SoftBank reports ¥1.12 trillion quarterly loss after data-center writedown

SoftBank reported a fiscal second-quarter loss of ¥1.12 trillion, equivalent to $7.1 billion.[1] It was the company’s first quarterly loss in almost two years, while analysts had expected an average profit of ¥129 billion.[1] The result also reversed its ¥347.3 billion profit in the previous quarter and its ¥2.5 trillion profit in the same quarter a year earlier.[2] For professionals tracking the company, the scale of the miss makes it important to separate the data-center charge from other reported gains and losses.

SoftBank recorded a $3.7 billion writedown on its U.S. data-center projects.[2] The company said the charge reflected changing requirements for existing and planned projects.[2] It wrote down non-refundable advance payments made to secure power-generation equipment for U.S. data centers.[1] SoftBank had paid $9.5 billion upfront, of which $2.9 billion went toward equipment it no longer needed.[2] The company also recorded losses related to non-refundable advance payments and modifications to signed contracts.[2] It secured rights to rebates of up to $2.1 billion on future equipment purchases, subject to conditions.[2]

The data-center spending and high financing costs were associated with a ¥597.2 billion charge.[2] SoftBank also recorded a ¥270.1 billion loss on the valuation of its Intel holdings and related derivatives.[2] In contrast, its Vision Funds recorded an investment gain of ¥85 billion.[2] These figures show that the quarter included both investment gains and substantial charges; they do not, on their own, establish how future results will develop. SoftBank also raised a record $56.5 billion in the latest quarter and fully repaid a $40 billion bridge loan.[2]

SoftBank shares had fallen by more than half since June as investors questioned its exposure to the AI boom.[2] They rose 13.9% on Tuesday ahead of the results amid a broader rebound in Asian technology stocks.[2] Separately, SB Energy faced a possible delay to a planned listing at a $50 billion valuation, and OpenAI is both a prospective SB Energy customer and a company to which SoftBank has committed about $65 billion.[2] SoftBank’s attempted acquisition of ABB’s robotics business was blocked by regulators following a national security review.[2]