A year ago, SoftBank’s profits were boosted by the merger with Sprint, but that was not the case this year, with earnings down 39%.
SoftBank Group Corp. reported a 6.9 billion yen ($761.5 billion) profit for April-June on Tuesday, down from 1.26 trillion yen a year earlier. Sales rose 16% to 1.48 trillion yen ($13 billion) in the third quarter.
SoftBank, whose investment portfolio includes WeWork, Yahoo! Japan, and Alibaba, a Chinese e-commerce company and a variety of other businesses, said it made investments totaling $2.1 billion in the last quarter.
The first to offer the Apple iPhone in the Japanese market, SoftBank benefited last year when U.S. mobile carrier Sprint, which is owned, merged with T-Mobile, a European telecommunications company.
SoftBank profited this year from its investments, recording a net gain of 309.7 billion yen ($2.8 billion) in SVF1, or “SoftBank Vision Fund One,” and another increase of 97 billion yen ($882 million) in SVF2. It also operates what’s called a Latin America Fund, with 48 investments.
With the recent stock boom, SoftBank posted the most considerable annual profit for any company in Japanese history for the fiscal year that ended in March, surpassing Japan’s top earner Toyota Motor Corp.
Analysts, however, are raising concerns about SoftBank’s holdings, stating that worse may be to come in the July-September quarter.
Chief Executive and founder Masayoshi Son dismissed the record profit of the previous fiscal year as a coincidence, promising to keep pursuing his dream of innovation, not just monetary gains.
Despite the coronavirus pandemic, SoftBank is benefiting from the world’s move online, including the rise of remote working and online entertainment, Son said.
He told reporters, “It was a meaningful year for us.”.
Son said SoftBank is the world’s largest investor in artificial intelligence, with 10% of the capital in unlisted AI companies, including unicorns, privately held startups valued at over $1 billion.
The second-and third-ranked AI investors have invested a fraction of what SoftBank has, he said, stressing he is taking the risk because he is convinced the “AI revolution” is underway.
In March 2021, SoftBank completed its mobile application company Line Corp. business integration, which includes Yahoo! Japan, electronic payment operator PayPay Corp., and online clothing retailer ZoZo.
“We’ve had some bumps along the way, but we are slowly on the rise,” Son said about the company’s recent investments.