SoftBank Group Corp’s Vision Fund has experienced a significant turnaround in its earnings, with its highest gains in almost three years. This recovery is attributed to the resurgence in the valuation of tech companies.
In the December quarter of fiscal year 2023, the Vision Fund reported a JPY 600.7 billion ($4.35 billion) gain on investments, marking a substantial upturn following record losses in the previous fiscal year. This news comes after a challenging fiscal year that concluded in March 2023, during which the Vision Fund suffered a record loss of approximately $32 billion due to a tech stock price slump and underperforming Chinese business ventures.
SoftBank’s net income also rebounded, marking the first quarterly profit after four consecutive losses. The Vision Fund has now reported gains for three consecutive quarters. In the December quarter, SoftBank recorded an investment gain of $5.5 billion, largely due to the sale of shares in its majority-owned chip designer, Arm Holdings. Arm, acquired by SoftBank in 2016 for around $32 billion, went public in the U.S. last year with a valuation of over $50 billion.
This turnaround is significant given SoftBank’s recent challenges. In May, the company reported a JPY 5.32 trillion loss for the Vision Fund in the previous fiscal year. However, the company made ambitious moves, such as Arm Holdings revealing its IPO ambitions with a close to $54 billion valuation in September 2023.
The recovery of SoftBank’s Vision Fund is a positive sign for the company and the overall tech investment landscape. It demonstrates the resilience of the tech sector and its potential for growth. As the valuation of tech companies continues to rise, SoftBank stands to benefit from its strategic investments.
