Company Reports

SoftBank Corporation's June-quarter revenue was up 9.4%, with operating profit up 4.0% and net profit up 3.3%. Underlying operating profit grew 9%, and net profit grew 7% excluding a one-time revaluation gain in the 2025 June quarter.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have seen several bouts of telecom price competition since Rakuten entered the mobile market. We can't rule out further pricing pressure in the core telecom market, but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank's fiscal 2025 revenue was up 7.6%, with operating profit up 5.4% and net profit up 4.7%. Fiscal 2026 guidance was for revenue growth of 6.6%, operating income growth of 5.5%, and net income growth of 1.7% with a JPY 8.8 dividend, up from JPY 8.6 in each of the past five years.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have seen several bouts of telecom price competition since Rakuten entered the mobile market. We can't rule out further pricing pressure in the core telecom market, but Rakuten's financial position might make it difficult for the company to start any more price wars.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have seen several bouts of telecom price competition over 2020 and 2021, where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market, but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank's third-quarter fiscal 2025 revenue and operating profit increased by 8%, with net profit up 21%. Management raised full-year revenue guidance by 3.7% and operating profit guidance by 2%.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank's second-quarter fiscal 2025 revenue increased by 7.8% with operating profit up 20% and net profit up 26%. Core telco operating profit growth was around 6% so most of the profit growth was from media, e-commerce, and finance.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank Corp's first-quarter fiscal 2025 revenue increased by 8.0%, with operating profit down 4.3% and net profit down by 9.1%. Excluding one-offs relating to revaluation gains, operating profit was up 6.0% and net profit grew by 0.5%.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank's fourth-quarter fiscal 2024 revenue increased by 10%, with operating profit up 16% and net profit up by 8.6%, leaving the full year ahead of the company's guidance.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank's third-quarter fiscal 2024 revenue increased by 5.2% with operating profit up 8.5%, which was broadly in line with our expectations. SoftBank will be selling services and providing infrastructure for the SB Open AI Japan joint venture. More financial details are expected in May.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

SoftBank Corp's second-quarter fiscal 2024 revenue increased by 7.5% year over year, with operating profit up 7.6%, which was better than our expectations. Management increased its fiscal 2024 operating profit guidance to JPY 950 billion from JPY 900 billion previously.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.

We retain our SoftBank fair value at JPY1,660 per share following its first-quarter fiscal 2024 result. The first-quarter revenue growth of 7.4% and underlying operating profit growth of 7.6% were ahead of the unchanged full-year guidance growth guidance of 1.9% and 2.7% respectively. However, management is still expected to invest heavily in artificial intelligence, which could contribute a JPY50 billion-JPY60 billion loss in fiscal 2024, offsetting the outperformance in the first quarter. We retain our narrow moat rating based on cost advantage and efficient scale in SoftBank's core telecom business. Our forecasts for underlying average operating profit growth over the next five years is 5.6% per annum driven mainly by forecast growth in Payment Services, LY Corp and lower competitive intensity in mobiles. We see the shares as slightly overvalued at these levels.

We retain our fair value estimate of JPY 1,660 per share for SoftBank following its fiscal 2023 results (year-ending March 2024). Management provided fiscal 2024 guidance of 2% revenue growth, 3% operating income growth, and 2% net income growth. At first glance, this seems conservative compared with the reported fiscal 2023 revenue growth rate of 3%, underlying operating income growth rate of 14%, and underlying operating income growth of 45%. However, management outlined a plan to invest heavily in artificial intelligence, expecting this segment to contribute a JPY 55 billion loss in fiscal 2024. Excluding this investment, the fiscal 2024 operating profit growth guidance would have been around 8.5%, which is more in line with what we’d expect from 3% revenue growth in a high fixed-cost business like telecom. We retain our narrow moat rating based on cost advantage and efficient scale in SoftBank’s core telecom business. Our forecast for underlying average operating profit growth over the next five years is 5.7% per year, driven mainly by forecast growth in payment services, LY, and lower competitive intensity in mobiles. We see the shares as slightly overvalued at these levels.

Given its higher financial leverage and high dividend payout ratio, SoftBank is the most leveraged way for investors to invest in the Japanese telecom market. If the Japanese mobile market can return to the cozy, stable oligopoly status that it has enjoyed for much of its history, SoftBank would likely provide investors with the highest returns of the large listed telecom companies. However, we have saw several bouts of telecom price competition over 2020 and 2021 where SoftBank’s financial leverage has worked to lower its profits more quickly than the other operators. We can't rule out further pricing pressure in the core telecom market but Rakuten's financial position might make it difficult for the company to start any more price wars.