KDDI profits dip 2.5% on lower voice revenues

Japan’s second-largest operator, KDDI, has announced that its fiscal Q3 net profit fell 2.5% due to lower voice revenue and higher promotion costs.
Profits of 65.67 billion yen (€584 million) in calendar 4Q were down from 67.35 billion in 2009, as revenues fell a marginal 1% to 853.42 billion yen, and operating profits dipped 1.3% to 124.9 billion yen from 125.83 billion yen a year ago.
While the overall figures are relatively stable, KDDI’s mainstay mobile business reported an 18% fall in operating profit with a 2.5% decline in revenue. ARPU fell 9% to 4,980 yen while revenue from voice calls fell 17%.
KDDI president Takashi Tanaka hinted the firm was pinning its hopes on the smartphone boom in Japan after making a late entry last year into the segment dominated by rival Softbank’s retail of the iPhonethe Wall Street Journal reported.
“As smartphones become more widespread, we will see the data portion of the revenue increase,” said Tanaka, who indicated the company expects to hit more than one million smartphones in sales cumulatively, by end March.
KDDI’s data revenue rose 2.7% as more customers switched to smartphones. Tanaka said he expected overall ARPU to start rising through to March 2013 due to the smartphone spread.
The company said that subscribers who switched to its IS03 smartphone, which runs on Google’s Android, were responsible for a 40% increase in data ARPU since the unit launched late November.
Industry watchers have speculated that KDDI may start carrying the CDMA version of the iPhone though Tanaka declined comment.