SoftBank’s Vision Fund, the brainchild of the company’s founder Masayoshi Son, has faced a number of headwinds including a slump in technology stocks as a result of rising interest rates, a tough China market and geopolitics.
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SoftBank’s flagship investment arm the Vision Fund posted its fourth straight quarterly loss on Tuesday as a slump in technology valuations continues to hit the Japanese giant.
The Vision Fund segment posted a pre-tax loss of 660 billion Japanese yen ($5 billion) for the December quarter. SoftBank’s Vision Fund’s loss on investments came in at 730.35 billion yen over the three-month period.
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SoftBank Group overall reported a net loss of 783.4 billion yen, sinking back to a quarterly loss after posting a profit in the July-to-September quarter.
It has been a tough time for SoftBank whose Vision Fund has stakes in a range of tech companies, from start-ups to listed behemoths, amid a massive drop in technology valuations over the past year.
SoftBank said some of the major losses in the last quarter were due to an “overall decrease in the fair value of portfolio companies, mainly reflecting markdowns of weaker-performing companies and share price declines in market comparable companies.”
Some of SoftBank’s worst-performing investments include Chinese artificial intelligence firm SenseTime, which is down 57% over the past year, and Indonesian technology group GoTo, which has seen its shares plummet over 65%.
Masayoshi Son, SoftBank’s outspoken founder and the mastermind behind the Vision Fund, said in May that the company would go into “defense” mode and be more “conservative” with the pace of investments after the unit posted a record 3.5 trillion Japanese yen loss for last fiscal year.
SoftBank said that it made just $2.76 billion in new and follow-on investments in the nine months to Dec. 31, a “significant reduction” from $39.24 billion in 2021.
Over the past year, SoftBank has been exiting some of its highest-profile investments to raise cash. In August, it said it had sold its remaining stake in U.S. ride-hailing giant Uber. And last year, it sold some of its Alibaba shares via a derivative called a forward contract. Son made his fortune with an early investment in Alibaba more than two decades ago.
Son, who is known for his colourful investor presentations, was not present on the company’s earnings call Tuesday.
The SoftBank CEO is currently focused on trying to pull off a public listing of ARM, the British chip designer it bought in 2016. The company’s finance chief Yoshimitsu Goto said on Tuesday that the listing of ARM will take place this year.
“Preparation is underway and we will see how the market condition goes,” Goto said.
