Message from Management

The NTT Group has made steady progress since the announcement of our Medium-Term Management Strategy in May 2023.
This year, the second year of the strategy, is an important year for us to steadily build momentum toward achieving the goals of the Medium-Term Management Strategy for FY2027.
By steadily promoting existing initiatives and proactively tackling new challenges, we will create new value and contribute to the realization of global sustainability.

Without challenge, the landscape never changes--Beyond Self-Innovation

On July 1, 2025, Nippon Telegraph and Telephone Corporation celebrated its 40th anniversary and rebranded as NTT Corporation. As we launched the new NTT, I chose the catchphrase "Without challenge, the landscape never changes" to express our determination to keep taking on challenges globally--and my own unwavering commitment to management.

My mission as President is to drive NTT's transformation forward, together with 992 group companies and 340,000 employees worldwide, as we continue to tackle the dynamic changes reshaping society.

What are we challenging, and how will we change the landscape? At the core lies IOWN--the path of which leads to enriching people's lives and contributing to the planet's future.

Our medium-term strategy toward 2027 has reached its midpoint. I will not slow our pace of challenge. The NTT Group will keep sustainability at the heart of management and continue to push forward.

To our 2.74 million shareholders and all stakeholders, I sincerely ask for your continued support.

Beyond Self-Innovation: Growth investments with a long-term view beyond the medium-term strategy

Our medium-term strategy is a roadmap to demonstrate solid growth and achieve sustainable value creation for the NTT Group.

Over the past 40 years, NTT Group's portfolio has expanded from domestic fixed-line services to mobile and global ICT businesses, evolving significantly with the changing environment. In recent years, technological advances and social change have been transforming our business environment at unprecedented speed. Moreover, surging power demand from digitalization and AI highlights the urgency of advancing efforts toward a sustainable society--now a critical social issue.

Against this backdrop, our medium-term strategy is guided by the principle: "Innovating a Sustainable Future for People and Planet" We are advancing growth investments in areas such as IOWN, AI, data centers, and financial services, while also driving group-wide transformation--including rebranding and making NTT DATA a wholly owned subsidiary. These initiatives aim to strengthen group-wide synergies and meet the expectations of customers and stakeholders alike.

Beyond Self-Innovation lies the future NTT Group aspires to realize.

Evolution of our business portfolio

■Fixed-line Communications　■(Reposted) FLET'S Hikari, etc　■Mobile Communications　■(Reposted) Smart Life Business　■System interaction services(include data center services)　■Others

^*The center of the pie chart represents the total operating revenues for the fiscal year. The percentages indicate the proportion of total operating revenues.

Our Commitment to IOWN: Enriching Lives and Securing the Future of the Planet

We have newly defined NTT Group's Core, broadening our founding vision beyond the "the development of human society and the enrichment of people's lives" to a mission of contributing to the richness of the Earth--embracing nature and all forms of life--under the principle of "Innovating a Sustainable Future for People and Planet"

We believe AI will be one of the most impactful contributors to enriching lives and shaping a sustainable future for our planet. AI is already becoming an integral part of everyday life, supporting people across diverse contexts. Going forward, AI will increasingly support human judgment and action--enabling early disease detection, disaster response, personalized education, elderly care, and climate-change mitigation--becoming a vital force for safeguarding lives and livelihoods.

At the same time, we are confronted with the stark reality of AI's rapidly growing energy consumption. Training large-scale AI models with tens of billions of parameters can require over 1,000 MWh--more than the hourly output of a nuclear power plant. Moreover, because large language models (LLMs) require regular retraining and updates, electricity demand could grow to unimaginable levels if current trends continue.

The path forward is to enrich lives through AI while simultaneously reducing its energy footprint. IOWN is our direct response to achieving these seemingly conflicting goals in unison.

Cutting power consumption with IOWN -- leveraging Optical Technology as the key

The defining feature of IOWN is the replacement of electrical signals with optical ones. This shift from electricity to light delivers two key advantages.

First, light travels at the fastest speed in the universe--nothing can surpass it. Leveraging this property, IOWN enables the transmission of massive AI data volumes at ultra-high speed and low latency.

Second, optical signals are far more energy-efficient than electrical ones. Transmitting large data volumes via electrical signals generates heat, meaning part of the energy is lost in conversion. As a result, data centers housing vast numbers of servers require substantial additional power for cooling systems to manage the heat produced. By contrast, optical transmission and processing generate only minimal heat compared to electrical signals.

IOWN is designed to fully leverage these advantages.

Embedding sustainability at the core of our strategy to realize commercial IOWN

The NTT Group Sustainability Charter articulates our core philosophy: "Self as We." This embodies a spirit of altruistic coexistence--pursuing not only personal well-being but also the happiness of others at the same time.

At its core, the reason NTT Group embeds sustainability in our strategy is rooted in the philosophy of "Self as We." IOWN is our commitment to enriching people's lives and contributing to the future of the planet.

As noted earlier, our medium-term strategy is designed to drive growth and deliver sustainable value creation across the NTT Group.

In March 2023, we launched IOWN 1.0 for commercial use. In May 2025, at the Osaka-Kansai Expo, we demonstrated IOWN 2.0, achieving an 87% reduction in power consumption. By fiscal 2026, we plan to roll out a commercial version that doubles communication capacity beyond the Expo demonstration. Beyond the medium-term strategy, NTT Group envisions further growth powered by IOWN at its core.

Creating Value through the Cycle of Customer Experience (CX) and Employee Experience (EX)

Enhancing Customer Experience (CX) and Employee Experience (EX) are core initiatives underpinning our medium-term management strategy and the future beyond.

As a leader, my conviction has always been to foster an environment where employees work with vitality and purpose, and where their excitement, inspiration, and joy (EX) are valued. This translates into customer satisfaction (CX). Every "thank you" from our customers fuels our motivation and drives further value creation.

NTT's symbol mark, the "Dynamic Loop", embodies this very cycle. We believe that the continuous cycle of CX and EX, connecting into the future, is the driving force for NTT Group to create value for society and help build a sustainable future.

Advancing Customer Experience (CX)

In our medium-term management strategy, NTT Group has identified enhancing Customer Experience (CX) as a core pillar, reflecting our commitment to delivering experiences that exceed expectations and ensuring that we remain the trusted choice of customers.

We continuously improve our services by acting quickly on customer feedback. For example, NTT DOCOMO's "d Payment" has enhanced usability through faster app launches and barcode display, earning high ratings in market surveys. In June 2025, we launched "DOCOMO MAX," a flexible rate plan tailored to customer lifestyles, integrating services across communications, finance, and entertainment to deliver a more personalized experience.

For enterprise customers, NTT East and NTT West's "FLET'S Hikari Cross Biz" leverages high-speed, high-capacity connectivity to improve operational efficiency and remote work environments, enhancing CX through greater digital adoption. In addition, NTT DATA is advancing CX transformation through AI and data integration. Leveraging data from customer touchpoints, we have expanded our "LITRON®" AI agent series to support operations, while also optimizing marketing strategies through generative AI--enhancing the systems that power the "backstage" of CX.

Since FY2024, we have appointed Chief Customer eXperience Officers (CCXOs) across our major group companies to accelerate CX improvement. Leveraging advanced technologies such as IOWN and AI, we are committed to creating even greater experiential value for our customers.

Enhancing Employee Experience (EX)

From the start of my presidency, I have prioritized enhancing Employee Experience (EX), recognizing that our people are the driving force behind innovation and customer service. Accordingly, we have tied employee engagement to executive compensation and incorporated it into performance-based bonuses for all managers.

By expanding career development opportunities and deepening understanding of HR programs, we have created a more supportive environment for employees to shape their own careers. As a result, our employee engagement survey showed a 61% positive response rate, an improvement of seven points year on year. One example is the "NTT Group Job Board," an internal open recruitment program that empowers employees to take on new challenges. We designated a special promotion month, sharing user interviews and other content to encourage participation and strengthen this initiative.

We have also advanced initiatives such as establishing the "NTT Group Basic Policy on Customer Harassment" (July 2024), supporting the "Men's Childcare Leave Project" and hosting childcare seminars (September 2024), and launching our first Alumni Event to strengthen diverse talent pipelines (September 2024). We are honored to have received multiple awards again this year recognizing these efforts.

Since becoming President, I have prioritized open dialogue with employees as a cornerstone of EX enhancement. Through direct conversations with employees working tirelessly on the frontlines, I share my vision, listen to their authentic voices, and learn from their perspectives. Incorporating employees' voices into management has always been my core principle, and I believe it is essential to driving further enhancement of NTT Group's corporate value. Looking ahead, we remain committed to fostering an environment where employees can find fulfillment in their work and continue to embrace new challenges.

Since becoming President, I have embraced the motto "Go Anywhere," undertaking 18 site visits across Japan and around the world--including North America, South America, Asia, and Europe. During these visits, I not only conveyed our management strategy in my own words and openly expressed gratitude to employees, but also placed strong emphasis on listening to their voices through small-group discussions and hands-on experiences at worksites.

Steadily Advancing Initiatives in Core Businesses

Our existing telecommunications initiatives play a vital role in supporting and enabling new growth opportunities.

While mobile communications revenues continue to decline, as noted earlier, strengthening our customer base by integrating mobile services with Smart Life offerings--including banking--is essential. We remain committed to enhancing network quality, and with pride in our role as the backbone of Japan's telecommunications infrastructure, we will ensure the stable and sustainable operation of our network facilities.

At the same time, our regional telecommunications business has begun to show signs of recovery. We will continue to drive performance improvements in our regional telecommunications business by advancing digital transformation (DX), enhancing efficiency, and strengthening cost competitiveness. Given the deterioration of NTT East and West's Copper-based telecommunication facilities and the decline in cost efficiency in the future, NTT East and West plan to gradually transition to fiber-optic and wireless-based fixed-line services by 2035, ensuring the continuity of fixed-line telephone services. To avoid causing inconvenience to existing customers, we will provide sufficient notice and transition periods before switching to alternative services, and NTT East and West plan to announce basic policies and related information in September 2025.

Revision of the NTT Act

In May 2025, the revised NTT Act was passed and enacted by the National Diet of Japan. We view this revision positively, as it reflects adaptation to the current market environment and ongoing technological innovation.

We will continue to actively advance R&D, while working flexibly with a wide range of domestic and international partners. Through further R&D promotion and the social implementation of initiatives such as IOWN and our proprietary LLM "tsuzumi," we aim to contribute to strengthening Japan's industrial base and enhancing global competitiveness.

NTT East and NTT West will continue to comply with relevant regulations, including the Telecommunications Business Act, uphold fair competition in the telecommunications market, and ensure equitable access to networks and line installation infrastructure for other operators. They will also contribute to delivering universal service, advancing and reinforcing network infrastructure, and promoting regional revitalization and local economic development through a wide range of service offerings.

Representative Member of the Board
President and CEO
Akira Shimada