SoftBank Group posted a net loss of 1.12 trillion yen, about $7.1 billion, for the July-to-September quarter, its first loss in almost two years, as a selloff in technology shares hit its holdings and the costs of its U.S. artificial intelligence buildout climbed. Analysts had expected a profit of 129.32 billion yen, according to Bloomberg estimates. A year earlier, SoftBank earned 2.5 trillion yen.
The results came out after the Tokyo market closed on Tuesday. Earlier in the day, SoftBank shares jumped 13.9% to 3,872 yen as Asian chip stocks tracked Wall Street’s rebound. Even after that gain, the stock was about 19% below its Oct. 29 close of 4,765 yen.
SoftBank booked a 597.25 billion yen loss in the six months to Sept. 30 from realigning its procurement plans for power generation equipment for U.S. AI data center projects, Reuters reported. Financing costs rose to 461.9 billion yen in the quarter, driven by a margin loan backed by its Arm shares, heavy bond issuance and higher funding rates. Listed holdings including Coupang and Grab fell during the quarter, CNBC reported.
Revenue reached 2.22 trillion yen, ahead of the 2.02 trillion yen LSEG analysts expected. Revenue for the six months rose 13.3%, helped by the telecom business and AI computing.
SoftBank’s biggest bet held its value. The company said it had invested $54.6 billion in OpenAI as of the end of September, with a fair value of $99.6 billion, for a cumulative gain of $45 billion. That fair value was unchanged from March, Reuters reported. SoftBank made a further $10 billion follow-on investment in OpenAI in October, under a schedule it announced earlier.
The company faces pressure on several fronts. Reuters reported that the Democratic Party’s victory in last week’s U.S. midterm elections raised concerns about tighter regulation of the AI data center buildout. Last Thursday, China barred SoftBank’s purchase of the China operations of ABB’s robotics division, part of a $5.4 billion takeover; ABB says the two companies are still in talks to move the deal forward. On Monday, SoftBank, Grab and Malaysia’s PETROS announced plans to commit a combined $1.85 billion in initial capital for AI infrastructure in Malaysia.
