Slide 1: Earnings Results for the Three-month Period Ended June 30, 2018
v.1.3 Earnings Results for the Three-month Period Ended June 30, 2018 Investor Briefing August 8, 2018 SoftBank Group Corp.
Slide 2: Legal Disclaimer for SoftBank Presentation
LEGAL DISCLAIMER for SoftBank Presentation This presentation (this “Presentation”) is furnished to you for informational purposes and is not, and may not be relied on in any manner as, legal, tax, investment, accounting or other advice or as an offer to sell or a solicitation of an offer to buy limi
Slide 3: Disclaimer
Disclaimer This material was prepared based on information available and views held at the time it was made. Statements in this material that are not historical facts, including, without limitation, plans, forecasts and strategies are “forward-looking statements”. Forward-looking statements are by t
Slide 4: Accounting
Accounting 4
Slide 5: Segments and Core Companies
Segments and Core Companies FY17 FY18 Reportable segments Core companies Reportable segments Core companies SoftBank Domestic SoftBank SoftBank Wireless City Planning Telecommunications Wireless City Planning SoftBank Commerce & Service Sprint Sprint Sprint Sprint Yahoo Japan Yahoo Japan Yahoo Japan
Slide 6: Adoption of IFRS 9 and IFRS 15 -1
Adoption of IFRS 9 and IFRS 15 -1 IFRS 9 (Financial Instruments) IFRS 15 (Revenue from Contracts with Customers) Primary changes in accounting treatment: Primary changes in accounting treatment: Recognition of changes in fair values of investment securities (1) Customer acquisition costs (SB/Sprint)
Slide 7: Adoption of IFRS 9 and IFRS 15 -2
Adoption of IFRS 9 and IFRS 15 -2 Impact of adopting new standards on P/L: Net sales: + JPY 25.5 bn, operating income: + JPY 26.7 bn Net sales Operating Income (JPY bn) (JPY bn) Impact of adopting new standards 2,272.8 Impact of adopting new standards 2,247.3 +25.5 715.0 688.3 +26.7 2,186.1 479.3 FY
Slide 8: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) 1. One-time gain following Arm’s China business becoming an associate from a subsidiary due to the establishment of joint venture: JPY 161.3 bn 2. Valuation gain at SoftBank Vision Fund: JPY 244.9 bn (mainly due to valuation gain of JPY 164.3 bn recorded for Flipkart
Slide 9: Consolidated B/S Summary (IFRSs) - Non-current assets
Consolidated B/S Summary (IFRSs) - 1 1. Reclassification of Flipkart shares as assets classified as held for sale, following the agreement on the sale (SoftBank Vision Fund) 2. Increase in investment securities of JPY 349.9 bn: investment in GM Cruise, increase in fair values of Uber and Grab (JPY b
Slide 10: Consolidated B/S Summary (IFRSs) - Liabilities
Consolidated B/S Summary (IFRSs) - 2 1. Refinancing of corporate bonds: ‒ Foreign currency-denominated senior notes: issuance totaling JPY 272.7 bn, early redemption totaling JPY357.6 bn ‒ Domestic straight corporate bonds: issuance of JPY 450 bn, redemption at maturity of JPY 400 bn (JPY bn) B/S As
Slide 11: Consolidated B/S Summary (IFRSs) - Equity
Consolidated B/S Summary (IFRSs) - 3 1. Cumulative impact of adopting the new standards (IFRS 9 & IFRS 15) of JPY 300.6 bn was recognized as adjustments to the opening balance of retained earnings (positive impact) (JPY bn) B/S As of As of Items Change Primary changes item Mar 2018 Jun 2018 6,273.0
Slide 12: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) 1. Acquisition of investments at SoftBank Vision Fund: JPY 177.0 bn 2. Refinancing by SBG: issuances and redemptions (incl. early redemption) of corporate bonds 3. Distributions from SoftBank Vision Fund to third-party investors: JPY 153.5 bn (fixed: JPY 34.8 bn, per
Slide 13: Outline of Funds in SoftBank Vision Fund and Delta Fund
Outline of Funds in SoftBank Vision Fund and Delta Fund As of June 30, 2018 SoftBank Vision Fund Delta Fund Major limited partnership SoftBank Vision Fund L. P. SB Delta Fund (Jersey) L. P. Total committed capital USD 91.7 bn *1 USD 6.0 bn *1 SBG: USD 28.1 bn *2 SBG: USD 4.4 bn Third-party investors
Slide 14: Capital Deployment of SoftBank Vision Fund and Delta Fund
Capital Deployment of SoftBank Vision Fund and Delta Fund (USD bn) As of June 30, 2018 Total The Company Third-party investors Committed capital *2 SoftBank Vision Fund 91.7 *1 28.1 63.6 *1 *1 *1 Delta Fund 6.0 4.4 1.6 Contribution from limited partners*3 SoftBank Vision Fund 23.5 7.1 16.4 Delta Fun
Slide 15: Investments of SoftBank Vision Fund and Delta Fund -1
Investments of SoftBank Vision Fund and Delta Fund -1 Investment portfolio (as of June 30, 2018) Acquisition Fair Company names (in alphabetical order) Businesses cost Value Arm Limited Semiconductor technology designer Auto1 Group GmbH Used car wholesaler in Europe Brain Corporation AI-based autono
Slide 16: Investments of SoftBank Vision Fund and Delta Fund -2
Investments of SoftBank Vision Fund and Delta Fund -2 (USD bn) Acquisition As of June 30, 2018 Fair value cost SoftBank Vision Fund 27.1 32.5 Investments acquired Delta Fund 5.0 5.0 Investments agreed to be transferred 0.1 0.1 from the Company Total 32.2 37.6 Excl. consolidated subsidiaries -7.1 -7.
Slide 17: Third-party interests in SoftBank Vision Fund and Delta Fund
Third-party interests in SoftBank Vision Fund and Delta Fund (Reference) Links with the consolidated financial statements Third-Party Interests in SoftBank Vision Fund and Delta Fund P/L C/F (Total of current liability and (JPY bn) non-current liabilities) As of April 1, 2018 1,844.7 Contributions f
Slide 18: Income and loss arising from the SoftBank Vision Fund and Delta Fund business
Income and loss arising from the SoftBank Vision Fund and Delta Fund business included in P/L Income and loss arising from the SoftBank Vision Fund and Delta Fund business included in income before income tax in P/L are calculated by aggregating income and loss arising from SoftBank Vision Fund and
Slide 19: Income on Equity Method Investments Related to Alibaba
Income on Equity Method Investments Related to Alibaba Alibaba SoftBank Group US GAAP IFRSs (CNY mil) (JPY bn) Income on equity Reconciliation Income on equity Net income Net income Ownership method Exchange rate method investments to IFRSs investments FY17Q1 10,647 -8,568 *1 2,079 Approx. 30% 619 J
Slide 20: Derivative Gain and Loss Relating to Variable Prepaid Forward Contract for Alibaba Shares
Derivative Gain and Loss Relating to Variable Prepaid Forward Contract for Alibaba Shares $184 $186 $141 Total gain to be recorded Alibaba share $108 at time of settlement (June 2019) price $77 (+ USD 11.7 bn) Cumulative increase +USD 11.7 bn USD 7.0 bn USD Gain on sale Derivative assets 4.8 bn of +
Slide 21: Appendix
Appendix 21
Slide 22: Breakdown of Goodwill / Intangible Assets
(Reference) Breakdown of Goodwill / Intangible Assets (JPY bn) B/S As of As of Change Main items Changes in Outline item Mar 2017 Jun 2018 Amortization Others exchange rate 4,302.6 4,251.4 - -67.6 +16.4 Goodwill Arm 2,851.4 2,770.0 - -81.4 - SoftBank 907.5 907.5 - - - Sprint 312.8 325.5 - +17.4 - FC
Slide 23: Finance
Finance 23
Slide 24: Main Activities in FY2018 (Investments and Funding)
Main Activities in FY2018 (Investments and Funding) Event Amount Timing Accumulated investment amount: USD 32.1 bn Invest- By June Investments made by SoftBank Vision Fund and Delta Fund ment (Ref.) Total committed capital: USD 97.7 bn 2018 (incl. capital committed by SBG: USD 32.5bn)*1 Restructurin
Slide 25: Preliminary Application for Listing of SoftBank Corp. Shares
KK Preliminary Application for Listing of SoftBank Corp. Shares • Preparation towards listing is on track; securing managerial independence of SB and restructuring organization for its own growth. • SB will play a central role in domestic businesses as a major consolidated subsidiary of SBG even aft
Slide 26: Adjusted EBITDA and Adjusted EBITDA Margin (1)
Adjusted EBITDA and Adjusted EBITDA Margin (1) Consolidated adjusted EBITDA has been stable. Adjusted EBITDA Adjusted EBITDA Margin (JPY bn) SoftBank Seg. Yahoo Seg. Sprint Seg. Others Consolidated SoftBank Seg. Yahoo Seg. Sprint Seg. 721.8 700.1 * 40% 41% * 38% 35% 321.9 360.2 32% 32% 27% 23% 55.6
Slide 27: Adjusted EBITDA and Adjusted EBITDA Margin (2)
Adjusted EBITDA and Adjusted EBITDA Margin (2) SoftBank segment has sustained high margin. Adjusted EBITDA Adjusted EBITDA margin (SoftBank segment) (JPY bn) 333.5 334.0 * 39.6% SoftBank * 37.9% Segment NTT DOCOMO 36.1% 36.5% 35.2% KDDI 35.4% SoftBank Group 32.0% 31.7% (Consolidated) *Remain at the
Slide 28: Interest-bearing Debt (by Sprint / source of funding)
Interest-bearing Debt (by Sprint / source of funding) *1 Major changes Sprint debt increased due to forex rate change. Sprint segment 4,486.7 from Mar 2018 Borrowings 1,570.6 Bonds 2,886.4 +83.9 (forex) (JPY bn) Other 29.6 15,855.4 16,014.9 Lease Obligation etc. 1,211.6 14,653.7 14,703.0 14,183.3 SB
Slide 29: Interest-bearing Debt (by entity)
Interest-bearing Debt (by entity) (JPY bn) Major changes Sprint*1 4,486.7 from Mar 2018 (JPY bn) Borrowings 1,570.6 Bonds 2,886.4 +83.9 (forex) 15,855.4 16,014.9 Others 29.6 4,486.7 SoftBank segment *1 1,830.9 4,343.9 ($40,746mn) Borrowings and ($40,892mn) securitization of 636.2 receivables Lease o
Slide 30: Cash Position
Cash Position Decreased since Mar’18 mainly due to bridge investments. Excludes cash position of JPY 77.5 bn at SoftBank Vision Fund and Delta Fund and JPY 423.6 bn at The Japan Net Bank. (JPY bn) After considering transfer ( 4,461.1 ) of bridge investments 3,414.3 1,560.4 3,177.9 3,205.0 Rest of th
Slide 31: Net Interest-bearing Debt
Net Interest-bearing Debt Decreased mainly due to bridge investments and forex rate. Excludes net interest-bearing debt of (JPY bn) JPY537.5 bn at SoftBank Vision Fund and Delta Fund and JPY302.0 bn at the Japan 13,114.2 Net Bank. 12,650.4 12,280.2 11,525.2 -1,560.4 11,239.4 Rest of the Group (excl.
Slide 32: Leverage Ratio and Investment Asset Value (LTV)
Leverage Ratio and Investment Asset Value (LTV) Leverage Ratio Investment Asset Value (LTV) Holding Company SoftBank Segment (Other Businesses) <Equity Holdings> KK (incl. Sprint acquisition) etc. Net interest- Net interest- JPY 3.02 tn JPY 6.99 tn bearing debt bearing debt Adjusted = 2.5x Equity va
Slide 33: Supplemental (1) Basic Concept
Supplemental (1) Basic Concept Consolidated net interest-bearing debt Major SoftBank Holding Company consolidated Segment (Other Businesses) subsidiaries Sprint, Yahoo, SoftBank Vision Fund, etc. LTV Net interest- (Net interest- Self-controlled bearing debt/ bearing debt/ finance EBITDA Equity value
Slide 34: Supplemental (2) Calculation of Leverage Ratio
Supplemental (2) Calculation of Leverage Ratio SoftBank Segment (a) Net interest- 3.02tn bearing debt KK Adjusted = 2.5x (Incl. Sprint acquisition) 1.19tn EBITDA SoftBank Segment (JPY tn) Net interest-bearing debt SoftBank Segment 1.69 net interest-bearing debt Interest-bearing debt *3 1.83 Borrowin
Slide 35: Supplemental (3) Calculation of Investment Asset Value (LTV)
Supplemental (3) Calculation of Investment Asset Value（LTV） Holding Company (b) Net interest- (Other Businesses) 6.99tn bearing debt <Shareholdings> (c) Equity value of = 29.8% 23.47tn 24.7% shareholdings *After considering transfer etc. of bridge investments (JPY tn) *1 *5 Net interest-bearing debt
Slide 36: Net Leverage Ratio (Consolidated)
Net Leverage Ratio (Consolidated) 6.2x (immediately after Vodafone K.K. acquisition) 4.9x *4.2x *4.3x *After considering transfer of bridge investments 1.1x Jun '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11 Mar '12 Mar '13 Mar '14 Mar '15 Mar '16 Mar '17 Mar '18 Jun '18 *1 Net leverage ratio = net int
Slide 37: Shareholders' Equity Ratio
Shareholders’ Equity Ratio Increased due to net income addition and adoption of new accounting standards. Shareholders’ equity *1 Shareholders’ equity ratio (JPY bn) Effective 273.0 shareholders’ equity *2 Ratio of effective 273.0 shareholders’ equity *2 18.5% 17.5% 17.6% 16.6% * * Of which JPY242.8
Slide 38: Debt / Equity Ratio
Debt / Equity Ratio Debt / equity ratio (gross / net) 3.0x 2.8x (Gross) 2.4x 2.3x (Net) *2.1x (Net) *2.0x (Net) *After considering transfer of bridge investments Mar'18 Jun'18 *1 Debt / equity ratio = interest-bearing debt / equity attributable to owners of the parent (shareholders’ equity after con
Slide 39: Interest Expense
Interest Expense Interest expense increased due to foreign currency-denominated senior notes and margin loan. Interest expense (finance cost) Interest coverage ratio (JPY bn) RestSprint Excl. of the Consolidated Excl. Rest Sprint of the Sprint Group Group (excl. Sprint) (excl. Sprint) 143.4 120.9 7.
Slide 40: Market Cap: Major Listed Shareholdings of SBG and Its Wholly-owned Subsidiaries
Market Cap: Major Listed Shareholdings of SBG and Its Wholly-owned Subsidiaries Market value of listed shareholdings amount to JPY 17 tn. (JPY tn) 15.9 16.6 16.6 12.6 11.3 Partial 9.7 monetization 13.6 13.4 12.9 (Alibaba) 8.1 Alibaba 8.0 7.1 Sprint 4.6 Yahoo Japan Others 1.3 Mar '13 Mar '14 Mar '15
Slide 41: Capital Commitment to SoftBank Vision Fund and Delta Fund
Capital Commitment to SoftBank Vision Fund and Delta Fund <Capital Commitment (as of June 30, 2018)> SoftBank Vision Fund Delta Fund *1 91.7 （USD bn） *1 6.0 （USD bn） 28.1 *2 *1 63.6 *1 (of which 7.1 was 1.6 contributed) （of which 1.4 was 4.4 （of which16.4 was contributed） (of which 3.7 was contribut
Slide 42: Main Investment Portfolio of SoftBank Vision Fund
Main Investment Portfolio of SoftBank Vision Fund (as of August 6, 2018) (Ping An Good Doctor) Ping An HealthKonnect (Full Truck Alliance) *The investments presented herein are solely for illustrative purposes and have been selected to showcase the variety of investments. They do not purport to be a
Slide 43: SBG: Price and Spread of JPY Bonds
SBG: Price and Spread of JPY Bonds SBG JPY Bonds Price SBG JPY Bonds Spread Z-spread, bps 106 450 Sub 2022 #2 2026 #50 Sub 2022 #2 2026 #50 Hyb 2021 #1 Hyb 2023 #2 Hyb 2021 #1 Hyb 2023 #2 105 400 104 350 103 300 102 250 101 200 100 150 99 100 98 50 16/4 16/7 16/10 17/1 17/4 17/7 17/10 18/1 18/4 18/7
Slide 44: SBG: Price and Spread of Foreign Currency Notes
SBG: Price and Spread of Foreign Currency Notes SBG Foreign Currency Notes Price SBG Foreign Currency Notes Spread (USD denominated notes) (USD denominated notes) 115 Z-spread, bps 2022 USD 2025 USD Hyb 2027 USD 2027 USD 2028 USD 2023 USD 600 2025 USD 110 500 105 400 100 300 95 90 200 2022 USD 2025
Slide 45: Sprint: Price and Spread of the Notes
Sprint: Price and Spread of the Notes Sprint Senior Notes Price Sprint Senior Notes Spread Z-spread, bps 120 1400 2024 USD 2024 USD 2021 USD 115 2021 USD 2025 USD 1200 2025 USD 2028 USD 110 2028 USD 2026 USD 2026 USD 1000 105 100 800 95 600 90 85 400 80 200 75 70 0 16/4 16/7 16/10 17/1 17/4 17/7 17/
Slide 46: FY2018 Finance Strategy
FY2018 Finance Strategy • Pursue optimal leverage as a strategic holding company Our Aim • Well-protected financial management to be invulnerable for any environmental change - Leverage index: Manage LTV lower than 35% Safety design - Cash position: Maintain a liquidity level that covers redemptions
Slide 47: Expected Financial Management (illustrative)
Expected Financial Management (illustrative) • Seek to maximize enterprise value by maintaining optimal leverage through appropriate LTV management • LTV expected to improve for mid-to long-term along with investment asset value Investment asset value 35% LTV % Net debt Time 47
Slide 48: Reference
Reference 48
Slide 49: Subsidiary Guarantee on SBG Debts
Subsidiary Guarantee on SBG Debts • After the listing of SoftBank Corp. is approved by TSE, guarantee on SBG debts will be released. • All the senior unsecured debts of SBG will be pari passu after the guarantee release. Condition of guarantee release Listing approval of TSE TSE approval of the list
Slide 50: SBG Credit Rating Trend
SBG Credit Rating Trend Acquisition of Acquisition of Acquisition of Acquisition of Japan Telecom Vodafone K.K. Sprint Arm 14 13 A/A2 JCR (A－) 12 A－/A3 11 BBB+/Baa1 10 BBB/Baa2 9 BBB－/Baa3 S&P (BB＋) Outlook: Negative 8 BB+/Ba1 7 BB/Ba2 Moody’s (Ba1) 6 BB－/Ba3 5 B+/B1 4 2003 2004 2005 2006 2007 2008
Slide 51: SBG Bond Redemption Schedule
SBG Bond Redemption Schedule (JPY bn) Domestic straight bonds 1,305.6 Domestic subordinated bonds Domestic hybrid bonds*2 Foreign currency-denominated senior notes*3 455.6 Foreign currency-denominated 954.2 hybrid notes*2 *3 304.0 700.0 598.8 510.4 164.8 148.8 487.7 15.4 442.3 850.0 140.4 700.0 193.
Slide 52: Sprint Debt Maturities
Sprint Debt Maturities （USD mil） Sprint Debt 8,903 4,936 4,856 4,893 4,146 3,045 2,592 2,475 1,868 2,000 368 368 ~ FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 FY31 *1 The balance as of June 30, 2018. *2 Created by SBG based on Sprint earning result material 52
Slide 53: Interest-bearing Debt: Breakdown by Long/Short and Fixed/Variable
Interest-bearing Debt: Breakdown by Long/Short and Fixed/Variable Interest-bearing debt: Interest-bearing debt: Long / short ratio Fixed / variable ratio (JPY bn) Long-term Short-term (JPY bn) Fixed Variable 16,014.9 16,014.9 15,855.4 15,855.4 18％ 18％ 29％ 29％ 11,528.3 11,528.3 20％ 34% 82％ 82％ 71％ 71
Slide 54: SoftBank
SoftBank 54
Slide 55: Progress on Preparation for Listing SoftBank Corp. Shares
<SoftBank Segment> Progress on Preparation for Listing SoftBank Corp. Shares Announced commence preparations to list SoftBank Corp. shares (February 7, 2018) SoftBank brand trademark’s usage rights granted from SBG (for domestic business) Transfer of shares of domestic companies Transfer of WCP, Sof
Slide 56: Basis of YoY Analysis at SoftBank Segment
<SoftBank Segment> Basis of YoY Analysis at SoftBank Segment Presentation In the following presentation, new standards (IFRS 9 and 15) are adopted since FY18 is hypothetically applied to FY17 for comparison and referential purposes YoY analyses in this presentation will be based on ① difference
Slide 57: Change in Revenue Reporting
<SoftBank Segment> Change in Revenue Reporting Changed revenue reporting classifications in FY18Q1 Previous New Classified by service Added classification by customer type (Consumer/Enterprise) Consumer Communications Services Telecom service revenue Consumer Mobile Mobile Broadband Enterprise Bro
Slide 58: 1. Net Sales
<SoftBank Segment> 1. Net Sales FY18Q1 sales was JPY880.5 bn (②: +51.1 bn YoY) Strong growth in BB drove Consumer sales, while mobile communications showed steady growth サービス別内訳 Breakdown by service Consumer breakdown ①Accounting factor ②Business factor ①Accounting factor ②Business factor （YoY c
Slide 59: 2. Operating Income / Adjusted EBITDA
<SoftBank Segment> 2. Operating Income / Adjusted EBITDA FY18Q1 operating income was JPY 221.8 bn, +20.0 bn (+9.9%) YoY Operating income / Segment income Adjusted EBITDA ①Accounting factor ②Business factor （YoY change） ①Accounting factor ②Business factor （YoY change） <JPY bn> <JPY bn> 800 684.7 69
Slide 60: 3. Segment Income YoY Analysis
<SoftBank Segment> 3. Segment Income YoY Analysis Topline growth in all business sections Successfully reduced cost mainly in Sales related expenses Mobile -1.4 Fixed-line - 0.5 Solution, etc. +3.3 Mobile + 4.4 Broadband +13.3 Product and other sales+17.2 Sales related 11.9 2.8 Depreciation <JPY
Slide 61: 4. Mobile Subscribers and Churn Rate
<SoftBank Segment> 4. Mobile Subscribers and Churn Rate (main subscribers) Subscribers: main subs increased 434K YoY due to steady growth of smartphone net adds (plus LINE MOBILE starting FY18Q1) Churn rate: FY18Q1 churn rate improved YoY by 0.10pp for main subs and deteriorated by 0.01pp for ha
Slide 62: 5. ARPU (main subscribers)
<SoftBank Segment> 5. ARPU (main subscribers) Q1 total ARPU decreased by JPY 50 YoY: Dilutive impact of Y!mobile and LINE MOBILE smartphones drove down ARPU Discount on ARPU improved due to decrease of monthly discounts (JPY) (YoY change) 6,000 5,610 5,490 5,470 ARPU before ① -130 discount 5,000
Slide 63: 6. Developments in Broadband
<SoftBank Segment> 6. Developments in Broadband 5.26mil SoftBank Hikari subs at FY18Q1-end; steady growth of new acquisitions 8.50mil subs to Home Bundle Discount Hikari Set Cumulative subscribers Home Bundle Discount Hikari Set (number of connected lines) cumulative subscribers ＜Mil＞ (YoY chang
Slide 64: 7. Capex / Adjusted Free Cash Flow
<SoftBank Segment> 7. Capex / Adjusted Free Cash Flow Focusing on expansion of LTE service area and improvement of network quality, FY18Q1 capex was JPY 65.1 bn Adjusted FCF steadily heading for goal of JPY 500 bn for FY18 (excluding impact from purchase of YJ shares) Capex*1 Adjusted free cash
Slide 65: 8. Further Growth Opportunities
<SoftBank Segment> 8. Further Growth Opportunities SoftBank Vision Fund + Ping An HealthKonnect Deploy potential cutting-edge business models in Japan *Certain "SoftBankVision Fund" investments described herein are subject to pending regulatory approvals. The future operating plans described above a
Slide 66: 9. Establishment of JV with Yahoo
<SoftBank Segment> 9. Establishment of JV with Yahoo ō SoftBank ō Vision Fund Invest- ment 50% 50% Provision of tech- nologies Collaboration to provide smartphone payment service *PayPay is an equity method associate of SoftBank Corp. and Yahoo Japan Corp., and also a consolidated subsidiary of So
Slide 67: 10. WeWork Japan
<SoftBank Segment> 10. WeWork Japan 6,000 Memberships 5,200 0 Feb. Mar. Apr. May Jun. Jul. 2018 (Source) WeWork Japan (Photo credits) WeWork Accelerate business in Japan *Past performance is not indicative of future results.There can be no assurances that historical trends will continue throughout t
Slide 68: 11. Establishment of JV with DiDi
<SoftBank Segment> 11. Establishment of JV with DiDi DiDi Mobility Japan Corp. Launch trial operations in autumn * Investments in DiDi are held by SB Delta Fund (Jersey) L.P. and other subsidiaries of SoftBank Group Corp. outside SoftBank Vision Fund. ** This page is based on the press release annou
Slide 69: 12. Expansion of New Business Areas
<SoftBank Segment> 12. Expansion of New Business Areas For DiDi logo: *DiDi Mobility Japan Corp. For WeWork logo: *WeWork Japan GK FinTech Robotics Sharing economy Security JV Collabo- ration JV JV JV Collabo- ration Investment Subsidiary (smartphone-based securities trading market) JV Collabo- Inve
Slide 70: 13. Tender offer by SoftBank Corp. for YJ shares
<SoftBank Segment> 13. Tender offer by SoftBank Corp. for YJ shares Strengthening the alliance between SoftBank Corp. and YJ Increased managerial freedom for YJ by dissolving JVA between SBG and Altaba Before TOB After TOB SoftBank SBG Altaba SBG Corp. Altaba 10.8% (12.1%)* 43.0% 23.9% 43.0% 34.
Slide 71: 14. FY2018 Forecast
<SoftBank Segment> 14. FY2018 Forecast 1 Increase in revenue / profit *1 Excl. impact of YJ shares acquisition 2 Generate stable FCF (JPY 500bn) *2 Promote “Beyond Carrier” strategy & 3 enhance collaboration with SVF 4 Preparation for IPO *1 Comparison based on new standards (IFRS 9 and 15). Number
Slide 72: (For reference) Net Sales
<SoftBank Segment> (For reference) Net Sales (JPY bn) Reference FY17Q1 (Previous) FY17Q1 (New) FY18Q1 (New) YoY (New) Consumer 612.5 600.0 634.9 35.0 Telecom service revenue 479.3 470.1 487.8 17.7 Mobile 406.3 395.6 400.0 4.4 Broadband 73.0 74.5 87.8 13.3 Product and other sales 133.2 129.9 147.1 17
Slide 73: Definition and Calculation Method of Principal Operational Data
<SoftBank Segment> Definition and Calculation Method of Principal Operational Data i. Mobile All data on mobile communications service includes SoftBank, Y!mobile and LINE MOBILE brands. Each category includes the services as follows. Main subscribers: smartphones, feature phones, tablets, mobile da
Slide 74: Sprint
Sprint 74
Slide 75: Q1 FY2018 Results Investor Briefing
Q1 SoftBank Investor Briefing FY 2018 RESULTS August 8th, 2018 75
Slide 76: Cautionary Statement
Cautionary Statement SAFE HARBOR This release includes “forward-looking statements” within the meaning of the securities laws. The words “may,” “could,” “should,” “estimate,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan”, “outlook,” “providing guidance,” and si
Slide 77: FY1Q 2018 Highlights
FY1Q 2018 Highlights Wireless Service Adjusted EBITDA Net Income Revenue [1] delivered for the 3rd consecutive quarter GREW HIGHEST Operating Income sequentially for the in more than eleven first time in more years than four years delivered for the 10th [1] excluding the impact of the new revenue re
Slide 78: Growing Connections
Growing Connections Postpaid Phone Net Adds Prepaid Net Adds Results in Thousands Results in Thousands 170 88 87 55 35 3 Q117 Q417 Q118 Q117 Q417 Q118 12 GROWTH consecutive quarters of 6 GROWTH consecutive quarters of ©2018 Sprint. This information is subject to Sprint policies regarding use and is
Slide 79: Network Built For Unlimited
Tri-Band Most Improved Year-Over-Year Existing Sites 800 MHz, 1.9 GHz, 2.5 GHz 2.5 GHz Network 87% deployed on nearly two- 38.4 Mbps thirds of our macro sites Growth Built For Outdoor Small Cells Unlimited More than 15K on air 20.5 Mbps 2017 2018 Magic Box Distributed more than 260K to date National
Slide 80: Industry Leading Unlimited Plans
Industry Leading Unlimited Plans Unlimited Unlimited Plus Unlimited Basic Military Bundled Extras Mobile Hotspot 500MB LTE 15GB LTE 500MB LTE 3G Unlimited DVD-quality Full HD Streaming DVD-quality DVD-quality Video Streaming Streaming (480p) (1080p) Streaming (480p) Streaming (480p) Unlimited talk,
Slide 81: Digital Transformation
Digital Transformation Digital Virtual Advanced Sales Agents / AI Analytics ©2018 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or its relevant affiliates and may contain restricted, confidential or privileged materials intended for the sole u
Slide 82: Revenue Growth
Revenue Growth Wireless Service Revenue Postpaid Average Revenue per User Dollars in Billions (ARPU) $5.6 $47.30 $5.7 $5.6 $5.5 $44.57 $44.40 $43.55 Q117 Q417 Q118 Q117 Q417 Q118 New revenue standard impact New revenue standard impact GREW sequentially for the first time GREW sequentially for the fi
Slide 83: Improving Profitability
Improving Profitability Adjusted EBITDA Operating Income Dollars in Billions Dollars in Billions $3.3 $1.2 $0.8 $3.1 $2.9 $2.8 $0.6 $0.2 Q117 Q417 Q118 Q117 Q417 Q118 New revenue standard impact New revenue standard impact HIGHEST in more than 11 years 10 CONSECUTIVE quarters of operating income ©20
Slide 84: Net Income
Net Income Net Income Dollars in Millions $20 6 $176 $69 (actual dollars) Q118 Q117 Change Basic EPS (excl. ASC 606 impact) $0.01 $0.05 ($0.04) $24 Merger and Other Non-Recurring ($0.03) ($0.06) $0.03 Q117 Q417 Q118 $0.07 ($0.07) Spectrum license exchanges, New revenue standard impact after tax 3 CO
Slide 85: Capex & Adjusted Free Cash Flow
Capex & Adjusted Free Cash Flow Cash Capex[1] Adjusted Free Cash Flow Dollars in Billions Dollars in Millions $368 $1.2 $1.1 $0.8 $8 ($240 ) Q117 Q417 Q118 Q117 Q417 Q118 Ramping Up Next-Gen Network POSITIVE Initiatives 5 out of last 6 quarters [1] excludes capitalized device leases ©2018 Sprint. Th
Slide 86: Guidance
FISCAL YEAR 2018 Guidance Adjusted EBITDA Cash Capex $12.0 billion to $5.0 billion to $12.5 billion $6.0 billion As Reported excluding $11.3-$11.8B excluding the leased devices impact of the new revenue recognition accounting standard ©2018 Sprint. This information is subject to Sprint policies rega
Slide 87: Appendix
Appendix 87
Slide 88: Revenue Recognition Changes
Revenue IMPACT FROM NEW REVENUE STANDARD Three months ended June 30, 2018 As Reported - Previous Recognition New Revenue Revenue Difference (in millions) Standard Standard Net operating revenues Changes Service revenue $ 5,740 $ 5,883 $ (143) Equipm ent sales 1,173 892 281 Equipm ent rentals 1,212 1
Slide 89: Arm
Arm 89
Slide 90: Arm China
Our Joint Venture explained Arm Arm China China AAnew chapter: Joint Building Venture: on on Built strong foundations strong foundations November 2017 General information pack (inc HR) © 2018 Arm Limited 90
Slide 91: Arm has great success in China
Arm has great success in China 150 Licensees 10bn Chips shipped by Chinese partners using ARM processor technology 20% 95% Arm’s revenues Chinese designed SoC comes from Chinese based on ARM based companies processor technology © 2018 Arm Limited 91
Slide 92: China landscape
China landscape China is investing to become a net exporter of semiconductors China already has world class chip developers Some companies desire technology optimised for local market Some Government projects are accessible to technology • Chinese developed • Chinese owned • Chinese controlled © 201
Slide 93: Arm decided to create Arm China Joint Venture
Arm decided to create “Arm China” Joint Venture Multiple investors 49% 51% Largest single shareholder Arm receives $775.2m for 51% stake in Arm China © 2018 Arm Limited 93
Slide 94: Revenue share from Arm China back to Arm Limited
Revenue share from Arm China back to Arm Limited Arm Ltd processors Arm Ltd Arm China Significant proportion of revenue is passed through to Arm Ltd Arm Ltd Arm Ltd processors processors © 2018 Arm Limited 94
Slide 95: Arm Ltd transferred all China-based employees to Arm China
Arm Ltd transferred all China‐based employees to Arm China 341 employees transferred to Arm China Arm Ltd Arm China staff costs no longer Arm China included in Arm’s operating costs © 2018 Arm Limited 95
Slide 96: Arm China provides services to Arm Limited globally
Arm China provides services to Arm Limited globally Arm Ltd purchases services Arm Ltd Arm China Arm China services include HR support for Arm’s APAC offices IT support for Arm’s APAC offices Technical training for APAC customers Mbed engineering Software engineering © 2018 Arm Limited 96
Slide 97: Establishing Arm China in Q1 2018
Establishing Arm China in Q1 2018 Arm China JV started in April 2018 Sale of 51% stake occurred 26 June 2018 341 employees transferred to Arm China Contracts for 150 customers being novated Novation has delayed contract signing in Q1 Delayed contracts are expected to sign later in FY2018 © 2018 Arm
Slide 98: Device-to-data security
Data Arm Pelion IoT Platform Control End‐to‐end services built on Arm IPG+ISG security framework Applications Ecosystem (App Development Enablement) CDP Asset Tracking Device‐to‐data security Enterprise + Data Management Services Other Data Pelion Device Management Services Connectivity Management S
Slide 99: SoftBank
SoftBank