Tech investor leads £800m funding round into UK self-driving car software firm, Wayve
Japanese tech investor SoftBank achieved a second consecutive quarter of profit as it seeks to improve its performance ahead of major planned investments in artificial intelligence.
According to financial results released on Monday, SoftBank recorded a net income of 231 billion yen (£1.18 billion) in the first quarter of 2024, compared to a loss of 57.6 billion yen in the same period last year.
Despite this quarterly gain, it was insufficient to offset losses throughout the rest of its financial year, resulting in SoftBank experiencing its third annual loss of 227 billion yen in the 12 months ending in March.
SoftBank also saw significant returns on its investments, particularly in the UK-based chip designer Arm. Investors are optimistic about Arm’s potential to become the cornerstone of a new AI-focused strategy under the leadership of CEO Masayoshi Son.
Increases in Arm’s value do not directly impact SoftBank’s profits, as Arm is a subsidiary. However, the price of shares listed on the New York Stock Exchange’s Nasdaq has risen by 60% in 2024. Nikkei Asia reported on Sunday that Arm intends to develop AI chips with the goal of releasing its initial products in 2025.
Son transformed SoftBank into a leading global investor through strategic investments in internet services such as China’s e-commerce giant Alibaba, as well as its role as a significant mobile phone distributor.
Using his investment gains, the outspoken executive made a series of increasingly bold bets on tech companies and secured backing from Saudi Arabia for its tech-focused SoftBank Vision Funds. While the valuations of its companies soared during the tech boom of the coronavirus pandemic, SoftBank has since experienced a period of retrenchment following the bubble burst. Despite this, Son’s belief in rapid technological advances remains strong.
Last week, SoftBank spearheaded a $1 billion (£800 million) funding round into the British autonomous driving technology company Wayve. Additionally, Bloomberg has reported that SoftBank is in discussions to acquire the British AI chipmaker Graphcore.
SoftBank was anticipated to return to a loss for the latest quarter, but staying profitable could help Son justify additional significant investments. However, the Vision Funds backed by Saudi Arabia did not perform as strongly as SoftBank’s other investments in the first three months of the year. They declined in value by 115 billion yen, primarily due to WeWork, the office rental company that filed for Chapter 11 bankruptcy in the US in November, and which Son had vigorously and expensively supported.