GREE : Summary of main supplementary explanations questions and answers at the FY2023 Third Quarter GREE results briefing held on May 11, 2023

■Summary of main supplementary explanations questions and answers at the FY2023 Third Quarter GREE results briefing held on May 11, 2023

【Q1】 Can you let us know about earnings contribution and the outlook for overseas versions of Heaven Burns Red?

【A1】 As it has only been roughly three months since the release of overseas versions of Heaven Burns Red, it is not possible to provide an accurate forecast at this time. However, overseas versions have gotten off to a quick start and we have achieved sales levels in line with the scale of the markets in which these versions were released.

【Q2】 What are the strengths of REALITY when compared with metaverse services offered by other companies?

【A2】 We see two main strengths. The first is that a large community has already been formed in REALITY. REALITY's user numbers are growing rapidly, especially overseas, and the number of global users has surpassed 10 million. In addition, many of our users visit REALITY on a daily basis. This is extremely rare among global metaverse services. REALITY's second strength is that progress has already been made in terms of monetization. Many metaverse services have been unable to achieve monetization despite having large user bases. One of REALITY's strengths is that we have achieved steady monetization via avatars and livestreams, etc.

【Q3】 How is REALITY making use of generative AI?

【A3】 Other companies operating metaverse services (such as Fortnite) have allowed users to make use of generative AI to create user-generated content (UGC), which has contributed to the expansion and development of services. We aim for REALITY to gradually evolve into a metaverse that incorporates such UGC elements. We have already begun to experimentally use AI to create 3D assets such as avatars and world elements.

【Q4】 What is the income outlook for 4Q FY2023 in the Internet and Entertainment Business? 【A4】 Due to the winding down of contribution from anniversary events for the Japanese

version of Heaven Burns Red and the release of overseas versions, we expect operating income in the Internet and Entertainment Business in 4Q of roughly ¥1.5 billion.

【Q5】 What is the income outlook for 4Q FY2023 in the Investment and Incubation Business? 【A5】 Because we have received dividend income from CVC funds in 4Q, we expect to post

operating income from already-secured sources of roughly ¥0.5 billion in the Investment and Incubation Business in 4Q.