Rakuten Mobile chair and CEO Mickey Mikitani (pictured) argued improved network quality, following an expanded roaming deal and optimisation efforts, is driving user adoption in Japan and putting it in a position to charge a premium for higher quality service. 

On its Q1 earnings call, Mikitani claimed “smooth progress” in turning around the group’s loss-making mobile unit, noting profitability is just around the corner, with a target of EBITDA turning positive by December 2024.

He noted it is now in the third phase of its launch, which is telling customers about its improved network quality. It is working to a target of 10 million subscribers by end-2025.

The operator’s revenue grew 7.1 per cent year-on-year to JPY62 billion ($396.3 million), with mobile service sales expanding 36 per cent to JPY36.1 billion. Its operating loss was JPY66 billion compared to JPY92 billion a year earlier.

Looking at the group’s broader mobile segment, which includes subsidiaries such as Rakuten Symphony, its operating loss dropped 30 per cent to JPY71.9 billion, while revenue increased 3.6 per cent to JPY99.8 billion. Symphony revenue jumped 55.3 per cent to $118 million.

In early April the operator said it added 1.5 million subscribers within a year, taking its total to 6.5 million at end-March.

ARPU was up marginally to JPY2,024. Mikitani noted it targets increasing that to JPY2,500 by charging more for a higher-quality service. He also highlighted that since the operator doesn’t do business on a standalone basis, the wider Rakuten ecosystem gives users access to value-added services and loyalty rewards, which can drive ARPU gains.

Capex in the first quarter dropped 47 per cent to JPY33 billion from a year earlier.

The operator is targeting commercial launch of service on the 700MHz band in June, which will help take population coverage to 99.9 per cent.