Financial Data and Key Metrics Changes - The company reported a net income of ¥1.8 trillion for the first half of the fiscal year, a significant decrease of ¥360 billion compared to the previous period, effectively representing a loss of ¥6 trillion in net asset value (NAV) [5][6][10] - The NAV decreased from ¥27 trillion to ¥20 trillion, with Alibaba's share dropping from 60% to 28% of the total NAV [10][11] Business Line Data and Key Metrics Changes - The Vision Fund accounted for 44% of the total NAV, showing growth from 16% in the previous year, while Alibaba's share significantly decreased [9][10] - The Vision Fund lost approximately ¥1 trillion in the last three months, but cumulatively it has gained ¥6 trillion since its inception [16][17] Market Data and Key Metrics Changes - The U.S. market showed steady growth, while the Chinese market, heavily influenced by Alibaba, faced significant declines [11][21] - The company's loan-to-value (LTV) ratio is currently at 19%, indicating a safer financial position compared to previous years when it reached 65% [13][15] Company Strategy and Development Direction - The company aims to increase investments in Japanese companies, with a focus on AI unicorns, despite currently low numbers in the pipeline [50][66] - The strategy includes a share buyback of ¥1 trillion to enhance shareholder value, taking advantage of the current discount in NAV [43][84] Management's Comments on Operating Environment and Future Outlook - The management expressed optimism despite the current challenges, referring to the situation as a "blizzard" but noting potential growth opportunities [5][41] - The management highlighted the importance of maintaining a disciplined financial approach while exploring new investment opportunities [84][88] Other Important Information - The company is focusing on diversifying its portfolio and reducing risks by investing smaller amounts in a larger number of deals [54][55] - The management acknowledged the challenges posed by the regulatory environment in China but remains committed to investing in AI-related companies [80] Q&A Session Summary Question: What is the investment policy for Japanese companies? - The company aims to increase investments in Japanese companies, with the first investment made by the Vision Fund and more expected in the future [50] Question: What is the commitment for SVF 2? - The company plans to maintain a commitment of about ¥100 million in investments annually, considering LTV and other key performance indicators [52][53] Question: How does the company view the regulatory environment in China? - The management is concerned about the regulatory environment but believes that the risk is manageable due to the reduced percentage of Chinese investments in the NAV [88] Question: What is the outlook for PayPay? - The management is confident in PayPay's growth potential and aims to turn it profitable soon, despite current losses [69] Question: What is the company's view on the market environment for Japanese startups? - The management sees challenges in Japan's startup ecosystem but believes that success stories will encourage more young entrepreneurs [94]
SoftBank(SFTBY) - 2022 Q2 - Earnings Call Transcript