Masayoshi Son's SoftBank Announces $3.4B Share Buyback As Vision Fund Tech Arm Yields Investment Gains

Masayoshi Son-led SoftBank announced a share buyback initiative amid its first-quarter earnings report. The company plans to repurchase up to 6.8% of its shares, amounting to 500 billion yen ($3.4 billion).

What Happened: The share buyback announcement follows pressure from shareholders, concerned about the company’s market capitalization being significantly lower than the value of its assets. Investment firm Elliott Management has been pushing for a share repurchase program.

In its fiscal first quarter report ending in June, SoftBank Group SFTBY announced a 1.9 billion yen ($12.9 million) investment gain in its Vision Fund tech investment arm.

However, the Vision Fund also reported a 204.3 billion yen ($1.39 billion) loss in the same quarter. This is a stark contrast to its profit in the same quarter last year and includes administrative expenses and gains and losses attributable to third-party investors, CNBC reported on Wednesday.

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Despite the Vision Fund’s losses, SoftBank’s net sales rose 9.3% year-on-year to 1.7 trillion yen ($11.5 billion). The company’s net profit was 10.5 billion yen ($71.5 million) following a 316.2 billion yen ($2.15 billion) loss in the year-ago quarter.

Why It Matters: SoftBank’s earnings report comes amid market volatility. The company’s shares recently dropped nearly 19% in a single day due to a broader fall in Japanese stocks. Despite this, SoftBank continues to position itself as a key player in the artificial intelligence boom, with significant investments in companies like Arm and Wayve.

As of August 6, 2024, SoftBank’s shares are trading at $24.7, down 0.04% from the previous close. The company’s 52-week high and low are $37.19 and $18.78, respectively.

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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari