SoftBank reported a net loss of $ 3.5 billion in the second quarter, Reuters reported

TOKYO (Reuters) – SoftBank Group Corp. went into the red in the July-September quarter with a loss of 397 billion yen ($ 3.5 billion) as a result of a fall in the valuation of its Vision Fund unit’s technology portfolio.

The loss was compared to a profit of 628 billion yen in the same period a year earlier.

The Vision Fund unit had a quarterly investment loss of 1.167 trillion yen.

CEO Masayoshi Son describes SoftBank as a goose that lays “golden eggs” – referring to its holdings in startups that go to market, but initial public offerings (IPOs) have fallen and shares of many of its major assets have fallen during the quarter.

“The strategy to create a perception of improved value by bringing things to the public has not really worked this year,” said Redex Research analyst Kirk Boodry.

SoftBank’s depressed valuation of China’s portfolio continued to reduce its performance as a result of a regulatory downturn. The group’s largest asset is a Chinese e-commerce company Alibaba (NYSE :), fell about a third in the three months to September.

Bright spots for the Vision Fund are the Indian portfolio with lists aimed at Ola ride-hails and logistics company Delhivery.

SoftBank has been reducing its holdings after the expiration of the deadlines, and focused on investing through its second Vision Fund, a $ 40 billion capital committed by SoftBank itself.

($ 1 = 113,3500 yen)