Docomo adds 10M LTE customers

Docomo highlights LTE growth but profit, revenue fall

04 NOV 2014

Japanese operator NTT Docomo has expanded its LTE user base by almost 10 million over the past year and now has 26.22 million LTE customers. About 1.3 million of those subscribers have purchased VoLTE-enabled handsets.

Almost 45 per cent of its 61 million mobile connections are LTE. It had 1.19 million net adds during the April-September period compared to just 240,000 a year earlier.

Almost 90 per cent of its 26.4 million smartphone customers are LTE customers. It sold 6.76 million smartphones in its fiscal H1, up 7 per cent from the previous year. Sales of tablets jumped 60 per cent to 720,000 units.

To support the growing LTE user base, Docomo increased the number of LTE base stations 20 per cent to 79,000 in Q2 and aims to deploy 95,300 by the end of next March (its end of the FY 2014). A quarter of the base stations support download speeds of 100MB/s or higher (up from 16 per cent at the end of June) and by March 42 per cent will support those speeds.

Capex, however, decreased in H1 9.2 per cent to JPY292.5 billion (US$2.6 billion).

Aggregate ARPU (its broadest measure which includes voice, packet and ‘Smart’ ARPU) was down 5.8 per cent to JPY4,410 ($40.43), while churn fell to 0.62 per cent from 0.86 per cent a year ago.

In the face of increased competition from rivals SoftBank and KDDI, in February Docomo plans to begin selling combined fibre and mobile packages at a discount. It will use its parent company fibre network to offer broadband speeds of up to 1Gb/s for the ‘Docomo Hikari packs’.

During its fiscal H1 overall revenue declined 1.2 per cent to JPY2.17 trillion ($19.9 billion), with mobile service revenue falling 3.4 per cent to JPY1.82 trillion. Operating expenses rose 2.75 per cent to JPY1.77 trillion.

Net income dropped 13.6 per cent to JPY259 billion, and its EBTIDA margin fell to 34.2 per cent from 37.6 in H1 2013. The company attributed much of the income fall to the impact of migrating customers to new billing plans, which will continue to be a drag on earnings for the next six months.

Its forecast for the full fiscal year (ending March 31) is a 1.4 per cent fall in revenue to JPY4.4 trillion and a 9.6 per cent decrease in net income to JPY420 billion.

Author

Joseph Waring

Joseph Waring joins Mobile World Live as the Asia editor for its new Asia channel. Before joining the GSMA, Joseph was group editor for Telecom Asia for more than ten years. In addition to writing features, news and blogs, he...

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