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IPhone brings carriers record profit

by Kazuaki Nagata

Staff Writer

KDDI and Softbank said Tuesday that they posted record high sales and operating profit in the business year through March 31 thanks to the hugely popularity of the Apple iPhone, which is continuing to contribute to their growth.

Non-iPhone provider NTT DoCoMo reported last week that its sales rose 5.4 percent to ¥4.4 trillion from the previous year, but its operating profit dropped 4.3 percent to ¥837 billion. It is the first time in six years that DoCoMo’s operating profit declined from a year earlier.

The three major carriers’ business results show that the iPhone remains a growth engine.

Softbank Corp. reported sales of ¥3.3 trillion, up 5.5 percent from a year earlier, and operating profits of ¥745 billion, up 10.3 percent.

KDDI Corp.’s sales rose 2.5 percent to ¥3.6 trillion while its operating profit increased 7.3 percent to ¥512.7 billion.

Although media worldwide have reported that Apple may have lost its growth momentum as sales of iPhones slow down, KDDI President Takashi Tanaka said otherwise.

“My understanding is that (the sales of Apple’s products) have not slowed down in the Japanese market,” he said.

KDDI forecasts its sales will reach ¥4.1 trillion and its operating profit ¥630 billion in the current business year. Starting in fiscal 2013, business results of Jupiter Telecommunications Co., the nation’s biggest cable TV service provider, will be included in the KDDI group’s result.

DoCoMo, which has the largest number of subscribers — currently more than 61 million — estimated that sales will reach ¥4.64 trillion. Its operating profit is expected to stay nearly the same as that of fiscal 2012.

Softbank Chairman and CEO Masayoshi Son said his company will see more than ¥1 trillion in operating profit this year, which would exceed that of DoCoMo.

Softbank recently acquired GungHo Online Entertainment Inc., which is expected to boost its operating profit by some ¥150 billion, according to the carrier.

Softbank topped its two rivals in terms of net subscription gains in fiscal 2012 with 3.5 million subscriptions, while KDDI followed with 2.6 million. DoCoMo’s net increase was 1.4 million.

As for getting users of other carriers to defect, KDDI gained about 1 million users from other carriers, while Softbank lured some 410,000 users. DoCoMo lost 1.4 million users to its rivals.