On November 8, 2024, SoftBank Corp. (TOKYO: 9434) President & CEO Junichi Miyakawa presented earnings results for the second quarter (Q2) and first half (H1) of the fiscal year ending March 31, 2025 (FY2024). At the press conference held in Tokyo, Miyakawa began with a review of SoftBank’s consolidated results.
In FY2024 H1, revenue (3,152.1 billion JPY), operating income (585.9 billion JPY), and net income (323.9 billion JPY) increased year-on-year (YoY) by 7%, 14% and 7%, respectively. Miyakawa stressed that revenue and profits increased across all of SoftBank’s business segments (Consumer, Enterprise, Distribution, Media & EC and Financial Business).
Forecasts for revenue, operating income and net income revised upward
Comparing SoftBank’s FY2024 H1 performance against the full-year forecasts for FY2024, Miyakawa noted that better-than-expected progress has been made, with 51% of revenue, 65% of operating income and 65% of net income already achieved.
Given this performance, Miyakawa announced that SoftBank upwardly revised its full-year forecasts for FY2024, with increases of 150 billion JPY in revenue, 50 billion JPY in operating income and 10 billion JPY in net income versus the initial forecast. With these upward revisions, SoftBank is now forecasting 6,350 billion JPY in revenue, 950 billion JPY in operating income (notably representing a 6% increase versus the initial forecast) and 510 billion JPY in net income for the FY2024 full year.
With regard to the Medium-term Management Plan, which goes from FY2023 to FY2026, Miyakawa noted that SoftBank’s progress is ahead of schedule.
Consumer segment sees customer shift to ‘SoftBank’ mobile service brand
Reviewing the highlights of SoftBank’s business segments in detail, Miyakawa noted that in the Consumer segment, an increase in smartphone subscribers and customer spending contributed to a continued increase in mobile revenue in FY2024 H1, which was up 12.2 billion JPY (+2%) YoY to reach 788.8 billion JPY.
He added that, for the first time since mobile service price reductions were implemented in the spring of 2021, there were more conversions from SoftBank’s ‘Y!mobile’ brand to its ‘SoftBank’ brand, which typically sees higher customer revenues. He said this was partly due to the popularity of the new ‘SoftBank’ brand “Pay-toku” price plans that utilize PayPay’s services to give customers added point rewards.
The Enterprise segment registered 445.8 billion JPY of revenue in FY2024 H1, a 11% increase YoY, driven by steady growth in business solutions and others, which saw a 28% YoY increase in revenue. FY2024 H1 operating income for the Enterprise segment was 94.4 billion JPY, a 12% YoY increase.
For the Distribution segment, which includes the results of subsidiary SB C&S Corp., in FY2024 H1 revenue and operating income increased by 44% and 20% YoY, respectively. Notably, AI server revenues from external customers increased fivefold YoY due to increased demand for AI-related products. Miyakawa commented that the know-how of AI engineers at SB C&S is helping to drive this growth, and that he expects the trend to continue.
The Media & EC segment, which incorporates LY Corporation (the operator of LINE and Yahoo! JAPAN services), also saw growth in revenue and operating income, with YoY increases of 5% and 40%, respectively. When excluding one-time factors, Media & EC operating income was up 16% YoY.
PayPay achieves positive operating income for two consecutive quarters
In the Financial Business segment, FY2024 H1 revenue was up by 19% YoY at 129.8 billion JPY and operating income reached 13.6 billion JPY, a major improvement compared to the operating loss of 2.9 billion JPY registered in the previous fiscal year. The increase was driven by improved performance at PayPay, which registered positive operating income in both FY2024 Q1 and Q2.
Making continued progress on next-generation social infrastructure initiatives
Toward the end of his presentation, Miyakawa highlighted SoftBank’s progress being made on building out next-generation social infrastructure for the AI era. He noted that SoftBank’s AI computing platform was recently expanded to house approximately 6,000 GPUs through the addition of approximately 4,000 NVIDIA Hopper GPUs, and that approximately 4,000 NVIDIA Blackwell GPUs will be added by the first half of FY2025, which will bring the GPU total up to approximately 10,000.
Miyakawa added that – through its subsidiary SB Intuitions that utilizes this Japan top-level AI computing platform to develop LLMs – SoftBank released a homegrown Japanese LLM with 460 billion parameters for research purposes.
In closing, Miyakawa said SoftBank will continue to secure funds to make growth investments in infrastructure for AI, with the October 2024 listing of Series 2 Bond-Type Class Shares being one notable example.
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Presentation material (PDF: 15.2MB/50 pages) Supplementary materials: Overview of SoftBank (PDF: 3.16MB/22 pages) |
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(Posted on November 8, 2024)
by SoftBank News Editors
