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NTT : WEST Financial Results for the Fiscal Year Ended March 31, 2026 (NTT WEST Website)
NTT : WEST Financial Results for the Fiscal Year Ended March 31, 2026 (NTT WEST
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Financial Results for the Fiscal Year Ended March 31, 2026 (27th Term) May 8, 2026 1 Copyright 2026 NTT WEST, Inc. This document is a translation of the Japanese original. The Japanese original is authoritative. The forward-looking statements and projected figures concerning the future performance of NTT WEST and its subsidiaries and affiliates contained or referred to herein are based on a series of assumptions, projections, estimates, judgments and beliefs of the management of NTT WEST in light of information currently available to it regarding NTT WEST and its subsidiaries and affiliates, the economy and telecommunications industry in Japan and overseas, and other factors. These projections and estimates may be affected by the future business operations of NTT WEST and its subsidiaries and affiliates, the state of the economy in Japan and abroad, possible fluctuations in the securities markets, the pricing of services, the effects of competition, the performance of new products, services and new businesses, changes to laws and regulations affecting the telecommunications industry in Japan and elsewhere, and other changes in circumstances that could cause actual results to differ materially from the forecasts contained or referred to herein. * “E” in this material represents that the figure is a plan or projection for operation. ** “FY” in this material indicates the fiscal year ending March 31 of the succeeding year. 2 Copyright 2026 NTT WEST, Inc. FY2025 Financial Results and FY2026 Financial Results Forecast In FY2025, NTT WEST’s operating revenues increased for the firs t time in four quarters, and operating profit rose for the firs t time in two quarters. In FY2026, NTT WEST aims to continue increasing operating revenues and operating profit （Billions of yen） IFRS (Consolidated) FY2025 FY2024 Results Results Year-over-year FY2026 Compared to Forecast Forecast Year-over-year Operating Revenues 1,468.6 1,504.2 +35.5 +32.2 1505.0 +0.8 Operating Profit 81.8 83.5 +1.6 +6.5 90.0 +6.5 Profit* 60.8 53.2 (7.6) +3.2 54.0 +0.8 EBITDA 291.8 289.9 (1.9) +2.9 295.0 +5.1 Capital Investment 239.8 251.2 +11.4 +1.2 245.0 (6.2) Net Increase (Decrease) in Hikari Subscriptions (Number of Subscriptions) +59,000 (10.34 million) +95,000 (10.44 million) +37,000 +35,000 +100,000 3 (10.54 Million) +5,000 Copyright 2026 NTT WEST, Inc. * Represents profit attributable to NTT WEST, excluding noncontrolling interests. Status and Forecast of Operating Profit Although there has been a decline in fixed voice-related revenue, operating profits increased in FY2025 due to the expansion of fiber-optic services and growth businesses, as well as ongoing cost improvements NTT WEST aims to increase operating profits in FY2026 by continuing various initiatives, and we will further accelerate these efforts to ensure sustainable growth in FY2027 and beyond (Billions of yen) 81.8 90.0 Fixed voice- Expansion of related revenue fiber-optic decline services (21.0) +12.0 Expansion of growth segments, cost improvements, etc. +11.0 Including the impact of inflation, etc. related revenue decline (18.0) Fixed voice- ※ Expansion of fiber-optic services +10.0 Expansion of growth segments, cost improvements, etc. ＋14.0 Including the impact of inflation, etc. Achieve sustainable growth 83.5 FY2024 4 ※Excluding the impact of the rate revisions Copyright 2026 NTT WEST, Inc. FY2025 FY2026 (E) Specific Initiatives for FY2026 01 Maintain and Expand the Communications Business Expand the Enterprise Business Expand New Services and Businesses CX/EX Improvement / AI Implementation 5 Copyright 2026 NTT WEST, Inc. 1- 1 . Maintain and Expand the Communications Business ~Hikari Services~ We aim to expand sales of Hikari cross and all-unit subscriptions, and improve CX to increase net subscriber numbers and ARPU (basic fees) Hikari Cross All-unit Subscription CX Improvements Cross 1st proposal Expand all-unit subscription plans for new buildings Continuous improvements to increase customer loyalty 1.3x 1.6x FY24 FY25 FY27 Double ¥3,170 ¥3,180 ¥3,260 95,000 ¥3,310 100,000 Increase ARPU (basic fees) 37,000 59,000 Increase numbers of net additions Copyright 2026 NTT WEST, Inc. 2023 2024 2025 2026 6 1- 2 . Maintain and Expand the Communications Business ~Service Trans fers~ We are implementing network optimization proposals for half of the services scheduled to be discontinued in FY2026 We are implementing a preemptive transition of fixed-line telephone services (Phase 2 scheduled to be announced in Q1 2026) Proposing Network Optimization for Approximately Half of the Services Scheduled to be Discontinued (approximately 500,000 business lines) Implementing an Early Migration of Fixed-Line Telephone Services Delivery/Support Cloud Security AI BPO Managed Services FY2026 Around FY2028~ FY2035 Phase 1 (Announced in February 2026, services to be discontinued in March 2027) Areas requiring maintenance due to aging equipment Areas where the transition is being carried out in collaboration with local governments and other entities Phase 2 (Scheduled Announcement Q1 2026) In addition to the requirements for phase 1 Areas where it is difficult to maintain off-s ite containment systems Phased transition in urban areas Fixed-line telephone services INS Net Business ether wide STM ※ Phased Announcements and Transition Services Scheduled to be Discontinued Copyright 2026 NTT WEST, Inc. 7 Future Fixed-Line Telephone Services: Service Migration from Copper Lines to Fiber-Optic or Mobile Lines https://www.ntt-west.co.jp/denwa/2035denwa/ Demand for use cases is materializing, such as Expo 2025 and rugby broadcasts We aim to increase the number of projects by firs t expanding the coverage area in major cities As data centers are concentrated in urban areas where land and power are in short supply, we are connecting data centers via IOWN to transition to a decentralized regional model Expansion of Coverage Areas and Projects FY2026 Expansion to major cities FY2027 Nationwide Expansion From an Urban Model to a Decentralized Regional Model Conventional Urban Model Data Centers To ensure quality, distances of 10~30km between data centers is the norm FY2025 Kansai and Tokai regions FY2026 Major Cities Fukuoka, Hiroshima and others FY2027 Nationwide Growing demand for data centers is leading to a shortage of electricity and land By connecting data centers via IOWN, The project is currently expanding by about tenfold 都市部 IOWN 地域 地 域 大容量 低遅延 低消 費 電力 Remote Productions Critical Lines challenges related to land, power, costs and quality can be addressed through regional Expo Sites Hanazono Rugby Stadium Local Government Networks University Network decentralization Professional Baseball Copyright 2026 NTT WEST, Inc. (Information Highways, etc.) 8 ・・・ 1- 3 . Maintain and Expand the Communications Business ~IOWN (All-Photonics Connect)~ 2. Expand the Enterprise Business ~Zero Trus t Managed Service (Tentative Name)~ We plan to launch a managed service offering a Zero Trust environment tailored to the scale and industry of our enterprise customers in October 2026 (with options for a public SASE model or a private SASE model) Mid-sized companies and SMEs Remote Environment Local Governments Closed Network (NaaS) 3 4 Public SASE Internet Security for AI Low latency, high bandwidth SLA High maintainability NTT Data Center Private SASE Data 2 1 Internet Data Centers Cloud Customers are able to choose between a public SASE model and a private SASE model Local Governments Features Offered 1 A sovereign environment will be achieved by handling security measures and storing logs within NTT’s domestic data centers* 2 A robust Zero Trust environment with closed networks and private SASE** 3 Comprehensive managed services covering everything from customer devices to various Zero Trust features 4 Security features tailored to mid-sized and small businesses at a low cost to enable a Zero Trust environment Mid-sized companies and SMEs *Some functions will be processed outside of Japan. Copyright 2026 NTT WEST CORPORATION 9 **Secure Access Service Edge: A new network security concept that integrates network and security functions and delivers them through a unified platform. 3- 1 . Expand New Services and Businesses ~Solmare~ Expand of Comic C’moA, one of Japan’s largest e-bookstores Strengthen comprehensive initiatives ranging from the production of original comics to licensing for anime and film adaptations FY2026 Aim to grow revenue to over ¥100 billion by acquiring capabilities in areas such as print publishing and animation in the global market FY2025 Global Expansion Inhouse Original Works FY2027~ Aim to grow revenue to more than ¥100 billion Screened: October - December 2025 Screening: April 2026~ 10 Revenue of approx. ¥87.0 billion Copyright 2026 NTT WEST, Inc. 3- 2 . Expand New Services and Businesses ~VOICENCE~ We launched of "VOICENCE," a voice AI business dedicated to protecting “the right to one’s voice” and enhancing “the value of one’s voice” (October 2025) We are continuing to expand our network of partners and corporate clients, and our Trust technology was awarded firs t place in the "GENIAC-PRIZE". Expanding the Corporate Use of VOICENCE Partners In-house Developed Trust technology was Recognized and Awarded First Place in NEDO’s “GENIAC-PRIZE*” (Titles omitted) 4 People as of October 2025 9 people and 1 company as of March 2026 Challenges Posed by the Evolution of Generative AI Tampering Trust Technology: Building Trust Authenticates Generative Actor Tetsuya Bessho Voice Actress Nozomi Kasuga Voice Actor Voice Actress Voice Actor Freelance Announcer Natsuki Hanae Tomoko Kaneda Shugo Nakamura Sakiko Nojima Impersonation Unauthorized Generation AI Content X Traceability Vtuber KizunaAI Voice Actress Omi Minami Voice Actress Aya Uchida amuleto Tabio Corporation Mizkan Holdings Co., Ltd. Pre-event social media * A prize-based program (contest) organized by the Ministry of Economy, Trade and Industry and NEDO aimed at the societal implementation of generative AI announcements and in-store radio Copyright 2026 NTT WEST, Inc. 11 broadcasts for the birthday celebration campaign Audio for business presentations Audio for in-store promotions * NEDO: National Research and Development Agency New Energy and Industrial Technology Development Organization 4- 1 . CX/EX Improvement ~Telecommunications Operations Reform~ By the Q4 FY2026, we will implement a s implified application process, flexible modification support, and progress visualization Enhancing CX by making the standard a “web experience that is actually easier” - In STEP 1 (Q4 2026), we will implement “customer self-service/automated order fulfillment” for key products, primarily FLET’S Hikari - In STEP 2 (Q4 2027), we will streamline the service ordering process for our partner companies Pre-Order Application, Changes, and Other Procedures Application ~ Coordination ~ Installation Increase the automatic processing rate for service orders Visualization of order progress 60 ％ * 2 ％ *Automated processing rate, including up to Step 2 ~ Installation ~ During Service Use Application support via AI Chat Streamlined applications Can check the progress through s implified address of your application after registration submission Simplified identity verification Self-service procedures for scheduling and rescheduling installation dates Informational push notifications (e.g., Retrieval of installation dates, etc.) Can view your contract details and submit additional applications on My Page Copyright 2026 NTT WEST, Inc. Mobile Support Can be completed in 10 minutes or less Order Installation Placement Scheduling Eliminating multi-step communication through system integration Automatic dispatching and assignment of service orders Automatic assignment Reception Distribution System System 12 Customers Facilities Distribution System System Automatic Request 4- 2 . AI Implementation Including the effects of initiatives to reform telecommunications operations, we aim to achieve cost savings of ¥14 billion by FY2030 The AI business is expected to generate projects worth ¥50 billion by FY2030 Expansion of the AI Business Delivering new value to our customers through the advancement of AI-driven services AI for Internal Company Use AI for Customers AI Based Business Trans formation Improved customer experience and fundamental streamlining of business processes through the Operational Transformation Streamlined creation of proposal materials and business meetings minutes ・・ ・ Data-driven, push-based problem-solving proposals utilization of AI and Training Employee development tailored to individual skills and experience Visualization and utilization of employee skills Efficient coordination and management in the event of a malfunction Accident prevention through the detection of unsafe actions AI Managed ・・ ・ Facilities Human Resources ✓ ✓ Real-time support Enhanced support Autonomous Driving Early detection of obstacles, hazardous behavior AI Attack learning, early threat detection Enhanced security measures Security AI ・・ ・ ・・ ・ AI AI AI Aggregated Data (Customer interactions, services usage, etc.) Copyright 2026 NTT WEST, Inc. Human Resources Information Route control and optimization ・・ ・ 13 Measures to combat internal misconduct are scheduled to be completed by the end of FY2026 as planned On-site inspections and risk mitigation measures for systems containing critical information Identifying and managing risks using the “IT Asset Risk Management Database” Specific Measures Policy of phasing out external storage devices such as USB drives Expansion of Zero Trust and layered defense to group companies, and strengthening of account management As a security-first company, we will continue to strengthen our information security measures without letting past incidents or the countermeasures taken fade from memory Measures to Combat Internal Misconduct Visualization of Risk Minimization of Risk Points Sophistication of Monitoring and Thorough Inspections Strengthening of Information Security Promotion Systems Preventing regulations and manuals from becoming mere formalities through s implification Embedding awareness through layered training and workplace discussions Operating a system that uses AI and correlation analysis to detect unauthorized operations, suspicious access, and other such activities Operating a system for centralized monitoring and response to logs and detected data Reference (For further information on the progress of NTT WEST Group's efforts to strengthen information security in light of the illegal access of customer information)* 14 https://www.ntt-west.co.jp/corporate/security/ Copyright 2026 NTT WEST, Inc. *Japanese only Status of the Progress Towards Strengthening Information Security (Announced on March 31, 2026) Copyright 2026 NTT WEST, Inc. Copyright 2026 NTT WEST, Inc.