SoftBank Group Shares Rise Sharply After Quarterly Net Profit, Arm's Stock Jump

By Kosaku Narioka

SoftBank Group shares rose sharply following its first quarterly net profit in more than a year, adding to the previous day's stock surge sparked by chip-designer unit Arm Holdings' stronger sales outlook.

Shares were recently 10% higher at 8,088 yen after rising as much as 15% earlier Friday morning, and following a 11% rise on Thursday.

The Japanese technology investment company said Thursday after market close that it posted net profit of Y950.00 billion ($6.36 billion) for the three months ended Dec. 31, thanks partly to an improvement in its tech investment funds business. That followed four consecutive quarters of net losses as central banks raised rates to rein in inflation, causing selloffs in the tech startup sector.

Its Vision Funds business posted profit of Y422.74 billion in the third quarter, compared with loss of Y660.10 billion in the year-earlier period.

SoftBank Group shares rose sharply Thursday after Arm stock surged in after-hours trading, following the company's forecast of $850 million to $900 million of sales in its current quarter, above forecasts of $779 million in a FactSet analyst survey. Arm stock jumped 48% on Thursday.

Arm, which is 90% owned by SoftBank Group, is cashing in on surging investments in AI. While the company's circuits are dominant in mobile phones, it is making growing inroads in chips that go into data centers where AI computations are made.

"Arm is the company that can contribute the most to AI, which is the biggest theme in the world," SoftBank Group Chief Financial Officer Yoshimitsu Goto told reporters at an earnings briefing on Thursday.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

February 08, 2024 21:13 ET (02:13 GMT)

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