Il Japanese group SoftBank registered one net loss of 23,4 billion dollars (3,16 trillion yen) in the April-June quarter, the greatest ever, due to the sales that have hit the sector on the market of technology stocks, reducing the value of its gigantic subsidiary Vision Fund. In the same period of the previous year, Softbank had recorded a profit of 761,5 billion yen. The actions Sofbank are up today on the Tokyo market by 0,74%.
Softbank: Vision Fund losses caused by rate hikes and global instability
The losses for the quarter derive from the fact that the same Vision Fund posted a record $26 billion loss last May as rising interest rates and political instability rocked global markets and could test investors' willingness to sustain further big losses, it reports. the Reuters news agency.
The founder and CEO of SoftBank, Masayoshi Son, has already promised to tighten investment criteria and preserve liquidity to ride out the recession and today announced workforce cuts of Vision Fund, saying there are no "sacred areas."
“There is a lot of confusion in the world,” Son said in a briefing after releasing the data, referring to the sell-off in the technology sector. But he acknowledged that the company had invested in more start-ups than it should have and that the ratings are inflated.
SoftBank has also authorized a program of share repurchase worth up to 400 billion yen, which could reassure investors.
Softbank tries to bounce back by selling Uber and Opendoor
SoftBank wrote down the value of unlisted assets in its two Vision funds by 1,14 trillion yen. The writedowns of these private assets are unlikely to reflect the extent of the current market weakness, analysts said.
To raise cash, SoftBank divested companies including the taxi service Uber Technologies (UBER.N) and the home sales platform open door Technologies (OPEN.O), for total earnings of $5,6 billion.
SoftBank sold Uber for an average share price of $41,47, versus Friday's closing price of $32,01.
The other Vision Fund's holdings in 269 companies were worth $37,2 billion at the end of June, compared to an acquisition cost of $48,2 billion.
