Japan tech giant SoftBank posts $23 billion quarterly loss

AP

Tokyo, Aug 9 : Japanese technology company SoftBank Group posted a $23.4 billion loss in the April-June quarter as the value of its investments sank amid global worries about inflation and interest rates.

SoftBank Group Corp.'s loss of 3.16 trillion yen was a reversal from its 762 billion yen profit in the same quarter a year earlier. Quarterly sales rose 6% to 1.57 trillion yen ($11.6 billion).

"I must humbly and honestly acknowledge that things are really bad," a somber Chief Executive Masayoshi Son told reporters Monday. "I must face up to this."

Losses for the last six months totaled about 5 trillion yen ($37 billion), and the latest red ink was the worst quarterly loss since the company's founding, he said.

For the fiscal year that ended in March, Softbank racked up losses of 1.7 trillion yen ($13 billion), a reversal from the 4.9 trillion yen profit for the previous year. Annual sales grew 10.5% to 6.2 trillion yen ($46 billion).

Although Softbank's portfolio is not directly exposed to the war in Ukraine, the company warned that global uncertainty as well as inflation and soaring energy costs would likely hurt its profitability.

Much of the dip of the value in shares came from a drop in price of Chinese e-commerce giant Alibaba, in which SoftBank is a major investor. The declining value of the yen also hurt Tokyo-based SoftBank's bottom line because its borrowings must be repaid in yen.

How long the problems will persist is unclear, Son said, noting it could be months or even years because of global instability and inflation.