WeWork cost SoftBank $14.3 billion, and its chief executive claims that "homework is what went wrong."

 WeWork cost SoftBank $14.3 billion, and its chief executive claims that "homework is what went wrong."

Management states that SoftBank is prepared to make significant investments whenever the chance arises.

The management of the Japanese technology conglomerate disclosed in a post-earnings call that SoftBank has lost a total of $14.3 billion through its equity and debt investments in WeWork. This was days after the portfolio company, which had been valued at $47 billion, filed for a Chapter 11 bankruptcy proceeding in the US. SoftBank made investments $1.5 billion in the September quarter, $1.8 billion in the June quarter, alongside bets of $500 million each in the three quarters that followed.

"When we learned of the bankruptcy, we were very sad. We must acknowledge this fact and draw conclusions from it for our next investing endeavors. After the tech giant released its September quarter results, Yoshimitsu Goto, CFO of SoftBank Group, said, "Exactly what went wrong is homework for us."

"WeWork has been valued very cautiously by us. Thus, the effect on SoftBank's financials in the most recent quarter did not come as a surprise to us," he said.

When asked about Masayoshi Son, the CEO of SoftBank, and his participation in the WeWork scandal, Goto said that while Son was ultimately engaged in all the choices as the CEO, SoftBank as a company should learn from the experience.

For the six months ending in September, SoftBank Vision Funds (SVF) experienced a $3.86 billion investment loss (not including profits on bets on subsidiaries) as a result of declining share prices of its listed portfolio firms and declining fair values of its private portfolio companies.

SVF reported an investment loss of $3.7 billion for the September quarter, much worse than its $86 million loss for the June quarter of this year but still a significant improvement over its $9.5 billion loss for the same period last year.

SVF reported a $1.2 billion gain on investments at the segment level, which includes profits from its holdings in Arm and other SoftBank group companies.

Even if SoftBank has increased its investment activity considerably over the last several quarters, it is still a long way from making large bets at once, which was its defining characteristic a few years ago.

It made bets of $500 million every quarter for the three quarters that followed, and it invested $1.8 billion in the June quarter as well as $1.5 billion in the September quarter.

"Ticket sizes may increase when the opportunity arises. When it comes to investing prospects, we are quite picky. We are prepared for any significant opportunity that may arise and have an abundance of cash," Goto said.

The Israel question

Amidst the recent geopolitical unrest in the area, SoftBank management was questioned about the company's future plans in Israel. They responded that they had made an investment in a cybersecurity firm in Israel during the September quarter.

"We are still searching the world for disruptors in artificial intelligence. There is, of course, a great deal of human misery there. Our investing horizon is rather lengthy. No matter where they are, we will keep supporting businesses that succeed "said SoftBank Vision Fund executive managing partner as well as chief financial officer Navneet Govil.

The executives of SoftBank also spoke extensively about their AI concept and wagers. It did not, however, respond to rumors that Masayoshi Son, Sam Altman, the CEO of OpenAI, and renowned former Apple designer Jony Ive were teaming together to launch an AI hardware startup.