NTT DoCoMo today reported its first decline in annual profit and lower than expected profit growth for this year. For the year that ended March 31, DoCoMo's profit was 784.17 billion yen, down 29 percent from 1.1 trillion yen a year ago. Analysts had expected a profit of 800 billion yen. The carrier's revenue also dropped 4 percent to 4.84 trillion yen. DoCoMo last year warned that revenue and profit would drop for the first time due to growing discount costs for its 3G service, FOMA. DoCoMo predicted a profit of 810 billion yen ($7.7 billion) for the new fiscal year that started April 1, compared with analysts' previous estimates of 843.3 million yen.
NTT DoCoMo is locked in a vicious 3G price war with rival KDDI. KDDI's au service has been stealing market share from DoCoMo for the last several years. Japan's government also plans to grant licenses to one or two more new carriers this year, adding to DoCoMo's competitive pressure. DoCoMo is still far and away Japan's wireless market leader, claiming 48.8 million subscribers at the end of March.
For more on DoCoMo's first ever drop in profit:
- read this article from AFX News