Shares of Japanese investment firm SoftBank (TYO: 9984) are down nearly 5% after the company reported a record $32 billion U.S. loss at its Vision Fund that primarily invests in technology companies.
The $100 billion U.S. Vision Fund was launched in 2017 under the stewardship of SoftBank founder Masayoshi Son.
The Vision Fund and shook up the technology investing world with big bets on high-profile firms such as WeWork (WE), Uber (UBER) and numerous Chinese tech companies.
However, many of SoftBank’s investments have turned negative coming out of the Covid-19 pandemic, resulting in escalating losses for the Vision Fund.
The Vision Fund also suffered due to Beijing’s crackdown on China’s tech sector and subsequent plunge in share prices of companies such as Alibaba (BABA) and Baidu (BIDU).
While there has been a recovery in tech stocks this year, most securities remain well-below their 52-week highs following a big selloff in 2022 known as the “tech wreck.”
Technology stocks have faced headwinds over the last 18 months from high inflation and rising interest rates used to bring consumer prices lower.
To help stem its losses, SoftBank has been selling its stakes in Alibaba, the Chinese e-commerce company, as well as American ride-hailing company Uber.
However, the company says it is now preparing for its next big investment opportunity in artificial intelligence (A.I.).
SoftBank is also planning for the initial public offering of Arm, the British chipmaker it acquired in 2016.
Arm has filed for a listing on a U.S. stock exchange in the coming months in what is expected to be one of the biggest stock issuances of the year.
SoftBank’s stock has declined 2% over the past 12 months.
