SoftBank Loses $6.2 Billion in Quarter as WeWork Weighs on Investments
Japanese tech investor held an approximately 50% stake in the office-leasing company that announced bankruptcy on Tuesday
TOKYO—SoftBank 9984 1.07%increase; green up pointing triangle Group sank deeper into the red in the July-September period as it reported write-downs related to the bankruptcy of office-sharing company WeWork and technology shares stayed under pressure amid rising interest rates in the U.S.
The Japanese technology investor posted a net loss of 931.1 billion yen, equivalent to $6.2 billion, for the quarter ended Sept. 30. That is compared with a 477.6 billion yen loss in the April-June quarter and 3.034 trillion yen profit a year earlier, when it unwound its stake in Alibaba Group Holding.
Its Vision Funds investment unit posted a 258.9 billion yen loss after it returned to profitability in the April-June period for the first time in six quarters. The loss reflects softness in technology shares in the July-September quarter. The MSCI World Information Technology Index fell about 6% during the quarter.
SoftBank also said it has recorded a total of 234.4 billion yen in losses related to WeWork WEWKQ 91.96%increase; green up pointing triangle, which earlier this week filed for chapter 11 protection in the U.S. because of weakness in the office market. SoftBank holds about a 50% stake in WeWork.
SoftBank has been WeWork’s biggest backer since it started investing in 2017. The Japanese company stepped in with a $9.5 billion bailout in 2019, following WeWork’s failed attempt to go public and spiraling losses.
At an annual shareholder meeting held in June, Masayoshi Son, the billionaire founder of SoftBank Group, said his judgment on WeWork was “a stain on my life.”
SoftBank had been defensive in making new investments because of mounting losses. But Son has said the company was getting ready to go on the counteroffensive.