Q1 2023 SoftBank Group Corp Earnings Presentation
Okay.
Thank you very much for waiting right everyone.
Now we would like to start the Softbank group called the earnings result announcement for.
That's a three month period ended June 30th 2022.
First of all I would like to introduce today's participants.
From lift.
We have masayoshi son, Chairman and CEO .
Sure.
[music].
You shouldn't need to go talk board of directors and CFO .
[music] Cosmical kidney Rhonda <unk> senior Vice President and head of accounting.
Today's announcement is live broadcast over the Internet.
Now I would like to invite Mr son, Chairman and CEO to present, you the earnings results and business overview of Softbank group.
Let me say something.
[noise]. If this is masayoshi son from cell phone. Thank you very much for your time today.
So today and now the market in the world is in a bit of confusion.
And today, Oh, we have a big loss of Softbank group.
I would like to announce today.
And let me explain you the detail.
Yeah.
First.
It's occupied Duane Musk I would like to share with you destroying.
This is.
Oh, absolutely yes.
Ex playing you my feeling up today.
This is poultry del Taco go out yeah, yes, Sir.
She.
Actually made a big close against Tucker Dusting again.
And came back is the.
Most of the bundle and came back.
And the background of that.
Actually.
Well, then they'll but naga that Eli.
[noise] wasn't made we sold that nobody Naga.
And.
They eat took forgot about yes, it had to face.
Facing with Takeda Sheen game, which is much much larger.
Army done theirs.
And most of the allies actually said this is going to be losing but also about today should not go for it but talk studies. They thought the state at the castle Howie about Taco go yes, it didn't want to lose his face so that the he get out from the castle.
How that battle made a complete loss in suffer and came back.
In that.
Oh actually Hum.
Okay.
None lesson and she.
Try to remember and to remind.
He's on the earnings.
And put it into destroying.
Yeah.
So this is called Scammy Joel.
As a phone.
Asked about the Nicaragua Hydra, so since the foundation of Softbank group.
I made that two consecutive caught us loss, so previous quarter and this time quarter consecutively.
We made a three trade union lever of the loss.
So in total <unk>.
Two young young those was made in the past six months.
So I believe I need to remind that myself and.
I'd like to remind remember in I'd like to make it a rounding to myself.
So today I would like to take this opportunity to share with you. The current status of the company in the business.
Eight.
Yeah.
Since I graduated.
I never had my boss.
So every time that they received a report from my people so when they buy.
There is a bad result.
And.
Meda excuse tried to hide the about the results that actually is not a good to report that made me even.
More upset yeah.
Experienced that from my past so when they bought the situation is not good.
It wasn't there, but the result is not good right.
Think that the we should be open book and explain to you.
Alrighty, So that's why that I would like to.
Make sure.
Well that that we are.
Sharing you the current real estate us of the company.
Like I said this quarter three.
Three trade Union loss.
Previous quarter about to Judy on your loss. So in total I said six through Union earlier, but that said these are five to union those previous yeah. We made a five two union game.
So actually about the same liver of D. A.
<unk> has been lost.
So when we record the big game.
I actually was very proud of myself.
And when I look back I bit embarrassed and I learned a lesson.
So the factors of loss there are two things one is the global stock market turmoil and the other is that rapid fall or begin.
In the meantime.
In the past three months NASDAQ composite index, a decrease by 20%.
B J O fund public stock index.
In the same period it declined by 31% so compared to NASDAQ actually digital fund public Stoke went down larger.
Because those are the public so you can see the buttery everyday so looking at those values.
Yeah.
Andy who he put it into the index points.
In the same period, while NASA declined by 22 hours declined by 31%.
Quarterly a gain and loss on investments at beech oven funds last year.
A year ago.
We've made the big game.
Compared to that moment.
The past two quarters.
We made.
About three trade Union Liberal the loss risk.
Respectively in cumulative.
We are not yet loss.
Your own funds.
Investor demand.
The gain that they.
Record so far that the UC the two peak like chemo.
The first peak.
That was the vision fund one.
And that declined.
That was due to we walk back then well ubah.
Untrusted.
Uh huh, not doing well performed I P O.
But still that the we were able to increase a bit of the baidu.
Hum to extra the.
Started at the bottom of Beach on fund one with our own money on balance sheet, which is about one year ago, and why we're able to contribute to the increase in value.
But in the past six months actually those old games has are gone.
So stable to union mutual funds game.
Actually came down to almost zero.
Yeah.
To be Super specific this blue part that shows value of vision fund one.
Vision fund one.
So loss and gain.
And.
Still have a gain from the vision fund one.
And especially listed.
Companies that vision fund one invested.
Exit dead when.
They'll buy the issue and what's a high so D vision fund one we're able to.
Recorder.
While the issue on game.
Yeah.
But.
Pink shows vision fund two.
Vision fund to invest in most of the business as.
That are not to list to do yet.
So a nonpublic.
Investments.
If you.
Baidu them against the market.
We have recorded by the Asian thus.
And the green indicate that some fund.
And that fund is now integrated vision fund two.
And a lot more.
Fund, so big loss Jude.
You too.
But the he shouldn't loss that we recorded.
For vision fund two ora.
Nonpublic vision fund one investment.
Be sincerely.
Kevin Kevin you did bother Evesham loss.
And as a result.
Vision fund to choose and that some you can see a huge loss here to be more specific on the left hand side of this well result as of end of March this year.
Gang was six seven Julien or 161 companies so.
Jean.
And 171 companies assault loss and Hunter 17 companies So no change.
So gain by $6 seven two young lost by three six Julien. So net net we still had three two in yen.
Uh huh.
Unrealized gain but.
As of end of June .
119 company so by the he Shang gain whereas 277 companies saw.
While the Asia loss.
And gang 5.1, Chilean law, so five Julien.
So cumulatively.
Three months ago.
Unrealized gain was street Julien.
But in the last three months, we almost lost.
That.
While the initial gain so a more companies so lost game too.
To be even more specific.
As of end of June .
Yeah.
Listed companies.
So.
Finally, he shown game, but.
As you can see.
35 listed companies so by the Asian loss.
Was one seven Chilean.
And now most EDA companies.
Even though they are not listed.
The calculated out by do you looking at.
Comparable businesses in the market.
And we decided to record filed.
While the issue of loss.
That was about one to the yen.
For nonpublic companies.
And.
Okay.
Performance of portfolio companies.
Turned out worse than anticipated because of that we also recall that by the ancient loss 256 volume.
So underperforming companies and public companies and nonpublic companies.
We recorded a realized excuse me.
The Asia loss the total three point to one Chilean marked down.
In terms of whether or not we recorded for the Asian loss. So according to our corporate rules, even though those companies are not the listed we.
Recorded by the Asian loss.
And foreign exchange, yes.
As you know yen has gotten weaker.
Very rapidly.
And half of our borrowing U S E.
Dollar dominated and remaining borrowing is in yen terms borrowing in yen trauma.
Well be right.
Paid back in yen. So it should not have an impact on our gain or loss, but.
Boring in dollar churn.
If you calculate in yen, we have to record the impact of increase in the yen amount or.
Foreign currency denominated net debt of companies in Japan.
After tax.
We don't fund loss was 2.3, Julian yen and.
Due to foreign exchange loss.
Total.
Loss was three point once your line yes.
Market cap is nine Julian but in only three months, we recorded three Chilean yen of loss.
So I would say that that loss is the.
The biggest in our corporate history.
And we take it very seriously.
And our most important indicators.
Our two indicators one S.
Net asset value.
What Nab.
And the other one as loan to value or L. T B.
Okay.
How much net debt we have against.
The value that we hold so those are the most important indicators.
And then in net on that does it value.
If you see on the dollar base in past three months, we have decreased by 16 billion U S dollars.
So close to about two trillion yen or so in the past three months.
So 150 won't be the only came down 235 b the one so almost 10% down.
However, when you look at on the Japanese yen base than 18.5 to Union and 18.5 G Union. So as I mentioned earlier, a accounting loss was three two year on year, but it does it bother you on the Japanese yen days actually no.
So it's even flat in three months.
So.
Does that mean that the we don't decrease in it and that doesn't value extra the U S flat from the Japanese yen level, but if you go more in deep.
I said in the other basis decreasing.
So the.
As a result of the depreciation there'll be in actually about two point due to union what saved due to the Forex impact so in our depreciation is.
Good or bad for Softbank group actually for the accounting point of view.
It was the reason for 820 billion yen loss a reason so that's the.
Buddy issuance hold the net debt.
So 820 billion yen loss, but if you see it and it does it bother you in Japanese yen as a result of the depreciation Libyan actually eat.
Walked positive for net debt it's buddy.
So now.
<unk> see fugazi on the accounting loss or do you would you see a net does it bother you.
That's I believe it's up to you me.
I believe it's more important that we focus on that does it bother you see and that I believe he was helped due to the foreign exchange and us.
Oh, almost everyday that the we are checking on it does its about you as a flat for us.
I shall report so when we see the batteries old we always share the bad situation. That's my policy so as of today.
So that's the end of June but as of today actually we have.
Worsened by one to union from there so 18.5.
Almost coming back down to 17.5 Btu Union, so that that I like to also share are you. The current status of ours. So actually the situation is a bit worse than that of gin and.
I just mentioned that than it does at the value is more important index for us when compared to the time of peak.
Actually for the quarter to quarter basically was flat, but the compared to the test actually has decreased by about 10 to D on yen or so.
The reason.
You can see in colors yeah.
Alibaba.
Okay.
Is in Orange.
This portion.
At the peak.
It was about $300 per share.
As of today, it's $90 or so per share.
So it's almost a one third.
So the reason that we have increased our net asset value and the reasons. We decrease the net asset value is mainly due to Alibaba as I mentioned earlier about the visual and funds, but the beach on funding cumulative calculation was it's almost breakeven.
We had a bit of a gain in the past, but now it's almost flat.
Uh huh.
Back to the time of peak.
The reason, we have increases because thanks to Alibaba and the reason that the glaring from the peak is also due to Alibaba.
So that explained in our bars in Orange, So if no impact from Alibaba All study that is making a good trend, but yeah actually the major impact to our net does it Buddy easing increase and decrease both coming from Alibaba.
Andy.
So we had a quite a bad result, but the only one.
Positive highlight.
He's willing to value which is improving.
Loan to value.
Is the net debt <unk> equity value of holdings.
Which we always tried to manage our loan to Baidu list, some 25% even in urgent situations, where you'd like to manage this and 35% that's the financial disciplines at the we've been communicating and that's our financial policy.
Of ours, and that's an important index for hours and.
And because the market is really a volatile so that the U N. A worried that the launch of body may increasing or exceeding or about 25%.
But this is something that we can control by ourselves equity market cannot be controlled by us easily what we cannot control of Tau of course, if we made a bad investment.
But it will decrease but the this downturn, but there is something that we can control to some extent as we promised with the market. We are working to improve the loan to value down to 14.5% now.
So six months ago, well before even before then.
We being in defense mode, which we have communicated to you and the we've been keeping this mode defense mode to the to date no.
The financial policy are in addition to loan to value is the cash position.
So liquidity or the cash position on our balance sheet are that the we always tried to maintain to cover two yeah redemptions of the bonds.
So that's something that the way you would like to maintain on our balance sheet. So that's the.
Cash position policy that we have.
For that actually we have.
More than double of the amount of one <unk> on our book, So we being a strictly following our own route which is to be in defense mode. At this moment loan to value is a decreasing and that the.
That may not be something that the we are weekend too much proud, though because equity value of holdings.
It's been decreasing from 32.1.
Trillion yen down to 21.7 to Union. So do your asset has decreased by 10, two union and along with that and it did.
Pets being decreased.
So far the trade union net debt being reduced down to three point wine truth Union. So it's a three or five as a result loan to value being improved.
So we have a fluids cash position.
And reducing the net debt.
And that.
<unk> decreased our assets are in the other hands by tend to union, but actually we have decreased our net debt. So that's why that that that leads to.
14.5% have loan to values.
And.
That is actually showing up.
A real Oh picture.
Of the company.
Yeah.
Now, let me talk about Softbank Vision fund.
Okay.
Softbank has become effectively investment company.
And Vijay on funds are our main vehicles.
To do that.
So far.
Softbank vision Fund's have invested in 473 companies I mean, the AI they eat at Unicorn.
Those are a very important asset for us for the future.
All 473 companies few.
Future Alibaba, while future Army.
Yes.
Okay.
I hope we will be there.
But you never know.
That said under the current circumstances.
Okay.
Of the 473 companies that we haven't we.
We believe that some of them will play a key role and AI revolutions in the future. That's why we are committed to supporting them.
Yeah.
They're all other things.
All of the lessons we have.
To learn.
Okay.
But the meeting with those.
Companies.
For the future.
Listening from them new business models.
I keep impressed.
And believe.
In them that they will make a difference in the future. So again our.
Belief is.
Not changed.
We talked about the first peak and the BOP Tama interim myself vision fund performance in the past and when we started we don't fund to choose.
Okay.
We decided to start with our own money.
Okay.
And we decided to take even bigger risks.
So that we can pursue our vision.
How have we done that.
Again, vishal funded shoe with our own money.
Started.
About one year ago and in three months.
We invested over 20 billion and the next.
Quarter, we invested 2 billion, followed by 9 billion investment in the next quarter.
So.
In total.
In the last nine months, we invested in almost five Chilean E M.
Mostly by Vision fund two and some buy lots of fun. So as you can see we have been very active in Germany saw the investment with vision fund two.
Yeah.
However.
We don't fund two as I mentioned earlier.
Recorded a huge loss.
Mainly.
By the Asian lost that to be calculated internally.
You Shuja.
And that's something that we did.
Since six months ago, or even nine months ago.
We have been.
Defensive as oppose to a phone server.
In such a defensive mode.
We have been.
More selective in making investments and we made that announcement.
And.
Six months.
I go.
Yeah.
Because of the huge investment.
While the Asia loss, we recorded four new investment be.
We have heightened investment discipline since.
Since the market is hurt.
And some people may say that now is the time to buy as opposed to just sell well, sometimes I feel like that I agree with them. However.
Remember the portraits all the Taco Gaba Eas I showed you.
At the beginning of the presentation.
His face.
Frowned face.
Yes, actually my face, we have a vision and the vision remains the same.
Yeah.
But if we.
Pursued the vision right.
Closely.
Mi ends up.
Losing big.
That's something that we have to avoid it.
So that's why we have a strong discipline in terms of L. T V, making sure that we have liquidity to cover two year Ruth with bond redemption.
We have to control ourselves, even though we sometimes feel that we want to invest in the market that.
Hats.
Tanked.
Because we want to make sure that do we.
Won't lose big.
So I have to we have to cope and myself to make sure that our investment that discipline.
Works.
For Softbank Vision fund.
We know that we have to reduce operational costs substantially again visual remains the same.
Our beliefs remained the same.
Yeah.
But.
Like it or not.
We know that we have to reduce operation costs.
For new investment.
We have to be more selective.
470 companies that we have already invested in.
Without new investment.
We need to focus on enhancing the value of the current portfolio.
So those are the things that we have to focus on at the moment.
Yeah.
Now talking about arm.
In recent month.
I talked a lot about the positive news around our island.
But again this time.
I.
And not in the positive.
Mode, and I need to speak little key in terms of army things are going well.
That's all I can say for sure about arm today.
And the vast but then not the least of let me share with you.
Something about <unk>.
Share repurchase program at nine.
Nine months ago, we established this one children yen all the share repurchase program and a V.
Have achieved a 70% in nine months.
Okay.
As you remember.
When we made the announcement of a share repurchase program.
Every time, we make such an announcement.
Remember, we delivered it as we announced and promise.
For this time.
We made announcement with some.
Caveat.
Attached.
Which is loans.
The loan to values not exceeding 25% and.
Making sure we have liquidity to.
To cover two years all of a bond redemption.
So the remaining 30%.
Until the end of the chairman.
May not be used up however.
Still.
Okay.
Even though we not may not be able to reach 100% all one Chilean yen and three months, but we are still committed to.
Repurchase shares up to one Julien so from today.
For our next 12 month B have you the.
Authorized share repurchase program at.
All 400 billion yen.
So that remaining.
30% or 300 billion yen about even though being.
Mont.
Use up all that.
300 billion yen buy and buy excuse me November eight.
We still commit data shoes.
Repurchase program.
Repurchase shares up to one Chilean him.
But are the most priority as our financial discipline and financial policy L. T V, 25% and liquidity up to two years all the bonds redemption those are the disciplines we keep.
And if we can keep them.
Within 12 months.
We will repurchase shares.
Up to 400 billion yen.
Again.
Keeping our financial.
You'll disciplines.
The.
Now have a newly authorized share repurchase.
All four.
400 billion yen programmer.
So that's all from myself. Thank you very much for your attendance.
Now we would like to take questions.
First of all you would like to take questions from the floor.
Please wait for the microphone and stocks with your name and affiliation.
For those who are on Xyrem.
Please press raise hand button and wait for your name is called.
Yeah.
If you would like to withdraw your question. Please press more hand with them.
Yeah.
We would like to take up to.
Two questions per person so that we can take questions from as many people as possible. So now we would like to take questions from floor.
Yes.
I am Nakayama from Toyota Kids I have two questions one.
So you said you learned.
Listen.
And investment scheme in business method.
Any specific parts that they you regretful you learned.
From this and the second a question that you have been increasing the afford transactional lease Alibaba shares I believe that Alibaba being you're using a full cloud at all.
And I would like to hear you how your policy for Alibaba shares holdings.
So the lesson I learned.
Our so many.
A but the whole vision fund one.
We are making a big swings.
<unk> D D.
We work.
We had.
Bend.
Almost one two year on year Liberal the investment case.
So.
We'd be making a big swing and couldn't hit the ball.
That was happened in the B zone and find the one because my.
Feeling was very strong my emotion was very slow to a specific companies or business. So that's something that I learned so we became more systematic and also smaller tickets and tried to make sure that we have a better profitability.
<unk> individual funds too. So that's why the buoy became that readout. They believe smaller ticket size in mutual fund two compared to vision fund one so rather than aiming for the homerun, but try to aim for first base hit sitcom Hey.
The base hits make sure that we have a good hits.
In the not too.
And most of the lead table, it's too much.
By myself, but the we sit.
Experts by region by six does and systematically.
We view the investments cases, and that made us more comfortable and being more confident to able to invest in digital one two so that is why fiscal 'twenty one.
In nine months, we have invested about five trillion yen level.
And we thought that the we can hit.
And also we thought we did made a about type two junior and lever up the games about a year ago, So where you have quite confident in.
And maybe where you are.
Veto vote about the Moon.
So although that we are making a small.
Thing, but the we were on the too many swings there.
As a result that led us to be a quite a large but the actual loss.
Of course market was not very good.
Because of some of our is happening.
Covid hits, there are many excuse I can't make however.
That's still the excuse.
I think that we should I should.
Uh huh.
Learn the lesson and be more selective.
For the investment activities, we shouldn't have.
This much damage and also.
But the Asian.
Four unicorns was so high in fiscal 'twenty one.
Because of.
Many people worried.
About Covid, however peoples for the market start thinking that we may be able to easily get overweight. The COVID-19, so that and our people are using more online services and those companies actually increased its valuations so that.
He is right that the evenly PE invest in high by the issue of all such unicorns, but the we thought that that that's a something that the weekend.
Get a good return.
Although at the each respective cases are so relatively small ticket size. However, we did many.
More than we.
Suppose to invest and if you pay inexpensive Ah it companies.
And then that you may have a high REO activity high possibility of losing.
So I believe that we have was where you are on the kind of a bubble.
And by the Asians.
That's all.
Yeah.
My responsibility.
As a commander.
Of course, I mentioned it became a systematic way of investing decisions. However, I was leading this systematic ah investment decisions.
And I Love our participated in this systematic investment decisions. So I believe that's something that Oh, my faucet, a responsibility and not the others anybody else, but me.
For your second question regarding Alibaba transaction.
There are several.
Derivative transactions.
We then.
Executing for our financing.
Got it by myself.
As a result of such a transaction.
We were able to have a good liberal cash position that I explained to you earlier. So this became a good source of all such cash position.
But.
When it comes to the.
Shepard I somebody Bubba.
Our financial position are those who would be the kind of factors that we always need to keep in mind to consider the father transaction late in the future.
Next question please.
Yes.
Nakajima for mature towards finishing I have two questions first.
Yeah.
You keep saying that you learned.
Painful lessons.
In the meantime.
You said that you believed and everybody issuance in the future.
From your perspective, how long this kind of a situation will continue so how long will you be.
I'll stay vigilant and selective in new investment so how long will this winter period. If you will continue I don't know whether it be three months three years.
Yeah.
When.
Real piece come back to grain.
We don't know.
In Taiwan and China.
Yeah.
Me.
Have to be concerned about tension between China, and Taiwan, and COVID-19 has not been completely com under the circumstances.
We are also suffering from.
Huge installations around the world.
In order to curb inflation.
Central banks.
Okay.
Globally have to raise interest rates.
And usually.
In such.
Circumstance.
The stocks.
Uh huh.
Soldier.
Big.
So from Investor perspective like us.
You have to say we are in winter.
Many people May think is the time to buy.
Including myself.
Some people.
Let's say that full list of the company's values is reviewed every day, but they set of companies their values are not reviewed every day.
So by the vision of our company.
When.
They may divest.
Financing.
There are still many business leaders.
That they can finance.
At the higher valuation than the last financing around.
So.
Current situation is.
That.
And they set of companies.
Volume is higher than it should be.
Even visit of companies before I P O.
Hey, boosted about their high valuation, but after the listing.
So huge loss of.
And thereby the Asians.
In fact.
Our vision fund so huge wildly evesham loss.
But unfortunately.
Unicorn companies' leaders still believe in that by the Asians and then they would or not.
Except the fact that that they may have to a seat on their valuation.
Laura than they think.
Sure.
So until the multiple.
Oh and elicit a company.
Yes, Laura done multiple of listed companies, we should wait.
So.
They said accompanies winter.
Is still continuing but unless it accompanies winter maybe longer than they said accompanies a winter.
You mentioned operational cost of reduction for vision fund and how much are you going to reduce operational costs, especially.
Our talent.
When it comes to funds it's sometimes.
It requires a lot of money to attract good talent to make a good investment.
Unfortunately.
Since our investment amount is smaller.
Source for it in your investment should be smoother.
Then you can't have too many.
Investment teams.
So vision fund.
<unk> count.
May need to be reduced dramatically not only vision fund but.
Corporate Liza.
Since we have been seeing a huge loss.
We have to reduce cost.
In our own company I wont say.
In figures or numbers in terms of cost reduction, but group wide cost reduction has to be.
Dumb.
Independent elicit a companies like Softbank KK and the Apple of course, they have to make their own just decisions.
But softbank group as an investment company has to reduce costs dramatically.
Oh, well take our next question.
My name is Heuga from Bloomberg. Thank you for your presentation. Today. My first question is about cost reduction and you just mentioned the second point. These are question is about the governance.
So you see.
Oh. This is the first time, you explain or you express your idea of reducing the human resources in the vision fund, but the in region.
Europe Asia, China, Japan, United States, which regions are you going to target for and also there are managing partner level senior level or do they also be us a target right now I believe there are 400 some people.
You can be doing fun, that's my understanding and you said that you are planning to have a large reduction of the resources in vision Fund do you have a rough idea of how many or how much.
About the size.
We are still.
Oh discussing internally, we haven't have a clear view yet.
But the.
There is no sacred.
Areas are so we have to review everything.
The first.
Is to keep a defensive mode.
That's been our.
Ah.
But it is from about nine months ago, and that will be maintained and execute.
As for financial policy.
We have loan to value index cashed position index. Those are the ones that we see as a reference for defense mode, but the next things that we need to do is to reduce the cost operational cost. So that's something that we should be focusing so.
Region, There is no and he say good region without any.
Exceptions seniors juniors or.
Golf is or front end without no exceptions that the world will review.
So following up to that answer you.
You have.
For investment's already been made in Japan, and you have about 10, or so resources or people or is that going to be the target as well.
I don't like to make how many from <unk> or anything like that here, but though again without any exceptions of where you would like to.
Consider and review the cost reduction.
So no comments on the size of the reduction.
No.
That's something that we are discussing internally right now and my second question is about governance.
These days are you been losing a management liberal the resources from the company Mr. Sokol, Mr. Marcello Clara two of them have lift.
And Mr. Rajeev Misra.
Ah I understand that he's a role has been changing so from the stakeholders point of view, who is doing what is also important for us to understand and they need to communicate that to city and that's what I missed that Rajeev misra.
What is he doing what is his role right now and what is the change from now to then and Oh. So how you feel about those people, leaving the company.
Yes rajeev.
Yeah.
E C O Softbank vision fund one.
That will be the same no change for that we have oh thoughts about the investors L beef and he is one of the key men.
He was he himself and myself are the key men.
And in the construct we stores little piece.
He stays as a key men for this fund.
So he.
Yes.
He understand and wish to fulfill these his responsibility.
So that the and at the same time cellphone regional funds. One has ended its funds period about though he may have some follow on investments to those existing investments.
It's gonna be very small amount, but oh, we would like to.
Yes.
Have him monitor in my knees are those that the.
Private companies that are in visit by Vision Fund one and also any follow on investment for the existing portfolio companies and be jump on one.
In addition to that the exit of those portfolio needs to be managed as well so that to be.
Covered.
His role for visual fund, one as will be the own funds too.
Which I said that that have a lot of lesson learned.
I E will be.
Working together with our managing partners there are tens are some.
Wendy's and putting ourselves so that the we love to work for vision Fund two.
For any new investment for vision fund two we are very selective. These days so that the our focus is going to be mainly that existing portfolio companies and also the AR for the warrant investments were those any new opportunities.
And occasionally you're going to be very selective.
So that the even though we're gonna reduced some resources, but still we believe that they will be able to keep the steady operation of the fund.
I want to add a little bit color Oh, what you just answered so Mr. Misra.
He's been involved in vision fund two but he will not be commit in the mutual fund to ease up my under is my understanding correct.
She will be.
Involved to some extent.
However, he will.
Not involved.
In mutual fund to us CEO of visual pun too high.
We'll be the C E O B, Joe fun too and they grew the elite.
So rajeev he's going to be support.
Supporter for vision fund two.
If that's the case.
Uh huh.
When we see the financial report of Yours.
The commitment by the management to be doing fine too.
It's right now.
You are the one for that but the I understand there is no any explanation in the financial reports of the hospital a group called.
But is that is there any opportunities that you're looking for that the other management, putting our money in mutual fund two or anything like that.
I will be the lead.
For the visuals on to you. Thank you.
Yeah.
Next question.
Still from the floor.
Each of call off from the Yomiuri newspaper. The first question is about portfolio companies 470, something.
And you're in the face of believing in damages that but other than just believe do you have any specific.
Ah things that you have in your mind for example challenges that have.
Are there anything that's S.
<unk>.
G support.
For them or.
Yeah.
You will be more hands on the hands off for the portfolio companies.
470.
Five companies.
Most of them are invested by Softbank is my Thunder Chew.
Vision fund one.
Invest in about 90, and mainly ticket size are very small for example.
Yes.
The ownership is about 5% to 10%.
So we are as a minority shareholder.
Supporting those companies.
So.
Hands on or not.
While turning around those businesses for example is not something that we think we.
Should a June .
Rather we may give some devices or b.
We may.
Make suggestions to.
Daily versus synergies, we have to do but we are not hands on if you will.
Rather.
Those business.
On Earth.
Our supported by banner.
From redo, our expertise and with.
Some financial.
Support.
But going forward not necessarily where the financial resources, we would like to support them with our expertise and advice.
And our.
Teams.
[noise] dedicated teams.
We'll.
Work closely with the derma.
She gave support for them.
Instead of a.
Investing in new companies.
Well the supporting those portfolio companies over with our teams.
The second question is around that when they need it.
Not the negative, but I'll have something positive I'd like to hear from you.
Softbank, KK and Z holding what's.
The strength.
Obi you by having those are companies yes.
Have great strength, and we have 475 companies in our portfolio.
And most.
Most of them.
Girl.
50% or even higher.
Our year. So they are still in a growth phase.
And.
There are.
Many companies that have great technologies and great business models.
So our <unk>.
Softbank, KK and our Yahoo and line in paint me for them those portfolio companies.
Our jewels.
So.
I believe that we can create a lot of positive relationships between those portfolio companies and our group companies.
Next question please.
My name or symbol from Sunday newspaper.
It relates to the previous question.
So you you you can create the positive relationship and also a 470 some companies but kind of.
Area.
Do you think that you can expect more going forward can you be more specific.
Yes.
Some of them.
You may be.
Be doubtful that that this company is this company really using utilizing AI.
There are about 10% or so, but actually 80 or 90% of those companies that are actually.
Making their business model because there is AI so are those companies.
Six hours is very much white.
Fintech too.
Meditech aid you take.
So there are a variety of.
Six does.
Ridge are all exciting.
And each respective companies, although they are small as individual company, but I believe Ah that reminds me of the time that the dawn of the Internet era like a golfer. So now a five to 10 years later.
Well, you're making a lot of our investments and that could be to the good result of late though and I'm quite sure and I'm confident that they will be able to see the good growth from those companies I have another question.
It is maybe out of the point about then the authority to make such but this huge those you are recording.
It's not.
Any misconduct or anything, but it's not the responsibility of the management, but do you have any plan to return your compensation or anything.
When it comes to compensation.
Compared to any direct does.
I'm the lowest in terms of compensation will I receive.
And about 100 billion yen altogether.
And out of this 100 million yen.
All our Mt.
Our.
But it will grow hoelscher have donated so if my compensation decrease that all the decreasing my donation so I'm not receiving in my hands.
So why is 100 million yen.
All of my compensation is because once they exceed 100 million yen.
That's the fish hold for the disclosure. So that's why that are we believe that we do I do need that disclosure. So 100 million. Then you have this 100 million yen looks like I don't receive anything because I don't I don't have to disclose and people may say that I'm doing something wrong doing which I don't.
Hunt and also.
As a source for donation.
100 media on yen I've been making a donation so that I would like to maintain the source for that.
Responsibility for the management I do feel that responsibility.
But the.
Even though I do decrease my annual salary.
Compensation that may not be the big thing for from the company wide point of view any other questions.
Promotional.
Yeah.
It sounds from Nikkei business I have two questions first.
Key holding was one of the companies that do exist. It my question is why.
E.
Fundamental reasons.
A holding you said K holdings.
Yeah.
Vicki.
This study Unicorn.
And after.
Look up here it is.
Over.
We sell down.
And one of them.
Such companies that to V. G S baking and I remember Uber.
And because that did almost all after.
Certain period of time since they go public.
We.
Recognize.
Gain.
And the second question is about cost reduction or more specifically head count reduction.
Well I feel it's a lease because you have built ecosystem and do you have built.
Yeah.
Relationships, our network and expertise.
And if you reduce head counts a lot.
You may find it very hard at June <unk>.
<unk> start.
Sometime in the future.
Well I completely agree with you.
So that's why.
I have a lot of headaches.
That may be shown.
In my head.
We have created great team and relationships and organizations.
Yeah.
I feel really bad.
If you want to reduce them, but.
Fact is we don't fund has recorded almost six trillion of lost in the last six months, so not only vision fund, but a group wise, we have to reduce cost without any exceptions.
So.
Scale and.
How.
Well you all still discussing but I just wanted to share with you our direction today.
And the interest of time and last question. Please.
I'm, okay for any longer I mean, how long is that it takes I am happy to take a gracious, but I believe this will be the last question.
My name is rather from Nikkei newspaper I have two questions.
Fortunately investment group.
Are there a media reporting the sales so fortress do you have any intention to sell and also what is the position of this company inside of your group. That's my first question.
Yeah. Thank you for your question as for fortress.
I have a feeling.
That's the way you want to.
Well you may want to consider cell setting the company. The reason is clear I just mentioned in my presentation.
But when it comes to the counterpart.
A buyer.
So where you would like to.
Discuss so we have some discussion going on to some extent.
And there are.
Yeah.
They are some buyers potential buyers and we are ready to how 'bout discussion with such and the reason is because of those explanation I made it so that I am we are open for any proposal.
My second question is about Alibaba share.
But the first quarter.
You utilize Alibaba she has for your financing quite a lot.
How much are there which are the used shares for Alibaba. So how much capacity do you still have for that financing using alibaba share.
That's something that though we are still dis gusting internally.
So once we have a clear view.
I would like to update you.
So that's all from the floor I have one question from the zone.
Yeah.
So.
This should be the vast question rich.
We just.
From.
A participant on zoom them.
Sure.
Well once again.
Please refrain from connecting to other Viva stream to avoid any occurring.
Oh that from Nikkei BP.
Happy early birthday.
And you will be 65 years old in three days.
So how.
And the logistic about your business.
Well.
I took a question about responsibility for the business.
And enthusiasm about the business.
I get more and more influencers stick about my business.
If I get sick.
Or if.
I lose motivation.
At the time.
I would retire because I don't want to cause any trouble to shareholders and employees, but at the moment I am fully energized about our business.
And to my vision.
Is unwavering.
Thank you very much.
That's the question from the tumor.
Thank you very much.
Oh, sorry about very depressing, earning results announcement, but I.
Wanted to be transparent and open book.
For your participants today.
Thank you very much. This concludes the Softbank Group Corp earnings results announcement for three months period ended June 32022.
The video footage of this meeting will be distributed on demand from our corporate website.
Once again, thank you very much for joining the Softbank Group Corp earnings results announcement for three months period ended June 30, 2022.
I missed that.