KDDI Corporation (OTCPK:KDDIY) Q4 2022 Earnings Conference Call May 13, 2022 4:30 AM ET Company Participants Ikuko Hongou - General Manager, Investor Relations Makoto Takahashi - President Shinichi Muramoto - Executive Vice President & Executive Director, Corporate Sector Keiichi Mori - Senior Managing Executive Officer & Executive Director, Solutions Business Sector Toshitake Amamiya - Managing Executive Officer & Executive Director, Personal Business Conference Call Participants Daisaku Masuno - Nomura Se ...

Tomorrow, Together | --- | --- | --- | --- | |----------------------------------------------------------------------------|-------|-------|-------| | | | | | | Financial Results for the Fiscal Year Ending March 2022 May 13, 2022 | | | | | KDDI Corporation | | | | | President | | | | | | | | | Makoto Takahashi 1 Highlights of Consolidated Financial Results for FY22.3 Achieving sustainable profit growth and enhancing shareholder returns Promoted "the integration of telecommunications and life design," with gr ...

KDDI Corporation (OTCPK:KDDIY) Q3 2022 Earnings Conference Call January 28, 2022 3:30 AM ET Company Participants Ikuko Hongou – General Manager, Investor Relations Takashi Shoji – Executive Director, Personal Business and Global Consumer Business Sector Shinichi Muramoto – Executive Director, Corporate Sector Keiichi Mori – Executive Director, Solution Business Sector Kazuyuki Yoshimura – Executive Director, Technology Sector Conference Call Participants Yoshio Ando – Daiwa Securities Co., Ltd. Daisaku Masu ...

Financial Data and Key Metrics Changes - Operating income for the first half was ¥573.1 billion, achieving 54.6% of the full-year forecast, with revenue increasing but operating income decreasing [7][27] - Multi-brand communications ARPU revenue declined by ¥30.4 billion, while mobile communications revenues increased by ¥11.7 billion due to Group MVNO and roaming revenues [8][9] Business Line Data and Key Metrics Changes - Life Design Domain operating income was ¥120 billion, up ¥10 billion year-on-year, driven by a ¥4.9 billion increase in the financial business [17] - Business Services segment operating income was ¥92.3 billion, with a steady progress rate of 50.1% towards the full-year forecast [18] Market Data and Key Metrics Changes - Cumulative 5G unit sales reached 4.7 million by the end of September, with a target of 8 million units by the end of March 2022 [11] - The number of au PAY members increased by 4.3 million year-on-year, and au PAY Card members increased by 1.2 million year-on-year to 7 million [21] Company Strategy and Development Direction - The company aims to promote 5G with a multi-brand strategy, enhancing customer experience by focusing on areas frequented by customers [28] - The company is focusing on strengthening service collaboration within the Life Design Domain and expanding the Business Services segment through IoT [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the competitive environment and demographic challenges, emphasizing the need for creativity in customer engagement and service deployment [70] - The company expects to achieve its full-year targets despite lower telecom revenues, with growth anticipated in both Life Design Domain and Business Services segments [27][56] Other Important Information - The company is targeting carbon neutrality by 2030, aiming to cut CO2 emissions by 50% compared to FY 2019 [24] - The company plans to expand its DX personnel to 4,000 members by March 2024 to support growth in key segments [26] Q&A Session Summary Question: Improvement in group ID numbers in Q2 - Management noted a net decline of 20,000 in Q1 but expected positive net additions in Q2, with good prospects for growth in the third and fourth quarters [33][35] Question: Trends for povo and its initial user reactions - The number of povo subscriptions exceeded 1 million, with a growth rate of about 100,000 per month, and initial user reactions were positive [37][38] Question: Churn rate trends for au and UQ mobile - The churn rate in Q2 was 0.74, and management expressed the need for further reduction, noting that subscribers remained with au more than expected [46][50] Question: Impact of mobile service price reductions - The impact of price cuts was estimated at ¥30.4 billion, aligning with expectations, and management indicated that roaming revenues would help offset this decline [53][54] Question: Growth in Business Services segment - Management acknowledged that the growth in the Business Services segment was not as high as expected but anticipated better performance in the second half due to the absence of one-off factors [83][86] Question: Impact of energy costs on telecom business - Management indicated that the impact of rising energy costs on the telecom business would be minimal due to bilateral contracts and energy-saving technologies [95]

Financial Results for the 1st Half of the Fiscal Year Ending March 2022 (from April to September 2021) October 29, 2021 Makoto Takahashi President KDDI Corporation Index 1. Consolidated Financial Results for the 1st Half 2. Multi-Brand Strategy 3. Growth Fields 4. Initiatives for Non-Financial Activities 1. Consolidated Financial Results for the 1st Half Highlights of Consolidated Financial Results for the 1st Half Steady progress towards full-year forecast Operating Revenue Operating Income | --- | --- | | ...

Financial Data and Key Metrics Changes - KDDI's operating income increased by ¥8.5 billion year-on-year, despite a drop in multi-brand communications ARPU revenue by ¥11.7 billion [7][8] - The net decrease in revenue from telecommunication charges is expected to be around ¥60 billion to ¥70 billion for the full year [9][10] - Overall, operating revenue and profits increased by offsetting the effects of lower telecommunications revenues through growth in other fields [26][27] Business Line Data and Key Metrics Changes - The Life Design Domain, a core service area, saw transaction volumes of settlements on loans grow by 1.3 times year-on-year, reaching ¥2.5 trillion [16][17] - The Business Services segment's operating revenues increased by 18% year-on-year, driven by Corporate DX, Business DX, and business infrastructure services [20][21] - The financial business within the Life Design Domain is identified as a growth driver, with significant increases in mortgage loan disbursements [16][17] Market Data and Key Metrics Changes - The total cumulative number of 5G units sold exceeded 3.4 million, with a steady increase of 1 million units in just three months [15] - au PAY smartphone settlements membership exceeded 33 million, indicating strong customer engagement in the au Economic Zone [18] Company Strategy and Development Direction - KDDI's growth strategy focuses on enhancing customer engagement, expanding in growth fields, and promoting 5G services while cutting costs [10][11] - The company aims to strengthen its multi-brand strategy and integrate telecommunications with life design services [12][13] - KDDI is committed to achieving sustainable growth through structural reforms and cost reductions, including the discontinuation of 3G services [9][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the competitive environment in telecommunications and emphasized the need to enhance customer engagement to achieve sustainable growth [10][11] - The company is optimistic about achieving its full-year forecast despite challenges, citing improvements in customer churn rates since April [34][56] Other Important Information - KDDI has revised its green plan to achieve zero CO2 emissions by 2050 and aims to reduce emissions by 50% by 2030 compared to fiscal year 2019 [24][25] - The company is actively pursuing initiatives to reduce power consumption at base stations and data centers [25] Q&A Session Summary Question: Mobile telecom service revenue and multi-brand strategy - The reduction of ¥11.7 billion in mobile telecom revenue is linked to a decline in group IDs, but overall mobile telecom revenue is performing well due to increased roaming service revenue [31][32][34] Question: Cost reduction progress and life design growth - Cost reduction efforts are on track, with marketing costs being a significant factor. The Life Design Domain has seen income increases across various segments, including financial services and electricity [36][38] Question: Churn rate and measures to improve it - The churn rate has improved from 0.8% to 0.6%, with UQ mobile's popularity contributing to this trend. Management plans to continue enhancing sales operations and customer engagement [42][46] Question: Breakdown of income factors in the business services segment - A one-time income from real estate transactions last year contributed significantly to the previous year's results, while ongoing growth in the data center business is expected [72][87] Question: Competitiveness of MVNO brands - Both J:COM and BIGLOBE are experiencing growth in revenue and IDs, with J:COM leveraging its cable TV subscriber base and BIGLOBE launching new price plans to remain competitive [75][79]

Financial Performance - KDDI's operating revenue for FY22.3 Q1 increased to ¥1,300.3 billion, with a progress rate of 24.3% towards the full-year forecast[3] - Operating income for FY22.3 Q1 increased to ¥299.2 billion, showing a progress rate of 28.5% towards the full-year forecast[5] - Growth fields contributed +¥12.6 billion to operating income, offsetting lower telecommunication revenues[8] - Business Services segment operating income increased by +¥7.5 billion, demonstrating steady growth[8] Growth Strategies and Initiatives - KDDI aims for sustainable growth by addressing key issues in the telecommunications business, including decreasing telecommunication charges revenue by ¥60-70 billion[15] - The company is expanding the "au Economic Zone" through customer contact and broader point circulation in the Life Design Domain[20] - KDDI is actively promoting 5G use through multiple brands, including UQ mobile, and expanding 5G coverage along rail lines[28, 33] - The company is enhancing customer engagement by strengthening customer contact points and providing new added value in the Life Design Domain[82] Business Services Segment - NEXT Core Business in the Business Services segment experienced significant growth, with operating revenue increasing by 18% year-over-year[57, 58] - KDDI is supporting customers' DX on a global basis, leveraging its IoT results and experience[60, 61] Sustainability - KDDI is committed to reducing CO2 emissions by 50% in FY2030 compared to FY2019 and aims for substantially zero emissions by 2050[75, 77]

KDDI Corporation (OTCPK:KDDIF) Q4 2021 Earnings Conference Call May 14, 2021 4:30 AM ET Company Participants Ikuko Hongou - General Manager, Investor Relations Department Makoto Takahashi - President Shinichi Muramoto - Executive Vice President, Executive Director of Corporate Sector Takashi Shoji - Executive Vice President, Executive Director, Personal Business & Global Consumer Business Sector Keiichi Mori - Senior Managing Executive Officer Executive Director of Solution Business Sector Conference Call P ...

Financial Results for the Fiscal Year Ended March 2021 (from April 2020 to March 2021) May 14, 2021 Makoto Takahashi President KDDI Corporation Index 1. Financial Results for FY21.3 | --- | --- | --- | --- | |-------|-----------------|--------------------------------|-------| | | | | | | | | | | | 2. | Growth Strategy | | | | | | | | | | | | | | 3. | | Personal Services segment | | | | | | | | 4. | | Corporate Value and SDGs | | | 5. | | Financial Forecasts for FY22.3 | | 1. Financial Results for FY21.3 Fin ...

Financial Data and Key Metrics Changes - Consolidated operating revenues for the first three quarters were JPY 3,923.8 billion, up 0.5% year-on-year [6] - Operating income was JPY 871 billion, up 3.2% year-on-year [6] - Cumulative consolidated operating income increased by JPY 27.2 billion, driven by growth in Life Design domain and Energy business [7][8] Business Line Data and Key Metrics Changes - Life Design domain sales for three quarters were JPY 940 billion, with a progress ratio of 72.9% towards the full-year target [8] - Business Services segment operating revenues for three quarters were JPY 722 billion, with a progress ratio of 76.0% [9] - Personal Services segment total ARPA revenues for three quarters were JPY 1,721.5 billion, with a progress ratio of 75.5% [9] Market Data and Key Metrics Changes - The number of 5G base stations is expected to reach about 50,000 by March 2022, covering 90% of the population nationwide [14] - Sales of 5G devices exceeded 1.2 million units in December [15] - The number of au PAY cardholders reached 6.1 million, indicating strong growth in cashless payment systems [20] Company Strategy and Development Direction - The company aims to promote 5G and growth fields to drive business growth [25] - New pricing plans for 5G services were introduced to cater to diverse customer needs [10][11] - The company is focusing on expanding its IoT connections and partnerships, particularly in the automotive sector [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of price cuts on revenues but emphasized the importance of sustainable growth and customer acquisition [28][29] - The company expects to achieve a JPY 100 billion cost reduction in the next fiscal year, contributing to performance [29][60] - Management remains optimistic about the growth potential in Life Design and Business Services despite some anticipated slowdowns due to COVID-19 [53][54] Other Important Information - The company is actively promoting digital transformation and regional revitalization projects [24] - Initiatives in non-financial areas include a new HR system to enhance employee productivity and work styles [23] Q&A Session Summary Question: Impact of price cuts on revenue and cost reduction areas - Management acknowledged that price cuts would have a revenue impact but emphasized the focus on sustainable growth and cost reduction initiatives [28][29] Question: Changes in growth initiatives in recent months - Management indicated that Life Design and Business Services have shown steady growth, with ongoing efforts to enhance service offerings [35][38] Question: Specific businesses driving profit increases - Strong performance in mobile services and a subsidiary focused on small- and medium-sized enterprises contributed to profit growth [44] Question: Expectations for subscriber movement between brands - Management expects some customers to move from au to UQ and Poco, with attractive pricing and services [48] Question: Cost reduction progress towards JPY 100 billion target - Management confirmed that most of the cost reductions would manifest in the next business year, with some realized this year [60][61] Question: Energy business profit margin outlook - Management explained the complexities of the energy market and efforts to minimize risks associated with wholesale power market fluctuations [66]