Satellite Growth Strategy: 5G Communications and Focus Areas

The key to the success of the Satellite Growth Strategy is 5G communications. Together with diverse partners, KDDI aims for an age of new value emerging from the integration of communications into every domain.
As of the end of FY23.3, the mobile telecommunications business has achieved steady growth with multi-brand communications ARPU of 3,940 yen and 31.23 million IDs. As for communications ARPU, the composition ratio of UQ mobile rose as did au unlimited usage plan subscriptions. ID exceeded the initial forecast due to strong momentum, especially for UQ mobile. The decline in YOY communications ARPU revenues has been steadily decreasing and we aim to rebound in the first half of FY24.3. We will continue to promote the attractiveness of 5G and unlimited usage plans, and further promote data usage through proposals tailored to meet customer needs to achieve further ARPU growth.

• Personal Services segment basis

We will support our customers' businesses by leveraging the diverse capabilities of the KDDI Group, with 5G at our core, in "Corporate DX" to support workstyle reform and improvement of business productivity, "Business DX" to solve management and social issues through the power of digital technology, and "Business Infrastructure Services" (data centers, contact centers, etc.) to facilitate these services. In terms of the performance of the Business Services segment in FY23.3, NEXT Core led operating revenue growth with an increase of 17.6% YOY, each category achieved double-digit YOY growth.

• In FY23.3, operating revenue excludes the impact of communications failure, while operating income excludes impacts of fuel price hikes and communications failure.

KDDI will promote the collaboration and cross-use of au Financial Holdings' diverse functions and services to increase customer engagement. In FY23.3, finance-related value-added ARPU revenues grew steadily by 17.7% YOY.
In addition to the growth in operating income, au Financial Holdings' customer base is steadily expanding with settlement/loan transaction volumes reaching 14.3 trillion yen, 8.6 million au PAY Card members, and 2.3 trillion yen held in au Jibun Bank loan products balance. We aim to maximize the corporate value of the KDDI Group by creating synergies resulting from leveraging au's customer base through the growth of our financial business.

"αU" (Alpha U) launched in March 2023. It provides comprehensive services for the Web3 era, including shopping, markets, wallets, and live streaming centered on the metaverse. Additionally, αU is highly acclaimed, winning the most prestigious award in the MM Research Institute Awards 2023, Metaverse Field of Smart Solution Division. Going forward, KDDI will continue to combine its strengths in cloud, network, and ID with the new technologies of the Web3 era to transform the customer experience and create a prosperous future society.
In addition, we are developing services using drones and creating new experiences using Starlink through our satellite telecommunications partnership with SpaceX.