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Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<p>Softbank Corp. results were mixed with revenue in line but operating profit (-7% in Q2) below consensus. Some of that is timing related as it laps a record-high quarter even as H2 comps get easier on tailwinds from ¥50bn in one-time expenses last year. On the telecom side, enterprise revenue growth of 4% including double-digit growth for solutions revenue is encouraging. Management remains confident of meeting full-year targets but as we saw with KDDI last week, mobile price reductions are starting to make their presence felt.</p>

Softbank Corp. results were mixed with revenue in line but operating profit (-7% in Q2) below consensus. Some of that is timing related as it laps a record-high quarter even as H2 comps get easier on tailwinds from ¥50bn in one-time expenses last year. On the telecom side, enterprise revenue growth of 4% including double-digit growth for solutions revenue is encouraging. Management remains confident of meeting full-year targets but as we saw with KDDI last week, mobile price reductions are starting to make their presence felt.

NTT (Nippon Telegraph & Telephone) (9432 JP)

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