The group reported more than $2bn in profit from its Vision Fund unit, but is being ‘cautious’ as Chinese regulators crack down on Alibaba and other companies in its portfolio.
SoftBank Group posted a profit of 762bn yen ($6.89bn) in its latest quarterly financial results, a 39.4pc year-on-year decrease. Revenue rose 15.6pc from last year to 1.479trn yen ($13.4bn), with diluted earnings per share standing at 368 yen ($3.33).
The Japanese conglomerate, which primarily invests in tech, energy and financial companies, reported a 235.6bn yen ($2.13bn) combined income from its flagship investment vehicles, the SoftBank Vision Funds.
This comes after the Vision Fund unit posted record profit in May.
The latest earnings report pointed in particular to gains from the recent listings of portfolio companies including ride-hailing business Didi Global, delivery app DoorDash, truck-hire outlet Full Truck Alliance and e-commerce firm Dingdong.
These helped to offset the fall in value of its investments in Coupang, Seer, KE Holdings and others.
Speaking to shareholders on the company’s earnings call, SoftBank CEO Masayoshi Son also said the company “want[s] to wait and see how things go” regarding any new large investments in China in the near future.
E-commerce giant Alibaba, which is one of SoftBank’s big investments, was hit with a $2.89bn fine by Chinese regulators in April as part of a wider crackdown on tech companies in the country. Days after listing in New York in early July, Didi was pulled from Chinese app stores at the behest of local regulators, which cited data protection concerns.
Chinese tech companies account for around a quarter of SoftBank’s Vision Fund investment portfolio, meaning the regulatory shake-up is significant news for the company.
“We will remain cautious until we can judge how deep and far the regulations will go,” Son said. “And we hope to actively resume investments when things become clearer.”
But SoftBank is also making plenty of bets outside of China. Earlier this year, its Vision Fund 2 led a $639m funding round for Swedish ‘buy now, pay later’ business Klarna, which has become Europe’s most valuable start-up.
With additional reporting from Sarah Harford