News Release ddjh091109b

1. QUALITATIVE INFORMATION RELATING TO CONSOLIDATED BUSINESS RESULTS

(1) Consolidated results

During the three-month period ended September 30, 2009, NTT Group took measures to expand broadband and ubiquitous services pursuant to its new Medium-Term Strategy entitled "Road to Service Creation Business Group" adopted in May 2008.

In the fixed-line communications market, the expansion of optical services and the accompanying shift from existing fixed-line telephones to optical IP telephones continued. Diverse services such as video distribution services were also deployed by various providers. Under these market conditions, in the next-generation network (NGN) segment, NTT Group endeavored to expand its "FLET'S Hikari Next" service area and the sale of services such as "Hikari TV" that take advantage of the capabilities of the NGN. NTT Group also made efforts to form alliances with other companies to expand distribution. As a result of these efforts, the number of "FLET'S Hikari" subscriptions reached 12.28 million at September 30, 2009.

In the mobile communications market, with the market reaching saturation due to the increased penetration rate, the competition among carriers to acquire customers and enhance services is becoming increasingly fierce. Under these market conditions, NTT DOCOMO revised the billing plans for its two-tier flat-rate service "Pake-hodai double" and "Biz-hodai double" and enhanced "docomo-doga" and other video content services thereby continuing to expand the packet communications use of its customers. With respect to mobile terminals, NTT DOCOMO launched seven handset models, including the first handset in Japan operating with "Android"¹ and the first waterproof version of the Raku-Raku PHONE series to cater to the diverse needs of its customers. In addition, NTT DOCOMO launched "docomo Mobile Remittance", a service that enables an NTT DOCOMO subscriber to send money to a recipient simply by designating the recipient's mobile telephone number without the recipient needing to open a bank account or register, as a part of the endeavor to increase efficiency. As a result of these measures, the number of mobile phone subscriptions reached 55.19 million, of which 51.26 million were FOMA service subscriptions, accounting for 92.9% of all subscriptions.

With respect to services for corporate customers, NTT Group continued its efforts to provide high value-added solutions tailored to customers' industries and business categories and to enhance its support capabilities adapted to the global business activities of the customers. NTT Group also made an announcement that, as a part of its "SaaS over NGN" efforts to support SaaS² businesses using the NGN, it will develop "series of functions SaaS platform³" as a service base for SaaS businesses. NTT announced that it will deploy services using the series of functions SaaS platform ³.

In its global businesses, NTT Group established new overseas business sites and formed capital and business alliances with local businesses to further improve its services from the perspective of coverage area expansion, support service enhancement and quality improvement.

As a result of these efforts, NTT Group's consolidated operating revenues for the three-month period ended September 30, 2009 were 2,495.2 billion yen (a decrease of 2.9% from the same period of the previous fiscal year), consolidated operating expenses were 2,174.2 billion yen (a decrease of 1.1% from the same period of the previous fiscal year), consolidated operating income was 321.0 billion yen (a decrease of 13.9% from the same period of the previous fiscal year), and consolidated net income before income taxes was 317.7 billion yen (a decrease of 17.1% from the same period of the previous fiscal year). Consolidated net income attributable to NTT was 142.7 billion yen (a decrease of 38.2% from the same period of the previous fiscal year) due in part to the fact that consolidated net income attributable to NTT was comparatively higher in the previous fiscal year owing to the effects of a one-time decrease in income tax (decrease in a deferred income tax liability) which resulted from the merger by NTT DOCOMO of its eight regional subsidiaries during the second quarter of the fiscal year ended March 31, 2009.

For the six-month period ended September 30, 2009, NTT Group's consolidated operating revenues were 4,998.1 billion yen (a decrease of 3.2% from the same period of the previous fiscal year). Consolidated operating expenses were 4,351.3 billion yen (a decrease of 1.5% from the same period of the previous fiscal year). As a result, consolidated operating income was 646.8 billion yen (a decrease of 13.2% from the same period of the previous fiscal year) while consolidated net income before income taxes was 643.6 billion yen (a decrease of 16.5% from the same period of the previous fiscal year). Consolidated net income attributable to NTT was 282.2 billion yen (a decrease of 30.5% from the same period of the previous fiscal year) for the six-month period ended September 30, 2009.

Notes:
1.	An operating system for mobile phones. It is characterized by an open development environment.
2.	Software as a Service - a service for providing software applications to customers via networks.
3.	A collective term for the authentication platform function, portal site function, fee charging & collecting function, multi-payment credit settlement function, network gateway function and web-system construction platform function.
*	NTT Group's consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States.

(2) Segment results
Results by business segment are as follows.

<1> Regional telecommunications business segment

NTT Group's consolidated operating revenues for the three-month period ended September 30, 2009 were 976.9 billion yen (a decrease of 3.6% from the same period of the previous fiscal year). Despite an increase in IP-related revenues attributable to the increase in "FLET'S Hikari" subscriptions, voice-related revenues decreased due to the decline in fixed-line telephone subscriptions. On the other hand, consolidated operating expenses were 942.3 billion yen (a decrease of 4.2% from the same period of the previous fiscal year) due to such factors as a decrease in operating expenses, including depreciation and amortization. As a result, consolidated operating income in the three-month period ended September 30, 2009 was 34.6 billion yen (an increase of 17.3% from the same period of the previous fiscal year).

For the six-month period ended September 30, 2009, consolidated operating revenues were 1,937.7 billion yen (a decrease of 3.5% from the same period of the previous fiscal year) and consolidated operating expenses were 1,887.0 billion yen (a decrease of 4.1% from the same period of the previous fiscal year). As a result, consolidated operating income for the six-month period ended September 30, 2009 was 50.7 billion yen (an increase of 24.6% from the same period of the previous fiscal year).

Number of subscriptions

Notes:
1.	The figures for "FLET'S Hikari" include NTT East's "B FLET'S" and "FLET'S Hikari Next" (launched in March 2008) and NTT West's "B FLET'S", "FLET'S Hikari Premium", "FLET'S Hikari Mytown" and "FLET'S Hikari Next" (launched in March 2008).
2.	The figures for "Hikari Denwa" represent number of channels (in thousands).

<2> Long-distance and international communications business segment

Consolidated operating revenues for the three-month period ended September 30, 2009 were 308.4 billion yen (a decrease of 5.1% from the same period of the previous fiscal year). Despite increases in OCN, VPN-related services and other IP-related revenues, the decline in conventional fixed-voice related revenues and other factors reduced consolidated operating revenues. Consolidated operating expenses for the same period decreased to 282.0 billion yen (a decrease of 5.2% from the same period of the previous fiscal year) due to lower telecommunication facility usage fees in conjunction with the decline in fixed-voice related revenues. As a result, consolidated operating income for the three months ended September 30, 2009 was 26.3 billion yen (a decrease of 4.3% from the same period of the previous fiscal year).

For the six-month period ended September 30, 2009, consolidated operating revenues were 616.5 billion yen (a decrease of 3.1% from the same period of the previous fiscal year) and consolidated operating expenses were 565.2 billion yen (a decrease of 2.7% from the same period of the previous fiscal year). As a result, consolidated operating income for the six-month period ended September 30, 2009 was 51.2 billion yen (a decrease of 7.6% from the same period of the previous fiscal year).

<3> Mobile communications business segment

Consolidated operating revenues for the three-month period ended September 30, 2009 decreased to 1,061.1 billion yen (a decrease of 3.3% from the same period of the previous fiscal year) due to a decrease in mobile voice related revenues caused by penetration of new discount services and new handset purchase methods and a decline in handset sales revenues. On the other hand, consolidated operating expenses increased to 829.1 billion yen (an increase of 1.3% from the same period of the previous fiscal year) as a result of an increase in expenditure for mobile phone protection and delivery service. As a result, consolidated operating income for the three-month period ended September 30, 2009 was 232.0 billion yen (a decrease of 16.9% from the same period of the previous fiscal year).

For the six-month period ended September 30, 2009, consolidated operating revenues were 2,145.8 billion yen (a decrease of 5.4% from the same period of the previous fiscal year) and consolidated operating expenses were 1,663.5 billion yen (a decrease of 1.8% from the previous fiscal year). As a result, consolidated operating income for the six-month period ended September 30, 2009 was 482.3 billion yen (a decrease of 16.0% from the same period of the previous fiscal year).

Number of subscriptions

Notes:
1.	The number of mobile phone service subscriptions, "FOMA" service subscriptions and "mova" service subscriptions include communication module subscriptions.
2.	Effective March 3, 2008, use of "2-in-1" service, in principle, requires a "FOMA" subscription; the number of mobile phone service subscriptions and the number of "FOMA" service subscriptions include such "FOMA" subscriptions.
3.	The figures for the number of "i-mode" service subscriptions represent the total for "FOMA" and "mova" combined.

<4> Data communications business segment

Consolidated operating revenues for the three-month period ended September 30, 2009 were 264.2 billion yen (a decrease of 0.5% from the same period of the previous fiscal year) as a result of a decrease in revenues from certain facility services in public sector. Consolidated operating expenses for the three-month period ended September 30, 2009 were 248.6 billion yen (an increase of 2.6% from the same period of the previous fiscal year) as a result of an increase in sales management costs. As a result, consolidated operating income for the three-month period ended September 30, 2009 was 15.6 billion yen (a decrease of 32.6% from the same period of the previous fiscal year).

For the six-month period ended September 30, 2009, consolidated operating revenues were 534.3 billion yen (an increase of 5.3% from the same period of the previous fiscal year) and consolidated operating expenses were 497.4 billion yen (an increase of 7.6% from the same period of the previous fiscal year). As a result, consolidated operating income for the six-month period ended September 30, 2009 was 36.9 billion yen (a decrease of 17.8% from the same period of the previous fiscal year).

<5> Other business segments

In other business segments, the substantial impact of the deteriorating economy and a slump in sales in the finance business, real estate business, construction and power business, system development business, advanced technologies development business and other businesses resulted in a decrease in consolidated operating revenues for the three-month period ended September 30, 2009 of 264.1 billion yen (a decrease of 9.4% from the same period of the previous fiscal year) and consolidated operating expenses of 268.5 billion yen (a decrease of 4.9% from the same period of the previous fiscal year). As a result, consolidated operating losses for the three-month period ended September 30, 2009 was 4.3 billion yen.

For the six-month period ended September 30, 2009, consolidated operating revenues were 525.3 billion yen (a decrease of 6.1% from the same period of the previous fiscal year) and consolidated operating expenses were 518.5 billion yen (a decrease of 3.2% from the same period of the previous fiscal year). As a result, consolidated operating income for the six-month period ended September 30, 2009 was 6.9 billion yen (a decrease of 70.7% from the same period of the previous fiscal year).