Announcement Regarding Current Status of Domestic AI Server Production and AI Infrastructure Supply Construction

StarSeas (Headquarters: Minato-ku, Tokyo; Representative Director and President: Masayuki Suzuki; TSE Standard Market: 3083; hereinafter referred to as 'the Company') announces that it is accelerating efforts to build a domestic production system for high-performance AI servers and a supply chain network for AI infrastructure.

In recent years, the rapid adoption of generative AI and Large Language Models (LLMs) has led to a global surge in demand for GPU computing resources and AI data centers. Meanwhile, Japan faces various challenges concerning its AI infrastructure, including a shortage of high-performance computing platforms, supply risks for components, and power efficiency requirements.

In this environment, the Company has positioned the AI infrastructure business as a core pillar of its medium- to long-term growth strategy. It will promote the establishment of a domestic production system and a stable supply network for AI servers through collaborations with domestic and international partners.

Key Strategies 1. Building a Domestic AI Server Production System The Company is considering establishing a production, quality control, and delivery system for AI servers in Japan in collaboration with domestic EMS (Electronic Manufacturing Services) providers. Through domestic production, the Company aims to ensure high quality and reliability, reduce lead times, mitigate geopolitical risks, and strengthen maintenance and support systems, thereby establishing a supply system capable of meeting expanding domestic demand.

2. Strengthening the AI Infrastructure Supply Chain Global supply constraints continue in the AI infrastructure sector, including GPUs, power supplies, and cooling-related components. The Company will work with domestic and international procurement partners to stabilize the supply of core components and enhance procurement capabilities to build a resilient supply chain adaptable to changes in international conditions and market environments. Furthermore, the Company is discussing potential collaborations with several domestic companies possessing strong business foundations, sales networks, and technical expertise.

3. Initiatives for High-Density and High-Efficiency AI Infrastructure Solutions With the progress of generative AI, power consumption in AI data centers is rising rapidly. The Company is developing high-efficiency server architectures for high-density GPU environments and exploring AI infrastructure solutions geared toward power optimization, aiming to contribute to TCO reduction and lower environmental impact for client companies. Looking ahead, the Company envisions integrating with data centers, power infrastructure, and grid-scale battery storage to build the next-generation infrastructure essential for the AI era.

4. New Production Line and Mass Production System Anticipating expanding domestic demand, the Company is considering the development of new production lines and a mass production system for AI server-related equipment. This initiative aims to improve production efficiency, stabilize quality, and optimize costs, thereby enhancing profitability and operating profit. Furthermore, the Company envisions expanding to multiple locations in Japan in the medium to long term.

Future Outlook The Company aims to enhance its corporate value by nurturing AI, data centers, power infrastructure, and battery storage as growth drivers, leveraging its existing business foundation. The Company believes that in the AI era, computing resources, data centers, and power infrastructure are becoming the very foundations that support society and industry. The Company views these structural changes as opportunities and is committed to contributing to the construction of AI infrastructure in Japan.

Comment from Representative Director and President Masayuki Suzuki 'We believe AI infrastructure is a critical foundation for the future digital society and industrial competitiveness. The Company will promote the construction of a high-quality and stable AI infrastructure supply system in Japan through collaboration with partners both domestically and internationally. Furthermore, we will look beyond just AI servers...'