Declining ARPU again hit NTT Docomo’s bottom-line in the first six months of its fiscal year, a result of aggressive promotions to migrate customers to lower price plans introduced to comply with new regulations.
Net profit for the April to September period dropped 8.5 per cent year-on-year to JPY372 billion ($3.42 billion). Total operating revenue fell 2.5 per cent to JPY2.33 trillion, with mobile service turnover declining 2.6 per cent to JPY1.4 trillion.
For the full fiscal year ending 31 March 2020, the market leader in Japan expects continued weakness, forecasting mobile revenue to decline 4.3 per cent from the previous year to JPY2.72 trillion and operating profit to fall 18 per cent to JPY830 billion.
While its mobile subscriber base increased 2.8 per cent to 79.2 million at end-September, ARPU dropped 3 per cent to JPY5,140. LTE penetration reached 74 per cent, up from 68 per cent at end-September 2018.
Its smart life business grew 13.8 per cent to JPY253 billion. Equipment sales were down 18.6 per cent to JPY318 billon.
The operator, which introduced pre-commercial 5G service in 40 locations on 20 September, aims to expand the service to 47 prefectures by end-June 2020 and deploy 10,000 base stations by mid-2021. It is rolling out 5G on the 3.7GHz, 4.5GHz and 28GHz bands.
The company plans to terminate its 3G FOMA service, which by the close of the period still had about 21,000 subscribers, on 31 March 2026.
Capex was down 14.5 per cent to JPY218 billion.
Despite its planned 5G investment, capex for the full fiscal year is forecast to decrease 4 per cent to JPY570 billion It is targeting total cost savings of JPY130 billion for the year after cutting expenses in H1 by JPY40 billion.Subscribe to our daily newsletter Back