Japan-based mobile operator KDDI reported modest profit and revenue growth for its fiscal Q1 ending 30 June, with mobile tariffs stabilising and strong subscriber growth, but faced continued declines in mobile turnover.
The operator’s net profit for the three-month period increased 3 per cent year-on-year to JPY179 billion ($1.6 billion). Operating revenue rose 1.9 per cent to JPY1.22 trillion, mainly due to a 4.9 per cent increase in handset sales and 3.8 per cent growth in its Life Design business, which covers value-added services across a range of sectors.
KDDI said higher revenue in its Myanmar business also contributed to the revenue increase, which came despite a 2.5 per cent decline in mobile communications revenue to JPY442 billion.
Revenue at its MVNO business more than doubled from a year ago to JPY9.78 billion.
The company added 3.8 million au mobile subscribers over the year, to end June with 52.9 million. Total average revenue per account (ARPA) dipped slightly year-on-year to JPY6,500, but valued-added ARPA rose 18 per cent to JPY660.
Atul Goyal, an equity analyst at Jefferies, said in a research note the operator’s churn rate was the lowest in three years thanks to the introduction of new price plans, while MVNO ARPA appears to have increased 12 per cent year-on-year to JPY1,654.
Regarding its 5G rollout plan, KDDI said in a statement it will work with a wide range of partners to accelerate technology testing and drive the creation of new services using the technology, as it aims to launch by 31 March 2020.