Softbank Posts Qtrly Loss as Tech Holdings Slammed by Rising Rates

By Ambar Warrick

Investing.com-- Japanese investment behemoth Softbank Group Corp. (TYO:9984) logged a quarterly loss on Monday as continued pressure on technology stocks, stemming from rising global interest rates, weighed on its holdings.

The firm posted a net loss attributable to shareholders of 3.16 trillion yen ($23.3 billion) in the April-June quarter, compared to a net profit of 761.5 billion yen in the same period last year.

This resulted in a loss of 1,949.55 yen per share, compared to expectations for a profit of 83.5 yen.

Most of this loss stemmed from Softbank logging a 2.9 trillion yen loss on its investments. Softbank’s premier Vision Funds, which control roughly $150 billion in capital, accounted for a bulk of the declines.

The firm, which operates the world’s largest technology-focused venture capital funds, has substantial holdings in several major technology companies, including Wall Street majors Microsoft (NASDAQ:MSFT), PayPal Holdings Inc (NASDAQ:PYPL), and Alibaba (NYSE:BABA).

But this has made the investment bank- led by Masayoshi Son- extremely vulnerable to a drop in technology valuations this year, as major central banks withdrew accommodative measures in the face of rising inflation.

With interest rates now set to rise further, tech valuations have come under extreme duress. For instance, the Nasdaq Composite index is trading down 20% so far this year, after losing over a third of its value earlier in the year.

A tech boom over the past two years saw Softbank log record profits. But this has drastically unwound in 2022. Softbank had logged a record loss at its Vision Fund segment in the prior quarter.

CEO Masayoshi Son has vowed to tighten financials and preserve cash, as the investment bank braces for a continued downturn in its holdings this year.

Softbank said in a statement that it had logged a 154.5 billion yen gain on its holdings in telecom firms T-Mobile US Inc (NASDAQ:TMUS) and Deutsche Telekom (ETR:DTEGn).

It also logged a 97.2 billion yen gain on the settlement of certain prepaid forward contracts using Alibaba shares.

Begin trading today! Create an account by completing our form

Privacy Notice

At One Financial Markets we are committed to safeguarding your privacy.

Please see our Privacy Policy for details about what information is collected from you and why it is collected. We do not sell your information or use it other than as described in the Policy.

Please note that it is in our legitimate business interest to send you certain marketing emails from time to time. However, if you would prefer not to receive these you can opt-out by ticking the box below.

Alternatively, you can use the unsubscribe link at the bottom of the Demo account confirmation email or any subsequent emails we send.

By completing the form and downloading the platform you agree with the use of your personal information as detailed in the Policy.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Back to top

Office network
  • London Office
    One Financial Markets 

    1 Finsbury Market
    London
    EC2A 2BN
    United Kingdom


    T:  + 44 ( 0 ) 203 857 2000
    E:  info@ofmarkets.com
  • Dubai Office
    One Financial Markets 
    OT19-39 Central Park Tower
    Dubai International Finance Centre
    Dubai
    United Arab Emirates
     
    T: + 00 971 44 22 888
    E:  info@ofmarkets.com
     

One Financial Markets is the trading name of Axi Financial Services (UK) Ltd, a company registered in England with company number 6050593. Axi Financial Services Ltd is authorised and regulated by the Financial Conduct Authority in the UK (under firm reference number 466201) and the Financial Sector Conduct Authority in South Africa (with FSP number 45784).

The information on this site is not directed at residents of the United States, Belgium, Poland or any particular country outside the UK and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

www.onefinancialmarkets.com is owned and operated by Axi Financial Services (UK) Ltd.

Award winning broker
We have been presented with a number of awards that recognise the quality of our service and dedication to our clients :

Best FSA Regulated Broker
Saudi Money Expo

Best Education Product
Saudi Money Expo

Best Broker - Online Trading
IAIR Awards

Best Institutional Broker
Saudi Money Expo

Best FX Services Broker
CN Forex

Top International
FX Broker 2015

Saudi Money Expo

Broker of the Year
Online Trading – Middle East

IAIR Awards

Best Forex
Customer Service 2018

JFEX Awards

We accept the following payment methods: