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KDDI Corporation (KDDIY)
OTHER OTC:KDDIY
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KDDI
(OTC:KDDIY)
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Rating:69Neutral
Price Target:
$18.50
▲(16.72% Upside)
KDDI's overall stock score reflects strong financial performance and positive earnings call highlights, tempered by technical indicators suggesting neutral momentum and a relatively high valuation. The company's solid revenue growth and operational efficiency are key strengths, but increased debt levels and challenges in certain business segments pose risks.
KDDI (KDDIY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$59.41B
Dividend Yield2.62%
Average Volume (3M)12.95K
Price to Earnings (P/E)18.9
Beta (1Y)0.15
Revenue Growth2.22%
EPS Growth43.84%
CountryUS
Employees61,288
SectorCommunication Services
Sector Strength97
IndustryTelecommunications Services
Share Statistics
EPS (TTM)0.29
Shares Outstanding4,187,847,700
10 Day Avg. Volume30,301
30 Day Avg. Volume12,949
Financial Highlights & Ratios
PEG Ratio-0.64
Price to Book (P/B)3.73
Price to Sales (P/S)3.23
P/FCF Ratio19.96
Enterprise Value/Market Cap1.69
Enterprise Value/Revenue0.02
Enterprise Value/Gross Profit0.04
Enterprise Value/Ebitda0.06
Forecast
1Y Price Target
$18.50Price Target Upside16.72% Upside
Rating ConsensusHold
Number of Analyst Covering1
KDDI Business Overview & Revenue Model
Company DescriptionKDDI Corporation (KDDIY) is a prominent Japanese telecommunications company that provides a wide range of services, including mobile and fixed-line communications, broadband internet, and various IT solutions. Established in 2000, KDDI operates primarily in the telecommunications sector but also has significant interests in technology solutions, content distribution, and IoT services. The company's core products include mobile phone services under the au brand, data services, and enterprise solutions that cater to both individual consumers and businesses.
How the Company Makes MoneyKDDI generates revenue through multiple streams, primarily from its mobile communications segment, which includes subscription fees from its au mobile services and prepaid plans. The company also earns money from fixed-line services, broadband internet subscriptions, and data center operations. In addition, KDDI has ventured into the IoT space, providing services that connect devices and enhance smart solutions for various industries. Strategic partnerships with global tech companies and local enterprises further bolster its revenue through collaborative projects and joint ventures. Furthermore, KDDI's focus on expanding its digital services, including content delivery and cloud solutions, contributes to its overall earnings, allowing the company to diversify its income sources.
KDDI Earnings Call Summary
Earnings Call Date:Aug 01, 2025
(Q1-2026)
| % Change Since: |
Next Earnings Date:Oct 31, 2025
Earnings Call Sentiment Neutral
The earnings call presents a mixed sentiment with notable revenue growth and successful financial services expansion, but offset by profit declines and challenges in specific segments like Digital BPO and smartphone subscriptions. The highlights and lowlights are fairly balanced.Q1-2026 Updates
Positive Updates
Revenue Increase
Operating revenue was JPY 1.4363 trillion, up 3.4% year-on-year, indicating a positive revenue growth for the company.
Financial and Energy Business Growth
The combined financial and energy businesses saw an increase of JPY 6.2 billion, and Lawson's equity method profit was up JPY 5.7 billion.
Mobile Revenue Growth
Mobile revenues for Personal and Business Services segments combined were JPY 550.6 billion, up JPY 7.6 billion year-on-year, with a mobile ARPU increase to JPY 4,340, up JPY 60.
Financial Services Expansion
au Financial Holdings operating income increased by 33% year-on-year to JPY 11.7 billion, with the au Money Activity Plan exceeding 1.6 million subscriptions.
Business Services Segment Growth
Consolidated operating revenue in the Business Services segment was JPY 349.7 billion, up 4.5% year-on-year, with operating income up 5.4%.
Negative Updates
Profit Decrease
Operating income was JPY 272.5 billion, down 1.6% year-on-year, and profit attributable to owners of the parent was JPY 171.1 billion, down 3.3%.
Sales Promotion Expenses Impact
The impact of prior year's promotional expenses, including a JPY 7.3 billion onetime expense, negatively affected operating income by JPY 4.4 billion.
Challenges in Digital BPO
The Digital BPO segment saw a decline in revenue and profit, with a slow progress in customer acquisition.
Weak Smartphone Subscription Growth
Smartphone subscription net additions were slowing down, indicating weaker growth in this area.
Company Guidance
During the financial results briefing for the first quarter of fiscal year ending March 2026, KDDI Corporation provided guidance on several key metrics. The company reported a consolidated operating revenue of JPY 1.4363 trillion, marking a 3.4% increase year-on-year, while operating income decreased by 1.6% to JPY 272.5 billion. Profit attributable to owners of the parent was JPY 171.1 billion, a decrease of 3.3% from the previous year. Despite the decline in profit, the company maintained that results were in line with initial forecasts. The Personal Services segment aimed for a full-year profit growth of over JPY 30 billion, with Q1 mobile revenues increasing by JPY 2.3 billion year-on-year. Mobile ARPU rose to JPY 4,340, and smartphone subscriptions increased by 450,000. The Business Services segment saw a 4.5% rise in consolidated operating revenue to JPY 349.7 billion, with operating income up 5.4% to JPY 57.5 billion. KDDI emphasized the successful launch of new pricing plans and their focus on digital data and AI to drive further growth. The company also highlighted the strengthening of financial services, with au Financial Holdings' operating income up 33% year-on-year to JPY 11.7 billion.KDDI Financial Statement Overview
Summary
KDDI demonstrates strong financial health with consistent profitability and a solid equity base. The company shows effective revenue growth and operational efficiency. However, the increase in debt levels and fluctuations in free cash flow warrant careful monitoring to ensure long-term financial stability.Income Statement
KDDI's income statement shows strong profitability with a consistent gross profit margin around 42-45% and a stable net profit margin of approximately 11-12%. The company has demonstrated steady revenue growth, with a notable increase in the TTM period. EBIT and EBITDA margins are healthy, indicating efficient operations. However, the slight decline in EBIT margin in the TTM period suggests potential cost pressures.85
Very Positive
Balance Sheet
The balance sheet reflects a solid equity position with a debt-to-equity ratio below 1, indicating moderate leverage. Return on equity is robust, consistently above 12%, showcasing effective use of equity capital. However, the increase in total debt over recent periods could pose a risk if not managed carefully.78
Positive
Cash Flow
KDDI's cash flow statement reveals a mixed picture. While operating cash flow remains strong, free cash flow has experienced significant fluctuations, with a notable decline in the TTM period. The operating cash flow to net income ratio is stable, but the free cash flow to net income ratio has decreased, indicating potential challenges in maintaining free cash flow levels.72
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2023 | Dec 2023 | Dec 2023 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.97T | 5.92T | 5.75T | 5.75T | 5.75T | 5.75T |
| Gross Profit | 2.51T | 2.51T | 2.43T | 2.43T | 2.43T | 2.43T |
| EBITDA | 1.77T | 1.78T | 1.62T | 1.62T | 1.62T | 1.62T |
| Net Income | 679.85B | 685.68B | 637.87B | 637.87B | 637.87B | 637.87B |
Balance Sheet | ||||||
| Total Assets | 17.59T | 16.88T | 14.15T | 14.15T | 14.15T | 14.15T |
| Cash, Cash Equivalents and Short-Term Investments | 963.51B | 921.17B | 887.21B | 887.21B | 887.21B | 887.21B |
| Total Debt | 5.10T | 4.44T | 2.43T | 2.43T | 2.43T | 2.43T |
| Total Liabilities | 11.94T | 11.23T | 8.35T | 8.35T | 8.35T | 8.35T |
| Stockholders Equity | 5.15T | 5.13T | 5.25T | 5.25T | 5.25T | 5.25T |
Cash Flow | ||||||
| Free Cash Flow | 551.95B | 958.47B | 956.97B | 956.97B | 956.97B | 956.97B |
| Operating Cash Flow | 942.49B | 1.36T | 1.71T | 1.71T | 1.71T | 1.71T |
| Investing Cash Flow | -925.28B | -1.18T | -832.43B | -832.43B | -832.43B | -832.43B |
| Financing Cash Flow | -438.27B | -33.55B | -476.48B | -476.48B | -476.48B | -476.48B |
KDDI Technical Analysis
Negative
15.85
Price Trends
16.99
Negative
16.98
Negative
16.73
Negative
Market Momentum
-0.36
Positive
30.73
Neutral
9.61
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KDDIY, the sentiment is Negative. The current price of 15.85 is below the 20-day moving average (MA) of 16.48, below the 50-day MA of 16.99, and below the 200-day MA of 16.73, indicating a bearish trend. The MACD of -0.36 indicates Positive momentum. The RSI at 30.73 is Neutral, neither overbought nor oversold. The STOCH value of 9.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KDDIY.
KDDI Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $17.99B | 12.87 | 17.71% | 7.07% | -5.13% | -5.90% | |
71 Outperform | $33.98B | 28.39 | 9.95% | 3.82% | 3.12% | 3.14% | |
69 Neutral | $59.41B | 18.95 | 13.28% | 2.62% | 2.22% | 43.84% | |
68 Neutral | $64.00B | 22.20 | 14.41% | 2.52% | -0.64% | 56.92% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
55 Neutral | $27.16B | 9.21 | -7.17% | 4.39% | 0.89% | -494.16% | |
52 Neutral | $28.38B | ― | -3.55% | 7.16% | -4.73% | -251.31% |
* Communication Services Sector Average
KDDIY
KDDI
15.85
-0.18
-1.12%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.