SoftBank Corp
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SoftBank Corp
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Ladies and gentlemen, thank you very much for waiting. We would like to begin the earnings results briefing for this 6 months ended September 30, 2021.
First of all, I would like to introduce to you today's speakers. From SoftBank Corporation, President and CEO, Junichi Miyakawa; Board Director, Executive Vice President and CFO, Kazuhiko Fujihara. Today's briefing is streamed live on the Internet. Thank you for your understanding.
Without further ado, I would like to invite Mr. Miyakawa to talk about the earnings results as well as the business performance.
This is Miyakawa. I would like to begin the presentation of the consolidated results for the second quarter for the fiscal year 2021.
First is the revenue, JPY 2.7242 trillion. It was up 12% year-on-year. On the half year revenue basis, it was a historical high. It included the consolidation of LINE. And also compared to last year, the handset sales had recovered. This is segment-by-segment revenue. As you can see, in all segments, revenue has increased.
Next is operating income. It was down 3%, JPY 570.8 billion. Compared to 2 years ago, it was reduced by JPY 18.8 billion. We have announced that we will be targeting JPY 975 billion for operating income. And at this point, we have progressed to about 60%. As for the achievement of target for the full year, we believe that we can achieve the target that we have set at the beginning of the year.
This is operating income by segment. As you can see, there was a reduction in Consumer segment. The reduction amount was about JPY 40 billion. The breakdown included the mobile service price reduction in the total of JPY 26 billion for the first half. In the previous year there was a change in the provision of the Half Price Support, and there was a reversal of that. And in total, it has reduced the income by JPY 40 billion.
Enterprise and Yahoo Japan LINE grew steadily. However, the increase from those segments could not offset everything.
In terms of the net income, it was down 2%. JPY 500 billion is the annual target for net income. The progress is over 60%, and we believe that we can achieve the target for net income.
This is the consolidated results for the first half. In terms of the earning power, the adjusted EBITDA, it has been increased by about JPY 6 billion year-on-year. In that sense, we were able to get to pretty good results for the first half.
This shows the progress towards fiscal '21 full year forecast. As you can see, I believe that we are set to achieve the target, and the progress is 50% for the revenue and 61% for the net income. So I think that we are on the right track.
As for the progress toward forecast by segment, in all of the segments, the progress is steady. This sheet is not something that we have disclosed in the past. How we see the full year and how much we have progressed is expressed on the slide. We wanted to be very transparent. That's why we created this table. JPY 975 billion is the target for the operating income. We are looking very much in details about how to get there. On a quarterly basis, we have expectation for how much we would be able to get to.
Q2 of last year, there were a lot of special factors. Last year, in the second quarter, we recorded the historical high operating income. We were not able to get to that point, but we did well.
As for Q3, there would be a dip. So compared to the previous Q3, it will go down slightly. And last year, there was a lot of plan for acquisition in Q4 of last year. But this year, we don't have that plan. So considering all of those factors, we believe that we can achieve the historical high operating income at the year-end.
Now I would like to go into each of the businesses. First is the Consumer business. The revenue was JPY 1.3784 trillion. There was impact from mobile device -- the mobile service fee reduction, but we were able to go up 6%. JPY 85 billion is the increased amount for the mobile device sales. But on the other hand, we introduced new price plans, and because of that, there was an impact of JPY 26 billion in the negative. The mobile revenue had come down slightly.
In terms of operating income, it was JPY 364.7 billion. As I said earlier, the impact of the price reduction is about 200 -- JPY 21 billion. And we have some reactions from the Half Price Support, so this is what we have finished off with operating income.
In terms of smartphone cumulative subscribers, it's up 6%. This is increase of up 6%. This is because Y!mobile was strong, steady. With regards to 5G plan cumulative subscribers, we have exceeded 10 million. So the number of smartphone subscribers was 26 million. I would say more than 1/3 were part of this 5G plan. So that's how we have been doing so far.
Next is on Enterprise business. So in terms of revenue, it was JPY 350.9 billion. This is up 5% year-on-year. In terms of Enterprise, we have some impact from the chip shortage, in particular, iPads. It's becoming difficult to source iPads.
So in terms of mobile acquisition business, we are now beginning to see some impact. As for the solutions itself, we're still in a growth rate stage, so we are still able to achieve plus 10% year-on-year growth.
In terms of operating income, it's up 15%. So this will continue to move steadily. It's JPY 74 billion.
In terms of business solutions and others revenue, since the last time we announced this, we have divided into recurring and nonrecurring revenues. So we have broken down the disclosures. So we will continue to disclose this in this manner. So in terms of recurring revenue, it's up 21%. So the growth of the Enterprise is quite steady, and it's really a buildup of recurring revenue. So we believe that we can continue to grow. We're quite confident.
This is Yahoo and LINE. Yahoo Japan LINE revenue, actually, Z Holdings just announced 2 days ago, but it's up 35%. In particular, with the addition of LINE business, media business has really gained strength. Operating income is JPY 115.5 billion. Actually, by making LINE subsidiary, we have about JPY 12 billion in accounting cost, but we're still able to overcome that and achieve this plus 18% growth.
Now with regards to EC merchandise transaction value, e-commerce was -- we had significant growth because of COVID demand. This year, we exceeded that, and we have top-down 10%. So this is something we're very delightful of.
Next is PayPay. The number of users for PayPay has exceeded 43 million. This is going very steadily in terms of the increase of the users. The user numbers are continuing to grow.
In terms of the number of payments, we started disclosing this from the last briefing. It was 1.66 billion times in terms of the number of payments. The growth year-on-year was 81%. PayPay is a super app. In order to become a true super app, number of payment is the most important KPI for PayPay. I mentioned this in the last briefing. Now we are in November, and in October, the number of payments was more than 300 million. The number of payments is growing each month. I believe that PayPay is a continuously growing app.
In terms of gross merchandise volume, it was JPY 2.4 trillion for the first half. It was 60% up year-on-year.
In terms of the payment system fee, starting from last month, for the small and medium merchants, we started charging payment system fee. We have already made the announcement for that. And there was a report that 20% of the merchants will cancel the contract with PayPay. As it was mentioned in the briefing of the performance of Z Holdings, there are 3.44 million merchants, and the cancellation rate was only 0.2%. And the impact to the GMV is as follows. GMV on a per month basis is JPY 400 billion approximately. And the discontinued merchants had the revenue of about JPY 0.4 billion per month, meaning that the impact was 0.1%. This means that the GMV loss from those cancellations were immaterial.
Another point is the services for merchants. This is called PayPay My Store. When the merchants subscribe for the service, there would be a discount for the payment system fee. So what is the PayPay My Store service? So there is analysis service, and also, there is a service in which the merchants would be able to use to advertise their stores. And actually, we had this service since the November of the previous year, but this was an initiative of the private entity. So I would not mention about the specific numbers of the subscribers. But in between August to October, after we have announced the charging of the SME merchants, the subscribers for the PayPay My Store has increased twelvefold.
Next, I would like to talk about Beyond Carrier and Beyond Japan initiative. At the beginning of this fiscal year, I have explained about the strategy for corporate value enhancement. We have 330 subsidiaries and affiliates. We have diverse business under us and investors and shareholders. Towards them, we want to explain in some of the parts, and we would like to enhance our information disclosure.
So what is circle in the red? Treasure Data, ADA, TBCASoft. I would like to talk about those 3 companies. First is Treasure Data. This morning, Treasure Data has made a press release, the headquarters in the United States, and has announced the investment of USD 222.5 million, and that is JPY 25 billion, and that's about 20% investment ratio. And what is Treasure Data? They provide customer data platform. Many companies have siloed information by each function. It is very difficult for the companies to have the across-the-board information utilization. So Treasure Data provides service, which would enable the integrated utilization of the data.
Starting from the left, there is data collection. First is integration of the information within the company that would be integrated with various data, and it enables digital marketing. So Treasure Data is being -- providing a service for more than 400 companies. Its customer base is big brands like these. The Japanese market share is above 90% already.
So why did we decide to invest in this company? So we have our group assets, which we believe that we can realize a high synergy. I mean, it's a chunk of -- a big bulk of synergies, and Treasure Data, which is really the market leader in CDP, and there's a market that is rapidly expanding. And Treasure Data, who is the leader of this market, has even a greater potential for growth. And that is why we had decided to invest in this company. And in addition to that, SBKK, SoftBank has a vision strategy called Beyond Japan. And in order to realize that, we believe that Treasure Data will contribute much and will be a big strength in that, realizing that goal.
Second point is that on ADA which we invest in and also its parent, Axiata Group, which is the largest telecom group in Southeast Asia. We have signed a product partnership agreement with Axiata Group. And we have the digital products and DX know-hows which will be multiplied with the customer base of Axiata to accelerate digitization in Southeast Asia. As a first step for collaboration with Axiata, we have ADA, which we invested in, in May, and it's already experiencing rapid growth in terms of revenue and, just in this quarter, has grown 229%. EBITDA is 445% growth, and we can expect further growth. It will continue to grow. So this is how this company is transforming into. So we, SoftBank and Axiata Group, we are in discussion on various topics. And ADA, I would say, is one success case between us.
And finally, but not in the least, we have TBCASoft. So QR code payment providers in Asia are in discussions to join international QR code payment ecosystem. This is a platform that is provided by TBCA. So we are in discussion of having Naver Pay and Axiata Group companies join this platform. We are hoping that travel between the countries will become even more active than pre-COVID. So we want to, first of all, start off with Southeast Asia. It's a strategy called Beyond Japan. We want to accelerate group synergies in other regions so that we can really accelerate our business growth.
So in summary, these are the 4 points. So as we had set out at the beginning of the year, the mobile price cut or the new price introduction, so in the first half, we had about JPY 21.6 billion. And for the full year, we're looking at an impact of JPY 7 billion or so. So it is in line with our initial forecast. And for management, this is an extremely challenging environment. And this is the time for us to fundamentally reexamine the corporate structure. So we take this as a proactive opportunity.
So in order for the company to continue to grow, we need to adapt to the changing environment. So this is transforming from communication between people to people, and we will now have the acceleration of 5G. And so we want to challenge on reforming every single industry. So we will have the communication between things, and digitization is taking place. So what we want to do is to implement information revolution or industry revolution here.
And also SDGs, these are the area where many companies are working on. We are looking at 30-, 50-year horizon, and we look at what could happen in the future, and we reverse calculate and develop the necessary technology and service. So since I have been appointed CEO since April and since assuming this role, I have been thinking deeply about the future of SoftBank. And there are many initiatives that we are endeavoring on today.
In the second half, what we have planted is now bearing fruit and taking shape. And I think there will be many that we will be able to announce to you. So I hope you will see SoftBank which is transforming.
So that is all for our earnings briefing. Thank you very much for your kind attention.
[Operator Instructions] Now we would like to go into the Q&A session. We would like to first take questions from the venue, followed by taking the questions online on Zoom. [Operator Instructions] The gentleman in the first row, in the left area.
From Yomiuri Shimbun, my name is [ Yoshikawa ]. I would like to ask about the mobile service price reduction. In terms of the price, you have already made announcements, and I think you have disclosed that. I would like to know about the impact [ volume-wise ]. I think that there would be a lot of impact to the development of the base stations. I would like to know about the impact. And I would like to know about the future of the mobile service fee.
Thank you for your question. The development of the base stations, whether the mobile service price reduction impact those. I am thinking that there may be some impact. When we were allotted the frequency, we submitted a plan about the development of the base stations and how we operate it. And at that time, we calculated the price plans. And when there is an imbalance between what we have calculated and the actuality, there would be a negative impact.
In the coming 1 to 2 years, that would be the period where we would be starting up the 5G service. And because of that, of course, we are a bit concerned. And we are working on restructuring as well as cost reduction in the other areas. We are trying to be thorough on that, so that there would be no negative impact on the network development side. If this continues 5 years and 10 years, then we would have to review how we would be developing the network infrastructure. But in the coming 1 to 2 years where we would be building the base stations, we would like to thoroughly implement our plan. There is no significant change in the CapEx. And at this point, we are aggressively conducting capital expenditure.
And in terms of the service price, how it would be in the future? I think that was the second part of your question. So we do have a plan for mobile services which starts from JPY 0. And we have been in this industry for many years. And in order to maintain the infrastructure, we need to work 24/7 for the maintenance of the network. We monitor the network, and the equipment, of course, there are always some kind of failure, which occurs suddenly. And the recovery work must be conducted, and our employees are working on that.
So the operation and maintenance costs are very important, and we don't intend to decrease the price to the extent we would not be able to pay the operational or the maintenance cost. So the network maintenance cost, that must be passed on, of course, to the subscribers. But at the same time, we would try to make the price optimal for the subscribers as well. We are conducting various kinds of analysis. And there are diversity now in the use of network, so we have to think about the new price plans accordingly.
I would like to now ask about the Enterprise business. It is very robust, and I believe that there is a lot of needs from the enterprises. And Docomo and KDD are going through various kinds of reorganization. So how would SoftBank be differentiating itself? The talent development as well as securing of the talent, what are your views on that?
The Enterprise business, there is abundance of requests to us for the provision of service. We need more people. So not only at the headquarters but also at the affiliates, we are working to secure talent. Japan was lagging behind in digitization. But now the engine has started for more digitization, and it will further accelerate. In conducting the Enterprise business, we want to build a model which would be sustainable. We would not be looking for temporarily good revenue. We want recurring revenue. In terms of the Enterprise business, we are confident that we would be able to grow steadily.
The gentleman on the second row from the front.
[ Ishikawa ], freelance writer. The other day, Docomo had a communication disruptions. And when 3 years ago, SoftBank did the same -- had the same issue. You said that maybe it's better to consider roaming revenue. So when such disruptions occur, what do you do?
And also, Japanese telecommunication charges, prices have really gone down probably the same level as the overseas. And -- but quality is, however, better in Japan. So overseas, the users suffer from quality. So is it something that Japanese user should expect in the future?
Well, I'm looking at Docomo's disruption case. I think that was -- when I'm looking at it, I think that's something could have really easily likely to have happened, and I think it was particularly centered on the device officially on IoT. So when you look at the roaming method of IoT devices, so you have to let the device be able to read the signal of any carrier and because there will be increase in IoT device costs, which is not really realistic. So this is a disruption that occurs on the core side of the network, and it's really difficult to have a mirror of that. So we need to eliminate that, and we're using a control program to eliminate that. So maybe we need to exchange information between carriers to increase resilience.
And also in terms of prices, if you go with MIC's announcement, we're probably the second lowest in prices around the world. And if you look at in terms of quality and volume of the telecommunication service, I think we're probably the best in the world. And so if that's the direction Japan should aim for, then we will do our best to catch up to that goal. But developed nations, which is driving the industry, is not really in that direction.
So in terms of development, we may be left behind or might be delayed. And so we have to look at the device system as well. I mean, this is something that we do in the standard development. But we need to really differentiate ourselves. And I guess, the way we were doing that in Japan as well, and it's kind of sad that I think this differentiation strategy will be lost between the carriers.
But in terms of developing the base stations, the infrastructures of 4G and 5G in terms of the number of base stations and also the power usage is completely different. And it actually consumes a large amount of energy for 5G. So you have to look at the structure. And if we go -- can we really maintain that level with the 5G prices, which is lower than 4G, so we have to take that into view as well.
Do we have any other question? In the center, second row from the front, the gentleman in the blue mask, please.
From Nikkei business, my name is [ Sato ]. I have 2 questions. The first question, recently, I think you have started 5G commercial stand-alone service, and why did you start from air terminal? And going forward, how would you envision expanding the 5G commercial service?
The second question is related to the previous question. NTT Docomo and NTT will be consolidating. And how would it impact your business? And on a competitive basis, how would that impact you?
In terms of the SA, we were able to create the air, so that is related to the development. The smartphone stand-alone was something that we wanted to do by spring, but it is under the condition that we would be able to secure enough chips of semiconductor. And going forward, we would like to roll out what we have in terms of the foundation.
Docomo and NTT Communications integration, they are a threat. So they were too big, so they were broken down. But now they are being integrated once again, and they are going back to how they were. So they're -- they split, but they're now remerging.
And we have a kind of a handicap vis-à-vis those big players. But as I have said earlier, we're trying to capture the demand on the enterprise side of digitization, and that demand is accelerating. Japan is lagging behind in terms of digitization, as I have said. But now the enterprises in Japan are working on digitization. And then there would be a lot of digital data to be put on the cloud. And the companies, which were lagging behind in this area is now trying to catch up. So we would like to support those companies to digitize.
NTT Docomo, NTT Communications, they are very good at those areas, so they are integrating, and they would be working on that. And on the other hand, SoftBank will be working in that field as well. And in the enterprise field, we will be having a big battle, but this is a healthy competition. So this kind of healthy competition is something that we need to welcome.
And in the area of digital transformation, we would like to contribute to building the system. And I think that there could be various wisdom from various companies which can be utilized. And we would like to compete with each other so that there would be a new business emerging from this industry. So this is something that we should see in the industry, this kind of healthy competition.
And in terms of the strength of SoftBank, we had been working in this area quite early on, so we do have know-how accumulated. And there are many advanced DX companies where we invest in, in the -- through the fund. So being able to work together with them is SoftBank's strength. So we will be working so that we would not be lagging behind our competition. Thank you very much.
Next is the gentleman on the right-hand side, second row from the front.
[ Nakajima ] from Kyoto press. Two questions about the subscriptions for LINEMO. Last time, you said less than 500,000. How have you been able to grow so far? And also, the other day, Docomo at one of their dealers, they said they will start handling MNVO (sic) [ MVNO ]. And also KDDI povo has also announced their low-priced plan as well. So with the new moves, how are you going to foster LINEMO and utilize that?
Thank you. So LINEMO stand-alone, so I guess I should say, according -- in LINE MOBILE, we have LINE MOBILE and LINEMO. And together, we have exceeded 1 million. So this number -- we haven't decided we will now close LINEMO itself, so we are not able to give you that information. But on a monthly basis, LINEMO, since launching the JPY 900 plan, it's really increasing its momentum, and we are seeing a very nice steady growth.
Also how do we really want to grow LINEMO business? This is not just LINE MOBILE -- LINEMO, but also, we have Y!mobile. And Y!mobile actually is better received by the customers right now. So Y!mobile will be our mainstay product. And of course, people who want to go online and they may prefer LINEMO, that's great. But Y!mobile has much more growth, so we want to continue to reinforce Y!mobile.
My second question, you have been talking about emphasizing how strong Enterprise business is. If I want to ask you a specific question, which areas of -- or services of Enterprise business is growing and really leading to increase in revenue? If you could just give me a bit general picture about that.
Thank you. So there's a lot of inquiries coming from enterprise customers, particularly in automation. So automation support for the processes or work that they do internally, we use the word RPA, so things like RPAs. In order to automate, what sort of tool do you need, so I think that's a lot of inquiries we received.
The other is, since LINE has joined our group, I mean, this has really played out a big role. So we use -- the enterprise customers would use LINE app on the surface, and they can use their own API to link with their customers. So they use LINE as an interface. And we're getting a lot of inquiries about that. And there's a lot of business closures on that, so they want to use communication with the customers using LINE.
So what mechanism can be built so that they can use LINE to interface with customers, and that's becoming the SBKK's job, and we're helping the customers build it. So I would say, most largely speaking, those are the 2.
The next question in the left area, the third row from the front.
From Nikkei Shimbun newspaper, my name is [ Kishta ]. You didn't directly talk about this, but I would like to ask about HAPS. Recently, you have announced that you have obtained the patent from Loon, so they have the balloon type. And how would you be utilizing the patent that you have obtained from Loon in the HAPS business?
Loon is working under Google, and they are using the air balloons' floating power, the helium gas, to go up. Even in the stratosphere, their weakness was that because there is an air stream, the device would not be able to stay in one spot. That's one weakness. From the carrier business, to be able to receive and transmit the signals in one spot is critical. But for the Internet providers, the -- their view is different in terms of what they place importance on. But the technology is very good. It's Google technology.
I think that there are air balloons remaining in the stratosphere. And there are -- at any time, any point in time, there are 300 air balloons, and 2 people are operating this. And it's AI-operated, and this is a great technology. When I saw that, I understood that they have a very significant automation know-how. And together with Loon, we created a wireless device. And rather than having big vendor provide this, we created the wireless device, and we went to the stratosphere and tested it, and we were able to get to the best quality.
And within this building, actually, there is an exhibition space for that device. So I hope that you would be able to see it someday. But it was great that we were able to work together with them. In the stratosphere, they kept on testing 7 to 8 years, and they have collected the data of the jet stream through that time, and we were shared that data, and we appreciate this very much. We had dispatched engineers, our engineers, to exchange views. And now, we have more understanding about the air balloon area which was something that we have gained from it.
The gentleman in the middle.
[ Sana ], I'm a freelance writer. Earlier, you've mentioned about chip shortage. With regards to 5G base stations development, any impact from chip shortage? KDDI said that there's a slight impact. So how is it for you?
Yes, certainly. There's no critical shortage, so we're okay so far. But the timing of supply delivery is quite ahead, so we're now starting to see some impact. No, nothing really has been stopped or hindered as a result of it yet, but we're starting to now see the impact. So that's the feel I have.
So where would be the impact? Just within as much as you can share, where is the impact?
So there are several smaller components, like components, parts that we normally would be able to source right away, we're not able to source immediately.
And also -- and in fact, it's -- what's the actual damage?
Well, maybe just inability to source iPads maybe. That's about it.
Any other questions? In the left area, the fourth row from the front.
From Toyo Keizai, my name is [ Takano ]. I have 2 questions. The first question, you talked about the year-on-year performance on a quarterly basis, and you said that it was newly disclosed. And you talked about how on a quarterly basis the performance had moved. And I would like to know a little bit more about the quarterly situation.
And the second is a mid- to long-term question. So the mobile carriers are focusing on similar areas like the area of finance or others. And I want to know where SoftBank intends to differentiate.
So this is the sheet I think that you're referring to. So the first and the second quarters, these are already completed. And at the beginning of the year, we made a calculation of all of the 4 quarters. And the biggest impact came from the mobile service fee reduction, price reduction. And we try to factor in that and create that plan. And according to the plan, the progress rate would be around 50%. And if you compare it with the fourth quarter last year, it was an aggressive fourth quarter. And this fourth quarter, we would not be so aggressive. So there would be a JPY 50 billion plus that would be derived compared to last year in the fourth quarter of this year.
So just because the mobile service price had been reduced, we would not be reducing everything. We need to be aggressive in some areas, and the development of the network will be worked on in a focused manner, and that is reflected in the plan.
And in the third quarter last year, it was JPY 252 billion in the third quarter. And we believe that this third quarter will be a little less than that. And in the fourth quarter, it was around JPY 120 billion last year, and we believe that we can go beyond that level. So that's the prospect that we have.
And you asked about the future. At SoftBank, SoftBank has been the mobile carrier, and now we are trying to transform into the comprehensive digital platform. And we use the term layer in our industry. What this means is that we act as a pipeline to connect various players. And so there is the connecting layer, the platform layer and the service providing layer. In each layer, we work on totally different things. And we want to have everything comprehensively. Using Yahoo and LINE, we would like to contact directly to our customers. And we would be able to do that through our comprehensive platform because we are able to access the customers directly. In the future, we need to be able to provide more services, so we will be creating those services.
And we want to think about 30 years out and then reverse calculate to what we need to do now. So how we would be able to contribute to the future world of SoftBank is what we are deliberating. So we now have the power service where -- at the -- we provide the telecom service as well as the electricity service.
Going forward, Japan is aiming to become carbon-neutral. And if it's not able to do that, it would be in a very dire situation. So we want to contribute to saving of the energy, while there is a lot of discussion going about the discontinuation of the nuclear power plant. But through our electric city service, we want to contribute more to the society. So the extension of the telecommunication service and the new service that should be generated in order to serve the future community are 2 areas where we would be working on. Thank you very much.
Due to time constraints, we can take one more question from the floor here. So the gentleman in the middle, please.
[ Ishino ], I'm a freelance journalists as well. So I'm looking at your financial results. In Consumer business, revenue increases the recovery in enhanced sales device sales. The factor is this is a reaction from last year's COVID, so you have been able to sell as usual. Is that the right understanding?
Yes, that's certainly right.
Okay. Understood. Then second question is you said that Y!mobile is strong. So if you have more people coming to Y!mobile, that could also affect your revenue sales negatively as well. So you have migration from LINE MOBILE to Y!mobile, and Y!mobile to SoftBank maybe. I think you were showing some of the graph before. So can you see any trend?
Of course, it goes both ways. So migration from SoftBank Mobile to Y!mobile is greater than Y!mobile to SoftBank. And in terms of upsell, it's for the 5G users because there's larger traffic within the volume which they use, they would use flat plan, and they tend to come back to SoftBank brand. So that cycle does exist. It will be nice if it cycled 1:1, then we would never have to talk about operating losses but -- or decrease in operating income, excuse me. But unfortunately, there's more migrating from SoftBank brand to Y!mobile. Does that answer your question? Thank you.
So that will be all for taking of the questions in the venue. And now we would like to take questions on Zoom. [Operator Instructions]
From Bloomberg, Mr. [ Hyuga ].
My name is [ Hyuga ] from Bloomberg. I would like to ask about the stock price and another question about the business. In terms of the stock price, SoftBank's stock price has gone up 22%. And the Nikkei average has gone up 8%. So compared to that performance of SoftBank is quite good. So the IR activities and your performance, were there anything different that you have done? So who are buying your stocks? Have you analyzed it? And if you have any data, I would like to know.
And Mr. Miyakawa, you have committed yourself to buying the stock, and do you intend to add on your holding? And the SoftBank Group, the parent company's market cap is more than JPY 1 trillion and JPY 10 trillion to JPY 12 trillion. And I was wondering if the SoftBank Group is going to further sell SoftBank shares.
Thank you very much, [ Hyuga-san ]. In terms of the stock price, it has been going up, and I am very appreciative of that. In terms of the factors for why it has gone up, so in the past, it was undervalued. It is not that we've had focused on something to increase the stock price. But what we have done is to disclose the information which was demanded from the market. We decided to be very transparent to the market and the status of the assets as well as the synergy of the assets that we hold. Also, what is happening to the companies that we decided to invest in, we try to track that and disclose the information. So those are the areas that we have been working on. So I would love to be able to control the stock to be able to change the stock price as we want, but that's not what we are doing.
And in terms of whether I would be adding on the holding of the stock -- SoftBank stocks myself, I don't intend to do that. SoftBank KK uses a lot of cash, so I want to be able to repay what I have borrowed from SoftBank KK, and I don't have so much cash at hand. So at this point, I don't have any intention of adding on my investment into the company.
In terms of SBG, whether they would be selling more of SoftBank stocks, I don't think this is something that I should be responding to. And SBG, people have not asked about doing that. So that's all I can answer for this point. Does that suffice?
Yes. So you are proactively disclosing, and I would like to move on to the second question. So PayPay, so is it going to be profitable and around what time you would be going into the black? And what about WeWork? Is WeWork's business doing better? Are there still challenges? And are you considering any restructuring? Please let me know.
In terms of PayPay, we believe that it will go into the black in the coming several years. The payment system fee is now being charged to the -- as small to medium merchants. And I think that we are now close to being able to control the situation quite well. But in terms of PayPay, we still want to expand. And after expansion period ends, we would like to go into the recovery phase. So in the coming year, we would still like to expand, and we would like to move towards going into the black ink. Whether we would be able IPO at some timing, once that's decided, we would make announcements.
In terms of OYO and WeWork, first, in terms of WeWork, under COVID, it has actually been doing quite well. WeWork in the U.S. has IPO-ed using SPAC and it is very stable. And rather than having the headquarters owning the headquarter building themselves, there are a lot of clients who would like to rent the space. So that's why WeWork is doing well.
In terms of restructuring for WeWork and OYO, we have done whatever we could, so going forward, we don't feel the necessity to significantly change things around. OYO is improving. And in terms of the utilization rate, it is 39% for OYO. So is -- does my answer suffice?
Yes.
Next is Mr. Masuno from Nomura Securities.
This is Masuno. Can you hear me?
Yes, we can hear you.
So I want to ask you about mobile industry environment. So when I look at the financial results, I think turn rate is increasing on an industry-wide basis, and you are actually increasing sales promotion to sell your handsets. But in terms of new acquisitions, I think there's an increased liquidity, mobility among the market. And net increase, I think, is quite on par between the players. And that's the trend you see in Q1 because if one player works really hard, everyone tries to follow on. So everyone is working very hard, and I think how that's how it's trending.
So in that sense, so no one is making a big win or losing big. So it's a tug of war, and I think this may continue for the time being. So what's ahead beyond that? So you sell 5G and you have unlimited plan for 5G, and you will probably book revenue with ARPU, not so much on handset sales. So maybe that's the flow. So what is your current view on this? And how are you looking at in terms of turnaround?
Thank you. So with regards to churn rate, as you just said, all 3 carriers have seen increase in churn rate. This is due to the increased portability or mobility of the users. So the stock has really not changed among the players. It's exactly as you say. So we do think that this will continue for a while. Meanwhile, SoftBank, we want to be focused on net additions, and that has not changed. So hopefully, we can continue to increase users.
Now what about 5G? How would it change?
So up until now, you had a network contact point, a device called smartphone. Now we will see increasing number of IoT devices. And this is not just the enterprise devices, but also on consumer side, I think it was the increasing number of IoT devices. So you may have IoT device primarily on some phones, but you may have IoT devices focused on -- centered around network. So perhaps units, that number of devices are maybe different. So for example, it will be different from the number of smartphones versus number of devices. So the concept may change.
And we will have second and third new markets. And maybe if once each carrier is able to deploy core 5G stand-alone devices, then even if it's the same smartphone, it will be -- there will be smartphones that have higher priority and connections, or maybe there will be devices that doesn't really have a lot -- or generate a lot of traffic. So with all these creativity, we will be able to create new services and price plans. Masuno-san, am I answering your question?
Well, for example, in consumer side, you have unlimited plan and ARPU with SoftBank brand maybe increased. If you're able to see that sort of scenario, what would be the time line?
Well, it's difficult to raise the price that you have lowered once. In fact, we have migration from Y!mobile to SoftBank, but we have users who are going from Y!mobile to SoftBank. I think I said that earlier. So 5G handset SoftBank's brands are able to get a lot of good connections of 5G, so I think they may approach closer to unlimited plan.
So we will make sure that we also offer rich contents so that we can expand market as well. So we will, first of all, develop the network for 5G. And all carriers, I think this will be the main battlefield from this year next year. And probably within this year, almost all carriers will be able to build up the facility for core 5G stand-alone, so we will have a new 5G service. So in a 2-, 3-year time line, we may have a completely different price plan structure. So at that time, we want to be sure we're at the starting line, and we want to actually lead the market in terms of share as well.
We would like to take the last question. Mr. [ Koyama ], who is a freelancer.
My name is [ Koyama ], I'm a freelancer. May I start, please? I would like to ask about PayPay. You talked about going into the black ink. And would the revenue be centering around the payment system fee? The expansion of the revenue from the payment system fee, I believe it's becoming difficult. But in addition to PayPay My Store, do you have any initiatives in place to increase the revenue?
In terms of the payment system fee, that would be the main chunk of the revenue. But if we look at Alipay, there are post-payment. So that would be one of the things to take a look at. Also in terms of the sales promotion, there are revenues from various campaigns. So it would be a combination of various initiatives that we would be taking.
My second question, shortage of chips. You mentioned that you have been slightly impacted by it. So going forward, how much would it impact you? For example, delay in the development of the base stations, would there be specific impact -- negative impact on your side?
If we look just this year, the shortage of the chips is impacting us in the area of procuring iPad. On the network side, by the end of March, we had made adjustments to secure the iPads so that there would be no shortage. And in terms of the new iPhones, we have secured the necessary inventory for us, so we are fine. But in the coming 2 to 3 years, if this pace continues, we may not be able to procure the inventory that we need, for example, not being able to procure the products 6 months later than we usually procure it. So if this continues, it would be negatively impacting us. But for now, we are in the clear. Thank you very much.
So with this, we end the Q&A session. So with this, we will be ending earnings results briefing for the 6 months ended September 30, 2021, for SoftBank Corporation. This briefing will be webcasted on our website on demand basis. So thank you very much for attending the briefings on earnings results for the 6 months ended September 30, 2021.
[Statements in English on this transcript were spoken by an interpreter present on the live call.]