The Vision Fund unit lost ¥297.5 billion ($2 billion) in the three months ended March, compared with a ¥2.2 trillion loss a year earlier. The gargantuan investment fund that Masayoshi Son proudly set up in 2017 lost a record ¥4.3 trillion for the full fiscal year, almost doubling the record loss of ¥2.6 trillion the year before.

While SoftBank has lost money off and on for years, the latest results are surprising because technology valuations around the world have largely rebounded this year. The Nasdaq 100 index, a benchmark for tech stock performance, rallied 20% during the March quarter, lifting share prices for some of SoftBank’s biggest investments.

The South Korean e-commerce company Coupang Inc., for example, gained about 9%, while the Chinese ride-hailing company Didi Global Inc. rose about 20%. SoftBank accounts for such gains in its portfolio companies as profit on its income statement.

But SoftBank marked down the value of its private companies far more than the increases in its public holdings. It lost about about $3.9 billion on its private portfolio during the quarter, while it gained about $1.9 billion with public companies. 

Amir Anvarzadeh, a market strategist at Asymmetric Advisors in Singapore, said that SoftBank may have marked down the value of private holdings to catch up to the overall market decline from earlier periods. “Unlisted names which account for something like 60% of its total investments had not been marked down more than 20%,” he wrote in a research note.

Yoshimitsu Goto, SoftBank’s chief financial officer, led a conference call with investors following results, after Son said that he wanted to focus on an initial public offering for chip designer Arm Ltd. Goto acknowledged the past year has been very rough, and the tech investor was forced to mark down the valuations of almost 350 companies.

“Total Defense,” he proclaimed in one slide about the fiscal year that just ended.

SoftBank’s startup investments came to a screeching halt during the year, with Vision Fund investments falling more than 90% to just $3.14 billion. Goto explained that SoftBank has been careful to keep plenty of cash on hand to cover debt and other obligations, in part by selling off most of its holdings in Alibaba Group Holding Ltd.

But Goto suggested that SoftBank may begin to invest more actively again. He said he meets with Son daily and he worries about whether Son has enough time to sleep because he is brimming with excitement about artificial intelligence, especially generative AI like ChatGPT. “My time has come,” Son has been saying, according to Goto.

SoftBank won’t dive into investments right away, but it’s more open to possible deals than it has been in the past.

“Last year, unless something unusual happened, we would rather have passed on opportunities,” Goto said. “But this year, if we’re comfortable, after checking every aspect, we want to take steps, one by one.” 

Analysts are skeptical about Son jumping back into deal-making mode too quickly. He may need to raise capital through Arm’s IPO before he starts spending money again.

“If the Arm IPO happens at a decent valuation, then I don’t think it’s negative,” said Sharon Chen, credit analyst at Bloomberg Intelligence. “But if the company ramps up investments prior to the Arm IPO, that’s likely to be negative because this could weaken LTV.”

Arm posted mixed results in the most recent quarter. Net sales rose 28% to ¥92.8 billion in the fourth fiscal quarter, compared with a year earlier. It lost ¥6.2 billion, though, after making ¥10.1 billion a year earlier. Currency rates had a significant effect on the results. Net sales in US dollars rose 12% to $696 million.

Bankers have pitched a valuation of between $30 billion to $70 billion for Arm’s listing, a wide range reflecting the challenges of valuing the firm against a backdrop of volatile semiconductor equity prices.

“The Arm story is key and valuation is important, but that may be more at the mercy of markets than SoftBank would like,” said Mio Kato, an analyst from LightStream Research who publishes on Smartkarma. 

SoftBank offloaded an additional $7.3 billion in Alibaba shares this year through prepaid forward contracts, according to a Bloomberg analysis of regulatory filings. This may have reduced SoftBank’s Alibaba stock to around 3.8%. Goto said SoftBank still has the option to buy back the shares or close out the options.

Last month, the Japanese conglomerate said it is selling its early-stage venture capital arm SoftBank Ventures Asia Corp. to an entity led by Taizo Son, the younger brother of Son. Terms of the deal weren’t disclosed. 

The sale of the startup incubator could ease SoftBank’s financing burden, while offloading Alibaba shares in the wake of the e-commerce leader’s plans to split into six parts would help maximize SoftBank’s divestment income, Bloomberg Intelligence analyst Marvin Lo wrote in a note last month. 

SoftBank is also nearing a deal to sell Fortress Investment Group to Mubadala for as much as $3 billion, the Financial Times reported, citing unidentified people briefed on the matter. Goto declined to comment on the topic.

That would help SoftBank’s share price, said Victor Galliano, an independent analyst who publishes on Smartkarma. “The focus for now has to be realizing investments where possible and reducing leverage, and we look forward to perhaps more disclosure on Masa’s debts with the group.”

Goto suggested that investors would hear from Son himself if SoftBank shifts back into offensive mode. The billionaire would want to deliver a clearer message if he starts hunting deals again.

“It’s not that we’ll only invest in generative AI,” Goto says. “Anything AI-related, we’d like to consider. May not be too speedy, we’ll need to be selective.”