SoftBank Group reported their fiscal first-quarter profit on Thursday that went beyond expectations, mainly driven by the gains in their Vision Fund tech investment.
SoftBank surprised the markets with a strong performance in the April–June quarter, posting a profit of 421.8 billion yen (around $2.87 billion), far surpassing analyst expectations of 127.6 billion yen ($0.866 billion), as per LSEG estimates. This marks the second consecutive profitable quarter for the Japanese tech conglomerate, which had recorded a steep loss of 174.28 billion yen ($1.2 billion) during the same period last year.
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A major boost came from its Vision Funds, which saw their overall value jump by $4.8 billion, the biggest quarterly rise since mid-2021. Even after accounting for expenses and other factors, the Vision Funds segment alone delivered a profit of 451.4 billion yen ($3.063 billion), a remarkable turnaround from the losses it reported in the previous year’s first quarter.
The Japanese giant said the Vision Fund’s value went up due to strong performances from public companies like Grab and India’s Swiggy. Some of its private investments in Indian startups also played a big role in boosting the fund’s overall gains.
SoftBank Group stock reached an all-time high on Thursday, just before its earnings release. The company’s share price has jumped over 36% since the start of the year, adding close to $37 billion to its overall market value.
Now SoftBank is eyeing IPOs for several of its major portfolio companies this year, including PayPay, Klarna, and India’s Lenskart. There’s also buzz that travel platform Klook might file for a U.S. listing in the coming weeks.
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At the same time, SoftBank is playing a central role in the massive $500 billion Stargate initiative in the U.S., which is focused on building AI infrastructure and data centers. Investors are now watching closely to see how the company plans to finance its part in this ambitious project.
Back in May, SoftBank reported its first full-year profit in four years, thanks largely to solid returns from some of its earlier bets like Alibaba, T-Mobile, and Deutsche Telekom. On Thursday, the company shared that it had sold 13 million shares of T-Mobile this August, bringing in around $3 billion from the deal.
The Japanese tech giant is also backing a massive $40 billion funding round for OpenAI, the company behind ChatGPT. It’s also waiting for regulatory approval to close its $6.5 billion deal to acquire AI chipmaker Ampere Computing.