Nippon Telegraph & Telephone Corp (NTTYY)

Price$27.55Cached quoteAs of 2026-09-05 19:20 UTC

AI: Fair-priced

Price checkThe shares offer a reasonable yield, but the current valuation leaves only a modest safety margin.

NTT's U.S. depositary receipt represents 25 ordinary shares. Management forecasts ¥12.10 of earnings per ordinary share for the year ending March 2027, while the underlying Tokyo shares recently traded at roughly 13 times forecast earnings. The planned ¥5.40 annual dividend implies a yield around the mid-3% range. That is attractive for a stable telecom, but not unusually cheap. With forecast profit down 5.5% and leverage elevated after acquisitions, the present valuation looks broadly fair rather than clearly discounted.

Big pictureNTT has produced durable cash for decades, although recent acquisitions make the old record less comparable.

The supplied SEC-derived history shows unusually steady cash generation: operating cash flow ranged from ¥2.39 trillion to ¥2.92 trillion during fiscal 2015-2017, while capital spending stayed near ¥1.27 trillion to ¥1.44 trillion. That left roughly ¥0.95 trillion to ¥1.62 trillion of cash after capital investment. Current results remain profitable, with fiscal 2025 revenue reaching ¥14.41 trillion and attributable profit ¥1.04 trillion. However, recent acquisitions changed the group materially, so the older cash record should demonstrate durability rather than serve as a direct valuation forecast.

Business strengthCore telecom cash flows remain resilient, but acquisitions have made the balance sheet much more leveraged.

First-quarter revenue rose 10.9% and profit attributable to NTT increased 5.8%, supported by communications, financial services and global technology operations. The balance sheet is less conservative than the historical SEC record: June cash was ¥2.39 trillion, while short- and long-term borrowings totaled about ¥16.25 trillion. Shareholders' equity was ¥9.86 trillion, only 20.8% of assets. Capital allocation remains shareholder-friendly: the board authorized up to ¥200 billion of buybacks and another dividend increase, while weighted average shares fell about 1.6% in fiscal 2025.

What could change the storyData-center growth could lift returns, while heavy investment and weaker mobile profits could pressure the valuation.

The strongest bull case is NTT DATA and data centers: fiscal 2025 Global Solutions operating profit rose about 51%, while data-center orders and capacity continue expanding. If that growth lifts group earnings while buybacks reduce shares, today's valuation could prove inexpensive. The bear case is that acquisitions and infrastructure spending consume too much cash before those returns arrive. Management itself forecasts attributable profit falling 5.5% this year. Sustained earnings growth above the current forecast would strengthen the thesis; rising borrowing without better profit growth would weaken it.

AI: News

First-quarter earnings beatQuarterly sales and profit grew faster than expected, easing concerns about NTT's near-term earnings momentum.

On August 6, NTT reported quarterly revenue of ¥3.62 trillion, up 10.9%, operating profit of ¥425.1 billion, up 4.9%, and attributable profit of ¥274.8 billion, up 5.8%. Earnings per share exceeded published market expectations. The Tokyo shares gained about 2.6% the following trading day and the U.S. receipts also advanced. The timing supports a favorable market interpretation, although broader market moves mean the earnings release cannot be credited with the entire price change.

Buyback and dividend increaseNTT committed more capital to shareholders even as management expects a modest earnings decline.

On May 8, NTT authorized up to ¥200 billion of share repurchases, equal to as much as 1.72% of shares then outstanding, and forecast a sixteenth consecutive annual dividend increase to ¥5.40 per share. Fiscal 2025 revenue reached a record ¥14.41 trillion, but management forecast attributable profit of ¥980 billion for fiscal 2026, down 5.5%. The combination supports the shares through cash returns, while the weaker profit outlook limits how strongly investors should value those distributions.

NTT DATA consolidationFull ownership of NTT DATA increased growth exposure but also raised financial commitments and balance-sheet risk.

NTT completed making NTT DATA Group wholly owned in September 2025 after paying about ¥1.35 trillion in the tender offer alone. The transaction gives NTT tighter control over global information technology, artificial intelligence and data-center investment, where recent growth has been strongest. It also helps explain why consolidated assets jumped from ¥30.1 trillion in March 2025 to ¥46.7 trillion a year later and why the equity ratio fell from 34.0% to 20.8%, increasing the importance of future cash returns.

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Financial statements

	2026	2025	2024	2023	2017	2016	2015	2014	2013	2012	2011	2010	2009	2008
Revenue	¥14.41T	¥13.70T	¥13.37T	¥13.14T	¥11.39T	¥11.54T	¥11.10T	¥10.93T	¥10.70T	¥10.51T	¥10.31T	¥10.18T	¥10.42T	¥10.68T
Gross profit	¥11.19T	¥10.61T	¥10.44T	¥10.37T	¥10.51T	¥10.57T	¥10.15T	¥10.04T	¥9.84T	¥9.72T	¥9.54T	¥9.38T	¥9.48T	¥9.42T
Gross margin	77.69%	77.39%	78.05%	78.92%	92.28%	91.59%	91.45%	91.90%	91.92%	92.50%	92.62%	92.15%	91.01%	88.18%
Research & development	—	—	—	—	¥211.62B	¥213.44B	¥233.75B	¥249.29B	¥269.19B	¥267.85B	¥268.22B	¥278.14B	¥268.20B	—
Operating expenses	¥9.41T	¥8.94T	¥8.50T	¥8.52T	¥9.85T	¥10.19T	¥10.01T	¥9.71T	¥9.50T	¥9.28T	¥9.09T	¥9.06T	¥9.31T	¥9.38T
Operating income	¥1.79T	¥1.67T	¥1.94T	¥1.84T	¥1.54T	¥1.35T	¥1.08T	¥1.21T	¥1.20T	¥1.22T	¥1.21T	¥1.12T	¥1.11T	¥1.30T
Operating margin	12.40%	12.18%	14.49%	14.04%	13.52%	11.68%	9.77%	11.11%	11.23%	11.64%	11.79%	10.98%	10.65%	12.21%
EBITDA	¥3.61T	¥3.46T	¥3.74T	¥3.48T	¥3.00T	¥3.11T	¥2.91T	¥3.09T	¥3.10T	¥3.13T	¥3.18T	¥3.13T	¥3.25T	¥3.47T
EBITDA margin	25.07%	25.22%	27.96%	26.49%	26.35%	26.99%	26.25%	28.32%	28.98%	29.82%	30.83%	30.74%	31.19%	32.46%
Net income	¥1.04T	¥1.00T	¥1.28T	¥1.21T	¥800.13B	¥737.74B	¥518.07B	¥585.47B	¥521.93B	¥467.70B	¥509.63B	¥492.27B	¥538.68B	¥635.16B
Net profit margin	7.20%	7.30%	9.57%	9.23%	7.02%	6.39%	4.67%	5.36%	4.88%	4.45%	4.95%	4.83%	5.17%	5.95%
Basic EPSper basic share	¥315.25	¥299.00	¥377.25	¥348.00	¥390.94	¥350.34	¥236.85	¥254.61	¥215.34	¥183.34	—	—	—	—
Diluted EPSper diluted share	¥315.25	¥299.00	¥377.25	¥348.00	¥390.94	¥350.34	¥236.85	¥254.61	¥215.34	¥183.34	—	—	—	—