SoftBank first-quarter operating income soars 50% higher; unveils Twin Access mobile service

8 Aug 2017

SoftBank Group Corp reported that operating income in the fiscal first quarter ending 30 June 2017 rose 50% year-on-year to JPY479.3 billion (USD4.33 billion) from JPY319.2 billion in the corresponding year-earlier period, as net sales and EBITDA increased 3% to JPY2.186 trillion and JPY700.1 billion respectively. However, net income plummeted 98% y-o-y to JPY5.5 billion, down from JPY254.2 billion, although SoftBank noted that excluding the gain on sales of Alibaba shares in the year-earlier period and a derivative loss in relation to the monetisation of Alibaba shares, net income would have been JPY183.3 billion. First-quarter CAPEX of JPY215.7 billion marked significant growth on the JPY1490 billion spent in April-June 2016. Meanwhile, the group’s US mobile venture Sprint reported revenue of JPY910.4 billion compared to JPY873.9 billion previously, as adjusted EBITDA improved to JPY321.9 billion from JPY271.7 billion.

In its domestic operations, SoftBank reported that net sales decreased by 0.8% y-o-y to JPY755.7 billion and adjusted EBITDA fell to JPY329.5 billion from JPY351.3 billion, on continued growth in smartphone and SoftBank Hikari fibre-optic subscribers. The number of cumulative mobile subscribers increased to 32.448 million (net 362,000) from 32.149 million, although total mobile ARPU fell by a net JPY230 to JPY4,380 a month. Monthly churn was 1.13% (unchanged y-o-y). Turning to broadband services, SoftBank had a total of 6.403 million connections at 30 June 2017, compared to 5.345 million a year earlier, broken down as SoftBank Hikari (direct fibre) 4.012 million, ‘Yahoo! BB Hikari with FLET’S’ (using wholesale fibre connections from rival NTT) 1.267 million and ‘Yahoo! BB ADSL’ (1.124 million).

In a related SoftBank development, NEC Corporation has announced that it will play its part in the delivery of a reliable business-oriented mobile network-powered access service, dubbed ‘Twin Access’, for the Japanese group. Twin Access is categorised as an access service that can utilise two mobile network connections to maintain constant, active connectivity between NEC Agater AG2521 line terminal equipment and centre-based devices that foreground so-called virtualisation technology. Using Packet Copy Capsuled (PCC) technology developed jointly by the pair, Twin Access has been designed to offer improved transmission quality with higher packet delivery rates than conventional single mobile line systems, enabling more stable and reliable communications. SoftBank intends to launch the new service commercially in October this year as part of its line-up of Smart VPN services, subject to the successful completion of ongoing field trials.

Commenting on the launch plans, SoftBank Vice President Network Division, Takenori Kobayashi, commented: ‘Because of its high quality of service, Twin Access can be used at locations where fibre lines are not available, or as an alternative to wired lines such as DSL or digital access … in addition, by utilising the features of mobile networks, such as their freedom from cable installations, Twin Access makes it possible to build flexible, economical, short term networks, such as temporary networks.’