In a much-needed win for Japan’s investment powerhouse, SoftBank Group has posted its first annual profit in four years a financial milestone that not only signals a rebound but may mark the beginning of a new era in its high-stakes strategy of bold tech bets.
The Tokyo-based conglomerate reported a ¥1.15 trillion ($7.78 billion) profit for the fiscal year ending in March, a sharp swing from the ¥227.6 billion loss it recorded just a year ago. While SoftBank has always lived on the edge making outsized investments in ambitious tech ventures the company’s recent performance suggests it may be regaining its footing after a tumultuous stretch defined by major losses, failed IPOs, and questions around its famously aggressive Vision Funds.
At the heart of this financial turnaround is not just good fortune, but also timing, vision, and perhaps a bit of luck.
For investors who stuck with SoftBank through the lean years including the collapse of its WeWork investment and the struggles of other once-hyped unicorns the return to profitability offers a glimmer of vindication. The company pulled in ¥517 billion in profit in the last quarter alone, more than doubling its earnings from the same period a year earlier. Much of this came from robust returns on its telecommunications operations and a rebound in valuations for some of its later-stage tech holdings.
This is no small feat. In many ways, SoftBank’s recent performance underscores both the volatility and potential of its core strategy, betting big on tech, particularly in sectors with rapid growth potential. It’s a playbook that worked wonders in the early days, particularly with its once-lucrative stake in Alibaba. But the fallout from WeWork’s collapse and other setbacks forced the company into a difficult period of reflection and reconfiguration.
Now, SoftBank is doubling down on what it sees as the next great technological leap: artificial intelligence. In March, it agreed to acquire U.S. semiconductor designer Ampere Computing for $6.5 billion. Then, in April, it revealed plans to underwrite up to $40 billion in new investment in OpenAI, the creator of ChatGPT. Of that amount, $10 billion is expected to come from co-investors. So far, around $1.84 billion has been raised from other backers, while SoftBank’s own Vision Fund 2 has invested $8.16 billion.
It’s an audacious move, even by SoftBank standards and one that comes amid increasing global competition in AI and mounting geopolitical headwinds, particularly U.S.-China trade tensions. But SoftBank’s leadership remains confident.
“AI is the defining force of our time,” a source close to SoftBank’s executive team shared. “We want to be at the center of the innovation, infrastructure, and intelligence driving it.”
One of SoftBank’s most ambitious new ventures is the so-called “Stargate” project a $500 billion initiative to develop massive data centers across the U.S., intended to provide the computational horsepower for AI-driven services in the coming decades.
While still in its early stages, Stargate has already identified over 100 potential development sites. However, Chief Financial Officer Yoshimitsu Goto noted that the company is still conducting due diligence and has yet to begin serious financing talks with lenders. He also brushed aside concerns that new U.S. tariffs would hamper the effort. “I don’t think our Stargate plans are being held up in a big way by the tariff situation,” Goto said during a Tokyo briefing.
Most of the funding, he emphasized, will come from project finance structures suggesting SoftBank is seeking to spread risk across a wider investor base.
Not all parts of the Vision Fund ecosystem are thriving equally. Vision Fund 1, which focuses on more mature startups, recorded a ¥940 billion gain over the past year. Investments in companies like ByteDance (parent of TikTok) and Coupang (a leading South Korean e-commerce platform) played a large role in the fund’s resurgence.
However, Vision Fund 2 aimed at earlier-stage startups wasn’t so lucky, suffering a ¥526 billion investment loss. Some of this can be attributed to the chilling effect of U.S. trade policy, which has hit global capital markets hard. Companies like Klarna, Oyo, and Chime have all postponed IPOs, waiting for calmer waters.
Despite these hurdles, SoftBank believes these delays are temporary. A source familiar with the fund’s internal strategy suggested that most planned listings are now on a “couple of months” delay, rather than being shelved for the long term.
Looking forward, SoftBank says it has over $36 billion in late-stage investments that could hit the public markets soon. Among the most anticipated are OpenAI and Japan’s PayPay, a fast-growing domestic payments platform.
Whether these bets will pay off remains to be seen. But for now, Masayoshi Son’s SoftBank often criticized, occasionally praised, but always watched is back in the black, and moving full-speed ahead into an AI-powered future.
