Presentation Materials

This is President Kato of NTT DOCOMO.

In the six months ended September 30, 2013, operating revenue was 2,199 billion yen for a year-on-year decline of 8.3 billion yen, and operating income was 473.2 billion yen for a year-on-year increase of 2.0 billion yen. Although a steady expansion in new business fields, growth in the number of subscriptions to the Xi services, and proactive sales promotion of smartphones increased revenues, profit ultimately declined due to "Monthly Support", a decrease in MOU, and other factors. On the expense front, due to using varied sales promotions with our Two Top strategy, reducing the cost of equipment, and streamlining the cost to reinforce managerial foundation, we have achieved reductions of 10.4 billion yen from the same period last year and an increase in profits on a decline in revenue.

The concentration of efforts on expanding smartphone users and propagating the Xi services kept smartphone sales at 6.32 million units, on par with last year, despite total handset sales of 10.47 million, which were lower than last year. The number of Xi subscriptions also rose to 16.4 million as of the end of September, for a year-on-year increase of 10.4 million, and the number of smartphone users also showed steady expansion to 21.5 million. During the second half, we are going to achieve 24.5 million units sales target for the year with our rich lineup of handsets for the second half, including iPhone and the three recommended models.

For our network, we have used Quadband, or four frequency bands, to successfully expand areas with solid coverage and have achieved downlink speeds of up to 150 Mbps1, the fastest in the world. DOCOMO is going to be even more proactive in rolling out an accommodating network configuration in the future.

In the "dmarket," a proprietary service offered by DOCOMO, the total number of subscriptions to "dvideo," "danime," and "dhits" had surpassed 7 million as of the end of September, and the total gross billing including other stores swelled to 27 billion yen. With the inclusion of these, revenues from new business fields rose to 310 billion yen, showing strong progress toward 700 billion yen in revenues at fiscal year-end.

As a new competitive stage begins during the second half of the year, DOCOMO will fully manifest its many strengths, including "an extensive device lineup," "a reliable network supported by technical capabilities," and "a vast array of services to make the 'Smart Life' a reality," and we will enlist the entire company in the dynamic operation of our business to achieve our goal of 840 billion yen in operating income by securing competitive superiority and pursuing structural reforms.

1. In the transmission speed for the LTE network. Based on figures disclosed by each company (as of October 2013). It can be used in some areas of the Tokyo, Nagoya, and Osaka regions. Transmission speed is the maximum downlink speeds, and will vary depending on the communications environment.