By Kosaku Narioka


SoftBank Group returned to a net profit in the second quarter, supported by gains in its tech investments.

The Japanese technology investment company said Tuesday that net profit was 1.180 trillion yen, equivalent to $7.68 billion, for the three months ended September, compared with a net loss of Y931.11 billion a year earlier.

The result soundly beat the Y199.3 billion estimated net profit in a poll of analysts by data provider Visible Alpha.

SoftBank's Vision Funds business swung to a profit of Y373.14 billion from a loss of Y258.86 billion in the year-ago period, driven by gains in its stakes in e-commerce company Coupang and ride-hailing company DiDi Global. Gains in its stake in T-Mobile US also helped the quarterly earnings.

Its bottom line last year was weighed by losses related to office-sharing company WeWork's bankruptcy in the U.S.

SoftBank's earnings are susceptible to fluctuations in tech stocks. It reported a first-quarter net loss after two consecutive quarters of net profits.

The company and its tech funds have started investing more aggressively in recent months after a yearslong defensive strategy, as tech stocks have risen thanks to artificial-intelligence enthusiasm and the Federal Reserve's rate cuts.

SoftBank invested about $500 million in OpenAI when the startup behind ChatGPT raised $6.6 billion in a recent round of new funding.

In October, SoftBank Group Chief Executive Masayoshi Son reiterated his bullish forecasts for AI, saying he believed artificial general intelligence, in which computers have human-level cognitive abilities, would be achieved in two to three years.

Subsidiary Arm Holdings last week posted a quarterly net profit of $107 million, compared with a net loss a year earlier, boosted by sales of increasingly complex chips crucial for AI applications.

SoftBank Group's stake in Arm now makes up a big chunk of the Japanese investment company's portfolio after it cashed in on its stake in Alibaba Group Holding over the years and reduced its concentration in China.

SoftBank's stock has gained about 50% this year, fueled by enthusiasm over rising AI-related demand at the company's investees, including Arm.


Write to Kosaku Narioka at kosaku.narioka@wsj.com


(END) Dow Jones Newswires

11-12-24 0333ET