SoftBank reports $2.4B loss in Q3 amid huge AI investments
What's the story
SoftBank Group has reported a massive third-quarter loss of ¥369.165 billion (nearly $2.4 billion) for the fiscal year 2024.
The dismal financial performance of the Masayoshi Son-led investment conglomerate is primarily attributed to a sharp decline in the value of the shares of several key portfolio companies during the quarter.
Despite the losses, SoftBank's Vision Funds portfolio managed to generate investment gains of ¥260.8 billion ($1.69 billion).
Portfolio adjustments
Vision Funds offloads investments worth $2.98 billion
During the third quarter, SoftBank's Vision Funds (SVF1 and SVF2) offloaded investments worth $2.98 billion. This included stakes in DoorDash and SenseTime, along with partial exits from a few other companies.
Despite foodtech giant Swiggy's strong market debut in November, other portfolio firms underperformed during the period, adding to SoftBank's overall loss.
Strategic moves
SoftBank's future plans and AI investments
Under the leadership of Son, SoftBank has been particularly interested in AI investments.
Reportedly, the company is considering investing as much as $25 billion in ChatGPT creator OpenAI as the competition heats up with China DeepSeek's entry into the sector.
Softbank has also partnered with OpenAI, Oracle, and other tech giants to build Stargate—a $500B project to establish AI data centers across the US.
AI ventures
SoftBank's diversified AI investment portfolio
Apart from OpenAI, SoftBank has also invested in Glean, an enterprise AI search firm.
The company has also backed Poolside, a developer-centric firm specializing in generative AI tools for software development.
Opera, a browser company that recently integrated AI capabilities into its platform, is another recipient of SoftBank's funding.
These investments highlight SoftBank's strategic focus on the rapidly evolving field of artificial intelligence.