NEC

Basic Information

Stock Code
6701
Industry
Electrical Equipment
Category Detail
Diversified Electrical Equipment
Prefecture
Tokyo
Establishment Year
July 1899
Listing Year
May 1949
Official Website
https://jpn.nec.com/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
Hitachi, Mitsubishi Electric, Fujitsu, Panasonic Holdings, Sharp, Sony Group

Overview

NEC is a major comprehensive electronics company founded in 1899, with strengths in communications and IT equipment, promoting the advancement of social infrastructure.

Current Situation

NEC posted consolidated sales of approximately 3.5 trillion yen and net profit of approximately 149.5 billion yen for the fiscal year ending March 2024, maintaining a solid earnings base. Centering on its mainstay system platform business and network services business, it is focusing on digital transformation utilizing AI and IoT. In the space sector, it holds about 70% of the domestic market share with a track record in developing cutting-edge artificial satellites and probes. It is also committed to sustainability, advancing business initiatives aimed at reducing environmental impact and creating social value. In the 2020s, it is concentrating on 5G infrastructure and quantum technology to enhance international competitiveness. It is strengthening its business portfolio through collaborations with competitors and M&A. Organizational reform is being promoted via management restructuring and expanded career hiring, aiming for sustainable growth in the medium to long term.

Trivia

Interesting Facts

  • Domestic's only vector-type supercomputer manufacturer.
  • Developed and successfully launched Japan's first artificial satellite 'Osumi'.
  • Manufactured the world's first sample return mission from an extraterrestrial body, 'Hayabusa'.
  • Achieved world No.1 in facial recognition benchmarks for four consecutive times.
  • Pioneered foldable mobile phone handsets.
  • Proposed the C&C (Computer & Communication) philosophy in the 1980s.
  • Once held top domestic share in mobiles and smartphones.
  • Conducting joint industry-academia research with AIST in quantum computing.
  • Numerous industry professionals and researchers awarded IEEE Fellowships and IEICE Awards.
  • Continues competition in domestic PC market via joint venture with Lenovo.

Hidden Connections

  • Although a member of the Sumitomo Group, it has a unique historical background of not using the Igeta mark.
  • Collaborated with Nissan and Casio on lithium-ion battery development, with deep ties to the automotive industry.
  • Makes broad social contributions as a sponsor of numerous sports teams and events.
  • Covers technology areas from personal computers to space development.
  • Strengthening overseas business base through international IT company acquisitions.
  • Secures high share in supplying broadcasting equipment to Japanese TV stations.
  • NEC's facial recognition technology is adopted in security systems of many government agencies.
  • Founder Kunihiko Iwatani created one of Japan's earliest joint venture establishment examples.

Future Outlook

Growth Drivers

  • Expansion of demand for 5G and Beyond 5G infrastructure development
  • Acceleration of AI, IoT, and digital transformation
  • Market expansion in space-related business and new technology development
  • Growing societal demand for cybersecurity measures
  • Practical implementation of quantum computers and quantum communications
  • Customer trust enhancement through sustainability management
  • Overseas business expansion via global M&A
  • Promotion of smartification in industry and social infrastructure
  • Growth in cloud computing services market
  • Response to technological innovations in FinTech
  • Provision of solutions addressing social challenges
  • Advanced response to next-generation communications standards and services

Strategic Goals

  • Expansion of digital transformation support domestically and internationally
  • Leadership in R&D toward practical quantum technology implementation
  • Establishment of IT platforms centered on AI and biometrics
  • Significant increase in sales ratio from space-related business
  • Expansion of products and services contributing to sustainable society
  • Maintaining superiority in global communications infrastructure business
  • Leadership in cybersecurity domestically and internationally
  • Deployment of smart city initiatives to major municipalities nationwide
  • Strengthening competitiveness in global FinTech and new financial technologies
  • Creation of innovative solutions through fusion of diverse technology fields

Business Segments

System Platforms

Overview
Provides advanced IT infrastructure and solutions to government and corporations, supporting DX.
Competitiveness
Comprehensive technological capabilities and strong domestic and international customer base
Customers
  • Government Agencies
  • Large Corporations
  • Public Organizations
  • Telecommunications Carriers
  • Financial Institutions
  • Manufacturing
  • Distribution
  • Educational Institutions
  • Medical Institutions
  • Infrastructure Operators
Products
  • Mainframe Computers
  • Servers
  • Storage
  • Cloud Services
  • System Integration
  • Data Center Services
  • ERP Software
  • Security Solutions
  • AI Platforms
  • IoT Solutions

Network Systems

Overview
Provides planning, manufacturing, and operational support for wired and wireless communications equipment.
Competitiveness
Advanced communications technology and long track record
Customers
  • Telecom Carriers
  • Internet Service Providers
  • Corporate Network Administrators
  • Broadcasters
  • Public Communications Operators
  • Data Center Operators
  • Financial Network Administrators
Products
  • Mobile Base Stations
  • Fixed Communications Equipment
  • IP Phone Systems
  • Optical Communications Equipment
  • Network Management Software
  • 5G Solutions
  • SDN Equipment
  • Wireless Communications Equipment

Space and Aviation Systems

Overview
Designs, manufactures, and supports operations of artificial satellites and probes.
Competitiveness
Overwhelming technological prowess with about 70% domestic market share
Customers
  • Space Agencies
  • Ministry of Defense
  • International Research Institutions
  • Commercial Satellite Operators
  • Rocket Development Companies
Products
  • Satellite Onboard Equipment
  • Space Probes
  • Ground Observation Systems
  • Aerospace Communications Equipment
  • Robotics Control Systems

IT Security and AI Applications

Overview
Provides advanced solutions integrating AI and security technologies.
Competitiveness
World-leading facial recognition technology and diverse biometrics
Customers
  • Financial Institutions
  • Government Agencies
  • Manufacturing
  • Distribution
  • Information and Communications
Products
  • Biometric Authentication Systems
  • Facial Recognition Technology
  • Cybersecurity Software
  • AI Image Analysis
  • Natural Language Processing Solutions

Energy-Related Equipment

Overview
Provides next-generation energy management systems and automotive batteries.
Competitiveness
High development capabilities in energy storage technology
Customers
  • Electric Power Companies
  • Renewable Energy Operators
  • Automakers
  • Infrastructure Operators
Products
  • Energy Storage Systems
  • HEMS Equipment
  • EV Charging Infrastructure
  • Smart Grid Related
  • Lithium-Ion Batteries

Industrial Solutions

Overview
Supports IoT adoption in industry to promote efficiency.
Competitiveness
System integration technology and AI utilization
Customers
  • Manufacturing
  • Logistics Companies
  • Retail
  • Construction
Products
  • Factory IoT Services
  • Logistics Management Systems
  • ERP for Manufacturing
  • Industrial Robots
  • Automated Inspection Systems

Education and Healthcare Solutions

Overview
Deploys optimized ICT services for education and healthcare settings.
Competitiveness
Comprehensive industry-specific software suite
Customers
  • Educational Institutions
  • Medical Institutions
  • Research Institutes
  • Local Governments
Products
  • Educational ICT Systems
  • Electronic Medical Records
  • Medical Information Management
  • Remote Learning Platforms
  • IT Services for Elderly Care

Financial Technology

Overview
Supports innovation and business efficiency in the financial sector.
Competitiveness
Pioneering technology development in FinTech
Customers
  • Banks
  • Securities Firms
  • Financial Services Companies
  • Insurance Companies
Products
  • Payment Systems
  • Blockchain Development
  • Risk Management Solutions
  • Transaction Monitors
  • Financial Data Analysis

Broadcasting Equipment

Overview
Supplies transmission equipment and master control devices to broadcasters.
Competitiveness
Proven track record and reliability with numerous TV stations
Customers
  • TV Stations
  • Radio Stations
  • Broadcast Equipment Operators
Products
  • TV Master Control Equipment
  • CM Bank Systems
  • Digital Transmitters
  • Radio Transmission Equipment

Peripherals

Overview
Provides diverse peripheral equipment for offices and schools.
Competitiveness
Advanced electronic equipment development and maintenance systems
Customers
  • General Consumers
  • Offices
  • Educational Institutions
Products
  • Multifunction Devices and Faxes
  • Electronic Whiteboards
  • OCR Systems
  • Printers
  • Projectors

Mobility Services

Overview
Deploys IT and communications solutions for automotive and transportation sectors.
Competitiveness
Cutting-edge technology from integration of communications and IT
Customers
  • Automakers
  • Public Transportation
  • Logistics Companies
Products
  • Advanced Driver Assistance Systems
  • Car Connectivity
  • MaaS Platforms
  • Charging Infrastructure Integration Services

Industrial Machinery

Overview
Provides a wide range of electronic components and control equipment for industry.
Competitiveness
High-quality semiconductor and electronic component manufacturing technology
Customers
  • Manufacturing Plants
  • Electronic Component Manufacturers
  • Automotive Parts Manufacturing
Products
  • Control Equipment
  • Sensors
  • Electronic Components
  • Relays
  • RFID Systems

Competitive Advantage

Strengths

  • Abundant enterprise IT and communications technology
  • Powerful sales network spanning Japan and overseas
  • Strong track record in space development
  • World-top-level biometric and AI technology
  • Diversified business portfolio
  • Robust sustainability promotion framework
  • Long-term R&D investment
  • Diverse customer base and industry knowledge
  • Solid financial foundation
  • Strengthened governance as a company with nominating committee, etc.

Competitive Advantages

  • World's only vector-type supercomputer manufacturer
  • Domestic development capabilities for space-related equipment with ~70% share
  • Overwhelming share in domestic communications network equipment
  • World No.1 facial recognition technology and diverse biometric services
  • Successful transition to AI and IT platform business
  • Pioneering R&D in 5G and Beyond 5G technologies
  • Enhanced governance and management transparency
  • Accelerated DX promotion through collaborations with major domestic firms
  • Overseas business strengthening via global M&A
  • Broad product lineup responding to diverse market needs

Threats

  • Intense competition in global communications equipment market
  • Market share erosion from low-price offensives by Chinese firms
  • Risk of delays in responding to rapid technological innovation
  • International economic and political risks (e.g., trade friction)
  • Challenges in talent acquisition and technology succession
  • Innovation pressure from emerging companies
  • Increasing cybersecurity risks
  • Changes in FinTech-related regulations
  • Fluctuations in space development budgets and intensifying competition
  • Business impacts from natural disasters or pandemics

Innovations

2024: Advancing quantum computer technology research

Overview
Jointly developing and researching quantum utilization technology with the National Institute of Advanced Industrial Science and Technology.
Impact
Aims to establish next-generation computing infrastructure.

2023: Collaboration on 5G and Beyond 5G technologies

Overview
Strengthening ties with Samsung Electronics and NTT on 5G base stations and O-RAN development.
Impact
Contributes to expansion of 5G infrastructure domestically and internationally.

2022: Progress on AI technology brand 'NEC the WISE'

Overview
Renewal of image and natural language recognition by AI and expansion of applications.
Impact
Expands AI utilization in social infrastructure.

2021: Launch of satellite operation and image sales business

Overview
Established operations for ASNARO satellite images and entered commercial sales.
Impact
Pioneers new space-related business.

2020: Launch of hyper-converged infrastructure products

Overview
Began offering integrated server and storage solutions.
Impact
Contributes to cloud adaptation of IT infrastructure.

2020: Advancing smart city-related technologies

Overview
Developed NEC Urban OS and conducted smart city demonstrations in multiple municipalities.
Impact
Accelerates digitalization of local communities.

2021: Initiating collaboration on quantum annealing

Overview
Cooperating with D-Wave Systems toward commercialization of quantum computing technology.
Impact
Creates new computing technology services.

2023: Entry into drug discovery business using AI

Overview
Established new company to advance cancer treatment vaccine development.
Impact
Contributes to new business creation in healthcare.

2020: Strengthening blockchain technology development

Overview
Developed blockchain application products specialized for FinTech.
Impact
Contributes to secure and efficient financial services.

2022: Enhancing next-generation AI platform

Overview
Expanded services fusing AI technology and cloud infrastructure.
Impact
Supports AI adoption across diverse industries.

Sustainability

  • Strengthening internal initiatives toward carbon neutrality
  • Providing energy-saving solutions using AI technology
  • Promoting product design aimed at reducing environmental impact
  • Advancing diversity management and talent development
  • Improving sustainability in the supply chain