SoftBank reports first-quarter income slide, gain on Intel stake

TOKYO, Aug 6 - SoftBank Group reported an 18% decline in first-quarter profit, supported by gains in its Intel investment despite no valuation boost from OpenAI. The company recorded a record net income of over $31.7 billion last year, driven by the increased value of its ChatGPT holdings. With growing interest in the AI boom, investors are closely examining the financial health of Masayoshi Son's SoftBank, which is heavily invested in AI-related companies.

CFO Yoshimitsu Goto acknowledged concerns about AI data center buildout bubbles. SoftBank reported a net income of $347.3 billion in the April-June period, booking investment gains of $1.86 trillion, primarily from Intel shares. The company also gained from its stake in ByteDance, TikTok's parent company. SoftBank's stake in OpenAI, valued at around 13%, will reach $64.6 billion by October, with total investment gains amounting to $45 billion.

SoftBank secured a $10 billion loan in August, using its OpenAI stake as collateral. The loan talks had earlier stalled due to the difficulty in valuing OpenAI, as it remains a private company. SoftBank has arranged margin loans on its holdings in Arm and SoftBank Corp, totalling $27.4 billion. While SoftBank's net asset value peaked in June, it has since dropped to 58.3 trillion yen as of August 5.