Idea Transcript
What Does SoftBank Do? By Craig Adeyanju | Updated April 11, 2018 — 11:57 AM EDT ADD TO WATCHLIST
SFTBF SoftBank Group …
Add
74.76 -1.11%
S Sprint Corporation
Add
5.88 -2.00%
View Watchlist
SHARE
With annual revenue of over 82 billion, SoftBank Group Corp. (SFTBF) is currently the 72nd largest company in the world, by revenue, according to Fortune magazine. Moreover, going by the magazine’s rating, SoftBank is also the seventh largest company in Japan, a country where some of the largest automakers in the world are headquartered. In several other countries, the U.K. for instance, SoftBank would be the largest company by far. Here's a closer look at what SoftBank does, by segment, which makes it so
large.
Trending
SoftBank currently conducts business under several major segments including domestic telecommunications, Sprint, Yahoo Japan, distribution and ARM segments. Here’s a breakdown of what each major segment is all about. (For more, see also: Why SoftBank Is Interested in Robotics.)
What Are the Top U.S. Imports?
Domestic Telecommunications
Which countries have the highest tariffs?
The domestic telecommunications segment is SoftBank’s second largest reporting segment. Under this segment, SoftBank sells mobile devices and provides mobile communications and broadband services to customers in Japan. The company also provides telecom services – data communications and fixed-line telephone offerings, for instance – to enterprise customers in Japan.
A Stock Sell-Off Vocabulary Guide The Basics Of Tariffs And Trade Barriers
How Do Interest Rates Affect the Stock Market?
SoftBank’s domestic telecommunication segment is a result of an April 2015 merger of SoftBank’s four domestic telecommunications subsidiaries – SoftBank Mobile Corp., SoftBank BB Corp., SoftBank Telecom Corp., Ymobile Corporation – into SoftBank Corp. Since the merger, the domestic telecommunications segment has had two core companies including SoftBank Corp. and Wireless City Planning Inc., which offers wireless broadband access services. SoftBank classifies the services rendered in the domestic telecommunications segment into two categories. They include communication services and mobile commerce services. Under the communications services, SoftBank offers mobile communications services to consumers through the SoftBank and Y! Mobile brands. In addition, the company offers data and fixed-line communication services to both consumers and businesses through the "SoftBank Hikari" and "Yahoo! BB" broadband services as well as Wireless City Planning’s Broadband Wireless Access systems. Under the mobile commerce services, SoftBank, in conjunction with Yahoo Japan offers online shopping services. The domestic telecommunications segment reported net sales of $21.97 billion in the nine months ended December 31, 2017.
Sprint With net sales of $24.85 billion in the nine months ended December 31, 2017, the Sprint segment is SoftBank’s largest operating segment and as the name suggests, the segment reflects the results from SoftBank’s stake in Sprint Corporation (S). SoftBank had acquired a majority stake in Sprint in July 2013. Sprint provides mobile communications and fixed-line telecommunications services as well as the sales and lease of mobile devices in the U.S. SoftBank has over 80% voting rights in Sprint. While it was trying to orchestrate a merger to create a much larger telecom footprint in the U.S., SoftBank decided to call off Sprint's merger with T-Mobile (TMUS) on account of disagreements over the ownership and structure of th emerged entity.
Yahoo Japan The Yahoo Japan segment reports the results from SoftBank’s stake in Yahoo Japan Corporation. Yahoo Japan was formed as a joint venture between U.S. internet company Yahoo Inc., which recently changed its name to Altaba Inc. (AABA) and SoftBank. According to Yahoo Japan's corporate website, with a 36.4% stake, SoftBank is the largest shareholder in Yahoo Japan.
Trading Center
Partner Links
Overall, Yahoo Japan makes money from online advertising, e-commerce and membership services. Hence, for SoftBank’s Yahoo Japan segment, the core companies include Yahoo Japan Corp. and Askul Corp, both offering services through platforms like Yahoo News, auction site Yahuoku and B2C e-commerce site Lohaco. This segment reported net sales of $5.94 billion in the nine months ended December 31, 2017, making it the fourth largest segment for SoftBank.
Distribution The distribution segment features two core companies including the American mobile device distribution company Brightstar Corp. and SoftBank Commerce & Service Corp. SoftBank had initially purchased a 57% stake in Brightstar in October 2013, but bought the company entirely in 2014. According to SoftBank, Brightstar offers “mobile device and accessory wholesaling, supply chain management solutions for mobile device distribution and inventory management, mobile device insurance and buyback, retail solutions and financial services” to mobile device manufacturers and operators. SoftBank Commerce & Service Corp. offers software and hardware items, network infrastructure and consulting services to both consumer and corporate customers in Japan. In the nine months ended December 31, 2017, the distribution segment, plus uncategorized services, reported net sales of $9.35 billion.
ARM The ARM segment was only added to the SoftBank Group in September 2016 after SoftBank acquired ARM Holdings Plc, a British semiconductor and software design company. The acquisition of ARM was based on the anticipation that ARM would be at the forefront of the paradigm shift to the internet of things, or IoT. Given that the ARM segment was only included in September 2016, it reported net sales of just $1.4 billion for the nine months ended December 31, 2017.
Robotics Softbank made headlines in June of 2017 when it announced the purchase of Boston Dynamics for an undisclosed sum. The Boston based robotics firm is known for their four-legged robodogs and bipedal human-like robots. One of their recent inventions, Atlas, stunned the wold when Boston Dynamics released a video of the humanoid doing a backflip. Softbank also makes Pepper, a Japanese speaking robot that is meant to be used for conversation and as a personal assistant, kind of like a cross between Alexa and The Jetsons' robot maid. (For more, see also: SoftBank Buys Google's Boston Dynamics.)
Investments In May 2017, SoftBank announced a $100 billion fund to invest in technology companies. Other investors in this fund include the Saudi Arabian Government, Foxconn Technology, Apple Inc., Qualcomm and Sharp Corporation. Softbank has already begun deploying this cash, announcing a $4.4 billion investment in WeWork. However, SoftBank has been investing in companies much longer than that. Its portfolio includes companies such as Uber, Didi Chuxing, Slack, etc.
RELATED ARTICLES INVESTING
SoftBank Invests Even More in Sprint Japanese telco Softbank recently revealed in an SEC filing that its stake in Sprint (NYSE: S) had reached 84.1%. That's up from around 83% in its previous disclosure. Investors are closely watching ... TECH
SoftBank Group and Saudi Arabia Plan to Launch a $100B Tech Fund (SFTBY) SoftBank and the Kingdom will invest $70 million in the global technology sector over the next five years.
INVESTING
Sprint Q2 Earnings: What to Expect? (S, ARMH) Sprint, which is 80% owned by Japan's SoftBank Corp, has been one of the market's pleasant surprises with its shares rising 27% year-to-date.
INVESTING
SoftBank Might be Twitter's 7th Suitor The Japanese firm could be the seventh candidate interested in Twitter. The others walked away from acquisition discussions.
INVESTING
Softbank: Would Give Up Sprint for T-Mobile Deal Sprint parent Softbank is reportedly willing to give up majority control for a deal on T-Mobile.
INSIGHTS
Why SoftBank Is Interested in Robotics SoftBank is investing heavily in the future of robotics. Here's why.
INVESTING
Softbank’s ARM Holdings Threatens Intel A Cannaccord analyst suggests that 'all shackles have been removed from ARM's ecosystem.'
INVESTING
Sprint Will Need Lots of Cash to Acquire T-Mobile Much cash is in order for Softbank to merge Sprint and T-Mobile, according to New Street Research.
INSIGHTS
The World's Top 10 Telecommunications Companies Learn about the top 10 telecommunications companies in the world and information about each company’s customer base, market share, and services. INSIGHTS
Why Is SoftBank Interested in 'Nightmare' Robots? SoftBank's acquisition of robotics company Boston Dynamics would help the company take charge of the Japanese robotics markets.
RELATED FAQS Q: What are the biggest telecommunication companies in the world? Learn what the five largest companies in the telecommunications industry are, ranked by both total revenue figures and market ... Read Answer >>
Q: What level of return on equity is average for a company in the telecommunications ... Learn about the average return on equity for the telecommunications sector and how government regulation may negatively affect ... Read Answer >>
Q: What is the average profit margin for a company in the telecommunications sector? Get an overview of the telecommunications sector, and learn the average net profit margins for companies in this highly competitive ... Read Answer >> STOCKS:
SFTBF
S
Search Investopedia
DICTIONARY: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
CONTENT LIBRARY Articles
Terms
Stock Analysis
Videos
CONNECT WITH INVESTOPEDIA Guides
Stock Simulator
Slideshows
FAQs
Exam Prep Quizzer
Calculators
Net Worth Calculator
Chart Advisor Browse Stocks
Mortgage Calculator
WORK WITH INVESTOPEDIA About Us
Advertise With Us
Contact Us
GET FREE NEWSLETTERS Careers
© 2018, Investopedia, LLC. All Rights Reserved Terms Of Use Privacy Policy
Newsletters