February 8, 2023: On Tuesday, SoftBank’s flagship investment arm, the Vision Fund, posted its fourth straight quarterly loss as a technological valuation slump continues to hit the Japanese giant.
The Vision Fund segment is posting a pre-tax loss of 660 billion Japanese yen for the December quarter. SoftBank’s Vision Fund’s loss on investments is coming in at 730.35 billion yen over the three months.
SoftBank Group reported a net loss of 783.4 billion yen, which decreased to a quarterly loss following posting a profit in the quarter.
It has been a difficult time for SoftBank, whose Vision Fund has shares in a range of tech groups, from start-ups to listed behemoths, between a massive drop in technology valuations over the previous year.
SoftBank stated that some of the losses in the previous quarter were due to an “overall decrease in the fair value of portfolio firms, mainly reflecting markdowns of weaker-performing groups and share price declines in market comparable firms.”
A few of SoftBank’s worst-performing investments include Chinese artificial intelligence groups SenseTime, which decreased 57% over the previous year, and Indonesian technology group GoTo, which has seen its shares plummet more than 65%.
Masayoshi Son, SoftBank’s outspoken owner and the mastermind behind the Vision Fund, stated in May that the company would go into “defence” mode and be more “conservative” with the speed of investments following the unit posting a register 3.5 trillion Japanese yen loss for last fiscal year.
SoftBank said it made just $2.76 billion in recent and follow-on investments in the nine months to December 31, a “significant reduction” from $39.24 billion in 2021.
Over the past year, SoftBank has been leaving some of its highest-profile investments to increase cash. It said it had marketed its remaining stake in U.S. ride-hailing giant Uber in August. And last year, it sold a few of its Alibaba shares through a forward contract derivative. Son made his fortune with an investment in Alibaba over two decades ago.
Son, known for his colourful investor presentations, was not present on Tuesday at the company’s earnings call.
The SoftBank CEO is currently focused on pulling off a public listing of ARM, the chip designer from British it had got in 2016. The firm’s finance chief Yoshimitsu Goto said that the listing of ARM would take place this year.
“Preparation is underway, and we will witness how the market condition goes,” Goto expressed.