2019_1q_omron_e

12/36 Business Environment by Segment: From Q2 Onward

We show here our outlook for the operating environment by business segment. In the short-term we have seen increased uncertainty as a result of US-China trade friction. From July, we feel the level of uncertainty has escalated. However, we believe that the medium- to long-term secular trends remain unchanged, such as continued investing in automation, which supports IAB, and rising health consciousness, which is favorable for HCB. This will continue to generate more growth opportunities for OMRON. We remain committed to executing on the initiatives for medium- to long-term growth as outlined in our initial action plan. That said, we believe it behooves us to be vigilant in the face of heightened uncertainty. We will be monitoring trends closely to ensure we are prepared to respond to any changes in the operating environment. At IAB, while we expect to see continued weakness in smart phone-related investments in Q2 and beyond, the other digital industries, primarily semiconductors, should remain firm. The automotive, food & beverage and social infrastructure industries should also remain firm. At HCB, we expect continued strength in the online channel, primarily in the emerging markets.