Japan's largest telecoms carrier, NTT, reported one of corporate Japan’s largest losses today.
The announcement comes after an overhaul of its workforce and soured investments pushed NTT deeply into the red.
But analysts and investors said NTT's estimated net loss of $6.5 billion for the last business year - the worst-ever for a non-financial firm in Japan - cleared the way for a profit rebound.
Nearly half of the special losses were for writedowns by mobile phone subsidiary NTT DoCoMo Inc, the global pioneer of mobile Internet services.
Faced with lower revenues at home, where new challengers are eroding its dominant position and the mobile market is nearing saturation, the NTT group went on a costly acquisition drive in 2000 and 2001 to cultivate growth opportunities overseas.
But the value of those investments fell as a global sell-off in telecoms shares hit carriers worldwide, forcing NTT to post a consolidated special loss in the half year to last September.
But analysts saw no reason for alarm over the losses, which had long been expected, and predicted an earnings recovery in the business year that began on April 1st.
Indeed, the loss was an improvement over the $7.5 billion reported recently in the Japanese media.