Japan's tech godfather has a record loss

The plunge of the technology company has pushed the SoftBank investment "empire" of billionaire Masayoshi Son into red alert.

The second quarter of 2022 is the second consecutive quarter that Masayoshi Son's SoftBank Group has experienced a decline in revenue due to the plunge in technology stocks.

In the latest financial report, the Japanese investment group suffered a heavy loss of 21.68 billion USD in the second quarter only. This figure increased SoftBank's net loss in the quarter to $23.4 billion , much larger than $15.5 billion in the same period last year.

In particular, the Vision Fund, which specializes in investing in technology corporations, has been heavily affected by the plunging stock prices and high inflation and interest rates.

According to Nikkei Asia , Masayoshi Son's empire has misjudged the stock situation of more than 300 technology companies that the two Vision investment funds are holding. Previously, in the first quarter, these two funds and the Latin America fund lost $21.6 billion on investments.

Shares of listed companies such as South Korean e-commerce firm Coupang, ride-hailing firm Uber and food delivery firm DoorDash all tumbled, dragging down SoftBank's profits.

Meanwhile, the situation of unlisted investments was not better in the last quarter. As a result, the Vision 2 fund, which specializes in investing in unlisted companies, faces a worse scenario, according to SoftBank.

In particular, the group's investment in 24.28% of shares in Alibaba in December 2021 has decreased to only 23.73% in the last quarter. Nikkei reported that SoftBank has sold off its assets at the Chinese technology group as collateral.

Besides, SoftBank also lost more than 6 billion USD in the foreign exchange market due to the depreciation of the yen.

However, these financial figures do not fully reflect the situation of some companies in SoftBank's portfolio such as Alibaba, which is invested in the form of equity.

CEO Masayoshi Son also said he tends to track net worth to gauge a company's performance. In the second quarter, the company's net worth fell from $200 billion in June 2021 to $137 billion.

Previously, in May, the CEO had confirmed that the two Vision Funds would go into "defensive mode", and set out stricter and more cautious criteria when making new investments.

The Japanese group attributed the decline in shares of investments mainly due to the general market's downward trend in the face of economic recession, inflation and rising interest rates.

According to Nikkei , returning to the past of glorious growth is a difficult problem for CEO Masayoshi Son. Renowned for his bold, risky investment style with great value, he is the one who turned SoftBank from a telecommunications corporation to a world leading technology start-up investment empire.

However, recently, Son has also faced many difficulties in terms of personnel. Rajeev Misra, once a manager of SoftBank's start-up funds, also resigned amid internal turmoil at the group.