Mobile Communications Segment

Financial data

(Millions of yen)
	FY2009	FY2010	FY2011	EOQ in FY2011
	FY2009	FY2010	FY2011	Q1	Q2	Q3	Q4
Net sales	1,562,891	1,701,414	1,944,551	441,079	498,966	518,576	485,930
EBITDA^*1	403,810	504,201	620,470	153,259	157,075	161,324	148,812
EBITDA margin (%)^*2	25.8	29.6	31.9	34.7	31.5	31.1	30.6
Operating income	171,390	260,895	402,412	102,657	104,546	107,283	87,926
Operating margin (%)	11.0	15.3	20.7	23.3	21.0	20.7	18.1
Capital expenditure (acceptance basis)	199,177	184,771	351,526	25,988	65,388	116,324	143,826
Depreciation and amortization (excluding amortization of goodwill)	161,518	176,337	156,993	36,637	37,637	40,052	42,667

[Notes]

*1EBITDA = operating income (loss) + depreciation and amortization (including amortization of goodwill) + loss on disposal of fixed assets included in operating expenses.
*2EBITDA margin = EBITDA / net sales.

Overall results

Net sales increased by 243,137 million yen (14.3%) year on year to 1,944,551 million yen, and operating income increased by 141,517 million yen (54.2%) year on year to 402,412 million yen.

The revenue growth was driven by a continued strong upward trend in the number of mobile phone subscribers combined with increases in ARPU and the number of mobile handsets shipped.

Number of mobile phone subscribers

Net Subscriber Additions by Operator^*6

Net subscriber additions^*3 (new subscribers minus cancellations) for fiscal 2011 totaled 3,532,100. This net increase was primarily the result of strong sales of iPhone.^*4 As a result, the cumulative number of subscribers^*5 at the end of fiscal 2011 stood at 25,408,700, raising SOFTBANK MOBILE's cumulative subscriber share by 1.8 percentage points year on year, to 21.3%.^*6

[Notes]

*3The number of net subscriber additions includes prepaid mobile phones and communication module service subscribers. Net communication module service subscriber additions for fiscal 2011 totaled 771,100.
*4iPhone is a trademark of Apple Inc. The iPhone trademark is used under license from Aiphone K.K.
*5The number of cumulative subscribers includes prepaid mobile phones and communication module service subscribers. The cumulative number of communication module service subscribers as of the end of fiscal 2011 was 1,308,600.
*6Calculated by the Company based on Telecommunications Carriers Association statistical data.

Number of mobile handsets sold/shipped

The number of mobile handsets sold in fiscal 2011 increased by 1,108,000 year on year to 10,242,000 and the number of handsets shipped increased by 1,199,000 year on year to 10,016,000. These increases were mainly the result of sales and shipment growth in both mobile handsets, especially iPhone, and communication modules.

ARPU

ARPU for fiscal 2011 rose 140 yen year on year to 4,210 yen. Out of this, the sum of the basic monthly charge and voice ARPU declined 160 yen year on year to 1,890 yen, reflecting an increase in devices which do not have voice communication functionality, and revised access charges between carriers. On the other hand, data ARPU rose 290 yen year on year to 2,310 yen. This was mainly the result of an increase in the number of data-intensive iPhone subscribers, combined with the after-effect of the termination of the non-data-intensive 2G service in March 2010.

Churn rate and upgrade rate

The churn rate^*7 for fiscal 2011 was 0.98%, which was 0.39 of a percentage point lower year on year. This was primarily because the churn rate was no longer inflated by the termination of the 2G service completed in March 2010, and there was a decline in the churn rate of customers who have completed installment payments for their handsets.

The upgrade rate^*7 for fiscal 2011 was 1.40%, which was 0.31 of a percentage point lower year on year. The upgrade rate was no longer inflated by upgrades from 2G to 3G seen in fiscal 2010 in association with the termination of the 2G service completed in March 2010, although the number of upgrades to iPhone 4 increased.

[Note]

*7Calculated with prepaid mobile phones and communication module service subscribers included in the number of subscribers, churn and upgrades, respectively.

Average acquisition cost per subscriber

The average acquisition cost per subscriber^*8 for fiscal 2011 declined 3,600 yen year on year to 36,900 yen. This was primarily because of an increase in the number of mobile handsets sold, especially handsets without voice communication functionality whose acquisition cost per subscriber is lower.

[Notes]

*8Average commission paid to sales agents per new subscription.
New subscriptions include prepaid mobile phones and communication modules.
*The content of this page is based on information included in the ANNUAL REPORT 2011.