SoftBank Group Corp full year net income soars to JPY1.43tn on better Sprint performance

10 May 2017

Japan’s SoftBank Group Corp reported revenue of JPY8.901 trillion (USD78.3 billion) for the twelve months ending 31 March 2017, a marginal 0.2% improvement on the prior year, but operating profit climbed 12.9% year-on-year to JPY1.026 trillion and net income attributable to shareholders leapt to JPY1.426 trillion from JPY474.172 billion aided by cost cuts and a rise in subscribers at its US wireless unit Sprint Corp. Nevertheless, Reuters notes that Sprint, the number four player in the US market, is still loss-making and likely to merge with rival T-Mobile US; in February 2017 SoftBank was reportedly poised to cede control of Sprint to T-Mobile to clinch a deal. SoftBank CEO Masayoshi Son told reporters today: ‘We are prepared to enter talks with an open-mind about various possibilities to make the US telecoms industry truly competitive … The current US administration’s stance on the industry is far more open to deregulation than the previous administration’. The CEO said T-Mobile is a prime candidate, but noted that there are other possibilities.

In its domestic operations, SoftBank reported that net sales increased by 1.6% y-o-y to JPY3.194 trillion and adjusted EBITDA rose 3.9% to JPY1.209 trillion, fuelled by brisk growth in smartphone and SoftBank Hikari fibre-optic subscribers. Furthermore, as the low cost smartphone market expands, the company is also aggressively promoting expansion of the mobile communications service sub-brand Y!mobile. The number of cumulative mobile subscribers increased by a net 362,000 y-o-y to 32.4 million, although due to take-up of lower income Y!mobile users, telecom ARPU fell by a net JPY200 to JPY3,950 a month. Monthly churn of 1.24% in fiscal 2017 was a 0.11 pp improvement from 1.35%. Turning to broadband services, SoftBank had a total of 6.145 million connections at 31 March 2017, compared to 5.079 million a year earlier, broken down as SoftBank Hikari (direct fibre) 3.592 million, ‘Yahoo! BB Hikari with FLETS’ (1.385 million) and ‘Yahoo! BB ADSL’ (1.168 million).