SoftBank Returns to Profitability: $3.5 Billion Net Income in Q1 2025

Market Surprise: SoftBank Posts Highest Quarterly Profit Since 2021

Japanese tech conglomerate SoftBank Group reported a net profit of ¥517 billion (approximately $3.49 billion) for the first quarter of 2025, far exceeding analysts’ expectations of a ¥26.9 billion loss. This marks SoftBank’s strongest quarterly performance since 2021 and signals a potential return to full-year profitability after four consecutive years of losses.

Vision Fund 1 Delivers: ¥940 Billion in Investment Gains

The primary driver behind SoftBank’s strong quarterly results was Vision Fund 1, which focuses on late-stage technology startups. The fund recorded an impressive ¥940 billion gain in investment income, largely fueled by the rising fair value of key holdings such as ByteDance (the parent company of TikTok) and South Korean e-commerce platform Coupang, both of which experienced notable value appreciation during the quarter.

Vision Fund 2 Suffers Heavy Losses Amid Market Volatility

In contrast, Vision Fund 2, which targets earlier-stage startups, reported a substantial investment loss of ¥526 billion. This was mainly due to a sharp decline—around 40%—in the value of portfolio companies like India’s Swiggy and Ola Electric, both of which struggled with market headwinds and rising operational costs.

Telecom Holdings Support Stability: T-Mobile Hits Record High

SoftBank’s established telecommunications holdings continued to provide reliable income. Shares of T-Mobile US surged to an all-time high in March, ending the quarter up more than 20%, contributing significantly to the group’s bottom line. Additional stakes in Deutsche Telekom also bolstered financial stability across the group’s legacy business segments.

Major Push into Artificial Intelligence: Ampere Acquisition and $30 Billion for OpenAI

In a bold strategic pivot, SoftBank announced several high-profile investments in the artificial intelligence sector. Most notably, it acquired chipmaker Ampere Computing for $6.5 billion and committed up to $30 billion in funding for OpenAI. These moves are designed to secure SoftBank’s leadership role in next-generation AI infrastructure and software development.

Stargate Project: $500 Billion Data Center Network for AI

SoftBank also unveiled its role in leading Project Stargate, a massive U.S.-based data center initiative worth $500 billion. The project aims to build next-generation AI computing infrastructure and is being developed in partnership with major tech players, including OpenAI, Oracle, Microsoft, and Nvidia.

Strategic Assessment: Profitability vs. Risk Exposure

Despite the stellar headline results, a substantial portion of SoftBank’s Q1 profit stemmed from market revaluations—a potentially volatile source of income. Meanwhile, aggressive AI investments and ongoing losses in Vision Fund 2 raise questions about the group’s long-term risk exposure and capital discipline. Analysts caution that consistent performance will require not only vision but also financial prudence.

Forward Outlook: Can SoftBank Sustain the Momentum?

SoftBank’s Q1 2025 report signals a potential turning point, with the group demonstrating its ability to generate value from both mature and emerging assets. However, sustaining profitability will depend on its ability to navigate volatile markets, scale AI investments responsibly, and balance risk across diverse business lines. Investors will be closely watching the performance of its Vision Funds and AI ventures in the coming quarters to assess whether this rebound marks a long-term trend or a short-lived recovery.