Masayoshi Son, Chairman and CEO of SoftBank Group at the SoftBank World 2018 event in Tokyo, Japan.
Kiyoshi Ota | Bloomberg | Getty Images
SoftBank Group posted a $ 12 billion quarterly profit on Tuesday after reporting a historic $ 13 billion loss for its last fiscal year.
The recovery depends largely on rising SoftBank Vision Fund betting ratings such as Uber and Slack, whose stock prices rose during the April-June quarter as US tech stocks rose during the coronavirus pandemic.
The SoftBank Vision Fund, which reported a loss of $ 18 billion last year, recorded a $ 2.8 billion investment profit for the quarter.
The Vision Fund performance has been further strengthened by new stock market lists in the initial US home insurance Lemonade, which SoftBank backed with $ 300 million, now valued at over $ 1 billion, for example.
SoftBank also raised the stock price with a stock buying plan. In March, the company said it planned to sell assets worth $ 41 billion to buy shares in the company and reduce debt.
It reduced its stake in Alibaba and its Japanese telecom unit. He is now considering selling UK chip designer Arm, for which he paid $ 32 billion, to US chip giant Nvidia, according to people familiar with the matter.
SoftBank Chief Executive Masayoshi Son confirmed that the company is looking for choices for the Arm chip design on Tuesday, adding that he is considering selling part or all of the arm, or taking the Arm to the public.
Vision Fund Uncertainties
The first Vision Fund, launched by Son in 2017, shocked the tech investment community because of its full size. At $ 100 billion, it was several orders of magnitude larger than any other technology investment fund, including those of Silicon Valley heavyweights like Sequoia and Andreessen Horowitz. More than half of the money comes from contributors like Apple, Qualcomm, Oracle founder Larry Ellison and the Kingdom of Saudi Arabia Public Investment Fund. In less than three years, the Vision Fund has supported about 90 start-ups with over $ 75 billion.
In July 2019, SoftBank shocked technology investors again when it announced plans to create a $ 108 billion “Vision Fund 2” to invest in artificial intelligence (AI). SoftBank Group pledged $ 38 billion for Vision Fund 2, while Apple, Microsoft and Foxconn were all rated as external contributors who would make billions extra.
Vision Fund 2 is up and running, but with only $ 38 billion from SoftBank Group. External investors decided to wait for their contributions as they waited to see how the Vision Fund’s early investments resulted.