SoftBank Group’s Vision Fund has reportedly made it to the headlines for having sold off its entire stake in the now beleaguered chipmaking company Nvidia. If sources are to be believed, Vision Fund’s stake in the company had been valued for more than USD 3 billion. As on December 31, 2018, the position was worth USD 3.63 billion, an official statement reported.
Vision Fund’s decision to divest its stake in Nvidia comes as a major blow to the Silicon-based chipmaker, that has already been through a series of setbacks lately. As per sources familiar with the knowledge of the matter, Nvidia’s share price has been reduced to almost half in the last four months. Last week, the company also curtailed its revenue guidance for the fiscal fourth quarter, on the grounds of the highly depreciating macroeconomic conditions, specifically in China.
Nvidia is not the first company to cite China’s weakening economy as a reason for cutting revenue guidance. Technology giant and iPhone maker Apple, in the month of January, claimed that it has curtailed some of its revenue guidance on account of weak demand from the Chinese consumers.
SoftBank shares depicted a higher close on Wednesday, post the firm reporting a 60% surge in quarterly profits as well as a share buyback program worth USD 5.5 billion. Nvidia’s shares on the other hand were up 1.5% as U.S. markets opened Wednesday.
SoftBank’s Vision Fund had revealed its stake in Nvidia in May 2017. The fund also holds potential other stakes in ARM – the British chip designer, Uber Technologies, and WeWork.
About SoftBank Vision Fund:
SoftBank Vision Fund, a subsidiary of SoftBank, perpetually invests USD 100 million or more in growth stage leading firms. Some of the leading investment hubs for the fund include artificial intelligence (AI), internet of things (IoT), communications infrastructure, robotics, telecoms, bio tech, computational biology, cloud technologies & software, financial technology, consumer internet businesses, and mobile apps.