Japanese tech investment giant SoftBank Group suffered a record quarterly net loss in the first quarter of its 2022/23 fiscal year, continuing to suffer from the effects of the global slump in tech stocks.
The group, which had already suffered a record annual net loss in its 2021/22 financial year ended March 31, announced a negative net result of 3,162.7 billion yen (almost 23 billion euros) for the April-June period. ), compared to a net profit of 761.5 billion yen the previous year.
SoftBank’s first quarter of 2022/23 was marked by significant investment losses (more than 2.8 trillion yen, or 20 billion euros), mainly related to its Vision Fund 1 and 2 funds.
“Be on the defensive”
These are “a reflection of the global downward trend in equities due to growing concerns about the economic downturn caused by inflation and rising interest rates,” he wrote in a statement.
The group cited some of its investments as the source of its biggest losses, including South Korean e-commerce giant Coupang, Chinese AI firm SenseTime and US food delivery company DoorDash.
SoftBank has been plagued by market volatility since its CEO and founder, Masayoshi Son, reoriented its business model in 2017 toward a financial holding company specializing in technology investments.
Last May, Son had judged that economic conditions encouraged “being on the defensive” in terms of investments, assuring that his group was now “more selective”.
Klarna fighting
SoftBank’s problems also stem from the hundreds of unlisted companies in which it owns shares, the value of which, more difficult to estimate, is often known during fundraisers.
The Swedish unicorn Klarna, a deferred payment specialist in which SoftBank invested heavily in 2021, thus saw its valuation fall by 85% year-on-year last month in the context of the global economic deterioration.
As usual, SoftBank Group did not release a full-year 2022/23 earnings forecast, “difficult to predict due to numerous uncertainties affecting results.”
The value of SoftBank Group shares on the Tokyo Stock Exchange has risen 4% since the beginning of the year, but is still down 46% from its peak reached in March 2021.
Source: BFM TV
