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November 24, 1997updated 03 Sep 2016 2:08pm

NTT CORE REVENUE DROPS AS MOBILE UNIT BOLSTERS PERFORMANCE

By CBR Staff Writer

Nippon Telegraph and Telephone Corp reported falling revenues from its traditional business, during the first half of its financial year. Fixed line services which generates 70% of NTT’s parent revenue, decreased six percent, although, as expected, the downturn was offset by strong growth in its cellular phone business NTT DoCoMo. First half net profit for the six months ending September 30, was up 24% at $1.64bn over the same period last year on revenues down 0.3% to $25bn. Operating profit was down 0.2% at $1.64bn and NTT DoCoMo boosted its interim group profit by around $793m to $2.78bn. NTT revenues from fixed-line phones are expected to fall to $36.1bn for the year from $38bn last fiscal year, according to NTT in part following the company’s 20% reduction of long-distance calling charges in February this year. In contrast, the company says that NTT DoCoMo will be the key source of profits for the year helping to push its full-year group net profit to around 80% to $2.12bn. According to the company, it is seeing a steady shift in demand to mobile phone and ISDN digital network services, and away from fixed-line analog phones. NTT President Junichiro Miyazu said NTT expects revenues from its ISDN service to jump 80% in the year to March 1998, and forecast that the service would start making profits during its fiscal year 1999/2000. DoCoMo, accounts for around 71.2% of Japan’s booming cellular phone market as of October, up from 64.1% in September. NTT Corp is to be restructured into three companies under a single holding firm in mid-1999.

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