On Monday, the second quarter 2022 performance report released by SoftBank Group showed that SoftBank's net loss in the second quarter was 3.16 trillion yen (US$23.4 billion), compared with a profit of 761.51 billion yen in the same period last year, setting a record for a loss of 1.7 trillion yen in the previous quarter, and continued to hit a record high.
The SoftBank Vision Fund, which the company relies on for its fame, lost 2.33 trillion yen in the second quarter, setting a record of 2.2 trillion yen in the previous quarter and in sharp contrast to the profit of 235.6 billion yen in the same period last year.
This is not the first time SoftBank has suffered such a huge loss. But unlike the past, the Masayoshi Son , who once compared himself to the "Son of God" Jesus , defended SoftBank's huge losses, finally bowed his head this time.
"fall" of the huge empire
In May this year, SoftBank announced the worst annual loss in its 40-year history, affected by the decline of global technology stock . As of the 2021 fiscal year ended in March, SoftBank Group had a net loss of 1.7 trillion yen (approximately RMB 89.9 billion), and Vision Fund lost 2.64 trillion yen (approximately RMB 139.7 billion), both setting a record loss.
Wall Street News Previously analyzed that in addition to the collective valuation of technology stocks, Masayoshi Son's investment style of "having a heavy position whenever he takes action" is also to blame. Masayoshi Son, who was once considered by many people as the "God of Investment", has had great investment achievements in recent years, which is hard to describe.
Although Masayoshi Son has publicly promised many times that he would change his radical investment bets, he still chose to bet on startup technology companies at the peak of the market last year. According to SoftBank’s documents, SoftBank’s fund invested about $38 billion in 183 companies last year, arguably the most invested in a year in the venture capital industry in history.
Since the beginning of this year, the plunge in technology stocks has once again taken deeper losses from Masayoshi Son's bets.
Vision Fund evaporated about $23.1 billion in April to June this year alone, with the first and second phases accounting for about half each. Compared with the loss of $26.2 billion in the previous quarter, this quarter can only be said to be a little "slighter".
Masayoshi Son's feelings about failure are becoming more and more profound, saying that he has learned an important lesson: " We lost 6 trillion yen in half a year. I also need to reflect deeply and always remember this lesson."
In addition to the sell-off of technology stocks, the decline of executives can be said to be "injured to injury." Marcelo Claure, chief operating officer of
, announced his resignation in January; other resignations include Katsunori Sago, the company's strategic director; Akshay Naheta, senior investment director; and Deep Nishar, a senior Silicon Valley veteran. Since March last year, seven managing partners have left SoftBank.
"The Trendmaker of the Times" is rising and falling between the ups and downs
Son can be said to be "the peak of his debut" in the investment world. Before investing in Ali , Son was successful by investing in Yahoo. When the Internet bubble reached its peak in 2000, Yahoo's market value exceeded US$100 billion. With the 33% stake in Yahoo , Masayoshi Son's net worth surpassed Bill Gates and became the world's richest man for 3 days.
After experiencing the Internet bubble and the 2008 financial crisis, Masayoshi Son continued to raise funds and invest, and the number of companies holding in is like a snowball. However, with the ups and downs of the tide, the crazy investment also made SoftBank taste the consequences themselves.
In the next few years, SoftBank's investment projects continued to suffer huge losses. SoftBank Group fell to the bottom in early 2020, and the already stormy Vision Fund was hit by the epidemic again. At that time, in an exclusive interview with the media, Masayoshi Son admitted that about 15 of the 88 companies invested by Vision Fund would go bankrupt.
Half a year later, Son "stand up" again. With the sharp rise in US technology stocks under fiscal stimulus and the successive listing of Vision Fund portfolio companies, SoftBank's investment looks very likely to appreciate.
But this time, SoftBank is approaching the edge of the cliff again. Only time can give us the answer to how Masayoshi Son leads this group through the crisis and whether his ambition to "300-year vision" can be realized.
has compared Jesus to defend SoftBank
In May 2020, Masayoshi Son said on SoftBank's earnings call that itself is as ununderstood as Jesus. He said that Jesus was also misunderstood and criticized.
At that time, Vision Fund suffered a huge loss of more than US$10 billion, especially when investing in WeWork suffered a huge loss.
Two of the participants believed that Masayoshi Son used such an analogy to show that if SoftBank's investment returns improved, his reputation would also be re-evaluated; otherwise, his reputation might become worse.
But after SoftBank announced its huge losses in May this year, Masayoshi Son's attitude has undergone some subtle changes, changing his former radicalism, saying that "SoftBank promises to take defensive measures."
But he still reiterated his belief in " information revolution ", predicting that the current market downturn is just a flash in the pan before Internet companies resume their sharp rise, and the opportunity comes again when SoftBank returns to the "offensive mode" in the next one or two years.
Hard repentance - Tokugawa Ieyasu
who mocked himself for "escape in a panic". This time, Masayoshi Son's frustration was written directly on his face.
He said that this was the biggest loss since the company was founded, and he also conducted self-examination. He admitted: "I am ashamed of my greed for huge profits in the past."
When the media asked what lessons he learned, Masayoshi Son said, "There are too many lessons and countless things":
We are too confident and too ambitious.
At the press conference, Masayoshi Son also showed illustrations of Tokugawa Ieyasu, one of the heroes of Japanese history, to allude to the dilemma he faced.
Tokugawa Ieyasu had great political ambitions, but at that time he was a retainer under the Oda Nobunaga . He was eager to compete for his achievements and recklessly sent troops to provoke his opponent Takeda's army. As a result, he was defeated by Sanfanghara and even his substitute was beheaded. Jia Kang fled back to his castle in a panic. After calming down, he found that his pants were very sticky and uncomfortable. It turned out that he was incontinent because he was too scared on the road.
But at that time, Tokugawa Ieyasu was not overly immersed in the embarrassment, but instead asked the painter to record his embarrassment at the time and put it in the bedroom, always checking and remembering the lessons of recklessness.
Sun Masayoshi admitted that he had tasted the taste of failure. He wanted to see the image of this hero who had failed but later became a shogun, forcing himself to remember to learn from his mistakes.
Masayoshi Son said at the end of the press conference: "I'm sorry that the content I shared today is frustrating. But I hope to be honest and transparent to everyone."
For this once glorious leader of the huge empire, this moment of confession came difficult and precious.
begins to "cut the flesh" and recover the blood
In order to make up for the losses of investors, Son said yesterday that he plans to implement comprehensive cost reduction measures on SoftBank and its Vision Fund, "it will have to include laying off personnel, and I have made up my mind about this."
On the same day, SoftBank said it plans to sell part or all of its 9% shares in online personal finance company SoFi Technologies . On Monday, it sold another 6.7 million shares of the company at an average price of $8.17.
Previously, SoftBank sold its Alibaba shares through the " forward contract " in the second quarter and raised US$10.5 billion in funds; so far this year, SoftBank has sold more than half of its Alibaba shares, raising a total of US$22 billion. SoftBank has also cleared its stake in companies such as Uber, raising a total of US$5.6 billion.
Sun also said he has begun to consider selling shares in Fortress Investment Group. In order to support SoftBank's stock price , Masayoshi Son also launched a stock repurchase plan of up to 400 billion yen, which will repurchase up to 6.3% of SoftBank shares from investors.
Moreover, SoftBank's new investment in the second quarter was only US$600 million, a decrease of as much as 97% from the same period last year. Masayoshi Son said that he would not go against the trend like Buffett stocks: "I understand that people become impatient when prices fall and want to buy the bottom as soon as possible, but if we do this, we may suffer severe trauma that cannot be recovered.”
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