Hitachi (6501) Investor Day 2024 summary

Strategic direction and transformation

• Shifted from a conglomerate to a digital-centric company, focusing on organic growth, value creation through innovation, and expanding Lumada's business share from 21% in FY21 to 29% in FY24, leveraging generative AI, DX, and GX tailwinds.

• Targeting global leadership in social innovation, with open innovation, global partnerships, and corporate venturing to address social issues and drive enterprise value.

• Emphasis on disciplined growth investments, portfolio simplification, asset-light strategies, and capital efficiency, supported by ongoing asset sales, M&A, and enhanced governance.

• Regional strategies balance local opportunities and risks across North America, Europe, Asia, China, and Japan, leveraging a One Hitachi approach.

• Focus on adaptability to technological and societal turning points, with ongoing investment in R&D, corporate venturing, and ecosystem partnerships.

Digital and AI-driven growth

• Lumada is central to growth, with rapid expansion in digital systems and services, cloud-managed services, and integration of generative AI to boost productivity and create new business models.

• GlobalLogic drives synergy and leads AI initiatives, including internal productivity tools and customer-facing solutions.

• Strategic alliances with major tech partners (NVIDIA, Microsoft, Google Cloud, AWS) accelerate AI solution development and talent expansion.

• Planned JPY 300 billion investment in FY2024 for generative AI infrastructure, services, and talent, aiming to advance Lumada and overall group growth.

• Digital transformation is applied across sectors, from energy and mobility to healthcare and manufacturing, with recurring service models and data-driven solutions.

Green energy and mobility expansion

• Major investments totaling $6 billion by 2027 in energy transition, grid capacity, and digital services, with a focus on decarbonization, energy security, and supporting data center growth.

• Ambition to triple Hitachi Energy's service business by 2030, leveraging a $200 billion installed base and digitalization of services.

• Acquisition of Thales GTS in May 2024 expands rail control and digital mobility capabilities, targeting higher margins, global market coverage, and €90–95M annual EBITA synergies.

• Nuclear and battery manufacturing, as well as green building solutions, are key growth areas, supported by R&D and bolt-on M&A.

• Commitment to R&D investment (JPY 0.8 trillion in current midterm plan) to drive future green and digital opportunities.