Edgar Filing: NTT DOCOMO INC

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Form 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR

15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of February, 2013

Commission File Number: 001-31221

Total number of pages: 15

NTT DOCOMO, INC.

(Translation of registrant’s name into English)

Sanno Park Tower 11-1, Nagata-cho 2-chome

Chiyoda-ku, Tokyo 100-6150

Japan

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Information furnished in this form:

1.	Report filed on February 5, 2013 with the Director of the Kanto Local Finance Bureau of Japan pursuant to the Financial Instruments and Exchange Law of Japan

NTT DOCOMO, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

MARCH 31, 2012 and DECEMBER 31, 2012


	Millions of yen
	March 31, 2012			December 31, 2012
ASSETS
Current assets:
Cash and cash equivalents	¥	522,078		¥	340,417
Short-term investments		371,504			151,409
Accounts receivable		963,001			279,447
Receivables held for sale		—			579,479
Credit card receivables		189,163			202,590
Allowance for doubtful accounts		(23,550	)		(20,666	)
Other receivables		47,014			348,380
Inventories		146,563			212,400
Deferred tax assets		76,858			59,411
Prepaid expenses and other current assets		65,630			86,624

Total current assets		2,358,261			2,239,491

Property, plant and equipment:
Wireless telecommunications equipment		5,700,951			5,375,527
Buildings and structures		867,553			876,623
Tools, furniture and fixtures		520,469			530,139
Land		199,802			199,846
Construction in progress		133,068			154,832
Accumulated depreciation and amortization		(4,885,546	)		(4,575,896	)

Total property, plant and equipment, net		2,536,297			2,561,071

Non-current investments and other assets:
Investments in affiliates		480,111			344,030
Marketable securities and other investments		128,389			313,137
Intangible assets, net		680,831			680,538
Goodwill		204,890			222,476
Other assets		255,747			417,261
Deferred tax assets		303,556			265,218

Total non-current investments and other assets		2,053,524			2,242,660

Total assets	¥	6,948,082		¥	7,043,222


LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	¥	75,428		¥	130,822
Short-term borrowings		733			15,110
Accounts payable, trade		738,783			711,323
Accrued payroll		55,917			41,666
Accrued interest		767			384
Accrued income taxes		150,327			71,822
Other current liabilities		132,048			142,203

Total current liabilities		1,154,003			1,113,330

Long-term liabilities:
Long-term debt (exclusive of current portion)		180,519			110,220
Accrued liabilities for point programs		173,136			157,739
Liability for employees’ retirement benefits		160,107			168,413
Other long-term liabilities		171,546			154,368

Total long-term liabilities		685,308			590,740

Total liabilities		1,839,311			1,704,070

Equity:
NTT DOCOMO, INC. shareholders’ equity
Common stock		949,680			949,680
Additional paid-in capital		732,592			732,610
Retained earnings		3,861,952			4,037,926
Accumulated other comprehensive income (loss)		(104,529	)		(48,594	)
Treasury stock, at cost		(377,168	)		(377,168	)
Total NTT DOCOMO, INC. shareholders’ equity		5,062,527			5,294,454
Noncontrolling interests		46,244			44,698

Total equity		5,108,771			5,339,152

Commitments and contingencies

Total liabilities and equity	¥	6,948,082		¥	7,043,222

See accompanying notes to consolidated financial statements (unaudited).

NTT DOCOMO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

NINE MONTHS ENDED DECEMBER 31, 2011 and 2012

Consolidated Statements of Income


	Millions of yen
	Nine Months Ended December 31, 2011			Nine Months Ended December 31, 2012
Operating revenues:
Wireless services	¥	2,819,222		¥	2,787,142
Equipment sales		354,932			583,653

Total operating revenues		3,174,154			3,370,795

Operating expenses:
Cost of services (exclusive of items shown separately below)		683,712			741,149
Cost of equipment sold (exclusive of items shown separately below)		477,291			581,703
Depreciation and amortization		488,590			500,493
Selling, general and administrative		780,777			845,270

Total operating expenses		2,430,370			2,668,615

Operating income		743,784			702,180

Other income (expense):
Interest expense		(2,386	)		(1,246	)
Interest income		1,000			1,145
Other, net		1,685			(2,854	)

Total other income (expense)		299			(2,955	)

Income before income taxes and equity in net income (losses) of affiliates		744,083			699,225

Income taxes:
Current		270,378			237,574
Deferred		72,113			38,096

Total income taxes		342,491			275,670

Income before equity in net income (losses) of affiliates		401,592			423,555

Equity in net income (losses) of affiliates, net of applicable taxes		(7,901	)		(13,717	)

Net income		393,691			409,838

Less: Net (income) loss attributable to noncontrolling interests		931			6,648

Net income attributable to NTT DOCOMO, INC.	¥	394,622		¥	416,486


PER SHARE DATA
Weighted average common shares outstanding — Basic and Diluted (shares)		41,467,601			41,467,601

Basic and Diluted earnings per share attributable to NTT DOCOMO, INC. (yen)	¥	9,516.39		¥	10,043.65

Consolidated Statements of Comprehensive Income


	Millions of yen
	Nine Months Ended December 31, 2011			Nine Months Ended December 31, 2012
Net income	¥	393,691		¥	409,838
Other comprehensive income (loss):
Unrealized holding gains (losses) on available-for-sale securities, net of applicable taxes		(3,550	)		36,143
Change in fair value of derivative instruments, net of applicable taxes		(12	)		33
Foreign currency translation adjustment, net of applicable taxes		(27,053	)		19,848
Pension liability adjustment, net of applicable taxes		313			(77	)

Total other comprehensive income (loss)		(30,302	)		55,947

Comprehensive income		363,389			465,785

Less: Comprehensive (income) loss attributable to noncontrolling interests		943			6,636

Comprehensive income attributable to NTT DOCOMO, INC.	¥	364,332		¥	472,421

See accompanying notes to consolidated financial statements (unaudited).

NTT DOCOMO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

THREE MONTHS ENDED DECEMBER 31, 2011 and 2012

Consolidated Statements of Income


	Millions of yen
	Three Months Ended December 31, 2011			Three Months Ended December 31, 2012
Operating revenues:
Wireless services	¥	941,444		¥	942,190
Equipment sales		119,727			221,285

Total operating revenues		1,061,171			1,163,475

Operating expenses:
Cost of services (exclusive of items shown separately below)		247,125			265,444
Cost of equipment sold (exclusive of items shown separately below)		159,461			207,420
Depreciation and amortization		170,206			176,278
Selling, general and administrative		249,096			283,262

Total operating expenses		825,888			932,404

Operating income		235,283			231,071

Other income (expense):
Interest expense		(706	)		(337	)
Interest income		328			417
Other, net		(2,693	)		2,489

Total other income (expense)		(3,071	)		2,569

Income before income taxes and equity in net income (losses) of affiliates		232,212			233,640

Income taxes:
Current		74,750			72,805
Deferred		60,155			18,708

Total income taxes		134,905			91,513

Income before equity in net income (losses) of affiliates		97,307			142,127

Equity in net income (losses) of affiliates, net of applicable taxes		(2,091	)		(13,180	)

Net income		95,216			128,947

Less: Net (income) loss attributable to noncontrolling interests		388			1,656

Net income attributable to NTT DOCOMO, INC.	¥	95,604		¥	130,603


PER SHARE DATA
Weighted average common shares outstanding — Basic and Diluted (shares)		41,467,601			41,467,601

Basic and Diluted earnings per share attributable to NTT DOCOMO, INC. (yen)	¥	2,305.51		¥	3,149.52

Consolidated Statements of Comprehensive Income


	Millions of yen
	Three Months Ended December 31, 2011			Three Months Ended December 31, 2012
Net income	¥	95,216		¥	128,947
Other comprehensive income (loss):
Unrealized holding gains (losses) on available-for-sale securities, net of applicable taxes		5,829			27,120
Change in fair value of derivative instruments, net of applicable taxes		(2	)		20
Foreign currency translation adjustment, net of applicable taxes		(24,853	)		17,402
Pension liability adjustment, net of applicable taxes		80			(290	)

Total other comprehensive income (loss)		(18,946	)		44,252

Comprehensive income		76,270			173,199

Less: Comprehensive (income) loss attributable to noncontrolling interests		385			1,670

Comprehensive income attributable to NTT DOCOMO, INC.	¥	76,655		¥	174,869

See accompanying notes to consolidated financial statements (unaudited).

NTT DOCOMO, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

NINE MONTHS ENDED DECEMBER 31, 2011 and 2012


	Millions of yen
	Nine Months Ended December 31, 2011			Nine Months Ended December 31, 2012
Cash flows from operating activities:
Net income	¥	393,691		¥	409,838
Adjustments to reconcile net income to net cash provided by operating activities–
Depreciation and amortization		488,590			500,493
Deferred taxes		65,486			28,858
Loss on sale or disposal of property, plant and equipment		12,460			18,766
Impairment loss on marketable securities and other investments		3,563			10,716
Equity in net (income) losses of affiliates		14,526			22,566
Changes in assets and liabilities:
(Increase) / decrease in accounts receivable		(160,584	)		686,106
(Increase) / decrease in receivables held for sale		—			(579,479	)
(Increase) / decrease in credit card receivables		(16,463	)		(12,405	)
Increase / (decrease) in allowance for doubtful accounts		4,004			(3,083	)
(Increase) / decrease in other receivables		9,421			(288,045	)
(Increase) / decrease in inventories		(35,634	)		(54,456	)
(Increase) / decrease in prepaid expenses and other current assets		(16,874	)		(16,874	)
(Increase) / decrease in non-current installment receivables for handsets		298			88,075
(Increase) / decrease in non-current receivables held for sale		—			(158,606	)
Increase / (decrease) in accounts payable, trade		29,132			9,518
Increase / (decrease) in accrued income taxes		(79,207	)		(79,297	)
Increase / (decrease) in other current liabilities		25,957			5,713
Increase / (decrease) in accrued liabilities for point programs		(21,649	)		(15,397	)
Increase / (decrease) in liability for employees’ retirement benefits		6,455			6,779
Increase / (decrease) in other long-term liabilities		(16,636	)		(22,440	)
Other, net		2,080			(9,578	)

Net cash provided by operating activities		708,616			547,768

Cash flows from investing activities:
Purchases of property, plant and equipment		(343,102	)		(415,629	)
Purchases of intangible and other assets		(180,656	)		(187,026	)
Purchases of non-current investments		(34,069	)		(6,876	)
Proceeds from sale of non-current investments		2,219			1,744
Acquisitions of subsidiaries, net of cash acquired		—			(17,237	)
Purchases of short-term investments		(883,596	)		(633,832	)
Redemption of short-term investments		692,285			773,950
Long-term bailment for consumption to a related party		—			(80,000	)
Proceeds from redemption of short-term bailment for consumption to a related party		—			90,000
Other, net		31			696

Net cash used in investing activities		(746,888	)		(474,210	)

Cash flows from financing activities:
Repayment of long-term debt		(171,837	)		(21,475	)
Proceeds from short-term borrowings		3,210			17,554
Repayment of short-term borrowings		(2,177	)		(8,155	)
Principal payments under capital lease obligations		(3,308	)		(2,229	)
Dividends paid		(223,671	)		(240,209	)
Contributions from noncontrolling interests		21,331			2,349
Other, net		(1,280	)		(3,097	)

Net cash provided by (used in) financing activities		(377,732	)		(255,262	)

Effect of exchange rate changes on cash and cash equivalents		(733	)		43

Net increase (decrease) in cash and cash equivalents		(416,737	)		(181,661	)
Cash and cash equivalents at beginning of period		765,551			522,078

Cash and cash equivalents at end of period	¥	348,814		¥	340,417


Supplemental disclosures of cash flow information:
Cash received during the period for:
Income tax refunds	¥	247		¥	1,017
Cash paid during the period for:
Interest, net of amount capitalized		2,923			1,629
Income taxes		351,819			320,439

See accompanying notes to consolidated financial statements (unaudited).

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1. Basis of presentation:

(1) General

The accompanying quarterly consolidated financial statements of NTT DOCOMO, INC. and its subsidiaries (“DOCOMO”) were prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Certain disclosures required by U.S. GAAP have been omitted. Since DOCOMO’s American Depositary Shares were listed on the New York Stock Exchange in March 2002, DOCOMO has prepared its consolidated financial statements pursuant to the terminology, forms and preparation methods required in order to issue American Depositary Shares, which are registered with the Securities and Exchange Commission of the United States of America.

(2) Receivables held for sale

DOCOMO entered into a contract regarding the transfer of billing claims with NTT FINANCE CORPORATION (NTT FINANCE) in June 2012. Under the contract, DOCOMO agreed with NTT FINANCE that monthly billing claims which would be billed to subscribers mainly for DOCOMO’s telecommunications services and by providing funds for subscribers’ handset purchases on or after July 1, 2012 would be transferred, at fair value, to NTT FINANCE.

Accounts receivable for DOCOMO’s telecommunications services and installment receivables for handsets, which had not been sold to NTT FINANCE and were held for sale as at the balance sheet date, are separately presented as “Receivables held for sale” on the consolidated balance sheets. Meanwhile, DOCOMO presents cash consideration to be received for the transferred billing claims, as at the balance sheet date, as “Other receivables”.

2. Summary of significant accounting and reporting policies:

Reclassifications —

Certain reclassifications have been made to the prior periods’ consolidated financial statements to conform to the presentation used for the nine months ended December 31, 2012.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

3. Marketable securities and other investments:

“Marketable securities and other investments” as of March 31, 2012 and December 31, 2012 were as follows:


	Millions of yen
	March 31, 2012		December 31, 2012
Marketable securities
Available-for-sale	¥	115,995	¥	298,565
Other investments		12,394		14,572

Marketable securities and other investments	¥	128,389	¥	313,137

The aggregate cost, gross unrealized holding gains and losses and fair value by type of available-for-sale securities included in “Marketable securities and other investments” as of March 31, 2012 and December 31, 2012 were as follows:

Millions of yen

March 31, 2012

Cost / Amortized
cost

Gross unrealized
holding gains

Gross unrealized
holding losses

Fair value

Available-for-sale:

Equity securities

106,186

20,909

11,126

115,969

Debt securities

—

Millions of yen

December 31, 2012

Cost / Amortized
cost

Gross unrealized
holding gains

Gross unrealized
holding losses

Fair value

Available-for-sale:

Equity securities

234,604

64,358

397

298,565

Other investments include long-term investments in various privately held companies. The aggregate carrying amount of cost method investments included in other investments as of March 31, 2012 and December 31, 2012 were ¥12,353 million and ¥14,520 million, respectively.

In the third quarter of the fiscal year ending March 31, 2013, DOCOMO reclassified the equity securities of Philippine Long Distance Telephone Company (“PLDT”), an investee company of DOCOMO, from “Investments in affiliates” to available-for-sale securities of “Marketable securities and other investments.” DOCOMO no longer exercises significant influence over PLDT as DOCOMO’s voting interest in PLDT decreased to approximately 9%, following the PLDT’s issuance of voting preferred stocks in response to the final resolution by the Supreme Court of the Philippines regarding the computation of Filipino-alien equity requirement of public utilities companies.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

4. Equity:

Effective May 1, 2006, the Corporate Law of Japan provides that (i) dividends of earnings require approval at a general meeting of shareholders, (ii) interim cash dividends can be distributed upon the approval of the board of directors, if the articles of incorporation provide for such interim cash dividends and (iii) an amount equal to at least 10% of decrease in retained earnings by dividends payment be appropriated from retained earnings to a legal reserve up to 25% of capital stock. The legal reserve is available for distribution upon approval of the shareholders.

In the general meeting of shareholders held on June 19, 2012, the shareholders approved cash dividends of ¥116,109 million or ¥2,800 per share, payable to shareholders recorded as of March 31, 2012, which were declared by the board of directors on April 27, 2012. The source of dividends was “Retained earnings.” DOCOMO started paying the dividends on June 20, 2012.

On October 26, 2012, the board of directors declared cash dividends of ¥124,403 million or ¥3,000 per share, payable to shareholders recorded as of September 30, 2012. The source of dividends will be “Retained earnings”. DOCOMO started paying the dividends on November 19, 2012.

In order to improve capital efficiency and to implement flexible capital policies in accordance with the business environment, DOCOMO acquires treasury stock.

With regard to the acquisition of treasury stock, the Corporate Law of Japan provides that (i) it can be done according to the resolution of the general meeting of shareholders, and (ii) the acquisition of treasury stock through open market transactions can be done according to the resolution of the board of directors if the articles of incorporation contain such a provision. The provision is stipulated in DOCOMO’s articles of incorporation.

Issued shares and treasury stock —

The changes in the number of issued shares and treasury stock were as follows.

DOCOMO has not issued shares other than shares of its common stock.


	Number of issued shares		Number of treasury stock
As of March 31, 2011		43,650,000		2,182,399

As of December 31, 2011		43,650,000		2,182,399

As of March 31, 2012		43,650,000		2,182,399

As of December 31, 2012		43,650,000		2,182,399

DOCOMO did not repurchase shares for the nine months ended December 31, 2011 and 2012.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

Per share data —

Per share data is as follows:


	Yen
	Nine months ended December 31, 2011		Nine months ended December 31, 2012
Basic and Diluted earnings per share attributable to NTT DOCOMO, INC.	¥	9,516.39	¥	10,043.65

	Yen
	Three months ended December 31, 2011		Three months ended December 31, 2012
Basic and Diluted earnings per share attributable to NTT DOCOMO, INC.	¥	2,305.51	¥	3,149.52

	Yen
	March 31, 2012		December 31, 2012
NTT DOCOMO, INC. shareholders’ equity per share	¥	122,083.91	¥	127,676.88

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

5. Segment reporting:

DOCOMO’s chief operating decision maker (“CODM”) is its board of directors. The CODM evaluates the performance and makes resource allocations of its segments based on the information derived from DOCOMO’s internal management reports. Accounting policies used to determine segment profit or loss and segment assets are consistent with those used to prepare the consolidated financial statements in accordance with U.S. GAAP. There were no transactions between the operating segments.

DOCOMO has five operating segments, which consist of mobile phone business, credit services business, home shopping services business, internet connection services business for hotel facilities, and miscellaneous businesses. The mobile phone business includes mobile phone services (Xi services, FOMA services, and mova services), packet communications services, satellite mobile communications services, international services and the equipment sales related to these services. Credit services business primarily includes DCMX services. Home shopping services business includes home shopping services business provided primarily through TV media. Internet connection services business for hotel facilities includes high-speed internet connection services for hotel facilities, which are provided in many countries in the world, mainly Asia and Europe. The miscellaneous businesses primarily includes advertisement services, development, sales and maintenance of IT systems. DOCOMO terminated mova services on March 31, 2012.

Due to its quantitative significance, only the mobile phone business qualifies as a reportable segment and therefore is disclosed as such. The remaining four operating segments are each quantitatively insignificant and therefore combined and disclosed as “all other businesses.”


	Millions of yen
Three months ended December 31, 2011	Mobile phone business		All other businesses			Consolidated
Operating revenues	¥	1,027,758	¥	33,413		¥	1,061,171
Operating expenses		790,576		35,312			825,888

Operating income (loss)	¥	237,182	¥	(1,899	)	¥	235,283


	Millions of yen
Three months ended December 31, 2012	Mobile phone business		All other businesses			Consolidated
Operating revenues	¥	1,108,863	¥	54,612		¥	1,163,475
Operating expenses		870,790		61,614			932,404

Operating income (loss)	¥	238,073	¥	(7,002	)	¥	231,071


	Millions of yen
Nine months ended December 31, 2011	Mobile phone business		All other businesses			Consolidated
Operating revenues	¥	3,078,603	¥	95,551		¥	3,174,154
Operating expenses		2,328,574		101,796			2,430,370

Operating income (loss)	¥	750,029	¥	(6,245	)	¥	743,784


	Millions of yen
Nine months ended December 31, 2012	Mobile phone business		All other businesses			Consolidated
Operating revenues	¥	3,237,564	¥	133,231		¥	3,370,795
Operating expenses		2,512,711		155,904			2,668,615

Operating income (loss)	¥	724,853	¥	(22,673	)	¥	702,180

DOCOMO does not disclose geographical information since the amounts of operating revenues generated outside Japan are immaterial.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

6. Contingencies:

Litigation —

DOCOMO is involved in litigation and claims arising in the ordinary course of business. Management believes that no litigation or claims outstanding, pending or threatened against DOCOMO would have a materially adverse effect on its results of operations, cash flows or financial position.

Guarantees —

DOCOMO enters into agreements in the ordinary course of business that provide guarantees for counterparties. These counterparties include subscribers, related parties, foreign wireless telecommunications service providers and other business partners.

DOCOMO provides subscribers with guarantees for product defects of cellular phone handsets sold by DOCOMO, but DOCOMO is provided with similar guarantees by the handset vendors and no liabilities were recognized for these guarantees.

Though the guarantees or indemnifications provided in transactions other than those with the subscribers are different in each contract, the likelihood of almost all of the performance of these guarantees or indemnifications are remote and amount of payments DOCOMO could be claimed for is not specified in almost all of the contracts. Historically, DOCOMO has not made any significant guarantee or indemnification payments under such agreements. DOCOMO estimates the fair value of the obligations related to these agreements is not significant. Accordingly, no liabilities were recognized for these obligations.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

7. Fair value measurements:

Fair value is defined as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” U.S. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value according to observability. The inputs are described as follows:

Level 1—quoted prices in active markets for identical assets or liabilities

Level 2—inputs other than quoted prices included within Level 1 that are observable for the asset or liability

Level 3—unobservable inputs for the asset or liability

DOCOMO also distinguishes assets and liabilities measured at fair value every period on a recurring basis from those measured on a nonrecurring basis under specific situation.

(1) Assets and liabilities measured at fair value on a recurring basis

DOCOMO’s assets and liabilities measured at fair value on a recurring basis include available-for-sale securities and derivatives.

DOCOMO’s assets and liabilities that were measured at fair value on a recurring basis at March 31, 2012 and December 31, 2012 were as follows:


	Millions of yen
	March 31, 2012
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale securities
Equity securities (domestic)	¥	51,808	¥	51,808	¥	—	¥	—
Equity securities (foreign)		64,161		64,161		—		—
Debt securities (foreign)		30		30		—		—

Total available-for-sale securities		115,999		115,999		—		—

Total	¥	115,999	¥	115,999	¥	—	¥	—


Liabilities:
Derivatives
Foreign exchange forward contracts	¥	1	¥	—	¥	1	¥	—
Foreign currency option contracts		1,096		—		1,096		—

Total derivatives		1,097		—		1,097		—

Total	¥	1,097	¥	—	¥	1,097	¥	—

There were no transfers between Level 1 and Level 2.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)


	Millions of yen
	December 31, 2012
	Total		Level 1		Level 2		Level 3
Assets:
Available-for-sale securities
Equity securities (domestic)	¥	50,838	¥	50,838	¥	—	¥	—
Equity securities (foreign)		247,727		247,727		—		—
Debt securities (foreign)		30		30		—		—

Total available-for-sale securities		298,595		298,595		—		—

Derivatives
Foreign exchange forward contracts		1		—		1		—

Total derivatives		1		—		1		—

Total	¥	298,596	¥	298,595	¥	1	¥	—


Liabilities:
Derivatives
Foreign currency option contracts	¥	353	¥	—	¥	353	¥	—

Total derivatives		353		—		353		—

Total	¥	353	¥	—	¥	353	¥	—

There were no transfers between Level 1 and Level 2.

Available-for-sale securities

Available-for-sale securities include marketable equity securities and debt securities, which are valued using quoted prices in active markets for identical assets. Therefore, these securities are classified as Level 1.

Derivatives

Derivative instruments are foreign exchange forward contracts and foreign currency option contracts, which are measured using valuation provided by financial institutions based on observable market data. Therefore, these derivatives are classified as Level 2.

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

(2) Assets and liabilities measured at fair value on a nonrecurring basis

Certain assets and liabilities are measured at fair value on a nonrecurring basis and are not included in the table above. Changes of fair value in such assets and liabilities typically result from impairments.

DOCOMO may be required to measure fair value of long-lived assets, equity securities whose fair values are not readily determinable, and other assets or liabilities on a nonrecurring basis.

DOCOMO uses valuation methods such as a discounted cash flow method and market approach techniques in order to determine the fair value of assets classified as Level 3. DOCOMO selects a valuation method which best reflects the nature, characteristics, and risks of each asset, and also determines the unobservable inputs using the best and most relevant data available. DOCOMO verifies the appropriateness of valuation methods and unobservable inputs, and may use third-party pricing information to evaluate the appropriateness of our valuation during the verification processes.

DOCOMO’s assets that were measured at fair value on a nonrecurring basis for the nine and three months ended December 31, 2011 were as follows.

Millions of yen

Nine months ended December 31, 2011

Total

Level 1

Level 2

Level 3

gains (losses)

Assets:

Goodwill

3,897

—

3,897

(6,310

)

Long-lived assets

353

—

353

(706

)

Millions of yen

Three months ended December 31, 2011

Total

Level 1

Level 2

Level 3

gains (losses)

Assets:

Goodwill

3,897

—

3,897

(6,310

)

Long-lived assets

353

—

353

(706

)

Goodwill

Fair value of the reporting unit is measured based on discounted cash flow method in combination with a market approach using unobservable inputs. Therefore, it is classified as Level 3.

Long-lived assets

With the recognition of impairment loss, fair value is measured based on discounted cash flow method using unobservable inputs. Therefore, it is classified as Level 3.

DOCOMO’s assets that were measured at fair value on a nonrecurring basis for the nine and three months ended December 31, 2012 were as follows.

Millions of yen

Nine months ended December 31, 2012

Total

Level 1

Level 2

Level 3

gains (losses)

Assets:

Receivables held for sale

728,981

—

728,981

—

(8,386

)

Investments in affiliates

3,211

—

3,211

(19,076

)

NTT DOCOMO, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (Continued)

Millions of yen

Three months ended December 31, 2012

Total

Level 1

Level 2

Level 3

gains (losses)

Assets:

Receivables held for sale

405,091

—

405,091

—

(6,991

)

Investments in affiliates

3,211

—

3,211

(19,076

)

Receivables held for sale

Receivables held for sale are measured at the lower of cost or fair value in the consolidated balance sheets.

Receivables held for sale are classified as Level 2. DOCOMO measures the fair value of the receivables held for sale by discounting, at LIBOR-based discount rates, future cash flows estimated while taking into account factors such as default probabilities and loss severity of similar trade receivables.

Investments in affiliates

Investments in affiliates are measured based on discounted cash flow method using unobservable inputs as a decline in value is other than temporary. Therefore, it is classified as Level 3.

DOCOMO’s assets that were measured at fair value on a nonrecurring basis in Level 3 for the nine and three months ended December 31, 2012 comprised the following:

Millions of yen

Nine months ended December 31, 2012

Fair value

Valuation technique

Significant
Unobservable input

Input value

Assets:

Investments in affiliates

3,211

Discounted cash flow
method

Weighted average
cost of capital

15.9

Millions of yen

Three months ended December 31, 2012

Fair value

Valuation technique

Significant
Unobservable input

Input value

Assets:

Investments in affiliates

3,211

Discounted cash flow
method

Weighted average
cost of capital

15.9

8. Subsequent event:

There were no significant subsequent events to be disclosed.

NTT DOCOMO, INC.

Date: February 5, 2013

/S/ MUTSUO YAMAMOTO

Mutsuo Yamamoto

Head of Investor Relations