We'll now start the briefing of NTT's financial results for the fiscal year ended March 31st, 2022. Thank you very much for attending today despite your busy schedules. I am Fujiki from the IR office and will be facilitating this session. First, I would like to introduce today's attending members. First of all, from NTT, Representative Member of the Board and President and CEO, Mr. Sawada. Representative Member of the Board, Senior Executive Vice President, Mr. Shimada. From NTT DOCOMO, Representative Member of the Board, President and CEO, Mr. Ii. Representative Member of the Board, Senior Executive Vice President, Mr. Hiroi. Today's briefing is streamed live online. We're also planning to stream the video on our website at a later date. Therefore, we seek your understanding beforehand. As for today's explanation materials, please refer to the presentation materials posted on our company website. On the first page of the materials, points to be considered is stated, so we kindly ask you to please go through them. After this, Sawada, President and CEO, will explain the overview of the financial results and receive your questions from the floor. Mr. Sawada, please go ahead. Thank you very much. My name is Sawada. I will describe to you the highlights of the fiscal year 2021 financial results. Let's talk about the forecast for fiscal year 2022. We'd like to start with page four of the slide. This shows you the summary and the highlights of the consolidated results. We saw increase in both operating revenue and operating income year-on-year. Operating income, operating revenue, and profit all reached record high. Profit exceeded JPY 1 trillion for the first time in history. As for operating income, operating revenue, due to increased revenue at NTT DATA, operating revenue increased JPY 212.5 billion, and reached JPY 2,456.4 billion. With the increased revenue, foreign exchange impact accounted for roughly JPY 127 billion. As for operating income, as a result of increase in revenue in various opcos and cost reduction, operating income increased JPY 97.72 billion year-on-year, up to JPY 1,768.6 billion. As a result of increase in profit linked to increase in operating income, as well as profit impact of minority shareholders after DOCOMO became its wholly owned subsidiary firm, and also one-off factors such as corporate tax, profit increased JPY 264.9 billion year-on-year, up to JPY 1,181.1 billion. As for overseas operating income margin, this improved 3.3 points, up to 6.3% due to increase in NTT DATA revenue and also structural reform. The number is now 6.3%. In the following page, we show you some of the new segmentation that we are applying since this fiscal year. In January, in conjunction with the transfer of NTT Communications and Comware to Docomo Group, we, what we did was to review the 2021 fiscal year results. We actually changed segmentation, so the bottom half on this chart indicates the new segment. We have created the integrated ICT segment by combining NTT Communications and Comware. Also, NTT Limited was taken to the international communication business segment, which was combined with the data communication business segment. We now have four segments, as you can see. Integrated ICT business segment, regional communication business segment, Global Solutions Business, and others. Page six. This shows you the forecast summary by segment. Correction, the results by segment. The top shows revenue, bottom shows income. You'll find the NTT DATA, the Global Solutions Business has seen very robust digital business. This has proved to show very positive results, as you can see. On the other hand, turning to operating income, across all segments, we saw increase in operating income across the board, as you can see. Let's now turn to page eight. This shows you the fiscal year 2022 forecast summary. Now, fiscal year 2022 is the year for the implementation toward achieving the midterm financial target in fiscal year 2023. Fiscal 2023 is the final year of the plan. Therefore, we are expecting increase in operating revenue, operating income, and also profit. All indicators, including operating revenue, operating income, and profit, will all reach record high levels. We will see expansion in all these column. As for EPS, on top of the increase in operating income, and I'll talk about this later, but as a result of new share repurchase, we are anticipating 340 JPY for fiscal year 2022. Turning to page nine, we show you in the forecast summary by segment for fiscal year 2022. The top part shows operating revenue, bottom shows operating income. Across all segments, we are expecting increase in both operating revenue and operating income across the board, across all the segments. Next page, please. This is page 10. This is in small print, but this shows you forecast summary by company. This shows you the forecast summary for fiscal 2022. On a non-consolidated basis, Docomo will see increase in both operating revenue and operating income for fiscal 2022. This week, we announced about the combination of NTT's overseas business, NTT Limited, and this will start from October this year. The plan for NTT Limited will include only that of the H1 of this year for the purpose of forecast summary. Now, on the bottom of the page, we show you a reference. We show NTT DATA prior to integration of overseas business and NTT Limited for full fiscal year for your reference. Both expect increase in both operating revenue and operating income. In particular, for NTT Limited, they're expecting increase in operating revenue of JPY 165.0 billion year-on-year. In 2021, they had a lot of orders, but then because of semiconductor shortage, they were not able to translate that into business. That profit will now be incorporated into fiscal year 2021. Orders are standing, will come into play, in fiscal 2022 for NTT Limited Turning to the next page 11. This shows you the operating income trend and operating revenue trend. This shows you on a quarterly basis, the trends of the operating revenue and operating income over the last couple of years. Right-hand side shows increase in operating revenue, and bottom shows increase. Top right is the best. 2018 is in blue. Mobile communications went down to green in 2019 because of the price reduction. We had the COVID-19. In fiscal 2022, we were in the yellow part. We started with a decline in both operating revenue and operating income, but then we began to have quarterly improvement. Last year is in the red part. In the Q1 of the last year, we had an increase in revenue, but a decline in profit. We received many questions about whether or not we were on track. This was very much in line with our guidance and plan. At the end of the day, we were able to complete the year by exceeding our target and guidance. Where are we in terms of fiscal 2022? This is the purple part. We're expecting an increase in both operating revenue and income in fiscal 2022. Let's turn to page 12. This page is showing the progress overview of the medium-term financial targets. Overall, it is on track. The darker green color is showing achieving the target. In this chart, you see CapEx to sales. In FY 2021, it is below 13.5%, which is at the very bottom line. We have finished the fiscal 13.1%, so we have achieved the target. Second line from the top, overseas operating income and margin, there were some concerns, I believe. FY 2021, it doubled from 3.3%, it has jumped up to 6.3%. FY 2022 forecast, it seems that that year we'll be exceeding the 7.0%. In FY 2022, we believe that we'll be able to achieve the target for FY 2023. Where you see the red arrows is, last autumn, we have revised upwards the financial targets, EPS and cost reductions. For EPS in FY 2021, we have achieved JPY 329, meaning that the original initial target, JPY 320, was achieved two years ahead of schedule. As for cost reduction, the initial target was JPY 800 billion, but we have achieved JPY 840 billion in FY 2021, two years ahead of schedule. FY 2022 forecast is JPY 930 billion, and the probability of achieving that is quite high. Next page, on page 13, we have summarized the shareholder returns. As for the dividends and forecast, we are expected to be JPY 120 per share as the annual dividend, which is five yen increase from FY 2021. This was resolved in today's board of directors meeting. With this, we are expected to increase for the 12th consecutive year since FY 2011. Also, the board today resolved to conduct share buyback of up to JPY 400 billion in total. As already announced, the Japanese government has included in their budget to sell the shares that they hold of ours. Including buying from the open market, we are planning to conduct a share buyback of up to JPY 400 billion. As for the topics, I will briefly go over them. Page 15, please. We are going to reorganize the holding company. We are going to establish the internal audit department and enhance the internal audit. The head of IR office, Ms. Fujiki, will be the head of the internal audit department. We would like to assign her to become the head of internal audit department. We'll also be enhancing the global branding, and we will newly establish IOWN, a product design center. Regarding the third point, this is done in order to accelerate the commercialization of IOWN concept. From the R&D stage, we are creating this organization to commercialize. The next page is a new space business realization. This is something we have already announced. We are going to establish a joint venture company, this July with SKY Perfect JSAT. We are going to build a space integrated computing and network. Next page is promotion of sustainability. As for this, there are three themes, and we would like to embody all three of these themes. We have set the target, and this will be reflected to the director's compensation. First, greenhouse gas emission volume is going to less than 3.075 million tons. This is 34% reduction as compared to FY 2013. The progress is on track. Carbon neutral is 2030 for overall, it's 2040. We are moving on track. As for B2B2X revenues, I think that we will be able to achieve JPY 600 billion. As for new female manager appointment rate, we are aiming to achieve 30%. FY 2021 result was 29%. As for the personnel matters. Oh, okay. The next page 18, is showing the progress overview of the medium-term management strategy initiatives. I would like to skip that. On page 19, I would like to explain about the personnel matters. This summarizes the way of thinking regarding the personnel matters. As for the individual personnel announcements, please refer to the individual company's press releases. At this time, regarding the personnel, we reorganize the personnel structure to establish a new management style and to further strengthen governance. For the holding company, the number of members of the board will be increased from the current eight members to 10 members, and out of that, five will be outside members of the board. I myself will be the representative director chairman, but I will become the chairman of the board of directors. Governance-wise, the executive side is four, and the six will be on the governance side on the board. In order to strengthen the corporate auditor system, one full-time outside corporate auditor will be added. Ratio of female member of the board, audit and supervisory board members, and senior vice presidents to be increased to over 30%. Internal control office will be reorganized into an internal audit department under the direct control of the president. We also have established a new office in charge of economic security. The personnel, including the overall group, there are many areas that we have renewed. Especially, as for the holding company related matters, more than half of the member of the board or the executive senior vice presidents were renewed. That is all from my side. Thank you. Thank you very much, Mr. Sawada. We would now like to take questions, field questions. As we've already informed you in advance, those who have registered beforehand and those who are connected to the phone conference system can ask questions. The operator will now explain how you can ask questions. We would now like to start the Q&A session. If you have any questions, please push zero followed by one. If you wish to cancel your question, please push zero followed by two. From SMBC Nikko Securities, Kikuchi-san, please go ahead with your question. Thank you. Kikuchi here. Thank you very much for this opportunity. Thank you. Thank you. NTT Limited and NTT DATA, I want to ask a question about NTT Limited and NTT DATA. NTT DATA stock prices went down, but you're fine. Your stock prices are fine. I think there are some concerns about NTT DATA. Are there concerns that NTT DATA's profit could be coming down? I would like to ask a question against this backdrop. NTT Limited, you presented structural reform at NTT Limited Are you in a situation where you can declare that structural transformation at NTT Limited is now over? Because that juncture is over, you now have a combination with NTT DATA. Or still, the first, do you believe that, since another six months remains, are you going to take additional measures? Can you share with us to what extent NTT Limited's structural reform is over? I think Q2, Q3 compared to that, I think the results are different. What is the difference? What is the reason for this difference in the Q4 as far as NTT Holding Company is concerned? What support are you going to render for NTT DATA? Mr. Homma, the President of NTT DATA, he might be saying that nothing needs to be done, but I think Mr. Sawada, and you're going to be the Chairman, Mr. Sawada, I suppose you're going to take leadership, and you're trying to go on to prop up NTT DATA. What type of support are you considering to provide to NTT DATA? That is my first question. Thank you. Yes, thank you for your question. With regard to the structural transformation at NTT Limited, I think in principle, most of the transformation has been carried out in fiscal 2021. I think in the past, we had a question. Structural transformation is something that needs to be continued over the long term. Having said that, are we going to see a very large number of people retire? That type of program has been mostly done in fiscal 2021. Now, you asked about the situation in theQ4. Yes, we had restructuring, and we had some impairment loss. Also, on top of that, we carried out additional structural transformation, and that translated into cost. Operating profit may seem smaller in the Q4 compared to Q2, Q3 because of those results. The profit this was severely affected by the semiconductor shortage situation. Why? They handle routers and servers. They deliver those servers and routers and receive maintenance fee from the customers. But then they had no products that they could deliver. They received orders, but they're not able to translate that into profit and revenue. That had significant impact in fiscal year 2021. That being the case, from October, the combination with NTT DATA. The base is already done. Now, you talk about assistance in the second part of our question. We need to pursue combination inclusive of the brand. It's important that we make sure that there's brand penetration. We have to promote that. Also people. We need to support in terms of personnel. We also need to support in terms of the governance, which is at the basis of this. As far as NTT Holding Company is concerned, we would like to make sure that we provide strong support under the new structure. Also, this is something over the long term. I'm talking about maybe a year or two. I'm talking about a year or two term. We have IOWN. Products and solutions that will be developed in the context of IOWN will be coming onto the scene. In terms of online, Docomo is providing a lot of support. Next type of solutions and versions will be coming up. NTT Holding Company and other NTT Group companies together can support NTT DATA and NTT Limited's combination. I hope that answers your question. Yes. Thank you. I'd like to turn to my second question. It's about shareholder return. This, again, divides into two parts. You carried out share repurchase of JPY 400 billion. Now, maybe based on the stock price today, the part involving government will be about JPY 30 billion-JPY 50 billion, which means that $50 billion will remain. Yes. Yes, JYP 50 billion will remain after you do the share purchase from the government. The thirty billion will be done through ToSTNeT-3 and from the market, right? Is my understanding correct? Or are you going to purchase from the marketplace through other means? JPY 50 billion isn't. Are you going to consider procuring the finances to buy from the marketplace? In terms of the dividend, you have a plan to increase your dividend by five yen. In the past, you had five yen increase, after the Q3, you increased that to 10 yen. NTT DATA had upward revision and of course on that basis, NTT also had upward revision in the dividend. There is no increase from dividend revenue from DATA. Maybe your share increase, your dividend increase had no relevance with DATA's performance. This time around, if you're going to increase your dividend increase of five yen- 10 yen, how will you finance that? I think five yen increase in dividend is a bit disappointing. Can you talk about the possibility of JPY 10 increase? Thank you. Turning to your first question. Are we going to buy pro rata from the marketplace? Yes, the amount is JPY 50 billion based on the stock price today, right? The share repurchase program is up to JPY 400 billion. It depends on the stock price of the given time. Inclusive of the market acquisition, yes, we have set the limit of JPY 400 billion for share repurchase. At this juncture, I cannot respond as whether or not we are considering purchase from the market aside from this authorization. With regard to dividend, as you pointed out, up until now, yes, we have had cases where we have indicated increase in dividend in the Q3. The biggest determining factor is whether or not we announce an upward revision after the Q2 is the source of dividend. If the situation is good, then we should of course return dividends to our shareholders, and that should be continuous. This time around, we have very positive business plan. Of course, the global environment is tough, but we have very positive business environment. If the situation is good, I'm sure the new president, Mr. Shimada, will make decisions accordingly based on that situation. I hope that answers your question. Yes. Thank you very much. Could I ask another question, the third question, if I may? It's about Docomo. Now, the segmentation has changed in Docomo, and it's very difficult to have the understanding in depth. Mobile communication service probably will decline by JPY 150 billion. I feel that's the plan. Still, you are anticipating JPY 8 billion increase in operating profit for Docomo. Up to billion in increases is the case for Smart Life, I would imagine. Unless you have significant cost reduction, you should not be able to enjoy increase in operating profit based on those numbers. Docomo's mobile communication service is on the downward trend. How is it that you're able to secure profit, a positive profit? That's my last question. Thank you. Okay, Mr. Hiroi, would you like to respond to that? Yes. Thank you. This is Hiroi from Docomo. I would like to respond to your question. Yes, indeed, mobile communication service revenue is declining. It's quite significant. At this moment, we are taking measures on the cost side to offset this loss. We are reflecting, refactoring in cost efficiency improvement. The driver of the cost efficiency improvement will be the streamlining and the efficiency in the sales channel. This is already explained in the presentation material. For example, we'll be using online functions, and through this we want to improve efficiency in the sales channel. Through that cost, we'll be able to offset the cost. Also, NTT Communications and NTT COMWARE has now been integrated, and as a result, enterprise business will see positive increase. These are the positive drivers. I believe, therefore, the new NTT DOCOMO Group as a whole will be able to realize an increase in operating profit at the end of the day. Thank you very much. I would appreciate further comments later on. Thank you very much. This was Mr. Kikuchi-san. We'd like to take the next question. Next, from Nomura Securities. Mr. Masuno, please go ahead with your question. I have several questions also, but the first one, the group reorganization, I believe that it has come to a cycle end. Docomo and communications integration in just two years, there'll be JPY 200 million. Just with video, JPY 300 million increase and you have the increase in revenue, but also the contribution to the profit or the cost reduction contribution to the profit. The remaining part, next fiscal year is going to contribute by 100, the difference of the JPY 100 billion contribution to the profit difference. This part, this fiscal year and next fiscal year's balance, can you explain about that? Another point is that the global reorganization, before you said at FY 25, you said the synergy is JPY 30 billion in terms of operating profit. So from NTT's holdings, it's about a 2% synergy. The cost reduction, I believe that's quite done on the backyard side. But to what extent is that going to have a positive impact on increase in revenue is what is difficult to understand. So this JPY 30 billion cost reduction and also the factors of increase of revenue, I would like to know. Thank you very much. Regarding the first question of NTT DOCOMO, maybe you should answer this question. This is Ii, the President and CEO. Thank you very much for your question. Yes, you are correct. In the first year, there's not that much of a contribution to the profit level. However, including the cost reduction initiatives, the profit is as you have just described. As Hiroi explained to you before, the operation cost itself, it's not just for the sales channel cost, but the network side operation cost, we are intending to thoroughly reduce that also. From that, the cost reduction will be generated. The side that will be showing an increase is the Smart Life business. We will put some money in the investment. The enterprise solution business growth is going to directly contribute to the profit. Also the telecommunication service business. Recently, we have ahamo, and the medium bucket services have been launched. Due to that, we are seeing a return of the customers in their twenties and thirties. The revenue is increasing on that side. It's not just the impact of the lowering the price, but we are seeing an increase in subscribers, which is contributing to the increase in the revenue. Therefore, with that, this fiscal year's synergy will be generated from this. More than majority, the contribution will occur from next fiscal year onwards in terms of synergy. Okay. Regarding NTT DATA, synergy of 2020 and 2025, the synergy is at JPY 30 billion. At this point, we are not disclosing any more additional information than that. They're not disclosing, so I cannot comment more than that. From the holding company's perspective, this is just the starting point or the entrance or starting the integration. Finally, the enterprise side global business governance has unified as a group. This is the first time since then. From there, the tangible and intangible synergies that we're now seeing at this point is going to increase, and also the reputation is going to improve. Through that, we'll probably have a return, but we do not have the solid numbers. Therefore, there will be a furthermore synergy coming forward is how the holdings look at this. Thank you very much. Mr. Ii, I will have a follow-up question. I do understand the overall picture, but the synergy between Docomo, NTT, and NTT Communications, JPY 50 billion or the B2B, JPY 30 billion, there is no contribution of that synergy to the profit. For the enterprise, there's a JPY 50 billion increase in revenue, and that's going to be a JPY 7 billion profit, is what we are expecting. This is the overall enterprise business? Yes. Okay. It's not just the incremental, but including the past two. Okay. My second question is regarding the impact to the share price. From that perspective, the mobile business price competition, what's going to happen to that is going to become a key. Each carrier is showing the decline in revenue. However, in each one of the individual brands, I believe that there's no additional decrease in the pricing. The weighted average blended overall, it went down. Docomo has the 100 GB, and for the, they are shifting over to a larger capacity or focusing on the data capacity. The environment, competitive environment, instead of having a decline in pricing for each individual brand, but having a more added value to each of the brand seems to be the direction heading from now onwards. What is the sense of scale and what is the situation? We have rolled out the 5G network, investing a lot. Docomo is focusing on the fast 5G service. How can we acquire the customers? One is to accelerate the network expansion and also the terminal and devices respond. We come up with the devices, a high-end one and a low-end one, which will function in a quick data transmission on the 5G network. Having the high and low end, then the younger generation can also use it. Market survey shows us that it's not that the younger generations, the twenties or thirties, they not necessarily have their own home router at home. Spending JPY 5,000 every month and having a home router, but having ahamo adding JPY 2,000 and being able to use 100 GB, that is more convenient, is what the younger generation think. We do believe that such a market for large capacity does exist. We are actually targeting that group in the market too. Thank you very much. Masuno-san, thank you very much. Next question, please. Next question is from Daiwa Securities, Ando-san. Mr. Ando, please go ahead with your question. Thank you. Ando here. I hope you can hear me. Yes, we hear you clearly. Thank you. I'd like to ask two questions if I may. My first question is on the following point. It's about the global margin. You are able to achieve this one year ahead of the schedule. You're able to achieve operating margin target. Now, in the past, operating income margin and revenue, you set these targets, I believe, in the past. But now you have unified your target into one single target, which is operating income margin, which is global operating income margin. At the time that you achieve this target of global operating income margin, are you going to shift your target once again to revenue going forward? Is there possibility of changing your policy going forward? Should we prepare for your, any change in your target policy down the road? That's my first question. Yes, thank you for your question. At this moment, are we going to return to revenue-oriented target, or are we going to add revenue-oriented target? That is not our plan right now. Because there was the impact of COVID-19, and of course, this year we've had impact of inflation as well as the war. Also foreign exchange or currency is now shifting to weak yen trend. At this juncture, are we going to set a revenue-linked target? I think it's probably not the case as far as the timing. It now is not the timing. Now having said that, I forgot which page it was, but NTT DATA. Yes, page ten shows you the forecast by securities company. NTT DATA is kind of JPY 108 billion. NTT Limited is considering increase of JPY 165 billion in terms of increased revenue. DATA is doing very well, and also NTT Limited has very strong order remaining. That being the case, maybe we need to re-review our mid-term plan. Maybe we under the new structure, under the new team, they may consider whether or not they should consider revenue as part of the plan going forward. Thank you for that. My second question relates to the capital expenditure, CapEx. Taking a look at the situation this fiscal year, I think there seems to be a slight increase in your CapEx. That is my understanding. How should we consider that? What are the factors that are behind the increase in CapEx this time around? What is the medium-term trend that we should be mindful of when it comes to CapEx? Yes, thank you. As far as the holding company is concerned, yes, real estate and data centers, these are the drivers behind the increase in CapEx. This is demand linked. There's strong intent on the part of the business players to provide these services. We have that many projects as far as the NTT holding company is concerned. We want to work with financial partners and take this off balance sheet. We want to try to expand by, but then reduce the amount of investment that is required on our part. As far as the main telecom part is concerned, I'm sure that this can be covered by Docomo colleagues. ocomo is really emphasizing 5G investment. Conversely, they have really contained the non-5G related investment in other areas. As for NTT East and West, they are very lean when it comes to CapEx. That is the situation. At this stage, it's really stayed in data centers. These are more conspicuous. Also, Docomo is making investments so that they can expand to other business as well. There's got to be that requirement, naturally. As far as the trend of investment is concerned, focus is on the new areas, focus is on investment in growth areas and areas that will generate profit. If I could add. Sorry, if I could jump in. Oh, sorry. Please go on. Okay. This is Ii here. Yes, I agree with what was just mentioned. I think network-related investment, we will contain that over the medium term. NTT Communications, they are building custom networks because of the orders they receive. That is not going to increase that significantly. Docomo's telecommunication facilities and other orders received, I think over the medium term, CapEx can remain flat. What is increased will be future investment for the future. For example, financial payment system-related investment or XR-related investment, XR-related software. The type of investments will be required in order to grow in the future. For this fiscal year and next fiscal year, over the next two years, I think we need to make robust investment in those areas. Thank you. When we take a look at the breakdown of CapEx, the Global Solutions Business seems to be increasing. That's how it seems. That's primarily data centers. Is that the case? Going forward, does this likely to increase? That is because of the robust business. Is that how we should interpret these numbers? This is Shimada here. As far as the data centers are concerned, yes, data center investment is increasing in the Global Solutions Business. That is true. In fiscal year 2021, JPY 170 billion was invested for data centers. In fiscal year 2022, the number is JPY 180 billion as a plan. If we include the third parties, in fiscal year 2021, it was JPY 180 billion investment. In 2022, it's JPY 300 billion if we include third parties, because we procured from third parties JPY 130 billion, so over JPY 300 billion investments will be made. The growth in the marketplace for data centers is about 30%. It's 30% more than 30% growth in the market. There's that robust demand out there. For the time being, this level of investment is going to be required. Whether will this continue over the next couple of years, we have to see the prevailing market situation? Okay, thank you very much. Thank you very much, Mr. Ando. Now we would like to take the next question. Next, from Credit Suisse Securities. Eguchi. Mr. Eguchi, please go ahead. This is Eguchi from Credit Suisse. Can you hear me? Yes, we can hear you clearly. Thank you very much. Regarding NTT Limited, I have two questions. The first question is regarding the fourth quarter's Limited sales. Probably there is a yen depreciation effect incorporated, but to what extent is that impact incorporated? And also regarding the semiconductor related reason, there is some order backlog, but how much of that backlog did you have? I just wanted to know this how much it grows. Thank you. For Limited in the Q4, this is related to the data center explanation given to you before. We have sold one, and that is recorded in the Q4, and that was about JPY 10 billion, and that is increasing that part. As for backlog, order backlog is JPY 130 billion. Eguchi-san, does that satisfy your question? Thank you very much. This time, where you said JPY 10 billion, is that a one-time recording or next fiscal year onwards? I have heard that there's a strong demand for data center, but is such a situation going to continue? Also, can you talk about the semiconductor? First of all, this JPY 10 billion, the situation, it's not that we've sold everything because the situation satisfied. It's just we were working on the off-balancing, so we sold it. It is a one-time for this time. This type of sales is going to continue moving forward. As Mr. Shimada mentioned before, with JPY 300 billion, the third-party capital will be JPY 120 billion. This scheme will be what I was talking about moving forward. As for the semiconductor, the Cisco routers, selling that to the customer, that type of order backlog is what we are talking about. Of course, FY2022, this fiscal year also such a backlog will remain. We will resolve this backlog. Once again, probably this is not going to reach JPY 130 billion for FY2022. It will be lower or smaller than that. Okay, if that is so, then the new fiscal year's NTT Limited's increase in profit, the structural reform positive effect is the majority, and the product mix or the actual profitability improve. How are those incorporated? It's 8-to-2 ratio. Structural reform is 8, and the expansion of customer or expansion in demand, the sales side is 20%. It's probably how you should look at it. Thank you very much. My second question is regarding the NTT Limited's incorporation to NTT DATA. I don't know if Mr. Shimada is gonna answer it, or I don't know if I should ask Mr. Shimada. When I listen about your explanation of a structural reform, it has not completed yet. You have done things in order to improve the profitability, is my understanding. NTT Limited's profitability, there's a high value-added services where you have switched the direction towards. Still, what is lacking? In order for you to compete in the global arena, what do you need? Do you need to improve other areas than improving the fixed cost? What are the areas that you need to further change is what I would like you, Mr. Sawada, to explain. Well, Mr. Shimada was preparing to answer that question, but I would like to hear a word from, of course, Mr. Shimada too. I myself, what I think is that NTT Limited, shifting over to a higher profitability service, they are still in the midway of that. The high revenue services, managed service or security services or edge-to-cloud type of advanced cloud type of services. That changes every day, meaning that one after another, new technology, new services need to be incorporated, and we need to change ourselves to enable that in our process model. The regional, when you think about the regional sales activities of NTT Limited, in order to sell a certain product, there are professionals. When a new product comes in, then a structural reform will be necessary again. I think that type of cycle is going to continue, is what I mean. Mr. Eguchi, as you have explained, the areas that the fixed cost will be reduced moving forward is our own DX cost and the IT. We will be providing edge-to-cloud to the customers, but we will provide that to ourselves too in order to enhance our own capabilities. Mr. Shimada, do you have something else? Well, for the foreseeable future, the profit growth, it will be generated from data center and managed service. If you look at the appendix material of the financial results, data center is the 38% of revenue growth, and managed service is at 23% growth. From here, there are returns. That area is going to be the growth area. For NTT Limited, what they're newly working on is the private 5G. Well, turning the whole factory into complete private 5G type of product. It has already started. As Mr. Sawada mentioned the next new profit source we need to create such a thing simultaneously in parallel. Of course, cost reduction or unprofitable business areas. I did mention this in the third quarter. A withdrawal from the unprofitable areas is something that we would like to do during FY 2022. The profitable area and withdrawing from the unprofitable business. Those are the rationalization or streamlining that we would like to do. Thank you very much. Thank you very much, Mr. Eguchi. Next question, please. Next question is from Mizuho Securities. Mr. Hori, the floor is yours. Hori-san, please. Thank you. My name is Hori from Mizuho Securities. I would like to ask just one question, if I may. I wanted to ask about NTT Limited, NTT DATA, and the combination of the overseas business opportunity between these two companies. Let's take a look at this scheme. Over the short term, it seems that it's disadvantageous to the shareholders of NTT DATA, but more advantageous for NTT. You said that this is simply a starting point. You also talked about IOWN, and you mentioned that the overseas company should be promoting IOWN. If that is the case, DATA will own 55%, NTT will own 45% of the new overseas operating company. This ratio, is this close to the final structure, the ultimate structure? Or is the ownership structure subject to change going forward? What about the division of roles? In this, in the slide presentation on Monday, application and platform will be done by NTT DATA and NTT Limited, and the base technology will be held by R&D team of NTT Holding Company and the R&D team. If that's the case, maybe the equity ratio for the new overseas operating company could change as a result. What are your thoughts? Is this the ultimate structure, or is this subject to change? Can I check, in line with the progress in the structural transformation, can this ownership structure for the new operating company for global business change over time? Yes, thank you for your question. Actually, we had the proposal where NTT DATA would have 100%. Then we have 55%-45% structure this time around. We want to support the overseas global service strategy that NTT DATA would like to implement. If we have new products, or should there be acquisition down the road, or should the market environment significantly change, maybe I think we have to consider whether or not these numbers should remain the same. That is our thinking. I see. Well, from the perspective of NTT DATA, Data at last has to repurpose the structural transformation of global business over the past, and now they are in a profitable situation. They are able to generate very comfortable profit right now. And this owes to the efforts made by NTT DATA. NTT DATA made efforts to improve the profitability. In this new operating, new in this new global business, global operating company, 45% of the company's profit will be taken away by NTT Holding Company. Once the profit level expands, maybe Data would want to expand their equity ratio. If that request were to come from Data, how does NTT Holding Company intend to respond to that request? Well, it depends on the circumstances at the time. If the request is reasonable, we may consider. Conversely, we also have shareholders of our own. It means that our take of the profit will be coming down if the structure change. If that should have a negative impact on the EPS, then that's a policy which will be difficult for us to take. Both companies are listed. NTT DATA's largest shareholder is actually NTT Holding Company. We're the largest shareholder for NTT DATA. We should not use the term minority shareholders, but there are other shareholders as well. We also have other shareholders of our own. How will the situation be perceived by other shareholders? I think both sides need to consider and make their respective decisions accordingly. Also, one other point. As for NTT DATA, at the time of the current medium-term plan, they have set the target of operating income, and they're considering possibly the EBIT target down the road. At this juncture, I think NTT Limited, by consolidating NTT Limited, their profit and revenue will improve. That is the situation for NTT DATA. As you mentioned, Mr. Hori, at the outset, it's not. The advantages are not skewed towards NTT Holding Company. I think that is not how NTT sees the situation either. I see. Thank you. Thank you. That is very clear. Thank you very much. Thank you very much. Mr. Hori, would you like to take on the next question? Next, from Okasan Securities. Okumura-san, please go ahead., Thank you very much. I am Okumura from Okasan Securities. Can you hear me? Yes, we can hear you. Thank you very much. I have two questions. The first is related to NTT DOCOMO. Non-consolidated DOCOMO, it seems that they're increasing their profit. The mobile customer base, it has expanded, but I would like to ask you about the outlook and forecast. At the finished fiscal year, due to the OCN, we cannot do an apple-to-apple comparison. With that included, were you able to expand the customer base? With the customer base expansion this time, are you also incorporating the net adds in the forecast that you have this time? This is Ii speaking. Thank you very much. Actually, as OCN Mobile ONE, the lower capacity lower price menu was from last October onwards, or in reality from December, so we were a bit late. That part, the customer base recovery was falling a bit behind. Compared to the year before, MNP has been improving. Converting into numbers against the previous year, about JPY 20 billion of recovery is shown on the revenue side. This fiscal year, furthermore, we are going to enhance it more. It's in a positive side. If we increase the power of the medium bucket and the smaller bucket, it will totally become into the positive side. That's what we were aiming for a long time, and we believe it is going to be such. We'll be okay. Okay. Having that as a premise, the competitors, in a way, are sacrificing their profits for short term, but still going after subscribers. For you, with the service lineup, with the current ones, you can expand your customer base? Or are you thinking that you need to come up with some new initiative to be launched? Well, in that sense, the new menu, our new, price plan, we're not to think about that. We're not at that stage yet. We are going to continue the medium bucket. We have the, ahamo Oomori, a type of new option added to that. The higher ARPU, menu, customer base is what we would like to increase. The lower price ype of ARPU, lower type of customer. We shouldn't spend the cost to acquire the low-end customer. Based on this way of thinking, we are putting our efforts in the marketing side instead of launching more new menus out into the market. Thank you very much. The next question regarding IOWN, I would like to ask Mr. Sawada. Sorry, it's qualitative, but this time you are newly establishing the product design center, and you will be developing the services from now onwards. Up till now, when you think about the monetization of IOWN, what are the areas that you think you can monetize? Or if there's something that you are already thinking of in terms of that area, can you share with us? Thank you very much. From last year, we started a trial, and this year, NTT East. Even though the performers are located in separate locations, simultaneously, they can perform the music. The low latency is a very short service, and that is comprised by All-Photonics networks. It's not digitalized, but the video information is transmitted, not being digitalized. I want that to be made a dedicated, a dedicated net, a dedicated network. The low latency dedicated network, the electric signal will be applied, and through that, a more secured backbone or service will be able to provide. The quantum dedicated, quantum communications dedicated network. IOWN's optical fibers advanced service is such a thing. FY 2025, we have the World Expo. Even though we say that it's only two years plus from now, and at that point, the disaggregated models, servers within a data center, we are thinking whether we will be able to prepare that or not, and we are working on it. Of course, this, the Photonics-Electronics Convergence type of a technology will be applied there. Therefore, that type of a full-scale type of attempt will occur in the FY 2024/2025 period. Also, as I have explained, we are looking at space, the optical transmission method, and this is one of the IOWN technology. We'll be using that in the space. If possible, next year or two years from now, we would like to commercialize it. We are considering it right now. Thank you very much for the detailed explanation. That's all from my side. Mr. Okumura, thank you very much. Next question, please. Next question is from Ishino-sama. Ishino question, Ishino-sama from Tokai Tokyo Research Center. Thank you very much. My name is Ishino from Tokai Tokyo Research Center. I would like to ask this question, if I may. Docomo and NEC and AWS are now going to have started public cloud testing since March. By the end of the year, are you able to achieve results of these tests? I think you have such plans. What about the capital investment? Once these tests are successful, will this have impact on our CapEx spend, going forward? That's my first question. I would appreciate your response. Also, should I go on to my second question as well? Can we take questions one at a time, please? Okay. Yes, one at a time. Thank you. This is Hiroi here. I'm not well-versed. Having said that, AT&T recently is now trying to sell their core network to Microsoft Azure. Core, with regard to core network, how are they going to incorporate into this public network? I think that has emerged as a very hot topic in the mobile industry. It's a very hot issue right now in this industry. They're trying to consolidate based on economy of scale. AWS and public cloud players are or one such option. Now, they're considering a lot of user information, so processing that information at the edge. If that is the case, then you don't need AWS and other public cloud functions. Is it really. I think there are still many discussions among the mobile industry as to whether or not which of these options are best. We want to gain knowledge and information through this testing. Now, we're not sure at what time the results can be achieved through these tests. When, with regard to impact on the capital investment, this is something we need to consider down the road. That is my response. Thank you. Okay, thank you very much for that. My second question is this. I think this relates to the previous question as well. It's about IOWN. With the Photonics-Electronics Convergence, you're able to create data centers through a photonic transmission route. If that environment is achieved, then the capital investment required will change. We're talking about data center investment increasing 30% per annum. I think we're seeing very excessive investment competition. If this type of excessive competition continues, then we're going to have such capital-intensive situation. At the end of the day, although we're talking about zero carbon in our society, you have players that are using so much energy. That risk is there. Therefore, data center project within IOWN can translate into cost reduction, I suppose. Against this backdrop, if you have already carried out such a calculation, what will happen to data centers? How much cost reduction can you achieve if you have photonics-based data centers compared to the current data centers and silicon-based data centers? How much cost reduction can you achieve? And also, what challenges remain? I think this is a major game-changing technology. To the extent possible, if you can share with us what you see as the possibility. Thank you very much. This is Sawada here. With regard to Photonics-Electronics Convergence, what this entails is within the LSI package, LSI memories will be connected to the LSI next door, and photonics will be utilized. That is what Photonics-Electronics Convergence is all about. Now, photonics semiconductor is photonics to complete semiconductors. Power consumption is supposed to be one-hundredth. This is something for 2020-2030 onwards. In the case of Photonics-Electronics Convergence, power consumption will be reduced to one-tenth. This percentage will improve. Servers that utilize this technology or data centers that utilize this technology need to be built. You need software that can run on top of such technology. To be quite candid, we're not sure how much cost can be reduced. We have not been able to calculate how much cost reduction we can achieve because we are not yet at a juncture where we can create such a system per se. What this means is that it's difficult to discuss how much CapEx will be involved. As far as the CapEx that we have right now, this is geared toward the power percentage required for data centers. What IOWN is looking for is servers and systems that are incorporated into the data centers. As far as we're concerned, this is not double investment. This is not a duplication investment for NTT. We want to work together with partners and we're trying to build servers and switches. This has to be done from the semiconductor level. That's what we're trying to implement together with our partners. Right now, we're not able to calculate the cost and effect at this juncture. We're not yet at that juncture. I see. If that is the case, from 2020- 2025, the second stage will begin. In 2030, you'll be able to switch to photonic semiconductors. It's, we're talking about five years plan. Within the next 10 years, can we expect major structural change as a result of the progress in this technology? Inclusive of how you invest, things may change over the 10 years time. Is my understanding correct or wrong? Yes, that is how we see the situation. Yes, you are right. Okay, thank you very much. Mr. Ishino, thank you very much. With the next question, we will be answering all of the questions that we have received. We would like to take on the next question. Morgan Stanley MUFG Securities, Mr. Tsusaka, please go ahead with your question. This is Tsusaka. Hello. First of all, the overall management design, so to speak, or the design of the profit. Moving forward, what kind of a company will NTT become is what I would like to know. In the last one year, about JPY 100 billion of a mobile revenue decline has occurred. At the same time, the global business and the solution business, you have surely established a profit. This fiscal year, the profits increased. The contributing factors, it seems that the majority is coming from the solution side. From next fiscal year onwards, the scenario of the ARPU largely increasing at this point is probably difficult to come up with because you don't know what the competitive environment is going to be. If that is so, the profit design for the overall NTT seems that the consumer part is maintaining the status quo or try to not make a loss or have a loss generated, but more getting closer to or focusing more on the enterprise side of the business, it seems that way in the last several years. From the management perspective, I believe you would like to increase both sides. Looking at the last two years, it seems that the focus is on this as such. Making more investment and increasing the profit, what are those areas? Is there a particular area that you would like us to focus on or you would like to focus on? Can you share that if such a thing does exist? Thank you very much. This is Sawada speaking. As you have pointed out, the consumer side of the business. Well, it seems the enterprise is stronger, but the consumer is flat. More than consumer, I think you're talking about telecommunication services. In Docomo's perspective, finance services, financial services or, the so-called Smart Life business area, the applications or the, personal solutions type of service. Next time, the XR business will be expanded. The handset or the devices included. In that area, the IOWN element can be incorporated. Consumer, in something it's flat, but the telecommunications consumers will be flat. The Smart Life business area, including the global business, will increase. In order to achieve that, we will invest and acquire and expand this business. That's one perspective. For the enterprise, for the global enterprise, NTT Limited and NTT DATA will be integrated including the edge-to-cloud technology. This is the area that still has room for growth. It will require investment. From mid- to long-term, the devices that we generate from the IOWN technology and the systems that the technology is embedded, and the software that will use t hose devices, to what extent can we prepare all that? Whether we'll be able to do that or not is going to determine whether we'll be able to expand the business or not. Shimada-san, anything to say for the foreseeable near foreseeable future? Maybe this is better that you, Mr. Sawada, answers. There's a Smart Life business area and the enterprise business area. Improving the and increasing the profit will be the base. The consumer business side, as Sawada, the President CEO, mentioned, and the telecommunications business side, stacking up the profit further is quite a hard challenge to take on. Therefore, on the enterprise side, how much can we increase and expand that business is going to be the challenge we need to take on for the next year or two. On the consumer side, the Smart Life business, from that perspective, there are a variety of other businesses, is what I think. In the internet type of companies, there are companies that specialize in that area, and there's quite a strong competitor out there. NTT DOCOMO's Smart Life business or new initiatives, compared to the existing strong players, in these areas, they're able to differentiate themselves. If such a thing does exist, can you share that with me? This is Ii speaking. Thank you very much for a difficult question. Yes, as you have rightly pointed out, our competitors, if I may name a company, SoftBank. They have an e-commerce platform based as Yahoo. They have an EC platform, meaning that they have a cash cow platform, Rakuten as well. We don't have such a thing. The general consumer type of business, maybe we cannot do such a thing, but we aim for the more niche market, like pharmaceutical drugs in the medical and healthcare area. Not just the ethical, not selling just the pharmaceutical drugs, but have the clinical checkup or the person link that with the personal health data. Having such added values. As the product sells, we will sell the drug products, pharmaceutical products. If we try to do the same thing, that's not, that doesn't have a meaning, but it's more reasonable if we team up with a partner that specializes in those areas. The 87 million DOCOMO's d POINT members is the base for us. What we're expanding right now is for the enterprise. We have the Business d POINT customer platform. We have only about four million at this point, but we will expand that. We will link an ID to our customers, and through that, the purchase behavior or and such data we will can be collected and can be analyzed, and then we can launch advertisements, specific advertisements toward that, or we can use that data for product development. We will focus on such a added value part. For the competitors, they don't disclose such a customer data or make it openly available. They're using them on their own, but we are actually doing the opposite to the customer. We will create the virtual customer database for our customers, and we are actively working on providing such service to our customers. The majority of the revenue will be like a advertising revenue model. Thank you very much. The last question is that DOCOMO experienced a JPY 100 billion decline in revenue, however, will continue to increase the profit. To do so, I'm sure there were various measures that were devised. This year, JPY 100 billion decline, next fiscal year, I'm just rounding up the numbers, but still they will increase the profit. Seems that the way they are conducting the business, even such a situation, they are recovering their competitiveness. When we think from that perspective to the conventional way of doing business by adding some change, it seems that they're able to conduct a business that is more efficient and more effective, and good profitability. Looking at the overall NTT Group, the improvement or kaizen that DOCOMO achieved, meaning or the optimization of the way they conduct business. Is there another organization within NTT Group that has such an opportunity? Or has all of the group companies done what they could do? I think there's still room for all of the group companies to do a similar thing as DOCOMO. As you have mentioned, DOCOMO has put their whole effort. The mindset or the structure, or the profit-generating structure is changing. Including the global side, how are they going to conduct their business moving forward? NTT East and West is just changing to an increase in both revenue and profit. Just providing in one region, but also going into revitalizing the local economy. Maybe they can go into that area, or the system side, or the DX area. Their processes are still old or obsolete, and they are fiber-centric. Each country, many of those countries, and labor-centric too. I believe 100,000. We conducted a survey of 100,000 employees and we will be able to understand that there are various issues that we need to understand that there are still various issues that we need to tackle and take up on the challenge. What do you think, Mr. Shimada? Well, for NTT East and West part, as already shared with you, up till now, they have been accumulating the cost reduction efforts. The process, majority of the process is conducted by people. It probably will take us several years still. However, automating that type of work, if we take it up to that stage, there's still quite of a room for improvement. Therefore, in that sense, the areas that the efficiency will improve, there are still areas remaining in DOCOMO and also remaining in NTT East and West, is our understanding. Thank you very much. Sorry, Tsusaka-san. Mr. Ii, do you have something to add? I thought that you were complimenting us and listening to your comments. Thank you very much. As you have pointed out, we have to change the mindset quite a bit, meaning that at what timing are we going to shift the conventional way of thinking. We kind of did a radical treatment to the organization. Of course, I'm sure there are some disaffection towards me by doing that. This fiscal year, all of the fruits can be picked for what we've been doing. I think it's just the thing that what could have been done has not been done till now. It's not that we're doing something that is impossible. They just had room, saying that they didn't have to. They still were able to be in a good situation without doing things. Just the cost reduction alone is not sufficient. What does change mean? The management needs to thoroughly convey that. Need to have a specific image. Ahamo is a good example. Buying the service only online, it's the opinions like, "Are you trying to make the Docomo shops go bankrupt?" The Docomo shops also think, "Oh, we can't stay like this, not doing anything. We have to do something else too." If we light the fire, Docomo has many forward-looking employees. Once we give them one nudge and push, they will move forward. The rest, I would like to leave it up to Shimada-san. Thank you very much. Mr. Tsusaka. thank you very much. We have responded to all the questions. With this, we'd like to conclude the presentation of the financial results for fiscal year 2021. Thank you for joining us today.