Japanese technology company oftBank Group racked up a loss of JPY 961.6 (roughy Rs. 68,179 crores) for the fiscal year through March, on red ink related to its Vision Fund investments including troubled office space-sharing venture WeWork. oftBank, founded in 1981, said Monday the drop in share prices around the world from the fallout of the coronavirus pandemic had slammed the value of its sprawling investments. Tokyo-based oftBank had reported a profit of JPY 1.4 trillion (roughly Rs. 99,250 crores) the previous fiscal year. Its sales for the fiscal year inched up 1 percent to JPY 6.2 trillion (roughly Rs. 4.39 lakh crores). It did not immediately break down quarterly results or give a forecast for the fiscal year through March 2021.
The pandemic was not expected to affect oftBank’s telecommunications business, such as mobile phone services in Japan. As people stay home to help curb the spread of the coronavirus, they tend to use more online deliveries and other Internet-based activities.
But the company’s technology licensing and royalty revenues may drop due to Arm, which provides microprocessors and other technology and is also part of oftBank’s operations, because of pandemic-related disruptions.
oftBank’s chief executive, Masayoshi on, told reporters the company was facing “unprecedented challenges” because of the pandemic
“I realise I am giving excuses, and the extreme economic hardships from this ‘corona-shock’ are very real,” on said.
oftBank bailed out WeWork last year, and severed ties with its co-founder Adam Neumann, whose reported lavish living has tarnished the brand. Its IPO was ditched, and oftBank has shelved its tender offer.
The future of the office-sharing business model itself is in question as reopening economies try to abide by social-distancing measures against the virus that causes COVID-19.
on said the move was related to Ma’s decision to semi-retire, including from his post at Alibaba. They continue to communicate regularly as “like-minded soulmates,” said on.
“It’s sad to see him go, but we will be best friends forever,” he said.
oftBank is a major investor in Alibaba. Ma, who joined the oftBank board in 2007, and on have a longstanding close relationship.
Ma, the co-founder of Alibaba, has been focusing on philanthropy lately, such as donating masks and test kits to help in the efforts against the pandemic.
oftBank announced three new board members, including oftBank Chief Financial Officer Yoshimitsu Goto, and Waseda University professor Yuko Kawamoto.
Another new member is Lip-Bu Tan, founder of Walden International, a venture capital firm focused on computer chips, cloud, and artificial intelligence. He is also chief executive of Cadence Design, a U electronic design automation software and engineering services company.
on said that adding outside board members will enhance corporate governance at oftBank, responding to criticism he wielded too much control.
Also Monday, oftBank said it was buying back its own shares, of up to JPY 500 billion (roughly Rs. 35,417 crores) in value, to shore up its bottom line.
“I am not totally pessimistic, given all the challenges we have faced in the past,” said on. “We will keep at it.”