NTT DATA Corporation: history, ownership, mission, how it works & makes money

A Brief History of NTT DATA Corporation

NTT DATA Corporation, established in 1967, is a prominent global IT service provider headquartered in Tokyo, Japan. Initially, it started as a division of the Nippon Telegraph and Telephone Public Corporation (NTT). Over the years, NTT DATA has evolved significantly, both in service offerings and geographical presence.

In 1995, NTT DATA became a standalone company when it was officially spun off from NTT, marking a pivotal moment in its growth trajectory. The company focused on providing IT services, consulting, and systems integration. By the early 2000s, NTT DATA had expanded its operations internationally, entering markets in Europe, North America, and Asia.

As of 2022, NTT DATA reported revenues of approximately ¥ 2.2 trillion (about $19.5 billion), positioning itself among the top 10 IT service providers globally. The company's operating income for the same year was ¥ 320 billion (around $2.8 billion), reflecting a solid operational performance.

In 2011, the company made significant strides by acquiring several firms to enhance its service capabilities. Among these acquisitions were Keane, Inc. in North America and a series of European consultancies, which helped NTT DATA strengthen its footprint in key markets. By 2018, it had acquired the U.S.-based IT firm, Everis, for approximately €1 billion, consolidating its position further in the European and Latin American markets.

NTT DATA’s strategic initiatives include a strong emphasis on digital transformation, cloud services, and AI solutions. In 2023, the company aimed to invest over ¥ 300 billion (around $2.7 billion) in R&D to develop innovative technologies and solutions.

NTT DATA has been recognized for its commitment to sustainability and digital innovation. In 2022, it ranked 20th in the Environmental, Social, and Governance (ESG) ratings among global technology companies. As part of its sustainability initiatives, it aims for a carbon-neutral footprint by 2030.

Throughout its history, NTT DATA has consistently focused on expanding its digital services portfolio. In fiscal year 2022, digital transformation services accounted for approximately 50% of the company's total revenues, highlighting the firm's commitment to evolving with market demands.

As of 2023, NTT DATA operates in over 50 countries, employing more than 130,000 professionals worldwide. The company continues to leverage strategic partnerships, including collaborations with major cloud providers like Microsoft and AWS, to enhance its service offerings.

NTT DATA’s future roadmap emphasizes innovation in AI, machine learning, and blockchain technologies, reinforcing its position as a leader in the IT services sector. The company aims to capture emerging market opportunities and expand its global presence through strategic alliances and targeted acquisitions.

A Who Owns NTT DATA Corporation

NTT DATA Corporation is a leading global IT service provider based in Tokyo, Japan. As of the latest available data, the ownership structure of NTT DATA is primarily composed of various stakeholders, most notably NTT Corporation.

As of March 2023, NTT Corporation owns approximately 54.8% of NTT DATA Corporation. This significant stake makes NTT Corporation the largest shareholder, indicating a strong strategic alignment between the two entities.

In addition to the ownership stakes, it’s important to examine the financial performance and market presence of NTT DATA Corporation. For the fiscal year ending March 2023, NTT DATA reported revenues of approximately ¥1.3 trillion (about $9.8 billion), with an operating income of ¥168 billion (around $1.25 billion).

NTT DATA operates primarily in sectors such as public sector, healthcare, financial services, and manufacturing. The company's ability to attract foreign investments is underpinned by its strong positioning in the IT services market, with a global workforce exceeding 120,000 employees across more than 50 countries.

The company's stock is traded on the Tokyo Stock Exchange under the ticker symbol 9613. The stock price has seen fluctuations, with the latest closing price around ¥1,600 per share as of October 2023.

Additionally, NTT DATA has been actively investing in research and development. For the fiscal year 2023, the R&D expenditure was approximately ¥70 billion (about $525 million), reflecting a commitment to innovation and technological advancement.

The corporate governance structure of NTT DATA emphasizes transparency and accountability. The Board of Directors consists of 12 members, with a mix of executive and non-executive directors ensuring diverse perspectives in decision-making. NTT DATA’s management practices are closely aligned with the overall strategy of its parent company, NTT Corporation, ensuring a unified direction in operations and growth.

NTT DATA Corporation Mission Statement

NTT DATA Corporation, a global leader in IT services and solutions, emphasizes its commitment to leveraging innovative technology to deliver optimal results for its clients. The company's mission statement reflects its dedication to "utilizing information technology to create a better society." This vision encompasses a broad spectrum of services, including consulting, system integration, and managed services.

As of the fiscal year ending March 31, 2023, NTT DATA reported consolidated revenues of approximately ¥1.1 trillion, marking a growth of 7.4% compared to the previous year. The company's operating income for the same period was about ¥149 billion, with a net income of ¥93 billion.

NTT DATA’s mission is supported by its strategic initiatives across various sectors. The company focuses on industries such as healthcare, financial services, and public services, where it aims to enhance operational efficiency through digital transformation.

NTT DATA’s investments in technology and talent are critical to achieving its mission. In 2023, the company allocated around ¥50 billion for research and development, focusing on areas like artificial intelligence, cloud computing, and cybersecurity. This investment is integral to sustaining its competitive edge and aligning with the mission of creating a better society through technology.

The company is also committed to sustainability and social responsibility, which is reflected in its mission. NTT DATA has outlined specific goals to reduce its carbon footprint by 30% by 2030 and to enhance diversity, equity, and inclusion within the workforce, aiming for women to represent 30% of leadership roles by 2025.

Through its comprehensive mission statement, NTT DATA Corporation not only addresses immediate technological needs but also aligns its strategies with broader societal goals, ensuring its services contribute positively to the global community.

How NTT DATA Corporation Works

NTT DATA Corporation, headquartered in Tokyo, Japan, operates as a leading global IT service provider. As of the fiscal year 2023, the company reported revenues of approximately ¥2.67 trillion, marking a 8.3% increase compared to the previous year. The business segments primarily include systems integration, IT infrastructure, and application management.

The major industries served by NTT DATA include financial services, healthcare, manufacturing, and public services, showcasing its extensive range of solutions tailored to diverse markets. In the fiscal year 2023, NTT DATA generated over 40% of its revenues from the financial services sector alone.

NTT DATA's operational strategy emphasizes digital transformation, leveraging technologies like AI, cloud computing, and analytics. Investment in research and development amounted to approximately ¥104 billion in 2022, highlighting the company’s commitment to innovation.

NTT DATA's approach includes strategic acquisitions to enhance its service offerings and geographical reach. In 2022, notable acquisitions included Everis, which expanded its presence in Europe and Latin America, and Netrisk, a cybersecurity firm, bolstering its capabilities in IT security.

The company also focuses on sustainable development goals, aiming to achieve carbon neutrality by 2030. As part of its sustainability initiatives, NTT DATA invested approximately ¥50 billion in green IT solutions in 2023.

NTT DATA’s workforce is a significant asset, with over 130,000 employees globally. The company invests substantially in training and development programs, with ¥25 billion allocated in recent fiscal years to enhance employee skills in emerging technologies.

NTT DATA’s stock performance has shown resilience, with a share price of around ¥1,500 as of October 2023. The company maintains a market capitalization of approximately ¥2.6 trillion. The dividend payout ratio stands at 30%, reflecting a commitment to returning value to shareholders.

Overall, NTT DATA operates through a combination of traditional IT services and innovative solutions aimed at addressing modern challenges faced by businesses, fostering long-term growth and sustainability in the global market.

How NTT DATA Corporation Makes Money

NTT DATA Corporation is a leading global IT service provider headquartered in Tokyo, Japan. The company primarily generates revenue through its diversified services and solutions across multiple industries. In the fiscal year ending March 2023, NTT DATA reported a total revenue of approximately ¥2.7 trillion (around $20 billion), marking a growth of 8.5% compared to the previous year.

The revenue streams for NTT DATA can be categorized into different segments, including IT services, consulting, systems integration, and cloud services. Here's a breakdown of their revenue contribution by segment:

NTT DATA's considerable focus on IT services positions it as a critical partner for businesses looking to enhance their technological capabilities. The IT services segment includes application development, infrastructure management, and IT outsourcing, which have witnessed increased demand as companies accelerate digital transformation initiatives.

Consulting services encompass business strategy, operational transformation, and technology consulting. The revenue from consulting reached ¥800 billion in FY 2023, reflecting the growing need for organizations to navigate complex business environments. This segment's revenue growth can be attributed to heightened interest in digital solutions and data analytics.

Systems integration services, essential for implementing new software solutions, generated about ¥400 billion. This segment continues to thrive due to the increase in enterprise demand for integrated systems that streamline operations.

Cloud services, while the smallest segment at ¥200 billion, show a promising growth trajectory. As businesses shift towards cloud-based solutions, NTT DATA's investments in cloud technology are likely to enhance growth in this area, with an anticipated CAGR of around 15% over the next five years.

Geographically, NTT DATA's revenue is diversified, reducing reliance on a single market. The revenue distribution includes:

The Japanese market generates the majority of NTT DATA's revenue, but the company is actively expanding its presence in North America and Europe, which are seeing robust growth rates, particularly in IT services and consulting.

NTT DATA has also pursued strategic acquisitions to bolster its market position. In FY 2023, the company completed acquisitions worth approximately $1.2 billion, aimed at enhancing capabilities in data analytics and application development, further diversifying its service offerings.

In summary, NTT DATA Corporation earns revenue through a balanced portfolio of IT services, consulting, systems integration, and cloud services. Continuous investment in technology and strategic acquisitions position the company for sustained growth in the evolving digital landscape.