Softbank's Vision Fund Bounces Back With $4B Gains, The Highest In Nearly 3 Years

SoftBank Group Corp SFTBY has witnessed a significant turnaround in its earnings, with its flagship Vision Fund posting its highest gains in almost three years. The recovery is attributed to the resurgence in the valuation of tech companies.

What Happened: In the December quarter of fiscal year 2023, the Vision Fund, SoftBank’s primary tech investment arm, reported a 600.7 billion Japanese yen ($4.35 billion) gain on investments. This marks a substantial upturn following the record losses in the previous fiscal year, reported CNBC.

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SoftBank’s net income also rebounded, marking the first quarterly profit after four consecutive losses. This turnaround 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 the underperformance of certain Chinese business ventures.

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. This sale was to one of SoftBank’s wholly-owned subsidiaries. Arm, which was acquired by SoftBank in 2016 for around $32 billion, went public in the U.S. last year, valuing the company at over $50 billion.

Why It Matters: This turnaround is significant, given SoftBank’s recent challenges. In May, the company reported a 5.32 trillion japanese yen loss for the Vision Fund in the previous fiscal year. This was followed by an ambitious move in September 2023, when Arm Holdings revealed its IPO ambitions with a close to $54 billion valuation.

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