The billionaire’s SoftBank “has to eat a lot” at a record loss

The world’s largest technology investor has announced that it recorded a loss of 3.5 trillion yen ($27.5 billion) in the financial year ended March. This is the record loss in SoftBank’s history. Compared to last year, this result is completely opposite.

In Tokyo, SoftBank CEO Masayoshi Son acknowledged the losses and pledged to restart new investments with a more cautious approach.

“SoftBank should be more cautious,” said Mr. Masayoshi Son, who is known as “a lot of food”.

According to Mr. Son, in the future, the Japanese group will have stricter criteria for new investments and will focus on improving the returns from its investment portfolios.

Mr. Masayoshi Son, who is known by the nickname “a lot of food”, affirmed that he will be more cautious in new investments.

SoftBank’s portfolio companies include South Korean e-commerce company Coupang (CPNG), ride-hailing app Grab in Southeast Asia. Both went public in record offerings on Wall Street last year. However, year-to-date, each company’s shares have fallen by more than 60%.

However, the most disappointing deal with the Japanese bank was Didi. The Chinese ride-hailing giant launched its IPO in New York last summer to great fanfare, but it wasn’t long afterward that it faced difficulties as regulations tightened on its tech giants. China.

The trouble escalated last December, when the company was forced to go through the process of delisting in the United States.

Shares of Didi are down nearly 70% this year. Last week, it was reported that Didi was being investigated by the US Securities and Exchange Commission for its IPO last year.

Didi failed SoftBank deal

“I believe the market is in turmoil,” Mr. Son said. Along with that, he also mentioned the impact of the COVID-19 pandemic and the Russia-Ukraine crisis causing interest rates and inflation to skyrocket. The US stock market also plummeted.

According to CNN, compared to the end of December 2021, the S&P 500 index has dropped by 18%, meaning that $7 trillion in capitalization has “evaporated” from the market.

Notably, stocks of technology companies suffered the most. An estimated $3 trillion in the $7 trillion decline in the S&P 500’s market capitalization came from the technology sector.

Stocks of tech giants like AppleMicrosoft, Amazon, Alphabet, Meta Platforms (Facebook’s parent company) and Tesla are all in the red. Private Netflix lost 70% of its value – the biggest drop in the S&P 500 this year.

Along with the S&P 500, the Dow Jones Industrial Average is also down 13% year-to-date. According to data from research firm Bespoke Investment Group, the Nasdaq index has fallen more than 20% in the last 30 trading sessions.

US stocks plunge

Talking about new investments, Mr. Son said that the opportunity in Japan is still there and SoftBank is having some small-scale deals. The billionaire also admitted that his company is “faced with great challenges” in China.

Mr. Son noted on Thursday that Alibaba, one of the conglomerates that had to undergo reforms, “had lost a lot.” The Chinese e-commerce giant is a longtime mainstay of SoftBank’s portfolio.

SoftBank shares fell 8% on the Tokyo Stock Exchange on Thursday. Overall, the group’s shares are down 17% this year.

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