Japan’s Softbank Group said third-quarter profit fell short of expectations as the cost of acquiring domestic wireless business users increased, while preparing for the initial public offering of its mobile unit (IPO).
The company said on Wednesday its earnings report said fiscal year-end operating profit for December last year was 274 billion yen (about 2.5 billion U.S. dollars), lower than the median forecast of 293 billion yen by analysts compiled by Bloomberg.
Masayoshi Son, the founder of SoftBank, relied on a steady flow of cash from Japan’s wireless telecom operations to complete its new mergers and acquisitions, but the U.S. mobile operator Sprint, which it acquired, has been struggling to reap profits and save subscribers.
Softbank’s domestic business profits are under pressure as Lotte, a billionaire unit owned by Hiroshi Mikitani, wants to become Japan’s fourth-largest mobile phone operator.
Meanwhile, Softbank has confirmed that it is preparing to get its Japanese wireless business to a public float, which will help to strip the telecommunications and investment sectors. In addition, the IPO will raise funds for Softbank to transfer some of its debt to the mobile unit. According to Nikkei News reports, the IPO may bring about 2 trillion yen in funds.