Alibaba founder and Michael Jackson enthusiast, Jack Ma, is stepping down from his role on Softbank’s board just as the company is reporting the biggest losses in its history.
The company announced that Ma is set to resign June 25, a departure that comes as Softbank continues to reel from its no good, very bad year from hell. Softbank on Monday reported an annual operating loss of 1.4 trillion yen (roughly $13 billion) for the year ending March 31, a staggering figure that the New York Times noted was the company’s first annual loss in Softbank’s 15-year history.
Softbank’s Vision Fund, its $100 billion investment outfit, reported losses of 1.9 trillion yen (roughly $17.7 billion)—a figure slightly higher than the previously estimated $16.7 billion in losses. Softbank said the fair value of the handful of companies in its portfolio, including the sinking ships that are Uber and WeWork, had “decreased significantly in the fourth quarter, primarily due to the impact of the outbreak of the novel coronavirus.”
It’s not clear why exactly Ma is leaving, and Softbank did not immediately return a request for comment about Ma’s departure from the company’s board. However, Softbank chief Masayoshi Son was quoted by Business Insider as saying Ma’s move “was something that he decided on his own.” And despite this looking pretty not-great for a company that’s currently on fire, Son spun the news relatively positively.
“That’s sad, but we still keep in contact directly and right before the COVID-19, we met face-to-face every month to have dinner, to talk about businesses, to talk about lives. And we will remain friends for the rest of our life, I believe,” Son said. He also cited Ma’s retirement from Alibaba last year, at which time Ma said he planned to focus on philanthropy.
Softbank’s astonishing losses follow the implosion of its investment in real estate disaster WeWork and its controversial founder Adam Neumann, who—after effectively running the company into ground before leaving it last year—is now suing Softbank over an alleged breach of an agreement relating to a failed WeWork bailout deal that Softbank ultimately reneged on earlier this year.
Son expressed some regrets to investors saying, “It was foolish of me to invest in WeWork. I was wrong.” It’s a particularly bad time for the embattled startup with the coronavirus rendering shared workspaces useless. As of Monday, Softbank reported a valuation of WeWork at $2.9 billion, an incredible decline from its highest valuation of $47 billion.
Uber, obviously, is not doing so hot right now either, as covid-19 and stay-at-home orders continue to pummel the company.
Ma, meanwhile, will still be stupidly rich and just fine.