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SoftBank returns to profit after 3 quarters of brutal losses — but says revealing actual operating profit 'not useful for investors'

Masayoshi Son
SoftBank CEO Masayoshi Son.

Koki Nagahama/Getty Images

  • SoftBank on Tuesday reported a $12 billion quarterly profit.

  • The results buck a trend of heavy losses at the prolific Japanese tech conglomerate, which declined to disclose a key financial metric.

  • CEO Masayoshi Son told investors the company was now in "defense mode" and hoarding cash.

  • As typical of his often eclectic presentations, this quarter's featured Samurai warriors.

  • Visit Business Insider's homepage for more stories.

After three quarters of heavy losses due to bets on money-losing tech firms like Uber, Wag, and WeWork, Japan's SoftBank said Tuesday that it had turned a profit during its most recent quarter.

The prolific tech investor recorded a nearly $12 billion profit for the quarter that spanned April though June, its fiscal first quarter, fueled in part by selling Sprint to T-Mobile earlier this spring. The results upend an annual loss of $9 billion the firm reported in March.

"Of course this is not perfect because the second wave of COVID-19 pandemic is not over yet," CEO Masayoshi Son said on a conference call. "So it is not that we can guarantee that this -- the performance of Vision Fund  — will remain positive; I cannot say so, but it is getting better and recovering."

Despite the results, Softbank also said that it would no longer disclose operating profit as a separate metric from net income. The measure is "not useful in appropriately presenting the consolidated financial results of a strategic investment holding company," it said. Usually, operating profit differs slightly because it can exclude certain expenses like taxes and other one-off charges.

SoftBank has decreased its massive debt load in recent months, which was partly brought on by stumbles in its $100 billion Vision Fund. At the same time, it's seen sales increase and its cash reserves rise. Positive results from portfolio companies like Alibaba — whose founder left SoftBank's board in June — and Uber, also helped fuel the recovery.

Softbank CEO Masayoshi Son Samurai Warriors
Son's presentation featured multiple images of Samurai warriors to accompany its new defensive tactics.

Softbank

Defense was a big topic of Son's presentation, which opened with scenes of Japanese Samurai soldiers — a metaphor for cash, apparently.

"I believe cash is actually the defense for us," Son said. "So by having our cash on hand, we will be able to enhance our defense power with that."

Shares of SoftBank, which trade in Japan, closed down about 2.45% at the close of business there Tuesday.

"Even at the time of a global financial crisis, Lehman crisis, and the COVID-19, when the situation is quite unstable, we always try to the term cautious and conservative," Son said.  "And that is the attitude we would like to take once again this time."

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