• Top line lifts earnings – The company had a solid Q1 FY3/26, increasing both sales (+4% YoY) and operating profit (+6.2% YoY), and improving OPM incrementally. Although competition remains fierce, particularly among low-cost brands, churn at its flagship au brand remains low and stable, with the overall figure at 1.11%. Price increases at au mobile will take effect from Q2, though the competitive environment means that sales-related expenses for the mobile business are also expected to increase. au Denki’s entry into the electricity retail market should help control expenses at this business. The company maintained its full-year forecasts. Our estimates are also unchanged.
