It’s been a tumultuous 12-months for SoftBank Group, but despite a variety of business obstacles, the company announced that its first-half net profit soared 346.7%, sealing a strong recovery after a massive annual loss, as tech stocks rally and the firm sheds assets to shore up its finances.
According to a statement from the company, net profit for the six month, from April 1 to September 30, came $18 billion USD, a dramatic increase from the previous year. The massive profit was due to the company’s gains on its investments.
SoftBank was asked to make projections for full-year profits, however the company said that it would not offer a forecast "as it is difficult to foresee consolidated results due to numerous uncertain factors".
SoftBank reported a nearly $9 billion net loss in the previous full fiscal year, but quickly returned to the black in the first quarter.
Masahiko Ishino, an analyst at Tokai Tokyo Research Institute, said SoftBank had displayed "a steady performance" in line with robust gains in the global equity market.
SoftBank founder Masayoshi Son has transformed the former third-tier telecoms company into an investment and technology giant with stakes in some of Silicon Valley's hottest start-ups through its $100 billion Vision Fund. Son has battled opposition to his strategy of pouring money into start-ups -- including troubled office-sharing firm WeWork -- which some analysts say are overvalued and lack clear profit models.
However, Son has insisted that his strategy is sound, and that SoftBank's portfolio is broad enough to weather the storm and the current results seem to echo his point. The first-half results came after SoftBank launched an aggressive plan to sell up to $41 billion USD in assets to finance a stock buy-back and reduce the firm's debt.
In line with the strategy of selling assets, SoftBank Group announced an agreement in September to sell British chip designer Arm to U.S. firm NVIDIA for up to $40 billion USD, potentially creating a new giant in the chip industry.