KDDI has downgraded its net profit estimate by 5% for the year to March on the back of higher mobile handset costs and fixed-line extraordinary losses.
KDDI said Friday its expects a lower net profit of 212.5 billion yen ($2.31 billion) in fiscal 2009, compared with an earlier forecast of 225 billion yen.
The firm attributed the 5% profit downgrade to higher than expected mobile handset sales and a 61 billion yen fixed-line extraordinary loss.
Higher handset sales initially adversely affect profits because of related sales promotion costs, such as sales agent commission, but eventually led to stronger earnings.
While operating profit forecasts were virtually unchanged, KDDI expects 2% lower revenues of 3.44 trillion yen thanks to lower mobile ARPU and weaker demand for fixed-line services.
KDDI is to due report its latest financial results later this week.
The firm’s recent purchase of a 31.1% voting stake in cable TV firm Jupiter Telecommunications are not due to be reflected until fiscal 2010.