at this stage, namely "accumulating a track record in mass production" and "building our customer base." We completed development of a general-purpose module for FA applications in June 2026, and going forward, we will focus our development mainly on increasing battery size, with the aim of expanding from backup applications to main power source applications. We will steadily expand sales and production toward making a full-scale contribution to profits under our next mid-term management plan.

■Working to strengthen our business portfolio

With regard to reforming our business portfolio, we will maintain strict financial discipline and optimize the allocation of management resources to achieve stable growth.
　During the MEX26 period, we decided to withdraw from two businesses: we discontinued production of prismatic lithium-ion batteries and transferred our EF2 business. These were not simply a matter of cleaning up unprofitable businesses; they were deliberate choices aimed at concentrating our management resources on the small battery sector. We are taking the resources freed up by these withdrawals and reallocating them to our growth businesses, further reinforcing efforts to make distinctive investments.
　In Functional Materials, we invested more than 2.0 billion yen at our Kobuchizawa Works to increase production of butyl tape for construction. This product is used in high-value-added applications such as airtight housing, and we plan for it to contribute to sales and profit from fiscal 2026 onward. In our adhesive tape business, whereas the high-value-added segment continues to grow, general-purpose products face intense price competition and pose challenges for profitability. We are therefore shifting toward high-value-added applications while implementing projects to reduce costs and strengthen sales.
　In our optical lens business, we have consolidated operations at Maxell Frontier, establishing an integrated structure that handles everything from design through manufacturing and sales. We will use this to create technological synergies, accelerate development speed, and improve business efficiency.
　EMC countermeasure components, which are under development at the New Business Producing Division, are products that absorb electromagnetic waves using films and other products containing magnetic powder, an application of technology that was originally used in products such as cassette tapes. The growing number of communication devices has led to a surge in data traffic, while the shift to higher frequencies to improve communication speeds has increased electromagnetic interference issues. This has heightened the need for electromagnetic shielding and noise countermeasures that prevent devices from being affected by outside interference and also from affecting other devices. We began shipping samples for customers' final products in April 2026 and are working to achieve commercialization as soon as possible, while leveraging existing facilities to hold down initial investment.

■Actively pursuing M&A and partnerships to accelerate growth

For details of our financial strategy for balancing investment and shareholder returns
Message from the Financial and HR Director

■Strengthening our management foundation and governance

We will work to integrate Maxell Sakura Co., Ltd., which has newly joined our Group, and ensure that it shares our MVVSS and moves toward the same goals with us. We sense the youthfulness of its employees and the vitality of its organization, and we believe there is significant potential for synergy in human resources as well.
　We will also strengthen our structure in overseas markets, which account for half of our Group's net sales. To understand and solve our customers' issues, it is important to communicate with local stakeholders at our front-line sales and production bases, and our overseas bases play an extremely important role in this regard. As market change accelerates, we need to shift from "technology-driven" sales to "market-driven" sales that take customer feedback and market trends as the starting point and feed them back into product development. Strengthening our marketing and sales activities is part of this effort, but beyond making sales visits to customers accompanied by engineers, we are also building a framework to systematically collect and analyze market information in each region.
　Solving our customers' problems is not easy, and we must keep taking on these challenges, however difficult they may be. I tell our younger employees that continuing to take on difficult challenges leads to their own growth and to the creation of new value. We want to continue fostering a culture in which people can take on challenges even if they may fail.
　To strengthen governance, we are shifting to a monitoring model in which the Board of Directors focuses on oversight while authority for execution is delegated to executive officers. This is speeding up decision-making and enabling us to respond quickly to changes in the external environment. To enhance the effectiveness of this monitoring model, we have put in place a framework in which the responsible executive officers attend Board meetings as needed, enabling discussions that reflect an on-the-ground understanding of the business. We have also made site visits by outside directors a regular practice, further strengthening the mechanism for reflecting front-line voices in management. In addition, as of June 2026, 4 of our 7 directors are outside directors, bringing the ratio of outside directors to 57.1%.

■Steady progress in our sustainability initiatives

In terms of environmental measures, to reduce CO₂ emissions, we are focusing on improving energy efficiency, utilizing renewable energy, and introducing solar power purchase agreements (PPAs) and non-fossil fuel electricity, among other initiatives. We have set a target of more than 50% reduction by fiscal 2030 compared to fiscal 2013, and we are progressing steadily toward this goal, having achieved a 43% reduction in fiscal 2024, and a 48% reduction in fiscal 2025. In addition, as a sign of management's commitment, we are aiming to obtain SBTi (Science Based Targets initiative) validation on target for reducing greenhouse gas emissions during fiscal 2026.
　Internally, we have also established a program to recognize and award outstanding environmentally conscious products and initiatives as Eco Excellence. We are currently revising the criteria to also evaluate the orientation and potential of the technologies involved, in order to further energize these activities.

■To our stakeholders

September 2026　by Integrated Report 2026

(Japanese)

• Integrated Report
• Mid-Term Plan MEX26
• Directors