Japan's SoftBank expects the performance of subsidiary Sprint Nextel to lead to the company's first annual profit decline in nine years.
The operator is forecasting an operating profit for the year ending in March of 900 billion yen ($7.9 billion), down from 1.09 trillion yen the prior year.
The projection marks a 10% - or nearly $1 billion - decrease on the company's previous forecast for the year.
A financial advisor interviewed by Bloomberg attributed the downgrade to SoftBank overestimating US-based Sprint's cashflow situation.
Sprint recently revealed plans to cut 2,000 jobs, or 6.5% of its workforce, after losing customers for an eleventh straight quarter, the news agency said.
For its fiscal second quarter, Softbank reported a 37% increase in net profit to 560.7 billion yen, partly as a result of Softbank's share of the benefits from the Alibaba IPO. Net sales surged 158% to 4.1 trillion yen.
But the company's operating profit of 259 billion yen missed analysts' projections, and the weaker Japanese yen is impacting the operator's cashflow.
Softbank added 565,000 domestic mobile customers during the quarter, and nearly all its customers are smartphone data subscribers, the company revealed.
Softbank paid a hefty $21.6 billion to acquire a 78% stake in Sprint Nextel last year.