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  • Introduction to Video Content
  • SoftBank, the Japanese conglomerate, has reported a loss of $6.2 billion in its second quarter due to its investment and financial support for WeWork, which filed for bankruptcy. This setback comes despite SoftBank's other successful ventures such as the listing of ARM, the largest semi IPO ever, and its ownership of Alibaba, Yahoo Japan, SoftBank's telco company Sprint, and other investments. However, the failure of WeWork continues to negatively impact SoftBank's performance. In response, SoftBank's CEO, Masayoshi Son, has identified potential growth opportunities in companies like TikTok parent ByteDance and Fanatics. The company's liquidity profile has improved, giving them more capital to invest in AI technologies. On the other hand, SoftBank's most significant holding, Arm, has seen a decline in value since its IPO. Despite these challenges, SoftBank remains focused on offensive investments and is determined to rebound from its recent losses.
  • Subtitles section
  • Welcome back.
  • SoftBank posting another loss in its second quarter.
  • It says, it was related to the investment and financial support for WeWork
  • which filed for Chapter Eleven bankruptcy this week,
  • Deirdre Bosa has the details in today's Tech Check.
  • Hey, D. Hey, Leslie.
  • So, this quarter, should have been Matsuyoshi San's victory lap,
  • He successfully listed ARM.
  • It was the largest semi IPO ever and the fifth largest U.S.
  • listing of all time.
  • Masa even brought back the golden goose slide from twenty twenty one.
  • You're looking at it right now.
  • The goose is the information revolution.
  • The eggs represent SoftBank successes.
  • Maybe small to read.
  • So I'll tell you what they are.
  • Alibaba Yahoo Japan SoftBank's telco company.
  • sprint and the latest golden egg arm.
  • Unfortunately, though
  • this graphic does not take into account SoftBank's losing bets
  • and what's become its biggest black eye
  • which is WeWork, and it continues to skew performance to the downside.
  • That's what it did this quarter.
  • The Japanese conglomerate posted a six point two billion dollar loss in the quarter
  • and cumulative losses in WeWork.
  • at a staggering
  • may be able to cash in on soon.
  • He called out TikTok parent ByteDance and Fanatics.
  • Now, I want to point out another slide from the presentation,
  • This shows how SoftBank's liquidity profile has strengthened from earlier this year,
  • It tells you that private liquid investments make up less of the portfolio than it did before.
  • And that means more capital
  • more money to deploy as they continue to move on to an offensive investment stance focused on AI,
  • Now, at the same time
  • though, one of its largest holdings
  • that's Arm,
  • It's losing value on the public market.
  • It's down from its IPO peak of sixty nine dollars a share
  • and today on disappointing earnings
  • it's down nearly six percent.
  • So that raises some questions
  • as to whether Arm can be the new Alibaba,.
  • As you see here, Masasan has been able to draw down on its Alibaba stake over the years
  • to make new investments
  • and clock profitability,
  • That stake has been dwindled down
  • and Arm has increased its position in the portfolio
  • going from eight percent to twenty four percent of the portfolio.
  • But guys, I mean, Alibaba was a once in a lifetime
  • you could argue, once in a few decades opportunity investment
  • went from twenty million dollars to over a hundred billion dollars at one point
  • so very unlikely that Arm is going to be as lucrative,
  • Yeah, although a lot of people coming to arms defense today
  • Dee, talking about the guidance being more cyclical
  • and Rene Haas telling Jim last night that the story obviously is a lot more structural than that.
  • Yeah, and that's fine.
  • I mean, even if Arm goes on to become a hundred billion dollar
  • two hundred billion dollar market cap
  • it's not going to be that Alibaba in the portfolio.
  • But remember that SoftBank still owns ninety percent of the company.
  • So there are some things that can do.
  • It can draw down that position.
  • And we know that Masasan and SoftBank are on the AI hype train,
  • Though so far, investments are really focused on logistics and transportation in this space,
  • So it hasn't really been in some of the buzzier
  • Kind of strictly generative AI companies
  • like a Cohere, or a Character AI,
  • So, we'll see, because the CFO reiterated again
  • that they're going to be going out there and making some investments,