NTT DATA Corporation

The call did not include a full quarterly income statement, EPS, or gross margin release in the discussion. Management did say Q3 data center fee income was about JPY 5 billion, with about JPY 5 billion in the first half and roughly JPY 10 billion in the 9-month period; North America also benefited from about JPY 3 billion of government subsidy. On guidance, management said the performance forecast had already been revised downward for data center gain on sale, other items were broadly unchanged from the initial plan, there is no planned Q4 data center gain on sale, and the company still wants to achieve its full-year target despite downside risk in overseas and weaker Japan public-sector momentum.

Nakayama said the company is still focused on hitting the full-year target, but acknowledged there is not much headroom left in some areas, especially overseas. He said Japan public-sector business is below plan year to date and the company will try to make up the shortfall in financial and enterprise segments. On capital recycling, he emphasized that the Singapore REIT IPO was part of a broader process, not a one-off event, and that NTT DATA wants to realize cash flow early and keep investing over time.

Kusakabe quantified the main Q3 one-offs: about JPY 5 billion from data center fee income and about JPY 3 billion from a North America subsidy, with the 9-month total for the data center item around JPY 10 billion. He did not provide EPS, revenue, or margin figures in this discussion, but confirmed that the company had already revised down the data center gain-on-sale forecast and that no Q4 data center gain is planned. Capital recycling remains tied to balancing EBITDA growth, data center investment, and leverage over the long term.

Analysts focused on whether the company is still on track after the July data center REIT shift, how much Q4 and full-year profit from capital recycling should be expected, and whether there would be more recycling next year. Management said Q4 has no planned data center gain on sale and next year is not fixed yet, but the general direction remains continued investment and recycling as needed. Questions also pressed on public-sector order trends, overseas order softness, AI disruption, and the speed of overseas restructuring; management said public-sector weakness is a reactionary decline from last year’s high-margin project, North America and parts of Europe are improving, AI should create efficiency and new business opportunities rather than immediate revenue decline, and the overseas integration program will continue to generate synergies but the company would not quantify the total contribution yet.