Japan tech giant SoftBank reports profit decline

TOKYO (AP) — Japanese technology conglomerate SoftBank Group Corp. reported Wednesday a 23 percent decline in fiscal third-quarter profit as adjustments in its major investment funds eroded income.

SoftBank Group, which has invested in British IoT company ARM and U.S. wireless company Sprint, had October-December profit of 698.3 billion yen ($6.4 billion), down from 912.3 billion yen in the same period the previous year.

Quarterly sales totaled 2.5 trillion yen ($23 billion), up 4 percent from 2.4 trillion yen.

SoftBank’s investment funds called SoftBank Vision Fund had a positive effect on the overall operating profit for the latest fiscal quarter, thanks to the rise in value of its technology investments.

SoftBank did not give a fiscal year forecast, which has been standard practice for the Tokyo-based company.

Late last year, SoftBank raised more than 2 trillion yen ($18 billion) at an IPO of its Japanese mobile company. The IPO compares with some of the world’s biggest, including China’s Alibaba Group, which raised about $20 billion when it went public in 2014, and Facebook, which raised $16 billion in 2012.

SoftBank, which offers internet and solar electricity services, was the first mobile carrier to offer the Apple iPhone in Japan. It is also behind the Pepper, the talking companion robot.

After the killing of Saudi journalist Jamal Khashoggi, SoftBank has said it will diversify its funding source for investments. Much of the Vision Fund money had come from Saudi Arabia.

The shake-up announced Tuesday ends Angela Ahrendts’ fiveyear stint overseeing Apple’s 506 retail stores and e-commerce operations. She is being replaced by Deirdre O’Brien, a longtime Apple executive who also runs the company’s human-resources department. Ahrendts will remain with Apple until April.

During her 30 years at Apple, O’Brien also helped gauge product demand. That issue has become a problem now that customers are holding onto their current iPhones longer instead of buying the latest models. It’s one reason Apple posted disappointing iPhone sales during the past holiday shopping season.

Although Apple sells iPhones and other products such as the iPad and Mac computer through a wide variety of merchants, its own elegantly designed stores have become a pivotal outlet, especially during the first few weeks after a new device hits the market.

“It was clear that Apple needed new strategies and a potential change on this front to catalyze demand in and outside the all-important retail stores,” Wedbush Securities analyst Daniel Ives.

Apple didn’t give a reason for Ahrendts’ departure, saying only that she is leaving “for new personal and professional opportunities.”

Ahrendts, 58, joined Apple amid great fanfare in 2014 after CEO Tim Cook persuaded her to leave a glamorous job running the fashion brand Burberry. To lure her away, Apple gave Ahrendts company stock valued at $70 million in 2014. In her last full year at Apple, she received a compensation package valued at $26.5 million, according to filings with the Securities and Exchange Commission.

Ahrendts’ arrival at the Cupertino, California, company coincided with the rollout of the Apple Watch, which the company designed to be a fashion statement in addition to a wearable piece of technology.

While at Apple, Ahrendts engineered renovations of highprofiles stores in San Francisco, New York, Chicago and other cities in an attempt to transform them into hip places to hang out while shoppers checked out the company’s latest innovations. Her lofty description of the stores as the equivalent of “town squares” became the subject of derision among some analysts and media commentators.