iPhones and iPads drive Softbank’s explosive Q1 profits


In case anyone doubts the power of Apple’s devices to lift the fortunes of its cellular network operator partners, Softbank’s newly reported fiscal first-quarter results (PDF) should prove convincing. The Japanese carrier reported a nearly 500 percent increase in net income for the quarter ending June 30 versus the same quarter last year. The company ascribed much of its success to strong demand for Apple mobile devices, including the iPhone and iPad.

Softbank’s net income for its first fiscal quarter of this year was ¥94.79 billion ($1.22 billion U.S.), which is up from ¥19.44 billion (around $250 million U.S. with current exchange rates) for the same period in 2010. Softbank says smartphones in general helped raise revenue, but the carrier has exclusive rights to sell the iPhone in Japan, where Apple is still the leading smartphone manufacturers by a wide margin.

Sales of Apple hardware may be contributing quite a bit to Softbank’s bottom line, but it also helps by increasing the average revenue per user (ARPU) for Softbank customers. Data ARPU climbed to a record high ¥2,440 per subscriber per month on average, putting it first overall in the world among mobile operators when it comes to the ratio of data to traditional cellular services ARPU. This is a significant victory as smartphones and apps encourage greater use of data in situations where previously voice or text played a more significant role.

Softbank CEO Masayoshi Son told TeleGeography in an interview that he believes Apple’s smartphone is only getting started, and stands to benefit from the general rise in smartphone popularity. Specifically, Son said “the iPhone’s strength is standing out the more people come to use smartphones,” suggesting that the iPhone’s advantages stand out better when compared to its competitors.

This represents only the latest in a string of very strong quarters for Softbank since the iPhone’s release on the network. So far, there’s no official indication that Softbank’s exclusive deal with Apple in Japan will end, and I’m sure that based on these results, that’s something the carrier is very happy about.

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