• Total mobile revenue gains and au Denki cost improvements fuel OP
gains – FY3/26 Q1-2 sales rose +2.2% YoY to ¥42.07bn and OP
increased +5.1% YoY to ¥9.35bn, putting the company on a solid
footing to meet its full-year forecasts. H1 OP growth was aided by a
combination of total mobile revenue gains and a reduction in au
Denki-related costs. The company is behind on achieving its mobile
subscriptions target. However, we think the combination of its H1
progress, au brand redesign, UQ brand price revisions implemented
in November, momentum from the launch of the iPhone 17 series
and au Denki cost control will help the company produce a strong H2.
