Kddi Corp Unsp/Adr

Thank you. Let me share with you the financial results for the third quarter of the fiscal year ending in March 2025. I will explain these four items today, as you can see. First, let me focus on the consolidated results. The third quarter cumulatively consolidated results for the FIA ending in March 2025 enjoyed a good progress in line with the full-year forecast. The left shows the operating revenue, which was 4,364.2 billion yen, up 2.3% year-on-year. The progress ratio was 75.6% versus the full-year forecast. The centre shows the operating income, which was 864.6 billion yen, up 2.0% year-on-year. The progress ratio was 77.9%. The right shows the net income with a progress ratio of 77.8%. Excluding a temporary impact due to reorganisation of subsidiaries and affiliates, it was plus 0.6% year-on-year. Next, let me explain factors for change in the consolidated operating income. The consolidated operating income grew with the steady increases of communications output revenues and main businesses such as finance, energy, and DX, as well as brisk performance of Lawson. From the left group, MVNO and Rakuten Roaming Revenues, were minus 12.2 billion yen year only. Multi-brand communications upper revenues were up 3.5 billion yen. Financial business and energy business combined were plus 12.6 billion yen. Lawson's equity method accounted income was up 18.2 billion yen. DX and business services segment were plus 12.3 billion yen. The income increased 16.9 billion yen by absorbing technology costs and an increase in sales promotion and advertising costs. Next. Next on personal services segment. First to... On total ARPU revenues, both communications and value-added ARPU revenues increased. The communications ARPU revenues up to the third quarter were plus 3.5 billion yen year-on-year. Value-added ARPU revenues was plus 27.9 billion yen year-on-year. As for the outlook for the fourth quarter communications ARPU revenue, we are forecasting an increase in revenue with new plans in Yuku Mobile and AU. Next, on smartphone... Subscriptions and churn rates. Please look at the left. The number of smartphone subscriptions, which is a growth foundation for upper revenues, has been steadily increasing. The right shows an increased mobility due to intensifying competition. While the multi-brand churn rate has increased, the EU churn rate has been maintained low. Next is about momentum. Please look at the left. Last November and December, we introduced a competitive competition Komi Komi Plan Plus in UQ mobile and Money Activity Plan Plus in AU under new topping in purple, where virtually 30 gigabytes can be used per month at the least expensive price in the industry. Moving to the right with these new plans, monthly net addition of the multi-brand idea has recovered the momentum since November. Concerning the total ARPU, we are maintaining an increasing trend for both communications and value-added ARPU. Please look at the right. Value-added ARPU increased mainly in finance and settlements, helped also by money activity plan. As for communications ARPU, by brand, it was plus 2.1% year-on-year in AU, plus 3.3% in UQ mobile. Both are growing. The migration from UQ Mobile to AU will have a steady increase of 1.5 times year-on-year. To expand TOTO APU, we'll be exercising synergy of communications times finance. Please look at the left. We have updated well-accepted money activity plan to be more attractive, making it easier to accumulate PONTA points. We aim to increase the ratio of unlimited plan and to foster utilization of value-added services while increasing the number of subscriptions. Please look at the right. We know from the track record that compared with other unlimited plans, AU money activity plan is effective in increasing the frequency of each financial service usage. With a more attractive AU Money Activity Plan Plus, we intend to further expand our customer base, accelerating the growth of AU Financial Group. Our collaborative initiatives with Lawson are also progressing. The left shows Ponder Pass, which has been well received since the launch in October. New acquisitions increased about 20% quarter on quarter. Customers using other carriers increasingly enrolled as Ponta Pass members. Pover Data Oasis has also been well received. Total 100,000 people are using it at more than 90% of Lawson stores. We are planning to start eSIM sales at all Lawson stores soon. Please look at the right. These initiatives are working, and the number of visitors to Lawson has been rising, contributing to the expansion of Lawson daily sales, which is plus 3.4% year on year. Lawson has a target of 30% reduction of store operations by 2030. It has started thinking about a target for daily sales to increase as well. We continue to strengthen collaborative initiatives for communications times convenience stores, realising the growth of the two companies. We'll continue to strengthen the networks. Last year, we achieved the number one in experiential quality in user experience evaluation by open signal. Please look at the left to further increase the communication quality. We started offering 5G SA service in all the sub-6 base station areas, utilizing the highest number of sub-6 base stations in Japan. In addition, as you can see in the right, we obtained a commercial license approval for direct-to-sale service DTC with the satellite completing preparation for service launch. From this spring, there will be more compatible devices. We aim to offer the service to about 2 million customers.

Next is on financial business. Left side, the customer base for our financial business is expanding steadily. AU Paycard exceeded 10 million members, and AU Jibun Bank's mortgage loan is also doing well, with cumulative loan amount exceeding 5 trillion yen, the fastest of any online bank. We are also working with Mitsubishi UFJ Financial Group to promote initiatives to utilize AI, as you see on the right side. In addition to developing finance specialized LLM and using it to propose financial services to customers, we will build a next generation remote customer service platform that utilizes convenience stores and other facilities to expand customer touchpoints for financial services and promote service reform. Next is on business services segment. Business services segment is expanding steadily, driven by growth area. Left side, year-to-date consolidated operating revenue for FY March 25 reached 1 trillion 12 billion yen, driven by 19.9% year-on-year growth in the growth area. iot related services are showing particularly strong growth in the growth area right side operating revenue was 122 billion yen up 20.8 percent year-on-year and the cumulative iot connections were up 22.2 percent year-on-year showing steady growth Next, let me explain Wacom Cross, a business platform for the AI era. At Wacom Cross, we are refining our strength by adding operational and security values on our communication and AI infrastructure. We will leverage these strengths to promote scaling of industrial DX solutions and AI utilization. Next is enhancing strength of Wacom Cross. As shown on the left, we deployed Connectin on a full scale in January 2025 by integrating communications into all products and services with our partners. we will expand Wacom Cross communications infrastructure and contribute to creating added value for our customers with our operational strengths. Right side, security becomes even more important in the era where communication and AI are integrated into all products and services. In order to strengthen our security business, we may lack a wholly owned subsidiary to integrate communication and security. We will support our customers' digitalization through these initiatives. Industry solution use cases are also increasing. Left side, in facility solutions aimed at digitalizing offices, we provide comprehensive services from interior to ICT infrastructure with group cooperation and partnering. there is a strong demand for integrated solutions with communications. And with inquiries from major e-commerce companies, our operating revenue for FY March 25 is growing steadily, up over 50% year on year. In order to achieve further growth, We will use the opening of Takanawa Gateway City, where our new headquarters will be relocated, as an opportunity to expand digitalization beyond our office to include buildings and entire towns using our own initiatives as a model case. Next is on AI utilization. Tama Data Center on the left began operating GPUs, and preparations to provide AI services are progressing steadily. In addition, to meet the growing demand for GPUs, we decided to introduce NVIDIA's latest GPU, which offers significantly higher performance than conventional GPUs at former Sakai plant site, which is scheduled to begin full-scale operation next fiscal year. We will make full use of this AI platform to accelerate our customers' digitalization cross. Next is on enhancing the power to connect. We are committed to developing future talent towards a society in which anyone can make their dreams a reality, which is our goal in KDDI Vision 2030. Specifically, we have held online instructions by professional soccer players, face-to-face interactions, and cashless school festivals at 100 schools to provide financial education to students. Furthermore, at the Osaka Kansai Expo, which will be held from April this year, Future City Pavilion will be providing visitors with experience of creating the future. Next is on MWC Barcelona 2025. Following on from last year, KDDI will exhibit from March 3rd to 6th. In addition to introducing our initiatives in communications and AI, retail tech, and mobility, we will also give a keynote speech on the first day of MWC. So please look forward to it. Toward KDDI Vision 2030, we have many initiatives coming up this year, including our new HQ relocation, next-generation convenience stores, and direct-to-sell service. We will further enhance the power to connect with AI to deliver exciting future vision. To realize the future society I've described so far, we need a high value-added economic circulation. As you know, thanks to various policies, pricing in Japan is considered to be among the lowest among the developed countries globally. In addition, telecom carriers are striving to create an environment with high connectivity quality through friendly competition. As the use of AI becomes commonplace in the future, the ICT industry will support it by responding to further traffic increases, disasters, and security measures. On the other hand, outsourcing costs to partners who build facilities and operation-related costs are rising, and we are being asked to negotiate fair transaction prices and pricing pass-through. We believe it is necessary to promote a virtuous economic cycle where we provide valuable services, including value-added services, to customers, receive payment in accordance with that value, and use it to further invest. We want to contribute to a virtuous cycle of economy supported by co-creation with such partners and the realization of sustainable future society. Lastly, today's summary. Consolidated results for the three quarters of FY March 25 are progressing in line with the full year forecasts. In addition to steady growth in major businesses, Lawson performs strongly. In personal services segment, total ARPU revenues increased steadily. New pricing plans are introduced for multi-brand, and both communications and value-added ARPU revenues are expected to grow. We will promote initiatives of communications and value-added services, such as financial services and Lawson, to generate synergy. In business services segment, growth area is expanding steadily, driving growth. In addition... We will strengthen communications, AI infrastructure, operations, and security, which support Wacom Cross. We will strengthen our initiatives for the future to achieve sustainable growth and enhance the power to connect with our partners in order to realize a sustainable society.

Thank you very much for your attention.