SoftBank Group posted a net loss of 1.12 trillion yen ($7.09 billion) for the three months to September 30, missing Bloomberg estimates for a profit of 129.32 billion yen and reversing last year's profit of 2.50 trillion yen.
The loss stems from a wipeout in global technology valuations amid uncertainty over artificial intelligence returns. SoftBank booked a 597.25 billion yen loss in the six months to September 30 from realigning procurement plans for power generation equipment for U.S. AI data center projects.
SoftBank's Vision fund posted a gain on investments of 245.6 billion yen in the quarter, down sharply from a 2.755 trillion yen gain a year ago. The company logged an investment loss of 133.59 billion yen overall.
Financing costs rose to 461.9 billion yen in the quarter from a margin loan backed by its Arm holdings, bond issuances, and higher funding rates.
SoftBank's OpenAI stake, a major source of exposure to AI buildout uncertainty, retained a fair valuation of $99.6 billion. Doubts over AI returns intensified as investors questioned whether trillions in sector spending would generate adequate profits. The Democratic Party's U.S. midterm victory raised concerns over regulatory scrutiny of AI data center expansion.
SoftBank shares lost over a quarter of their value in the past month. China also blocked SoftBank's $5.4 billion takeover of ABB's robotics division.
SoftBank Group shares and the broader Japanese tech sector face pressure. Investors should monitor quarterly earnings revisions and valuations of SoftBank's portfolio companies as AI spending efficiency comes into focus.