SOFTBANK CORP.
CONSOLIDATED INTERIM FINANCIAL REPORTFor the Six Months Ended September 30, 2002
FINANCIAL HIGHLIGHTS
1.

Results of Operations(Million yen; amounts less than one million yen are omitted.)
FY2003 Interim(April 2002
through September
2002)

Year-on-year
changeFY2002 Interim(April 2001
through September
2001)

Year-on-year
change¥191,052(31,199)(45,956)(55,802)(166.27)
−

4.2%
−
−
−
−
−

¥183,372(8,704)(16,150)(54,315)(161.29)
−

1.7%
−
−
−
−
−

Revenues
Operating income (loss)
Ordinary income (loss)
Net income (loss)
Net income (loss) per share— primary (yen)

FY2002(April 2001
through March
2002)¥405,315(23,901)(33,302)(88,755)(263.53)−

Net income (loss) per share—diluted (yen)Notes:
1. Equity in earnings (losses) of affiliates (Million yen):Six months ended September 30, 2002: ¥2,655
Six months ended September 30, 2001: ¥(8,976)
Fiscal Year ended March 31, 2002:¥(17,575)
2. Average shares outstanding (consolidated)
Six months ended September 30, 2002: 336,869,930
Six months ended September 30, 2001: 336,762,941
Year ended March 31, 2002: 336,798,168
3. Changes in accounting methods were applicable to the period under review.
4. Percentage changes for revenues, operating income (loss), ordinary income (loss) and net income (loss) arecompared with the corresponding period of the previous interim fiscal year.
2.

Financial Condition(Million yen; amounts less than one million yen are omitted.)
FY2003 Interim
FY2002 Interim
FY2002(As of September 30, (As of September 30,(As of March 31,
2002)
2001)
2002)

Total assets
Shareholders’ equity
Equity ratio (%)
Shareholders’ equity per share (yen)Note: Shares outstanding (consolidated)3.

¥1,123,856
352,42931.4
1,046.30¥903,283
288,34231.9
855.33¥1,163,678
465,32640.0
1,381.31

As of September 30, 2002: 336,867,620
As of September 30, 2001: 336,833,168
As of March 31, 2002: 336,872,342

Cash Flows(Million yen; amounts less than one million yen are omitted.)
FY2003 Interim
FY2002 Interim
FY2002(April 2002 through(April 2001 through(April 2001 throughSeptember 2002)
September 2001)
March 2002)

Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Cash and cash equivalents at end of the period
4.

5.

Scope of Consolidation
Consolidated subsidiaries:
Equity-method affiliates:

290
114

¥(11,219)
63,574(56,339)
107,844

Equity-method non-consolidated subsidiaries:

Changes in Scope of Consolidation
Consolidated subsidiaries:
Newly added:
31
Newly deleted:
Equity-method non-consolidated subsidiaries and affiliates:
Newly added:
14
Newly deleted:

SOFTBANK CORP.

¥(53,995)(24,254)
63,509146,821¥(79,123)
39,751
1,313
119,855
4

26
9

1

The SOFTBANK GroupAs of September 30, 2002, the SOFTBANK Group Comprised 408 companies with operation in 9 segments.

Business segment

Consolidated
subsidiaries (includes
partnerships)

Equity-method
non-consolidated
subsidiaries andaffiliates (includes
partnerships)

1.

e-Commerce

25

18

2.

e-Finance

138

18

3.

Media & Marketing

14

8

4.

Broadmedia

14

2

5.

Internet Culture

17

5

6.

Technology Services

7

4

7.

Broadband Infrastructure

17

1

8.

Overseas Funds

44

52

9.

Others

14

10

290

118

Total

Principal products and operational content of each business

Sales of PC software and such hardware as PCs and peripherals;
enterprise solutions; diversified e-commerce business, including
e-commerce between business and consumer
All inclusive Web-based financial operations, including Internet
securities operations; management of domestic venture capital funds;
incubation of portfolio corporations
Book and magazine publication in such areas as PCs, the Internet,
entertainment, etc.; exhibition management; web content development
Provision of applications and content for broadband broadcasting andcommunications and promoting the spread of such operations
Internet-based advertising operations; broadband portal business;
Internet-based auction business
Systems solutions business; business solutions business
ADSL technology-based broadband infrastructure business; opticalfiber-based ultra high-speed Internet access services and otheroperations
U.S.- and Asia-focused global private equity operations inInternet-related companies
Holding company functions for overseas operations; back-officeservices in Japane - Fin an c e

e - Co mme rc e

Morningstar Inc.
SOFTBANK INVESTMENTCORPORATIONSOFTBANK US Ventures VI LP Morningstar Japan K.K. WEB-Lease Co., Ltd.
SB Life Science Ventures Ⅰ,LP E*TRADE Securities Co., Ltd.
SOFTBANK FRONTIERSECURITIES Co., Ltd.

O ve rse as Fu n ds

E*TRADE
Japan K.K.

SOFTBANK FINANCECORPORATIONSB CHINA HOLDINGS PTE LTD
SOFTBANK Capital LPSOFTBANK Korea Co., Ltd.

[Overseas]

Vector Inc.
SOFTBANK COMMERCE CORP.
Emtorage Broadcommunications Inc.
CarPoint K.K.

SOFTBANK Publishing Inc.
SOFTBANK ECHOLDINGS CORP.

SOFTBANK
Holdings Inc.

[Domestic]

Me dia &Marke tin g[Operation Holding
SB Holdings
Companies](Europe) Ltd.

SOFTBANK ZDNet Inc.

SOFTBANK Media &Marketing Corp.

cyber communications inc.

[Operation Holding
Companie s][Domestic][Overseas]S OFTBANK C ORP.
(Pure Holding Company)
Yahoo Japan Corporation
Tavigator, Inc.
e-Shopping! Books CORP.

I n te rn e t Cu ltu re

SOFTBANK
Broadmedia
Corporation

SOFTBANKTECHNOLOGYHOLDINGS CORP.

SOFTBANKTECHNOLOGYCORP.

Te c h n o lo g y
Se rvic e s

Club iT Corporation
Aozora Bank, Ltd.

BB Cable Corporation
Xdrive Japan K.K.

IP REVOLUTION INC.

Akamai Technologies Japan K.K.
BB Technologies Corporation

UTStarcom, Inc.

B ro adme dia
O th e rs
B ro adban d
I n f rastru c tu re･･･ Segment･･･ Consolidated subsidiary･･･ Equity-method subsidiary or affiliate

SOFTBANK CORP.

2

SOFTBANK subsidiaries listed on domestic stock exchanges as of September 30, 2002:
Subsidiary

Listed exchange

1.Yahoo Japan Corporation

JASDAQ

2.SOFTBANK TECHNOLOGY CORP.

JASDAQ

3.Morningstaar Japan K.K.

Nasdaq Japan

4.Vector Inc.

Nasdaq Japan

5.E*TRADE Japan K.K.

Nasdaq Japan

6.SOFTBANK INVESTMENT CORPORATIONTokyo Stock Exchange 1st section(Nasdaq Japan)

7.SOFTBANK FRONTIER SECURITIES Co., Ltd.

Nasdaq Japan

8.Club IT Corporation

Nasdaq Japan(Reference) Subsidiaries listed on overseas stock exchanges:
Subsidiary
SOFTBANK INVESTMENT INTERNATIONAL(STRATEGIC) LIMITEDSOFTBANK CORP.

Listed exchange
Hong Kong Stock Exchange

3Management Policies
1. Fundamental Management Policy
The core philosophy of the SOFTBANK Group (hereafter as “the Group”) is “Endeavoring tobenefit society and the economy by fostering the sharing of wisdom and knowledge gained throughthe IT revolution”. By constantly providing innovative services, the Group aspires to remain at theforefront of social and economic progress.

The broadband market continues to expand rapidly with growth sparked by the launch of theGroup’s Yahoo! BB comprehensive broadband service, while conditions in the IT industry arechallenging due to shrinking demand for mobile phones and PCs and other factors.

DSL

connection services, currently the driving force of the broadband market, have been growing in 2002
at an average rate of more than 310,000 new lines per month, according to data compiled by
Ministry of Public Management, Home Affairs, Posts and Telecommunications. As of October 31,
2002, the cumulative number of DSL lines stood at 4,639,000. It appears that Japan has reached thestage where broadband technology is widely used.

The Group is positioning broadband infrastructure businesses and other broadband-related activities
as its most important business domain. The Group will channel its management resources into thebroadband sector and develop businesses in a creative manner with the aim of maximizing its
corporate value.

2. Basic Policy Regarding Allocation of Earnings
SOFTBANK CORP. (hereafter as “the Company”) strives to fulfill its social obligations through theproper distribution of earnings among all its stakeholders. In the current fiscal year, the Company
has not yet finalized plans for dividend payments. The Company plans to distribute earnings in linewith operating results, while taking it into consideration the need to maintain the proper balance
between measures to bolster the operating base and to preserve a stable dividend for shareholders
over the medium and long-term prospective.

The Group will step up efforts to reinforce its operating base by building a structure capable ofmaximizing earnings from the broadband infrastructure business. At the same time, the Group will
work even harder in other business domains to improve profitability. The aim is to establish a diverse
range of earnings sources for the entire Group, thereby facilitating the consistent and proper return of
earnings to shareholders and all other stakeholders.

SOFTBANK CORP.

4

3. Medium- and Long-Term Management Strategy
The Group’s strategy is to become the number-one corporate group in a diverse range of businessdomains involving broadband technology. The group’s current goal is that BB Technologies
Corporation becomes the leader in broadband infrastructure business by expanding the customers at
Yahoo! BB, a comprehensive broadband service being offered in conjunction with Yahoo Japan
Corporation.

In late September 2002, the Yahoo! BB service became the first Japanese DSL operator to exceed one
million lines on a cumulative basis, according to data compiled by Ministry of Public Management,
Home Affairs, Posts and Telecommunications. As of October 31, 2002, the number of lines installedstood at 1,208,000.

This achievement is the result of strong sales promotions activities supported by the entire Group.
Since June 2002, Yahoo! BB has consistently ranked first in the number of new subscribers inmonthly basis and in August recaptured the number-one market share. This service will continue toattract new customers through the Internet using Yahoo! Japan, through retailers of electronics andother products, and through other innovative sales channels. This service has also been successful at
retaining existing customers by offering a diverse lineup of services and customer support that has
been dramatically improved.

Distinguishing Yahoo! BB from most of all is its high-performance and low-price nationwide
broadband network. This purely IP network is structured connecting more than 1,500 (as of October
31, 2002) NTT central offices. This high-performance network makes it possible to offer a variety ofservices. A number of new services were launched during the first half of the current fiscal year.
Among them were an ADSL service with a maximum downstream speed of 8 Mbps, an IP telephoneservice called BB Phone, an ADSL service with a maximum downstream speed of 12 Mbps and awireless LAN service. The Group plans to offer more new and creative services, such as the BB
Cable TV service that is already operating on a trial basis. The goal is to improve profitability byoffering many services.

In businesses outside the broadband infrastructure domain, the Group has many proprietary brands,
most notably Yahoo! Japan, that collectively establishes a powerful platform for broadband
businesses. In e-Commerce, e-Finance, Media & Marketing, Broadmedia, Internet Culture,
Technology Services and other fields, the Group is developing and supplying a diverse array ofservices, content and applications. Through this stance, the Group intends to continue growing byenlarging the broadband market.

SOFTBANK CORP.

5

4. Important Management Issues
Increase Market Share in the Broadband Infrastructure Business

As is true of most infrastructure businesses, the Group’s broadband infrastructure business requires
substantial up-front investments. In the first half of the current fiscal year, this business generated an
operating loss due to expenses associated with ongoing start-up investments. However, a broadband
network capable of generating added value is already in place. A Group-wide effort to capture
customers has given the Group a leading 26% market share in Japan as of the end of October 2002.
The Group is placing the highest priority on increasing its share of the broadband infrastructure
market. The Group will implement a variety of tactics to expand the market share in order tomaximize earnings over the medium and long-term prospective.

Strengthen the Group’s Financial Position

The Group has significantly improved its financial position since the previous fiscal year. The Groupwill continue to preserve access to many fund-procurement channels to fund the start-up investments
required in the broadband infrastructure business. Concurrently, the Group will continue its policy of
rapidly reducing net interest-bearing debt to a suitable level. Net interest-bearing debt has fallen by¥38.3 billion during the first half of the current fiscal year to ¥193.6 billion as of September 30, 2002.
The Group intends to make more progress to attain a sound financial position.

Growth and Stability Outside the Broadband Infrastructure Business Domain

In e-Commerce, Media & Marketing, Broadmedia, Internet Culture, Technology Services and otherfields, the Group is aiming for continued growth by channeling management resources into activities
where the greatest potential exists for synergies with the strategic broadband infrastructure business.

In e-Finance and Overseas Funds, the natures of business are susceptible to stock market movements
and other factors. Presently, these businesses are performing poorly due to adverse market conditions.
The Group plans to stabilize operating performance by examining means of conducting businesses inaccordance with market trends.

5. Group’s Management Structure
Board of Directors and Corporate Auditors

The nine-member Board of Directors includes three outside directors. The inclusion of this external
perspective ensures that the board functions as a transparent and effective decision-making body.
Individuals from outside the Group account for more than half of its corporate auditors, who areresponsible for overseeing the performance of the directors.

SOFTBANK CORP.

6

The Group will continue to strive to upgrade its system of management checks and balances tostrengthen its corporate governance.

Disclosure Activities

Improving the disclosure of information is essential to enhancing corporate governance. The Group
works to conduct comprehensive disclosures of all operating information in line with its basic policyof releasing information in a fair and timely fashion. The Group will continue to take many actions
to deepen communications with all stakeholders. Such actions include meetings to report on current
operations, information meetings for analysts and others, and the placement of releases and otherinformation on the Group’s Web site.

6. Other Items
Related-Party Transactions

None

Other Important Matters Regarding Management

None

SOFTBANK CORP.

7

Results of Operations and Financial Position
1. Results of OperationsFirst-Half Overview
In the first half of the current fiscal year, despite the negative impact on sales due to the exclusionfrom consolidation of Key3Media Group, Inc., there was a year-on-year increase of ¥7,680 million,
or 4.2%, in consolidated sales to ¥191,052 million. This increase was mainly attributable to higher
sales in the Internet Culture segment and to the full-fledged contribution of sales in the Broadband
Infrastructure segment.

Compared with the first half of the previous fiscal year, the operating loss increased ¥22,494 million
to ¥31,199 million. The primary cause was initial investment costs required to launch Broadband
Infrastructure activities, a business now entering a period of expansion. Excluding this segment, theother consolidated subsidiaries returned to profitability at the operating level.

The ordinary loss increased ¥29,806 million to ¥45,956 million. There was a net equity gain underthe equity method, compared with a loss one year earlier, but the Company recognized the net
non-operating loss of ¥14,757 million. That loss was mainly due to an exchange loss of ¥9,240
million caused by yen appreciation and ¥5,151 million in losses from investment in partnerships in
the e-Finance segment.

The net loss increased ¥1,487 million to ¥55,802 million. This included special income of ¥51,117
million that primarily represented ¥46,618 million in gain on sales of investment securities, mostly
in respect of Yahoo! Inc. and UTStarcom, Inc. Outweighing these gains were special losses of¥58,569 million. The major components were a valuation loss on investment in affiliates, mainly
shares held in Key3Media Group, Inc. and Club iT Corporation, totaling ¥21,714 million; avaluation loss on investment securities, mainly shares held in CNET Networks, Inc. and E*TRADEGroup, Inc., totaling ¥18,685 million; and ¥9,764 million in loss on sales of investment securities
such as E*TRADE Group, Inc.

Results of Operations by Business Segment
e-Commerce—Segment sales were down ¥2,148 million, or 1.7% year on year, to ¥127,351 million.
This was mainly attributable to lower sales at SOFTBANK COMMERCE CORP. Operating income
increased ¥116 million, or 10.3%, to ¥1,252 million. Sales declining and a lower operating margin
ratio at SOFTBANK COMMERCE CORP. was outweighed by an improvement in operating
profitability at CarPoint K.K. and other recently launched businesses. Sales and expenses associated

SOFTBANK CORP.

8

with incentives for Yahoo! BB sales by SOFTBANK COMMERCE CORP. through major retailers
are included in the Broadband Infrastructure segment from the first half of the current fiscal year.
e-Finance—Segment revenue increased ¥2,967 million, or 28.2%, to ¥13,499 million. This was
mainly due to growth in brokerage commissions at E*TRADE SECURITIES, CO., LTD., which is a
consolidated subsidiary of E*TRADE Japan K.K. The operating loss declined ¥1,469 million to¥2,105 million, mainly the result of a smaller valuation loss on the operational investment securities
of SOFTBANK INVESTMENT CORPORATION. Special losses in this segment were recorded due
to a valuation loss of ¥2,155 million on investment securities representing E*TRADE Group, Inc.,an estimated reimbursement of success fees of ¥2,416 million (included in “other special losses”) at
SOFTBANK Ventures, Inc. and other items.
Media & Marketing—Segment sales fell ¥15,859 million, or 66.0%, to ¥8,163 million andoperating income was down ¥1,078 million to a loss of ¥463 million. The primary causes were theexclusion from consolidation of Key3Media Group, Inc. and lower sales and operating profitability
at SOFTBANK Publishing Inc. because of an extremely challenging business environment in the
publishing industry.
Broadmedia—Segment sales declined ¥688 million, or 11.4%, to ¥5,357 million due to thetermination of acquisition of new CS subscribers because Club iT Corporation has cancelled theagency agreement with a communications satellite services. A decline in the operating margin ratioat Club iT Corporation and higher licensing fees paid by Akamai Technologies Japan K.K. weremainly responsible for a year-on-year decrease of ¥895 million in operating income to a ¥600
million loss. The entire premium of ¥3,295 million resulting from the take-over-bid for Club iT
Corporation in the first half of the current fiscal year was written off as a valuation loss on
investment in affiliates.
Internet Culture—Segment sales rose ¥3,613 million, or 29.9%, to ¥15,692 million and operating
income was up ¥2,255 million, or 58.2%, to ¥6,132 million. This performance was due to growth infee incomes mainly by a system utilization fee in the auction business.
Sales and expenses of Yahoo Japan Corporation related to the Yahoo! BB service are included in the
Broadband Infrastructure segment from the first half of the current fiscal year.
Technology Services—Segment sales increased ¥1,330 million, or 15.7%, to ¥9,782 million. Thiswas mainly attributable to higher sales of PC-related products, growth in escrow services, and anincrease in revenue from the installation and maintenance services relating to the broadband
infrastructure business in SOFTBANK TECHNOLOGY CORP. Operating income was down ¥171
million, or 39.0%, to ¥269 million due to the decline of the gross profit margin in the systemsolutions business and to the increase of the fix costs, like personnel costs and others, in
SOFTBANK TECHNOLOGY CORP.
Broadband Infrastructure—Segment sales totaled ¥13,520 million. Major contributors were BB

SOFTBANK CORP.

9

Technologies Corporation, which continues to expand its business, and IP REVOLUTION, INC.,
which is a company posting steady growth in sales through an ultra-high-speed Internet connection
service using fiber optics. On the other hand, this segment posted an operating loss of ¥31,262
million due to substantial start-up costs. BB Technologies Corporation reported sales of ¥10,089
million and an operating loss of ¥29,419 million. One of the start-up costs was new customers
acquisition costs, like sales promotion expenses, outsourcing fees such as processing applications,etc., and accounted for almost one-third of this company’s total operating expenses of ¥39,508
million. Sales and expenses of SOFTBANK COMMERCE CORP. associated with incentives forYahoo! BB sales through major retailers, and sales and expenses of Yahoo Japan Corporation
associated with the Yahoo! BB business are included in the Broadband Infrastructure segment fromthe first half of the current fiscal year.
Overseas Funds—Segment revenue increased ¥1,193 million, or 154.0%, to ¥1,967 million due toan increase in fund management fees. Lower expenses due to restructuring actions since the previous
fiscal year resulted in a ¥1,638 million improvement in operating income to ¥1,484 million.
Other Businesses—Segment sales increased ¥1,461 million, or 14.0%, to ¥11,876 million, and theoperating loss decreased ¥1,727 million to¥3,845 million, as compared with the corresponding

period of the previous fiscal year.

Results of Operations by Geographic Segment
Japan—Sales increased ¥17,964 million, or 11.4%, year on year to ¥175,892 million. Contributing
to this growth was an increase in Internet Culture segment sales and sales generated by the
Broadband Infrastructure segment. The start-up costs at Broadband Infrastructure business, a sector
now in a growth phase, caused an operating loss to rise by ¥24,215 million, or 1,048.8%, to ¥26,524
million.
North America—Sales fell ¥11,392 million, or 81.7%, to ¥2,555 million and the operating loss
declined ¥607 million, or 65.3%, to ¥323 million. These changes were primarily due to the exclusionfrom consolidation of Key3Media Group, Inc.
Europe—Sales decreased ¥110 million, or 40.2%, to ¥163 million and the operating loss increased¥11 million, or 3.3%, to ¥371 million. This performance mainly reflected the exclusion fromconsolidation of Key3Media Group, Inc. and an operating loss in overseas funds business.
Korea—Revenues increased ¥1,882 million, or 19.9%, to ¥11,340 million, but the operating lossrose ¥241 million, or 29.5%, to ¥1,058 million.

SOFTBANK CORP.

10

2. Financial Position
Balance Sheet Analysis
Current assets totaled ¥354,369 million, ¥40,078 less than at the end of the previous fiscal year.
This was mainly attributable to a ¥26,439 million drop in other current assets caused by the transfer
to property and equipment of a temporary reimbursement in BB Technologies Corporation, whichthat had been initially recorded as future lease assets under the company’s plan.

Property and equipment increased ¥45,157 million to ¥73,566 million. This was mainly the resultof the transfer of a temporary reimbursement of BB Technologies Corporation from the current
assets and capital expenditures.

Investments and other assets decreased ¥263,418 million to ¥445,115 million. The largest
component was a decrease of ¥266,516 million in investment securities. This was due primarily tothe partial sale of shares in Yahoo! Inc. and a decline in its market value, as well as sales of equity
investments in UTStarcom, Inc., E*TRADE Group, Inc. and certain other companies.

Liabilities decreased ¥83,078 million to ¥568,139 million. Other current liabilities, which include
the account payables at BB Technologies Corporation, increased ¥22,668 million. However, there
was a decline of ¥62,579 million in deferred tax liabilities due to the partial sale of Yahoo! Inc. and a
decline in its market value, and a decline of ¥58,253 million in interest-bearing debts.

Shareholders’ equity decreased ¥176,983 million to ¥288,342 million as a net loss reduced retained
earnings by ¥58,258 million and there was a ¥107,409 million decline in an unrealized gain on othersecurities.

Cash Flow Analysis
Although cash was provided by investing activities, cash was used for both operating and financing
activities. The net result was a decrease of ¥12,010 million to ¥107,844 million in cash and cash
equivalents compared with March 31, 2002.

Net cash used for operating activities was ¥11,219 million, but this was ¥42,775 million less thancash used in the first half of the previous fiscal year. There was a loss before income taxes andminority interest of ¥53,408 million, but this was partially offset by depreciation and amortization of¥8,664 million, valuation loss on investment securities of ¥40,399 million, net exchange losses of¥9,177 million and other non-cash expenses. Another positive factor was the ¥13,773 million
year-on-year decrease in cash payments for income taxes to ¥8,646 million.

SOFTBANK CORP.

11

Net cash provided by investing activities was ¥63,574 million, ¥87,829 million more than one year
earlier. Purchases of property and equipment and intangible assets totaled ¥26,213 million, mainly
for initial investment costs at BB Technologies Corporation, and purchases of marketable andinvestment securities totaled ¥20,441 million. On the other hand, sales of marketable and investment
securities generated proceeds of¥110,261 million, which was mainly Yahoo! Inc. shares.

Net cash used for financing activities was ¥56,339 million. This was mainly the result of ongoingmeasures to reduce interest-bearing debts. Repayment of bonds was ¥24,782 million and there was a¥27,574 million net decrease in short-term borrowings. On a year-on-year basis, net financing cash
flows declined ¥119,848 million because proceeds from the issuance of bonds totaled ¥123,691
million in the first half of the previous fiscal year.

SOFTBANK CORP.

12

CONSOLIDATED BALANCE SHEETS

FY2003 interim(As of September 30, 2002)
Amount%(Millions of yen; amounts less than one million yen are omitted.)
FY2002 interim
FY2002
Increase(As of September 30, 2001)(As of March 31,2002)（Decrease）
Amount%Amount%ASSETS
Current assets
Cash and deposits
Notes and accounts receivable - tradeMarketable securities
Inventories
Deferred tax assets
Receivables related to margin transactions
Other current assets
Less : Allowance for doubtful accounts (current)
Total current assets

39.2¥128,824
67,784
19,45825,874
8,175
26,95597,506(1,637)
372,9428.1

5,476
16,263
21,7403.3

48,962
43,97916,04025,246134,228

254,633858
48,835130,527
11,797(1,538)445,11549.3

419,997
2,862
26,639134,514
9,971(1,632)592,35252.7(165,364)(2,003)22,196(3,986)
1,826
94(147,237)

555

0.1

2,593

0.2

(2,038)757

0.1¥903,283

100.0¥1,123,856

100.0¥(220,572)¥1,163,678

100.0¥102,379
55,912
7,612
41,1196,155
52,31990,363(1,494)354,369

33.2¥(26,444)(11,871)(11,845)
15,244(2,020)25,364(7,142)
143(18,573)¥113,580
62,047
9,545
36,312
15,43042,316
116,802(1,586)394,44733.9

1.9

43,4688,357
51,825

11,464
16,94328,408

2.4

4,180

12.0

(44,676)(43,979)(3,210)(12,683)(104,550)

16,19011,16031,531

2.7

521,150
1,287
35,832
141,456
10,313(1,506)
708,533

60.9

Non current assets
Property and equipment, net
Transmission equipments
OthersTotal tangible assets

48,944
24,62173,566

Intangible assets, net
Goodwill
Trade names
Consolidation adjustment
Other intangibles
Total intangible assets

4,285
12,82912,562
29,678-Investments and other assets
Investment securities
Long-term loans
Deferred tax assets
Investments in partnerships
Other assets
Less : Allowance for doubtful accounts
Total investments and other assets

Deferred charges

TOTAL ASSETSSOFTBANK CORP.

13

CONSOLIDATED BALANCE SHEETS

FY2003 interim(As of September 30,2002)
Amount%(Millions of yen; amounts less than one million yen are omitted.)
FY2002 interim
FY2002
Increase(As of September 30,2001)(As of March 31,2002)（Decrease）
Amount%Amount%LIABILITIESCurrent liabilities
Notes and accounts payable - trade
Short-term borrowings
Commercial paper
Current portion of corporate bonds
Current portion of convertible bonds
Income taxes payable
Deferred tax liabilities
Accrued expenses
Payables related to margin transactions
Allowance for sales returns
Other current liabilities
Total current liabilities¥55,192
82,35810,00067,91923,516553
13,08644,7201,139
93,291
391,778

43.4¥53,267
132,316
20,00045,469
6,586
7,329
3,407
11,14021,967
1,335
80,538383,357

34.1¥1,925(49,957)(10,000)
22,450(6,586)
16,187(2,854)
1,946
22,752(196)
12,7538,421

28.5(132,357)(20)(3,601)(3,954)(332)(3,756)(144,022)¥56,742
114,190
10,00048,8419,593
47
10,17637,417
1,343
70,623358,97630.8

179,365
125
13,12170,962331
28,335292,241

25.1-

Long-term liabilities
Corporate bonds
Convertible bonds
Long-term debt
Deferred tax liabilities
Accrued retirement benefits
Other liabilities
Total long-term liabilities

137,132
105
9,875
8,383
39
20,825
176,360

19.5

269,490125
13,476
12,337372
24,581
320,382

TOTAL LIABILITIES

568,13962.9

703,740

62.6(135,600)

651,21855.9

46,802

5.2

67,687

6.0(20,884)

47,134

4.1

Common stock

137,867

15.3

137,80812.3

58

137,867

11.9

Additional paid-in capital

162,23117.9

162,172

14.4

58

162,231

13.9

Retained (deficit) earnings(54,223)(6.0)

38,505

3.4(92,728)

4,035

0.3

Net unrealized gain (loss) on other securities

19,215

2.1(13,569)(1.2)

32,785

126,625

10.9

Translation adjustments

23,268

2.6

27,512

2.5(4,244)34,577

3.0

(17)

(0.0)

(0)

(0.0)

(17)

(10)

(0.0)

288,34231.9

352,42931.4(64,087)

465,32640.0¥903,283

100.0¥1,123,856

100.0¥(220,572)¥1,163,678

100.0

MINORITY INTEREST
IN CONSOLIDATED SUBSIDIARIESSHAREHOLDERS' EQUITY

Less: Treasury stock
TOTAL SHAREHOLDERS' EQUITYTOTAL LIABILITIES ANDSHAREHOLDERS' EQUITYSOFTBANK CORP.

14

CONSOLIDATED STATEMENTS OF INCOME
FY2003 interim(April 2002 throughSeptember 2002)
Amount%(Millions of yen; amounts less than one million yen are omitted.)
FY2002 interim
FY2002
Increase(April 2001 through(April 2001 through(Decrease)
September 2001)
March 2002)
Amount%Amount%Net sales from non-financing business¥177,834

93.1¥172,656

94.2¥5,178¥381,532

94.1

Cost of sales

163,95985.8

137,974

75.3

25,985319,328

78.8

Gross profit

13,875

7.3

34,682

18.9(20,807)62,204

15.3

Selling, general and administrative expenses

45,063

23.6

39,669

21.6

5,393

81,311

20.0

Operating loss from non-financing business(31,188)(16.3)(4,987)(2.7)(26,200)(19,107)(4.7)

Revenue from financing business

13,217

6.9

10,7155.8

2,501

23,782

5.9

Finance business expenses

13,2286.9

14,4337.8(1,204)28,576

7.1

(11)

（0.0）

(3,717)

(2.0)

3,706

(4,794)(1.2)(31,199)(16.3)(8,704)(4.7)(22,494)(23,901)

(5.9)

2,065
24,9397.2(914)(9,348)2,655(93)(7,701)

15,64017,575
8,715
41,931

10.3

Operating loss from financing businessTotal operating loss

Interest income
Exchange gains, net
Equity in gains under the equity method, net
Other non-operating income
Non-operating income

-

1,439
9,348

2,655
2,321
5,501

2,414
13,203

525

2.8

5,526
32,530

8.0

4,439
9,240

7,903
10.6

8,976
3,768
20,64811.3(3,464)9,240(8,976)
2,810
(389)

(24.1)(16,150)(8.8)(29,806)(33,302)

(8.2)

26.8

5,646
11,441
312
17,3999.5

40,972(9,492)
2,237
33,71767,06819,353
4,776
91,19822.5

9,764
18,68521,714484
7,920
58,56930.7

5,160
34,821
16,045
3,429
11,801
71,25738.9

4,603(16,136)
5,668(2,944)(3,881)(12,688)

15,673
99,046
19,413
3,761
39,942
177,836

43.9

Loss before income taxes and minority interest(53,408)(28.0)(70,008)(38.2)

16,599(119,939)(29.6)

Income taxes -current
Income tax refunds
Income taxes -deferred

23,784
4,957(15,338)

12.4
2.6
(8.0)

5,733

3.1

2.0

(10.2)

18,051
4,957
3,393

8,378

(18,731)(36,219)

(8.9)

1,095

0.6

2,694

1.5

(1,598)

3,343

0.8

¥(55,802)(29.2)¥(54,315)(29.6)¥(1,487)¥(88,755)(21.9)

Interest expense
Exchange loss, net
Equity in losses under the equity method, net
Other non-operating expenses
Non-operating expenses

6,579
20,259Ordinary loss

(45,956)

Gain on sale of investment securities
Dilution gains from changes in equity interest
Other special income
Special income

46,618
1,949
2,549
51,117

Loss on sale of investment securities
Valuation loss on investment securities
Valuation loss on investment in affiliates
Dilution loss from changes in equity interest
Other special losses
Special loss

Minority interest
Net loss

SOFTBANK CORP.

-

-

15

CONSOLIDATED STATEMENTS OF
ADDITIONAL PAID-IN CAPITAL AND RETAINED EARNINGS(Millions of yen; amounts less than one million yen are omitted.)
FY2003 interim(April 2002 throughSeptember 2002)
ADDITIONAL PAID-IN CAPITAL
Additional paid-in capitalat the beginning of the period¥162,231

Increase
Decrease
Additional paid-in capitalat the end of the period¥162,231(Millions of yen; amounts less than one million yen are omitted.)
FY2002 interim
FY2002
FY2003 interim(April 2001 through(April 2001 through(April 2002 throughSeptember 2001)
March 2002)
September 2002)
RETAINED EARNINGS
Retained earnings at the beginning of the period¥4,035¥94,803¥94,803

Adjustment to investment in affiliates due tochange in accounting from equity method to cost basis

93

624

690

Increase in retained earnings of companies
excluded from consolidation

1

Increase in retained earnings

94

624

690

(55,802)(2,358)(75)(54,315)(2,356)(46)(88,755)(2,356)
(142)

(107)

(203)

(203)

(2)

(0)

(0)

(6)
(58,352)(56,922)(91,458)¥(54,223)¥38,505¥4,035Net loss
Cash dividends
Bonuses to directors
Adjustment to investment in affiliates due tochange in accounting from equity method to cost basis
Decrease in retained earnings of companies
included into consolidation
Decrease due to merger
Decrease in retained earnings
Retained (deficit) earnings
at the end of the period

SOFTBANK CORP.

-

-

16

CONSOLIDATED STATEMENTS OF CASH FLOWS(Millions of yen; amounts less than one million yen are omitted.)
FY2002
FY2002 interim
FY2003 interim(April 2001 through(April 2001 through(April 2002 throughMarch 2002)
September 2001)
September 2002)
I Cash flows from operating activities:
Loss before income taxes and minority interest
Adjustments to reconcile income before income taxes andminority interest to cash used for operating activities
Depreciation and amortization
Equity in (gains) losses under the equity method, net
Dilution gains from changes in equity interest, net
Valuation loss on investment securities
Gains on sale of marketable and investment securities, net
Exchange losses (gains), net
Interest and dividend income
Interest expense
Decrease in receivables- trade
Decrease in payables-trade
Increase in other receivables
Increase in other payables
Others, net¥(53,408)¥(70,008)¥(119,939)

8,664(2,655)(1,464)40,399(36,854)
9,177
(591)
4,439
6,564
(3,632)(6,436)
11,85819,798(4,141)773(5,224)(8,646)
6,018(11,219)

4,188
8,976
(8,012)50,866(491)(7,961)(1,491)
7,903
18,558(15,308)(36,961)
20,450
4,991(24,300)
1,418(8,693)(22,419)(53,995)

11,74917,575(15,591)
118,459(51,490)(20,311)(2,129)15,64016,684(10,533)(37,474)
9,785
28,591(38,983)
2,320(17,281)(25,180)(79,123)

II Cash flows from investing activities:
Purchases of property and equipment and intangible assets
Purchase of marketable and investment securities
Proceeds from sale of marketable and investment securities
Additional investments in newly consolidated entities
Proceeds from sale of interests in previously consolidated subsidiaries
Proceeds from sale of interests in consolidated subsidiaries
Increase in loan receivables
Collections of loans
Others, net
Net cash provided by (used for) investing activities(26,213)(20,441)
110,261
(680)
(220)
1,080
(3,381)
1,085
2,084
63,574(8,470)(37,318)
29,107(5,033)(9)
767(7,724)3,379
1,046(24,254)(30,272)(71,426)
157,985(18,263)(33)
10,554(12,803)
8,294(4,283)39,751

III Cash flows from financing activities:
Proceeds from issuance of shares to minority interest
Decrease in short-term borrowings, net
Proceeds from issuance of commercial paper
Repayment of commercial paper
Proceeds from long-term debt
Repayment of long-term debt
Proceeds from issuance of bonds
Redemption of bonds
Cash dividends paid
Cash dividends paid to minority interest
Others, net
Net cash (used for) provided by financing activities

4,763(27,574)
10,000(10,000)
30(7,406)
2,396(24,782)(2,318)(28)(1,418)(56,339)2,430(3,359)50,000(60,000)
2,200(38,946)
123,691(9,550)(2,336)(620)
63,50911,039(29,226)
71,400(91,400)
15,630(43,531)
126,393(53,597)(2,346)(336)(2,712)
1,313

Interest and dividends received
Interest paid
Income taxes paid
Refunds of income taxes
Net cash used for operating activities

IV Effect of exchange rate changes(7,950)

2,454

3,578

V Net decrease in cash and cash equivalents
VI Net increase in cash and cash equivalents
due to the companies newly consolidated
VII Decrease in cash and cash equivalents due to exclusion ofpreviously consolidated entities
VIII Cash and cash equivalents at the beginning of the period(11,935)(12,286)(34,479)

34

2

2

119,855

159,105

159,105

IX Cash and cash equivalents at the end of the period¥107,844¥146,821¥119,855

SOFTBANK CORP.

-

(108)

(4,772)17

Basis of Presentation of Consolidated Financial Statements
1. Changes in Scope of Consolidationa) As of September 30, 2002, SOFTBANK CORP. (the "Company") consolidated 290 subsidiaries. 10 subsidiaries were not consolidated due totheir immateriality in terms of the consolidated total assets, sales and revenues, net income and retained earnings of the SOFTBANK
consolidated financial statements.
Main changes in scope of consolidation for the period ended September 30, 2002 were as follows;<Newly consolidated subsidiaries (including partnerships)>
1 BB SHOP! CORP.
2 SBI INTELLECTUAL PROPERTY CO., LTD.
3 Netrust,Ltd.

Newly established
Newly established
Newly invested in

Other 28 companies<Subsidiaries (including partnerships) excluded form consolidation>
1 e-Shopping! Wine CORP.
2 Prime Partners Corp. (former SmartFirm Corp.)
3 CAPITAL. COM, INC

Decrease in shareholding percentage due to sale of shares
Sale of shares
MergerOther 23 companiesb) As of September 30, 2002, the Company held 4 non-consolidated subsidiaries and 114 affiliates, all of which were accounted for under the equity method.
Main changes in application of the equity method for the period ended September 30, 2002 were as follows;<Increase；including partnerships>
1 BEST BroadBand Corp.
2 YAMADA BroadBand Corp.
3 LAOX BB Corp.

Newly established
Newly established
Newly established

Other 11 companies<Decrease；including partnerships>
1 InsWeb Corporation
2 MessageMedia, Inc.

Decrease in the shareholding percentage
Decrease in the shareholding percentage

Other 7 companies
2. Fiscal year end
Fiscal year ends of consolidated subsidiaries in terms of domestic and overseas are as follows;<Fiscal year end>
March end
(as same as consolidated B/S date)June end
September end
December end
February end

SOFTBANK CORP.

<Domestic><Overseas>

110

29

7
7
13
3

6
115
-

18

4 Summary of Significant Accounting Policies[1] Evaluation standards and methods for major assets(1) Marketable securities and investment securities
Held-to-maturity debt securities :Other securities:
With market quotations:Without market quotations:(2) Inventories

Stated at amortized cost

Stated at fair value, which represents the market price at the balance sheet date
(Unrealized gains/losses are included as a separate component of "Shareholders' equity",
net of tax, while cost of sales is determined primarily based on the moving-average method)
Carried at cost, primarily based on the moving-average method
Carried at cost, primarily based on the moving-average method[2] Depreciation and amortization(1) Property and equipment:
The Company and its domestic consolidated subsidiaries calculate depreciation using the declining-balance method, except in respect of atransmission equipment, of which it is calculated using the straight-line method. Foreign consolidated subsidiaries calculate depreciation using thestraight-line method based on the estimated useful lives of the related assets, in accordance with the accounting principles generally accepted andapplied in their respective countries of domicile.
(2) Intangible assets:
The straight-line method. Goodwill is amortized over 5 to 20 years.
[3] Accounting principles for major allowances and accruals(1) Allowance for doubtful accounts
Allowance for doubtful accounts is provided based on the aggregate amount of estimated credit losses on doubtful receivables, plus an amount forreceivables, other than doubtful receivables, calculated using historical write-off experience ratios from certain prior periods.
(2) Allowance for sales returns:
Allowance for sales returns is provided for the gross margin of future sales returns expected subsequent to the balance sheet date on an accrual basis.
(3) Accrued retirement benefits
Some domestic consolidated subsidiaries use the simplified method to calculate their accrued retirement benefits based on the projected benefit
obligation as of the end of the consolidated fiscal year.
Starting on July 1, 2002, the Company and some domestic consolidated subsidiaries transferred their pension plans from non-contributory defined
benefit pension plans to the defined contribution pension plans , and reversed their accrued retirement benefits at the time that transferring was
made.
[4] Translation of foreign currency transactions and accounts
All assets and liabilities in foreign currencies are translated at the foreign exchange rates prevailing at the respective balance sheet dates. Exchange
gains or losses are charged in the net income when incurred.
The translation of revenues and expenses in the financial statements of foreign consolidated subsidiaries into Japanese yen is performed by using the
average exchange rate for the period. Assets and liabilities are translated using the foreign exchange rates prevailing at the balance sheet date , andcapital stock is translated using the historical rates. Foreign currency financial statement translation differences are presented as a separate
component of "Shareholders' equity", except for the portion pertaining to minority shareholders, which is included in "Minority interest inconsolidated subsidiaries".
[5] Finance lease
Finance leases other than those whereby the ownership of the assets would be transferred to lessees at the end of the lease term are accounted for as
operating leases.
[6] Accounting method of consumption taxes
Consumption taxes are accounted for using a net-of-tax method.

5 The Scope of Cash and Cash Equivalents in the Consolidated Statements of Cash Flow
"Cash and cash equivalents" comprise cash on hand, bank deposits withdrawable on demand and highly liquid investments with initial maturities ofthree months or less and a low risk of fluctuation in value.

19
SOFTBANK CORP.

(Additional information)[1] Accounting method for treasury stock and reduction of legal reserves
Effective from the fiscal year beginning April 1, 2002, the Company adopted Financial Accounting Standards No.1: "Accounting Standards for Treasury
Stock and Reduction of Legal Reserves". Adoption of this new standard had an immaterial impact on the Company's results of operations and financial
position.
In addition, consolidated statements of additional paid-in capital and retained earnings have been prepared in accordance with the amended "Regulations
Concerning Semi-annual Consolidated Financial Statements", effective from the fiscal year beginning April 1, 2002.

[2] Defined Contribution Pension Plan
Following the enactment of the Act for Defined Contribution Pension, the Company and some domestic consolidated subsidiaries transferred theirpension plans from non-contributory defined benefit pension plans to defined contribution pension plans on July 1, 2002, and adopted Financial
Accounting Standards Implementation Guidance No.1: "Accounting for Transfers between Retirement Benefit Plans", issued by Accounting Standards
Board of Japan on January 31, 2002.
The related transition obligation of ¥297 million was recognized as "Other special losses" in the consolidated statement of income for the period ended
September 30, 2002.

SOFTBANK CORP.

20

NOTES
1 Accumulated depreciation of property and equipment
As of September 30, 2002
18,999 million yen

As of September 30, 2001
9,805 million yen

As of March 31, 2002
10,756 million yen

As of September 30, 2002
9,206 shares

As of September 30, 2001
175 shares

As of March 31, 2002
4,484 shares

2 Number of treasury stock held by the Company

3 Accounting for the assets and liabilities of the silent investment association
The assets and liabilities belonging to the silent investment association, net of deposits from the association members, at the end of periods are as follows;

Cash and deposits
Other current assets(Operational investment securities)
Other current assets(other)
Investment securities
Investments in partnerships
Other current liabilities
Other non-current liabilities(Deposit from the silent investment
association)

As of September 30, 2002
7,731 million yen

As of September 30, 2001
7,167 million yen

As of March 31, 2002
6,804 million yen

11,967

14,71011,936

24

260

232

4,565
457

5,501
1,392
811

1,491
2,726
163

23,832

28,21923,0284 Receivables and payables relating to margin transactions
Receivables and payables at each period end relating to margin transactions in securities businesses engaged by certain consolidated subsidiaries are as follows:
As of September 30, 2002
Receivables relating to margin transactions:
Loans receivable from customers for
margin transactions
Cash deposits as collateral for securities
borrowed from securities financecompanies
Payables relating to margin transactions:
Loans from securities finance companies
for margin transactions
Proceeds from securities sold for margintransactions

SOFTBANK CORP.

As of September 30, 2001

As of March 31, 2002

46,914 million yen

23,241 million yen

37,881 million yen

5,405

3,713

4,434

31,60013,20824,37913,1198,759

13,03821

5 Assets pledged as collateral(1) For future lease liabilities
FY2003 interim (as of September 30, 2002)
Assets pledged as collateralType of collateral
Carrying amountNotes and accounts receivable - trade
5,740
Other current assets
67(accounts receivable -other)Type of security
Mortgage
Mortgage(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Carrying amountAccount
Notes and accounts payables - trade278

Note: The collateral for the future lease liabilities of ¥35,817 million, of which ¥278 million was for "Notes and accounts payable-trade", was provided by
mortgaging against the aggregate of the current and future receivables due from customers of certain consolidated subsidiaries and a broadcasting
company, based on marketing agreements, etc.
The current receivables at September 30, 2002, held as the collateral for the above future lease liabilities, consisted of "Notes and accounts
receivable-trade" of ¥5,740 million and "Other current assets" of ¥67 million, respectively.

FY2002 interim (as of September 30, 2001)
Assets pledged as collateralType of collateral
Carrying amountNotes and accounts receivable - trade894
Other current assets
13(accounts receivable -other)Type of security
Mortgage
Mortgage(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Account
Carrying amountNotes and accounts payable - trade344

Note: The collateral for the future lease liabilities of ¥9,753 million, of which ¥344 million was for "Notes and accounts payable-trade", was provided by
mortgaging against the aggregate of the current and future receivables due from customers of certain consolidated subsidiaries and a broadcasting company,
based on marketing agreements, etc.
The current receivables at September 30, 2001, held as the collateral for the above future lease liabilities, consisted of "Notes and accounts receivable-trade"of ¥894 million and "Other current assets" of ¥13 million, respectively.

FY 2002 (as of March 31, 2002)
Assets pledged as collateralType of collateral
Carrying amountNotes and accounts receivable - trade
3,592
Other current assets
53(accounts receivable -other)Type of security
Mortgage
Mortgage(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Account
Carrying amountNotes and accounts payable - trade319
Other current liabilities
96(accounts payable -other)

Note: The collateral for the future lease liabilities of ¥33,902 million, of which ¥319 million was for "Notes and accounts payable-trade" and ¥96 million was for"Other current liabilities", was provided by mortgaging against the aggregate of the current and future receivables due from customers of certain
consolidated subsidiaries and a broadcasting company, based on marketing agreements, etc.
The current receivables at March 31, 2002, held as the collateral for the above future lease liabilities, consisted of "Notes and accounts receivable-trade" of ¥3,592 million and "Other current assets" of ¥53 million, respectively.

SOFTBANK CORP.

22

5 Assets pledged as collateral (continued)(2) For short-term borrowings and long-term debt
FY2003 interim (as of September 30, 2002)
Assets pledged as collateralType of collateral
Carrying amount
Property and equipment86

FY2002 interim (as of September 30, 2001)
Assets pledged as collateralType of collateral
Carrying amountType of security
MortgageType of security

Cash and deposits (time deposits)

23

Mortgage

Property and equipment

2,131

Mortgage

FY2002 (as of March 31, 2002)
Assets pledged as collateralType of collateral
Carrying amount
Property and equipment

1,262Type of security
Mortgage(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Carrying amountAccount
Short-term borrowings
43(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Account
Carrying amount
Other current liabilities
172(other account payables)
Short-term borrowings
277
Long-term debt
237

(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Account
Carrying amount
Short-term borrowings
163
Long-term debt
275(3) For long-term debt owed by the third party
FY2003 interim (as of September 30, 2002)
Assets pledged as collateralType of collateral
Carrying amount
Investments in partnerships
1,982

Type of security
Mortgage(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Carrying amountAccount
Long-term debt in the third party
2,400

FY2002 interim (as of September 30, 2001)
No transactions applicable.

FY2002 (as of March 31, 2002)
No transactions applicable.

SOFTBANK CORP.

23

6 Line of credit as a creditor (not used)
As of September 30, 2002
24 million yen

As of September 30, 2001
24 million yen

As of March 31, 2002
24 million yen

7 Accounts receivable sold
As of September 30, 2002
8,071 million yen

As of September 30, 2001

As of March 31, 2002

- million yen

11,825 million yen

As of September 30, 2001

As of March 31, 2002

- million yen

40 million yen

8 Notes receivable discounted
As of September 30, 2002
- million yen

9 Notes receivable maturing on the period-end dates
Notes receivable are settled on the date of clearance. Since the period-end dates of September 30, 2001 and March 31, 2002 were non-businessdays, the following balance of notes receivable maturing on those dates were not settled and were included in the closing balances of "Notes andaccounts receivable-trade".
As of September 30, 2002
Notes receivable- million yen

As of September 30, 2001
39 million yen

As of March 31, 2002
98 million yen

10 Dilution gains (losses) from changes in equity interest
Dilution gains (losses) were recognized from changes in the Company's equity interest as a result of capital transactions by investees including
an initial public offering.
The major dilution gains (losses) for the period ended September 30, 2002 are as follows:

UTStarcom, Inc.
E*TRADE Japan K .K .

SOFTBANK CORP.

Gains
891 million yen
851(Losses)- million yen
4724

11 Valuation loss on investments in affiliates"Valuation loss on investments in affiliates" recognized as a special loss in the consolidated statements of income are as follows.
(1) Valuation loss on investment in consolidated subsidiaries
As of September 30, 2002
6,065 million yen

As of September 30, 2001
192 million yen

As of March 31, 2002
331 million yen

As of September 30, 2001
15,852 million yen

As of March 31, 2002
19,082 million yen(2) Valuation loss on investment in affiliates accounted for under the equity method
As of September 30, 2002
15,649 million yen

12 Consolidated statements of cash flow
Reconciliation of cash and cash equivalents to the amounts included in the accompanying consolidated balance sheets is as follows.

Cash and deposits

As of September 30, 2002

As of September 30, 2001

As of March 31, 2002

102,379 million yen

128,824 million yen

113,580 million yen

Marketable securities

7,612

19,4589,545Time deposits with original
maturity over three months(431)(1,334)(1,065)

Deposits received from customers
in commodities business

(19)

-

(31)

Stocks and bonds with original
maturity over three months(1,696)(127)(2,173)

Cash and cash equivalents

107,844 million yen

SOFTBANK CORP.

146,821 million yen

119,855 million yen

25

13 Leases
13-1. Finance leases in which the ownership of leased assets is not transferred to lessees at the end of lease term
(as a lessee)(1) Amounts equivalent to acquisition costs, accumulated depreciation and net book value at the end of periods
As of September 30, 2002
Property and equipment
Equivalent to acquisition costs
Less: Amount equivalent to accumulated
depreciation
Net book value

As of March 31, 2002

47,36919,14742,315(12,567)(7,188)(8,872)34,802 million yen

11,959 million yen

33,442 million yen

Software (Intangible assets)
Equivalent to acquisition costs
Less: Amount equivalent to accumulated
amortization
Net book value

Total
Equivalent to acquisition costs
Less: Amount equivalent to accumulated
depreciation
Net book value

As of September 30, 2001

574

297

1,358

(200)

(54)

(353)

373 million yen

242 million yen

1,004 million yen

47,944

19,44543,673(12,767)(7,242)(9,226)35,176 million yen

12,202 million yen

34,447 million yen

As of September 30, 2002

As of September 30, 2001

As of March 31, 2002

11,44529,29640,741 million yen

4,231
9,148
13,379 million yen

8,780
27,56536,346 million yen(2) The future lease payments for finance lease at the end of the periods

Due within one year
Due after one year
Total(3) Lease payments, amounts equivalent to depreciation and interest expenses for the periods
For the period ended
September 30, 2002

For the period ended
September 30, 2001

For the period ended
March 31, 2002

Lease payments

5,680 million yen

2,307 million yen

6,370 million yen

Amount equivalent to depreciation expenses

4,739

2,198

5,366

Amount equivalent to interest expense

1,069

452

1,263

(4) Calculation method of amount equivalent to depreciation and interest expenses
The amount equivalent to depreciation is computed using the straight-line method over the lease periods, assuming no residual value, except
in cases where the residual value is guaranteed in the lease contract.
The amount equivalent to interest expense, which is calculated by subtracting acquisition costs from total lease payments, is allocated overthe lease periods based on the interest method.

SOFTBANK CORP.

26

13 Leases transaction (continued)
13-1. Finance leases in which the ownership of leased assets is not transferred to lessees at the end of lease term.
(as a lessor)(1) Acquisition costs, accumulated depreciation and net book value at the end of periods
As of September 30, 2002

As of September 30, 2001

As of March 31, 2002

Property and equipment
Acquisition costs
Less: Accumulated depreciation
Net Book value

993
(327)
666 million yen

1,009
(135)
873 million yen

1,004
(231)
773 million yen

Software (Intangible assets)
Acquisition costs
Less: Accumulated amortization
Net book value

514
(185)
328 million yen

370
(85)
285 million yen

511
(134)
377 million yen

Total
Acquisition costs
Less: Accumulated depreciation
Net book value

1,507
(512)
994 million yen

1,380
(221)
1,158 million yen

1,516
(365)
1,150 million yen(2) The future lease receivables for the finance lease at the end of the periods
As of September 30, 2002
Due within one year
Due after one year
Total

295
748
1,043 million yen

As of September 30, 2001
253
930
1,183 million yen

As of March 31, 2002
286
902
1,189 million yen(3) Lease income, depreciation and amount equivalent to interest income for the periods
For the period ended
September 30, 2002

For the period ended
September 30, 2001

For the period ended
March 31, 2002

Lease income

177 million yen

136 million yen

307 million yen

Depreciation Expenses

150

117

262

Amount equivalent to interest income

35

32

71

(4) Calculation method of amount equivalent to interest income
The amount equivalent to interest income, which is calculated by subtracting acquisition costs from total of lease incomes and estimatedresidual value, is allocated over the lease periods based on the interest method.

SOFTBANK CORP.

27

13 Leases transaction (continued)
13-2. Non-cancelable operating lease transactions(as a lessee)
The future lease payments for non-cancelable operating leases

Due within one year
Due after one year
Total

As of September 30, 2002

As of September 30, 2001

112
215
327 million yen

643
6,279
6,923 million yen

As of March 31, 2002
253
1,723
1,977 million yen(as a lessor)
No transactions applicable.

14 Subsequent events after the date of the consolidated financial statements.
Sales of partial shareholdings of Yahoo! Inc.
On November 6, 2002, the Company sold 17,500,000 shares of Yahoo! Inc. through SOFTBANK America Inc., a whollyowned subsidiary of the Company, for approximately $294 million (approximately ¥35.9 billion at the rate of ¥122 per
US$1). A capital gain of approximately ¥26.1 billion on this sale will be recorded in the Company's consolidated financial
statements for the period ending March 31, 2003.

SOFTBANK CORP.

28

SEGMENT INFORMATION
1. Business Segment Information(1) FY2003 interim (for the six-month period ended September 2002)(Millions of yen; amounts less than one million yen are omitted.)
e-Commerce
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)¥119,813
7,538
127,351
126,099¥1,252e-Finance

Media &
Marketing¥11,249
2,249
13,49915,605¥(2,105)¥7,804
359
8,163
8,626
¥(463)

Broadmedia¥5,198
158
5,357
5,957
¥(600)

Internet
CultureTechnology
Services

Broadband
Infrastructure¥4,798
4,983
9,782
9,512
¥269

¥13,49326
13,52044,782¥(31,262)

Technology
Services

Internet
Infrastructure¥4,280
4,170
8,451
8,010
¥440

¥27
0
27
1,060
¥(1,032)

Technology
Services

Broadband
Infrastructure¥9,955
8,571
18,527
17,391¥1,135¥7,386
1,781
9,168
27,121¥(17,952)¥15,456
236
15,692
9,559¥6,132

Overseas
Funds

Others¥1,967
1,967
482¥1,484¥11,270
605
11,876
15,721¥(3,845)

Total¥191,052
16,158207,211236,349¥(29,138)

Consolidated
Total

Elimination(16,158)(16,158)(14,097)¥(2,061)¥191,052
191,052
222,251¥(31,199)(2) FY2002 interim (for the six-month period ended September 2001)(Millions of yen; amounts less than one million yen are omitted.)
e-Commerce
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)¥121,008
8,491
129,499
128,364¥1,135e-Finance

Media &
Marketing¥9,941591
10,532
14,106¥(3,574)¥23,581441
24,023
23,407¥615

Broadmedia¥5,903
141
6,045
5,751
¥294

Internet
Culture¥8,113
3,965
12,0798,201¥3,877

Overseas
Funds

Others

¥774
774
928
¥(153)¥9,740674
10,414
15,987¥(5,573)

Total¥183,372
18,476
201,849
205,819¥(3,970)

Consolidated
Total

Elimination(18,476)(18,476)(13,742)¥(4,734)¥183,372
183,372
192,077¥(8,704)(3) FY2002 (for the fiscal year ended March 2002)(Millions of yen; amounts less than one million yen are omitted.)
e-Commerce
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)¥265,107
19,087284,195
280,989¥3,206e-Finance

Media &
Marketing¥21,301
2,959
24,26029,181¥(4,920)¥47,553
885
48,43945,877¥2,561

Broadmedia¥11,795
331
12,127
12,166¥(39)

Internet
Culture¥20,152
11,86232,01522,078¥9,936

Overseas
Funds

Others¥2,4812,481
2,708¥(226)¥19,581
1,222
20,80327,458¥(6,654)

Total¥405,315
46,703452,018
464,972¥(12,953)

Consolidated
Total

Elimination(46,703)(46,703)(35,756)¥(10,947)¥405,315
405,315429,216¥(23,901)

Notes:[1] 1. Business segments are categorized primarily based on the nature of business operations, type of services, and similarity of sales channels, etc., which the SOFTBANK Group uses for its internal management from the current interim period.
2.Main businesses by segment (based on the current interim period):(1) e-Commerce
Distributes PC software, hardware, and peripherals; operates enterprise businesses and business transaction platform- and consumer-related e-commerce businesses(2) e-Finance

All inclusive Web-based financial operations, including Internet securities operations; management of domestic venture capital funds; incubation of portfolio corporations(3) Media & MarketingBook and magazine publication in such areas as PCs, the Internet, entertainment, etc.; Web content development(4) Broadmedia

Provision of applications and content for broadcasting and broadband communications and promoting the spread of such operations(5) Internet Culture

Internet-based advertising, broadband portals, auctions, etc.

(6) Technology Services

System solutions, business solutions, etc.

(7) Broadband Infrastructure

Provides ADSL-based broadband infrastructure services, fiber optic ultrahigh-speed internet access services and other businesses.

(8) Overseas Funds

U.S.- and Asia-focused global private equity operations in Internet-related companies(9) Others

Function as overseas holding companies, provide back-office support services in Japan, etc.

[2] "Broadband Infrastructure" segment, which is the broadband business in ADSL (Asymmetric Digital Subscriber Line) technologies started in prior fiscal year, includes "Internet Infrastructure" segment separately disclosed inprior interim period ended September 30, 2001.

SOFTBANK CORP.

29

(Change in business segmentation)
Effective from the current interim period, the SOFTBANK Group changed its method for dividing the Group’s overall business into segments from a method primarily based on theroles and responsibilities of each of the operation holding companies to a new method which is used for internal management reporting purposes from the current interim period,
based on the nature of the business operations, type of services, and the similarity of the sales channels, etc.
The reason for the change is that the SOFTBANK Group intends from now on to focus on the broadband infrastructure business as the most important core business, and would
therefore like to disclose the Group’s activities more appropriately by integrating all broadband infrastructure-related business into one segment, rather than having such business, as
before, spread across various segments.
The following shows the impact on the consolidated statement of income for the period ended September 30, 2002 as compared with the amounts which would have been recognized
if the previous allocation had been applied consistently.
1 e-Commerce Segment"Net sales" decreased by ¥1,752 million and "Operating expenses" decreased by ¥2,847 million. As a result, "Operating income" increasedby ¥1,094 million.

2 Internet Culture Segment"Net sales" decreased by ¥8,311 million and "Operating expenses" decreased by ¥5,083 million. As a result, "Operating income" decreasedby ¥3,288 million.

3 Broadband Infrastructure Segment"Net sales" increased by ¥1,032 million and "Operating expenses" decreased by ¥2,254 million. As a result, "Operating loss" decreased by ¥3,286 million.

4 Elimination"Net sales" increased by ¥9,031 million and "Operating expenses" increased by ¥10,184 million. As a result, "Operating loss" increased by¥1,153 million.

SOFTBANK CORP.

30

2. Geographic Segment Information(1) FY2003 interim (ｆor the period ended September 30, 2002)(Millions of yen; amounts less than one million yen are omitted.)Japan
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)

North
America¥175,604
287
175,892
202,417¥(26,524)¥1,824
731
2,555
2,879
¥(323)

Europe

Korea

163
163
534
¥(371)

Others¥11,340
11,34012,399¥(1,058)

Total¥2,282
13
2,296
3,146
¥(850)¥191,052
1,196
192,248
221,377¥(29,128)

Elimination(1,196)(1,196)874¥(2,070)

Consolidated
Total¥191,052
191,052
222,251¥(31,199)(2) FY2002 interim (ｆor the period ended September 30, 2001)(Millions of yen; amounts less than one million yen are omitted.)Japan
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)

North
America¥157,845
83
157,928
160,237¥(2,308)¥13,897
50
13,947
14,879¥(931)

Europe

Korea

¥274

Others¥9,458

Total¥1,897

-

-

-

274
633
¥(359)

9,458
10,275¥(817)

1,897
3,488¥(1,591)¥183,372
133
183,505
189,514¥(6,008)

Elimination

(133)
(133)
2,562
¥(2,696)

Consolidated
Total¥183,372
183,372
192,077¥(8,704)(3) FY2002 (for the period ended March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)Japan
Net sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)¥352,044
1,677
353,721369,714¥(15,992)

North
America¥28,947
1,505
30,45328,599¥1,854

Europe¥1,575
1,094
2,669
3,930
¥(1,260)

Korea

Others¥19,520

Total¥3,227--

19,52021,097¥(1,576)

3,227
5,497
¥(2,270)¥405,315
4,277
409,592
428,838¥(19,245)

Elimination(4,277)(4,277)377¥(4,655)

Consolidated
Total¥405,315
405,315429,216¥(23,901)

Note: Net sales by geographic region were recognized based on geographic location.
Significant countries in each region are shown below:
North America: U.S.A. and Canada
Europe: U.K., Germany and France
Others: China, Hong Kong and Singapore

SOFTBANK CORP.

31

3. Overseas sales(1) FY2003 interim (for the period ended September 30, 2002)
Overseas sales for the period ended September 30, 2002 were omitted because the total overseas sales were less than 10% of total consolidated sales.

(2) FY2002 interim (for the period ended September 30, 2001)(Millions of yen; amounts less than one million yen are omitted.)
North
AmericaI. Overseas sales

Europe¥14,147

Korea

¥300

Other

¥9,458

Total¥1,940II. Total consolidated sales¥25,846¥183,372

Overseas sales as a percentage
III.
of total consolidated sales

8%

0%

5%

1%

14 %

(3) FY2002 (for the period ended March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)
North
AmericaI. Overseas sales

Europe¥29,323

Korea¥1,944

Other¥19,532

Total¥3,597

II. Total consolidated sales
III.

Note:

Overseas sales as a percentage
of total consolidated sales¥54,398¥405,315

7%

0%

5%

1%

13 %

Net sales by geographic region were recognized based on geographic location.
Significant countries in each region are shown below:
North America: U.S.A. and Canada
Europe: U.K., Germany and France
Others: China, Hong Kong and Singapore

SOFTBANK CORP.

32

PER SHARE DATA
Effective from the fiscal year beginning April 1, 2002, the Company and its consolidated subsidiaries adopted Financial Accounting Standards No.2:"Accounting Standards for Earnings per Share" and Financial Accounting Standards Implementation Guidance No.4: "Implementation Guidance for
Accounting Standards for Earnings per Share", which was issued by Accounting Standard Board of Japan on September 25,2002.
Retroactive per share information is as follows.

Net loss per share - primary (yen)Net loss per share - diluted -(note 1)
Net assets per share (yen)

FY2003 interim
Calculation
under
new standards¥(166.27)
855.33

FY2002 interim
Calculation
Calculation
under
under
new standards previous standards¥(161.57)¥(161.29)
1,046.02
1,046.30

FY2002
Calculation
Calculation
under
under
new standards previous standards¥(264.04)¥(263.53)
1,380.80
1,381.31

Basic data for computation of the per share data
1.

Average number of common stock outstanding
during each fiscal period (unit: shares) -(note 2)

Net loss allocated to common stock outstanding(in millions of yen)
Net loss not allocated to common stock holders
3.
(in millions of yen) -(note 3)2.

336,869,930

336,762,941

336,762,941

336,798,168

336,798,168¥(56,010)¥(54,412)¥(54,315)¥(88,926)¥(88,755)

207

96

N/A

171

N/A

Notes:
1. Diluted net income per share is not disclosed due to the loss position.
2. There were no potential dilutive securities in respect of the common stock outstanding at each period end.
3. The primary component is "Bonuses to Directors".

SOFTBANK CORP.

33

Investments in Debt and Equity Securities
FY2003 interim (as of September 30, 2002)
1. The aggregate cost and market value (carrying value) of other securities and available-for-sales securities(Millions of yen; amounts less than one million yen are omitted.)
FY2003 interim (as of September 30, 2002)
Market value(Carrying value)

Cost(1) Equity securities(2) Debt securities
Government bonds(3) Others
Total

Unrealized
gains/(losses)¥37,888¥62,614¥24,725310
107¥38,307

310
105¥63,030(0)(2)¥24,723

2. The carrying amounts of unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying amounts(1) Unlisted held-to-maturity securities:
Debt securities¥1(2) Unlisted other securities and available-for-sale securities:
Equity securities
29,714
Domestic debt securities
1,845
Foreign debt securities
5,248
MMF
9,257
Mid-term government bond funds
408
Preferred fund certificates
2,000
Others0
Total¥48,476

FY2002 interim (as of September 30, 2001)
1. The aggregate cost and market value (carrying value) of other securities and sales-for-sales securities(Millions of yen; amounts less than one million yen are omitted.)
FY2002 interim (as of September 30, 2001)
Cost(1) Equity securities(2) Others
Total¥147,176
2¥147,179

Market value(Carrying value)¥130,2182¥130,221

Unrealized
gains/(losses)¥(16,957)¥(16,957)

2. The carrying amounts of unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying amounts(1) Unlisted held-to-maturity securities:
Debt securities¥62(2) Unlisted other securities and available-for-sale securities:
Equity securities (excluding over-the-counter stocks)
41,384
Domestic debt securities
11,127
Foreign debt securities
11,670
MMF
17,725Mid-term government bond funds
1,707
Total
¥83,677SOFTBANK CORP.

34

Investments in Debt and Equity Securities (continued)
FY2002 (as of March 31, 2002)
1. The aggregate cost and market value (carrying value) of other securities and available-for-sales securities(Millions of yen; amounts less than one million yen are omitted.)
FY2002 (as of March 31, 2002)
Market value(Carrying value)

Cost

Market value > Investment cost
(1) Equity securities
Sub-total
Market value≦Investment cost
(1) Equity securities(2) Debt securities
Government bonds(3) Others
Sub-total
Total

Unrealized gains(losses)¥79,171
79,171¥268,420
268,420¥189,249
189,249

27,93525,530(2,405)301
228,239¥107,410300
225,833¥294,254(0)(2,405)¥186,843

2. The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying amounts(1) Unlisted held-to-maturity securities:
Domestic debt securities¥0
Foreign debt securities
99(2) Unlisted other securities and available-for-sale securities:
Equity securities (excluding over-the-counter stocks)
42,375
Domestic debt securities
1,742
Foreign debt securities
2,797
MMF
11,520Mid-term government bonds funds
323
Beneficial interest in trusts
1,000
Preferred fund certificates
2,000
Others30
Total¥61,889SOFTBANK CORP.

35

CONTRACT AND OTHER AMOUNTS, FAIR VALUE AND UNREALIZED GAIN
OR LOSS ON DERIVATIVE TRANSACTIONSCurrency Related(Millions of yen; amounts less than one million yen are omitted.)Nature of transaction

Contract amounts
Over 1 year

FY2002 (as of March 31, 2002)

FY2002 Interim (as of September 30, 2001)

FY2003 Interim (as of September 30, 2002)

Fair
value

Unrealized
gains/(losses)

¥24

¥24

Contract amounts
Over 1 year

Fair
value

Unrealized
gains/(losses)

Contract amounts
Over 1 year

Fair
value

Unrealized
gains/(losses)

¥10

¥10

Swap transactions

Off-market
transactions

・Australia dollars receiver,
JPY payer¥1,000¥1,000¥1,000¥1,000¥(159)¥(159)¥1,000¥1,000Forward exchange contracts
・

U.S. dollars purchased,
Japanese yen sold

-

-

-

-

Total

1,000

-

1,007

7

-

-

-

-

¥(151)¥24¥10

Interest Related(Millions of yen; amounts less than one million yen are omitted.)Nature of transaction

Notional amounts
Over 1 year

Fair
value

FY2002 (as of March 31, 2002)

FY2002 Interim (as of September 30, 2001)

FY2003 Interim (as of September 30, 2002)

Unrealized
gains/(losses)

Notional amounts
Over 1 year

Fair
value

Unrealized
gains/(losses)

Notional amounts
Over 1 year

Fair
value

Unrealized
gains/(losses)

Swap transactions
・

Fix rate receiver,floating rate payer

Off-market
Floating rate receiver,transactions ・
fix rate payer
・Fix rate receiver (receipt later),floating rate payer (pre payment)
Total¥1,528¥1,428¥126¥126¥5,771¥1,771¥303¥303¥5,771¥1,771

¥248

¥248

2,814

2,714

(203)

(203)

7,485

3,485

(419)

(419)

7,485

3,485

(366)

(366)

1,000

1,000

37

37

1,000

1,000

37

37

1,000

1,000

36

36

¥(39)

¥(78)

¥(81)

Notes: 1. Fair value is based on the information from the financial institutions.
2. In addition to the above, the overseas consolidated subsidiaries engaged in the securities business recorded the fair value of the equity options in the amount of ¥1,015 million,
and the notional amounts of these options, measured by the market value of the underlying shares were ¥10,765 million in the period ended September 30, 2001.

SOFTBANK CORP.

36