SoftBank reported a loss of $6.2 billion in the third quarter due to WeWork’s bankruptcy affecting business results

SoftBank reported a loss of $6.2 billion in the third quarter due to WeWork’s bankruptcy affecting business results

SoftBank, the world’s largest technology investment group, announced third-quarter business results with a huge loss of 6.2 billion USD, mainly due to the collapse of WeWork, the office leasing company that SoftBank owned. has invested billions of dollars. This is the largest loss in SoftBank’s history since its founding in 1981.

WeWork is one of SoftBank’s most failed investments, as the company had to withdraw from its plan to list shares in September this year due to lack of investor confidence. SoftBank had to save WeWork by spending $9.5 billion to take control of the company and pay founder Adam Neumann to leave his position as CEO. However, WeWork’s value fell sharply from $47 billion to $8 billion, causing SoftBank to record a loss of $4.6 billion in the third quarter.

In addition to WeWork, SoftBank also suffered losses from other investments of the Vision Fund, a $100 billion technology investment fund managed by SoftBank. Companies like Uber, Slack, DoorDash or Oyo all have difficulty maintaining or increasing their value in the market. The Vision Fund lost $8.9 billion in the third quarter, bringing the fund’s total loss in the first half of the fiscal year to $16.8 billion.

In response to these disappointing results, SoftBank CEO Masayoshi Son admitted that he made mistakes in evaluating the companies in which SoftBank invested. He also said that SoftBank will change its investment strategy, from focusing on revenue growth to focusing on profits and cash flow. Mr. Son also hopes that SoftBank will recover thanks to the potential of artificial intelligence technology, the field in which SoftBank is investing the most.

According to analysts, SoftBank can still overcome the current crisis thanks to other business divisions such as telecommunications, internet or chips. SoftBank’s shares have increased 17% since the beginning of this year, proving that investors still believe in SoftBank’s vision and capabilities. However, SoftBank is also under great pressure from stakeholders such as investors, shareholders or short sellers, forcing SoftBank to improve its transparency.