KDDI, the second largest mobile operator in Japan by subscribers, reported weak results for its fiscal Q3 as growth in new business areas couldn’t offset a slide in mobile revenue and a double-digit fall in handset sales.
The operator’s net profit for the quarter ending 31 December dipped marginally year-on-year to JPY160 billion ($1.47 billion), which the company attributed to higher profit from its growing business services sector despite continued weakness in its mobile business. Operating revenue fell 2.6 per cent to JPY1.31 trillion.
A 21 per cent increase in Life Design value-added revenue (covering media content and e-commerce) to JPY53.1 billion helped offset a 1.6 per cent decline in mobile turnover to JPY432 billion. MVNO revenue nearly doubled to JPY12.2 billion. Handset sales were down 13 per cent to JPY276 billion.
KDDI said to drive future business it is promoting “integration of telecommunications and life design” in the commerce, energy and education businesses, and taking steps to expand Life Design Services.
Revenue from its business services segment rose 7.4 per cent year-on-year to JPY198 billion, while global services revenue decreased 23 per cent to JPY46.5 billion.
Subscribers to its au mobile service increased by nearly 4 million year-on-year to end December at 54.3 million. Average revenue per account (ARPA) dipped slightly to JPY5,870. Valued-added ARPA for its Life Design Services was up 22 per cent to JPY720.
The company offered little detail on its 5G launch plans, but said in its earnings statement: “We will work with a wide range of partners to accelerate technology testing and drive the creation of new services leveraging 5G, aiming for the start of services in some areas in 2019.”Subscribe to our daily newsletter