SoftBank Group’s third quarter net profit plunged to 29 billion yen (US$251.4 million), down 97% from the previous year, as tech valuations across the globe remain subdued.
The company’s tech-focused Vision Fund reported a 92% decline in its gains on investments, clocking in at US$111.5 billion yen (US$966.3 million). Valuations of some of SoftBank’s biggest bets have suffered recently as investors weigh the impacts of China’s regulatory crackdown.
Photo: 123RF.com
With hurdles surrounding regulations still present, SoftBank has also halted its sale of semiconductor firm Arm to US chipmaker Nvidia Corp., a deal that was valued at up to US$80 billion. The Japanese conglomerate will instead look to take Arm public as it named a new CEO for the latter.
According to SoftBank, it would recognize a breakup fee of roughly US$1.2 billion, which Nvidia had deposited as part of the deal, as profit in the fourth quarter.
The Japanese firm’s results come amid a broad decline in the valuations of tech stocks globally as concerns grow over high inflation and the prospect of tightening monetary policy.
See also: Can Coupang out-Amazon Amazon in Southeast Asia?
Shares of Grab, WeWork, and Auto1 – which are portfolio companies of SoftBank – have weakened in Q3.
In the second quarter last year, SoftBank marked its first quarterly loss since Q4 of 2020, when it clocked in a record loss of nearly US$9 billion for the full year amid pandemic-induced write-downs on its investments.
Editing by Deepti Sri and Jaclyn Tiu
(And yes, we’re serious about ethics and transparency. More information here.)
Stay updated on the go with our mobile app.
Get latest insights with smoother, more personalized experience through TIA mobile app.
