SoftBank's Vision Fund, the investment vehicle behind Uber and WeWork, is riding high-flying technology stock, posting its biggest profit for years.
The fund, created by SoftBank CEO Masayoshi Son, reported a ¥844.1bn ($8bn) profit in its third quarter ended 31 December 2020 [PDF], surpassing record numbers set just a quarter earlier, and its best results since 2017.
The global ballooning of tech stock, driven by cheap money and pandemic restrictions, is to thank. In particular, IPOs have been a boon, including that of DoorDash, the Vision Fund-backed food delivery service which hit a $72bn valuation last December despite posting heavy losses.
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It's been quite a turnaround. Less than a year ago, the $100bn Vision Fund said it expected losses for FY2019 of ¥1.8 trillion ($16.7bn). At the time, the Japanese company said the losses would be the result of "a decrease in the fair value of investments due to the deteriorating market."
At that point, investment in office-sharing platform WeWork did not seem so smart as the world started to work from home.
In the latest financials, Masayoshi Son's laboured metaphor about SoftBank's ability to continue offering more golden eggs for the investment world prompted some derision on Twitter, as did his promise that business would recover from the decimating impact of the pandemic like some sort of winged horse.
It's Softbank Slides Day again today pic.twitter.com/aTxGkueAqC— Jacky Wong (@jackycwong) February 8, 2021
The company's golden touch was not quite universal, though. SoftBank posted a ¥285bn ($2.7bn) loss on derivatives, which helped create an overall loss in asset management of ¥113.5bn ($1.1bn).
It remains to be seen whether the Vision Fund's good fortune will last long enough to see the founder execute his long-term plan. In 2010, Son told investors that in 300 years SoftBank wouldn't be in the mobile phone business: it would be a telepathy service provider.
This is ridiculous, of course, but we can tell you were thinking that already. ®