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SoftBank generated a net profit of ¥248.6bn ($1.6bn) in its fiscal third quarter, driven by a $4.2bn gain from founder Masayoshi Son’s large and growing investment in OpenAI.
The figure for the three-month period to the end of December compares with a loss of ¥369bn in the same quarter the previous year, the company said on Thursday. It missed analysts’ expectations of a ¥398bn profit, according to LSEG data.
SoftBank’s earnings were driven by uneven gains from its tech-heavy Vision Funds.
The first fund made an investment loss of $4.1bn in the third quarter, primarily due to declines in the share price of publicly held companies such as South Korean online retailer Coupang, which was hit by a massive data breach.
But the losses were outweighed by a gain of $6.6bn in the second fund, which includes the OpenAI stake.
In the financial year to December, SoftBank said its investment gains on OpenAI totalled $17bn.
Son has staked his reputation on an increasingly concentrated bet on artificial intelligence, which he has said will shape “humanity’s future”. His company has invested more than $34bn in OpenAI and is in talks to potentially add another $30bn as part of a funding round that could see the ChatGPT maker’s valuation jump to $750bn.
After OpenAI restructured last year, SoftBank was left with roughly 11 per cent of the company, compared with Microsoft’s close to 27 per cent. As part of its drive to fund its bets on OpenAI, SoftBank sold its entire stake in chipmaker Nvidia for $5.8bn and some of its shares in T-Mobile for $12.7bn last year.
SoftBank’s shares have almost doubled over the past 12 months as investors pile into the company as a way to get exposure to OpenAI.
However, the stock price has fallen 29 per cent from a peak in October, reflecting growing fears about valuations in the sector, competition from rivals such as Anthropic’s Claude and Google’s Gemini, and questions about the company’s ability to finance its vast and growing number of commitments.
Alongside the investment in OpenAI, SoftBank has positions in a portfolio of AI-related companies through its Vision Funds, as well as a majority stake in UK chip designer Arm.
Arm has said it is exploring launching its own chips, and SoftBank has bought a number of semiconductor-related companies over the past two years, including Ampere and Graphcore, that could help that effort.
SoftBank has said those companies are now housed under a new unit alongside Arm.
Last quarter SoftBank also agreed to buy ABB Robotics for $5.4bn and DigitalBridge for $4bn, including net debt.
Chief financial officer Yoshimitsu Goto said on Thursday that although the group had made “over $40bn of investments in the last nine months”, including in OpenAI, it was maintaining financial discipline with net debt at 20 per cent of the value of SoftBank’s equity holdings and a cash position of $24bn.
In the US, Son is leading financing for the $500bn Stargate project to scale up data centres and AI infrastructure with OpenAI, Oracle and Abu Dhabi’s MGX.
SoftBank is expected to announce further deals in the US, including energy projects, backed by funding from the Japanese government as part of its $550bn deal with US President Donald Trump to win lower tariff rates.