SoftBank Group Corp. (TYO:9984) clocked a much stronger-than-expected fiscal second quarter profit on Tuesday, as the Japanese tech conglomerate continued to reap strong returns from its aggressive bets on artificial intelligence.
The company said it had sold all of its shares in NVIDIA Corporation (NASDAQ:NVDA)– about 32.1 million shares– for $5.83 billion in October. The sale was not reflected in Softbank’s second-quarter earnings, and the company did not disclose a rationale for the sale.
Softbank posted a net profit attributable of 2.502 trillion yen ($16.3 billion) for the July-September quarter, much higher than Bloomberg estimates of 418.23 billion yen. Softbank’s profit also more than doubled from the 1.179 trillion yen seen last year.
The strong earnings were fueled chiefly by strong gains on investments at the company’s flagship Vision funds, the second of which continued to carry out its investment commitments in ChatGPT maker OpenAI during the quarter.
Gain on investments at SoftBank’s Vision Funds surged to 2.755 trillion yen in the September quarter from 567.4 billion yen last year.
The conglomerate has ramped up its investments in AI and tangential technologies over the past three years, which have earned it strong returns in recent quarters.
Part of this investment is also a $500 billion venture with OpenAI to build more AI infrastructure in the United States.
Softbank also committed to invest $40 billion in OpenAI earlier this year, and carried out part of this investment through its Vision Funds in the September quarter.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. Softbank said it will conduct a four-for-one ordinary share split, effective January 1, aimed at making its shares more accessible. Softbank’s stock hit a series of record highs in October, before falling sharply.
