SoftBank Group Corp. (9984) Earnings Call Transcript & Summary

Now it is time to start. Good morning, ladies and gentlemen. I am Masayoshi Son, Chairman and CEO of SoftBank Group Corp. I would like to thank you all for joining the meeting today. I would also like to take this opportunity to express my gratitude for your constant support to the company. With your permission, I will Chair this meeting pursuant to the provision of Article 13 of the Articles of Incorporation. Now I will call the 40th Annual General Meeting of Shareholders of SoftBank Group Corp. to order. Today, we hold this meeting with appropriate measures in place to prevent spread of the new coronavirus and to minimize risks of infection. While asking our shareholders to kindly refraining from coming to the venue of the meeting, we have set up a dedicated website where you can exercise your voting rights or posting questions online. We are thankful that many of shareholders are indeed joining us remotely today. All directors, including myself, are participating through web conference system, too, except Director Yun Ma, who is not able to attend for an unavoidable reason. Please accept his apology. Please note that all questions, motions or statements you may wish to make should be posted on the website, whether you participate remotely or in person. When you do, please click comment on the screen, and then type in your comment. The meeting is scheduled to last 1 hour. Questions and/or comments should be about nothing other than the matters on today's agenda. The questions-and-answer session later in the meeting should last no more than 5 minutes, so make sure to sending them before the closure. The website is now ready for you to start posting notes. With a lot of shareholders joining the meeting today, we would like to limit the number of questions or motion to one per one shareholder. Please be concise in making your statement by keeping to the point. Due to the limited time, we may primarily address what many shareholders are interested in. Thank you very much for your understanding. The agenda today is just that set out on Page 3 of the convocation notice of this Annual General Meeting of shareholders. The number of voting rights held by the shareholders participating today constitutes the quorum. Now I will report on the reporting matter as shown on the screen. Details are set out on pages from 21 to 58 and on 61 and also available on our company's website. I would like to present you a summary video on the reporting matter. [Presentation]

Thank you very much for your attention. Now I would like to present the matters for approval. Before moving forward, I'd like you to take note that after the presentation on the matters for approval and business strategy, we will address your questions regarding the matters for reporting and approval. After the question-and-answer session is finished, we will take votes on matters for approval only. The meeting shall proceed in such a way as described on the screen. If you agree with this approach, please select Approve on the screen, then click Send. [Voting]

Please wait for a moment, we are confirming the result. Thank you very much for your patience. With the majority of shareholders agreed, we shall follow this approach. Proposal 1 is appropriation of surplus. Details are set out on Page 7 of the convocation notice. We propose to pay a year-end dividend for this term of JPY 22 per share. This means the annual dividend for fiscal year 2019, including interim dividend, is JPY 44 per share. Proposal 2 is election of 13 Board members. The terms of the office of the present 11 Board Directors will expire at the conclusion of this Annual General Meeting of shareholders. It is proposed that the number of Board of Directors be increased by 2 in order to strengthen management structure, and 13 Board members be elected. Details are set out on the pages from 8 to 18 of the convocation notice. Now I'd like to present our business strategy. History of human kind that I would like to look back a little bit. Crisis have created new normal. This is what I'm thinking these days. For example, back in 19th century, pandemic cholera occurred. Pandemic crisis, back in 1832, cholera outbreak in the U.K., about over 1 million people died due to that. To solve that situation, safe water or sewer system was introduced. And sewer system has been constructed, and that became new normal as if people will take it granted that you will be able to drink water freely and safely. 1929, Great Depression occurred. Economy was hardly damaged, and 13 million people became unemployed. Unemployment rate reached 25%, meaning 1 out of 4 people lost their jobs. And to solve that situation, people needed to create employment, jobs, so new deal generates the jobs. And, for example, hydroelectric dams or road was constructed to provide the jobs for the people. And as new normal, people start getting used to electricity, people get start used to cars in their lives. This time, crisis of novel coronavirus was and is impacting people's life largely, about 9 million people has been confirmed as infected. As a result, there were so many restrictions on contact of people. And to solve that situation, as new normal, I believe digital shift will, has been and will be accelerated because you cannot meet with people in person easily, and that may create the risk for infection so that you need to avoid the contacting with people, but still need to run your normal life. That means online meeting, online delivery, online education, online medical care, online shopping, online entertainment. Those are the one people will be able to communicate each other or transaction each other. And that days has started. And that is becoming new normal. So humankinds has already been using their wisdom, doing the best effort we can and try to bring the new normal so that we'll be able to live as before. And when it comes to specific, because people has some difficulty in retail shopping, restaurants, and the business activity has become difficult, but instead, online shopping, for example, Alibaba Coupang or Tokopedia, those are our family, group companies, are now expanding their business. For example, food delivery is another thing. Uber Eats, they are the public company. So they have disclosed their numbers and the gross booking of Uber Eats has increased 52%. Also we have DoorDash or Coupang under the umbrella or the Grab, so they are also providing such services in respective countries and markets. So for -- to solve the problems for people's life that we are trying to solve those problems as much as possible by providing such services to the people. And also online medication system or online medical service, this is not our group company, Ping An Good Doctor. As you can see the numbers, back in December last year, in the year before, monthly active user was about 60 million or 50 million people. So 50 million or 60 million. However, this year, from January 20 to February 10, only 3 weeks, only for 3 weeks, about 1.1 billion visits this app. So one is the unique user. The other one is cumulative numbers so that we cannot compare apple-to-apple. However, still, this is a tremendous number of people visiting online [ to receive the medical service, especially this COVID-19 outbreak ], many of the medical service was asked. And also on education aspect, because school was closed, and that happened many of the countries, and again, here, our Zuoyebang has a monthly active user, in April of about 137 million. So many students were able to receive their education online. In entertainment world, ByteDance, this is not a comparison with the other entertainment company, but actually, compared with all the application download, for example, compares WhatsApp, Facebook, Instagram, Messengers, those very remarkable communication tools and apps. Even compared with stores, actually TikTok has been downloaded 315 million times between January to March this year. So [indiscernible] is now reaching the #1 downloads worldwide. And here is the online meeting as the one of the latest edge technologies work has increased number of customer base by 28%. So many people is remotely working, and this, too, is providing the support for that. And this is something -- one of the solution for addressing the COVID-19 and therapies, vaccines is another things that are in [indiscernible] Vir, which is a great company. As a matter of fact, Vir uses high throughput biology and AI to assess millions of antibodies and bring optimal candidates into clinical development quickly. Vir has selected 2 antibodies from thousands of identified candidates for COVID-19. Testing in humans will begin this summer. I'm so expecting on this company, and with these vaccines or antibodies, once those are ready, people worldwide will be able to also receive this to help their lives, and that can be a good contribution to the society worldwide. Roivant also using AI in developing therapeutic medicines. So as you saw these slides, crisis in humankind and solution for that, I believe, digital shift is going to create new normal. And I believe that digital shift will make an even further progress going forward. This is not something that we taking this opportunity, but rather, we would like to step inside to solve the situation for people's new normals. So since our foundation of business, actually we have been pursuing this digital shift and leading the world, I believe, we will be doing without break, taking a breath that we would like to continuously put an effort to drive this digital shift. But when it comes to shareholders' interest, how is SoftBank's current situation? We hear a lot about concerns since we recorded the biggest loss in our corporate history. So that concern is valid. We are a strategic holding company. As you know, we are not operating company. We have great operating companies like SoftBank KK, our domestic telecom business, and Arm, Vision Fund, Sprint, which recently got merged with T-Mobile. Those excellent operating companies are with us in the group. But when it comes to holding company, that SoftBank Group Corporation, we are a strategic holding company, not operating company per se. Not only those big companies, but also unicorns are the ones that we have through SoftBank Vision Fund. So now we are a strategic holding company. The question is, which is better KPI, EBIT or shareholder value? The question is, EBIT, is it the most important KPI or not for us? My view is not. Maybe I have kept saying for some time, but let me repeat, once again, the latest shareholder value is more important. Before COVID-19, as of December 2019, equity value of holdings was about JPY 29 trillion, but also we had a net debt worth JPY 6 trillion. So equity value of holdings, you are shareholders, and you have SoftBank share. And suppose that if you have borrowing to purchase [ the share, you have to subtract the debt ] from the equity value that you have, so equity value minus net debt equals to shareholder value, which is JPY 23 trillion. In our case, as of December 2019, our market cap is around JPY 11 trillion. Of course, it depends on the time. So per share, you have value twice as much as market cap. That's a SoftBank shareholder value. And as of end of March when we recorded the biggest loss in our corporate history, loss in operating income and loss in net income were the loss that I'm talking about, the biggest operating loss to me is not really a big issue. Bigger issue, however, is shareholder value. Shareholder value dropped from JPY 23 trillion to JPY 21.7 trillion. So that is more important for me. And we also saw increase in net debt by [ JPY 0.3 trillion ]. So the shareholder value dropped to JPY 21.7 trillion from JPY 23 trillion. That's more important for me. In the pandemic of COVID-19, SoftBank share price dropped by half, and I'm sure that you were worried about our performance. But as of today, our equity value holding is JPY 30 trillion from JPY 29 trillion in December. We are even better than pre-COVID-19 in terms of equity value. And we increased our net debt a little bit. So all in all, we have shareholder value around JPY 23.3 trillion. So again, we are better than pre-COVID-19, and even better than March when the COVID-19 crisis was peak in Japan. So I think that we have been improving. But in the process, SoftBank share price dropped by half, like I mentioned earlier. Back then, the market overreacted and overshoot downward. That's my personal view. Anyhow, we have been improving slowly, but surely. And the day before yesterday, we made an announcement, big announcement, actually. In the past, we were really aggressive in entering in the U.S. telecom market. And Sprint, we acquired Sprint back then, and people thought that Sprint had been [ dragging SoftBank performance, and ] huge loss was made around the Sprint business, and we caused shareholders a huge concern. And people would say that SoftBank is dead. It's not SoftBank anymore, soft punk, or puncture, if you will. But as you know, the merger was successful, and we announced to sell 200 million shares of new Sprint T-Mobile company. And looking back, investment in Sprint, acquisition cost was JPY 2.1 trillion. It was not that we had JPY 2.1 trillion in cash, we had only JPY 0.4 trillion, and we made huge borrowings to acquire Sprint. That borrowing part I'm sure cause concerns, because people say that SoftBank is always stretching and trying to extend the business. And SoftBank is like betting on future business opportunity. But consequently, what happened was, currently, value is JPY 3.6 trillion, and we still keep 1/3 of Sprint because we don't want to give them up altogether. And also from agreement perspective, we need to keep some. Anyhow, borrowing amount remained almost same. The acquisition cost investment we made grew from JPY 0.4 trillion to 2 trillion. So 5x, close to 5x return, we enjoyed, again, from JPY 0.4 trillion to JPY 2.0 trillion. In terms of IRR, 25%. So I'm confident that we were able to increase the value. In fact, JPY 3.6 trillion is not the final number. Because after the merger, T-Mobile is growing. And I believe that T-Mobile will grow further. So eventually, it's not going to be JPY 3.6 trillion. And we hope that it will be better and bigger than JPY 3.6 trillion. So not just 5x, 6x, 7x, and we believe that there is still growth opportunity and we can get bigger return. Of course, that's my personal wish. But at least, many times, people said that you made a huge mistake in Sprint. But now we can say that we were able to increase the value of our business, which is Sprint. And 3 months ago, in the middle of COVID-19 crisis, we wanted to drive safe and we made announcement of sale and the monetization of assets sale totaling JPY 4.5 trillion, and people said that, "Can you really do that, that big amount?" Even though SoftBank has JPY 30 trillion of assets, but still, you can't do that when you want to sell. Actually, even though you may have unrealized value at the moment, but when actually you want to sell your assets, maybe it might be ending just theoretical, not actual. Sometimes, I would like to say back to them, well, maybe I should say, when we have some cash in hands, we want to maybe speak back to people who have concerns and worries about us. Because in just 3 months, we were able to achieve 80% progress to our goal of monetization program, JPY 4.5 trillion, and the remaining 20%, in my mind, is in the progress. T-Mobile. Extra opportunity should come. And please rest assure that this program is going well. Again, we are a strategic holding company, and we have equity, and Alibaba has the biggest equity value in our holdings. The equity we have, you may say that just a bubble and it's just unrealized gain. Sometimes, stock price goes up and goes down, and it's just something virtual, some people say that. But is that true? In fact, many people spend their money to get those shares. Of course, shares go up and down, but important thing is to look at the value of the business. Like you can see here, that revenue has been growing exponentially. Not only revenue, but also non-GAAP net income is growing steadily, 42% -- 42% up and up. And that's a fact. As you saw before, in the COVID-19 pandemic e-commerce importance is growing, because in the crisis, there were some people who experienced e-commerce for the first time, and they realize how convenient it is. So that's again part of new normal. Safe water, electricity and automobiles, every time crisis hit in humankind, new normal was born. And another new normal has been born. And people's shopping style has and will be changed. And let me talk about Arm. Most of the smartphones around the world are built on Arm chipset. Again, Arm is one of the most important company that we have. As you can see, Arm-based chip shipment has been growing exponentially, whether economy is good or bad, whether interest rate is higher and lower, or employment is good, bad, regardless of change of times, Arm-based chipset has been growing exponentially in terms of shipment. Not only smartphones, but also other computers are built on Arm and also home appliances. Some of them are built on Arm, especially servers that are used for cloud are increasingly using Arm. AWS is the biggest cloud in the world, that's Amazon's cloud service, and AWS CPU, or the engine of the computer, has migrated from different one to Arm chip. Arm's market share in server last year was 1%. Right after we acquired Arm, it was almost 0. And last year, 1%. This year, 4%. And next year, the year after, I'm sure that it will grow exponentially. Why? Because Amazon's AWS, which is the world's #1 cloud, has adopted Arm. In order to compete Amazon, they have no choice but to adopt Arm's chip. Otherwise, they can't beat in terms of processing speed and power. So in order to compete, again, Amazon or AWS, other cloud operators, have no choice but to migrate to Arm. And the day before yesterday, there was an announcement in Japan. Japanese supercomputer named Fugaku ranked as the world's fastest supercomputer. Unlike traditional Japanese supercomputers, Fugaku, instead of using specific customized CPU design, Fugaku adopted standardized CPU design. And software, not customized software, but world standard software, can be utilized for this Fugaku. So not only in terms of speed, but also in terms of commercial use case or availability for commercial use cases, Fugaku is excellent. So in terms of speed, Fugaku became the world's #1. But not only speed, but also applicability is one of the strengths that Fugaku has. On top of that, they don't need a lot of power to run Fugaku. Why? Because it's Arm. For the [ first time, Japanese supercomputer ] can run CPUs as many as 160,000. I'm sure all of them are Arm-based CPU. I need to double check. But I believe that almost 160,000 CPUs are Arm-based. And they can run in parallel, which delivers the fastest speed in the world. And also it's suitable for a lot of commercial application. That's great. [ And talking about stock performance and ] in the pandemic of COVID-19, the stock market has been heavily affected at the time of earnings result. Maybe I looked very serious and somber, not only because of our performance, but sad because of the people suffering from COVID-19. And I was frustrated [ with myself because I was not able to help them as much as I could. But if I look sad today, what people might ] ask me, are you okay? Are you worried? So today, I want to talk about business performance and our future opportunity. And like Vir [ Bio ], they have been developing vaccine and antibody, and that development has made me happier a little bit. In terms of our business performance, I have confidence as much as before. And like I keep saying, we are a strategic holding company. And most of the equity we have is Alibaba, T-Mobile and SBKK. That consists of the majority of our equity holding. And if you put in some index on weighted average and calculate assuming December 31, 2019 was [ JPY 100 ], Nikkei and Dow Jones dropped dramatically like you see on the slide. But our holding, most of our holding, has not really [ decreased a lot. In fact, it's been growing recently, ] meaning digitalization and digital information revolution continues to grow no matter what happens. Put into perspective, we have old economy. Old economy, in general, is what I'm talking about here, not specific industry or company, but we are looking at digital economy, not old economy. The value of companies, value of industries, if you put them together in terms of value, in old economy, it's stable, but flat. But in the digital economy, it's volatile. The value is [ volatile in digital economy. So sometimes it ] goes up, sometimes goes down in terms of value. But if you look at big picture, it's growing exponentially in digital economy. So the value of business, value of the company, value of industry, growth exponentially in digital economy. And this growth is in relation to Internet traffic growth. Well, automobile company's value is in relation to the number of cars in the market, but the corporate value in digital economy is relative to Internet's traffic curve. That's my view. If I put a line on top of this, again, SoftBank is a strategic holding company, and the value of equity hold minus net debt is shareholder value. So SBG's shareholder value is relative to Internet traffic growth curve. And if I show you the breakdown, since 1995, if you look at the shareholder value in a big picture, Internet bubble took place in 2000s, and SoftBank's market cap was around JPY 20 trillion at certain time. So market cap of SoftBank was higher than shareholder value, but that was maybe just a bubble. But after that, our shareholder value has been steadily increasing. Green, SoftBank KK; in yellow and magenta, the Sprint and now T-Mobile, and Arm in SoftBank Vision Fund. The biggest portion, the orange part is Alibaba. Since going public, Alibaba's value was realized. And before that, Alibaba was losing money. But after going public, the value has been materialized, and it plays an important role for us in terms of shareholder value. To summarize, just 10 years ago at shareholders' meeting, we announced Next 30-Year Vision. Because back then, it was 30-year anniversary since the founding. And when I founded the company, there were 2 employees, and those 2 employees left just in 1 week. And after that, it took 30 years. And we announced the Next 30-Year Vision in 2010. So it's been 10 years since then. So let me look back. In 2010, we envisioned brain computer will be realized. You can say AI, so computing powered by AI will be materialized in 30 years. So that was what we envisioned 10 years ago. And I think that reality is getting closer to closer because AI is becoming common and common in our conversations recently. And DNA treatment and artificial organs will be more and more common. That was what we envisioned in 2010. And in next 300 years, the life expectancy, excuse me, will be 200 years. And back then, people were like, what? But DNA treatment can be available, utilizing AI. So again, the reality is coming closer to our vision. And also, we envision that people will coexist with intelligent robot. Back then, we did nothing about robot in 2010. But just in 10 years, [indiscernible] and Boston Dynamics robots, SoftBank Group have been developing those robots are built on AI. Again, there was none in 2010. And we envisioned in 2010 that everything would get integrated with Internet and cloud, and the cloud will become the biggest asset in mankind. In 2010, few people knew Amazon's AWS. But now cloud is becoming the biggest asset in humankind. So SoftBank's consistent Information Revolution, happiness for everyone. Our philosophy remains the same since the founding of our company. In the process, we wholesaled personal computers, and we delivered LAN and Internet services. And you did different things here and there. But I said that we are coherent and consistent. We want to drive revolution, Information Revolution. Well, sometimes people may say that what you are doing, what they are doing, but what we really want to do is Information Revolution. Methodology may be different depending on the time, and tools may be different depending on when you are, but that's not a big issue. What we want to do, what we want to make it happen is Information Revolution. And we want to make everyone happy, putting together the people who share the same vision and make this happen. That's what it matters to me most. Again, Information Revolution is our consistent philosophy, and power and speed to make them happen is what we have as a strategic holding company. That's our strategy. So this is my consistent, coherent message that I pass on to you today. Thank you very much for your attention. Now I would like to address questions. Posted on the matters for reporting and approval. May I remind you that questions-and-answer section for you to post dedicated website will be closed in 5 minutes after we start Q&A session. If you wish to make any comment, please click Comment on the screen to send it. Thank you. Now let me address questions posted. Now we are taking the questions. Thank you very much for waiting. We have a preregistered questions in advance, so I would like to start with those.

So first question is, you have been telling the public that you pass on the torch to successor when you were in 60s. Is it still the same? Thank you for your question. No change. So right now, I am 62, 63. That's about there. And I have still 7 to 8 years left. And I would like to be active and being involved as Chairman and CEO of SoftBank Group. But when it comes to 69, medical technology has been developed as well, so I said roughly 60s. So I may go beyond, but that's that. I will decide when the time comes. But that's about it. I mean, roughly -- so I don't want to be strictly on the date of the birthday of the 70 that I have to retire, anything like that. I don't want you to accuse me. I want you to be kind of a big mind and accept. And I would like to revise a little bit here that that's not too strict. I roughly, around that time that I will consider. So that's the kind of a feeling I'm having right now. And at that time, also depends on my health conditions and so on. And also depending on company's situation or business status as well. So roughly, if you can accept that as a rough estimation, so if I may be a bit wrong, please accept my apology beforehand. Next question. How do you decide where to invest and manage it properly when the business climate is changing, relying only on your personal capacity should have a limitation? Thanks for the question. On my capacity? Well, in fact, to be very honest with you, I am confident, maybe I am too confident, some people may argue. Again, to be very honest with you, I am well confident with myself and my capacity. Because I am very confident, you are just a one-man leader in a company. But this -- since that group is really big, I think that there should not -- my capacity will put a limit on something. [ So I want to maximize capacity ] of our people and putting their capacities and competence together, we can deliver more than just one person's capacity. And we have more and more excellent people, not only in Japan, but also in the world. Marcelo, for example, played an important role to make the merger successful, and Rajeev, without him, we were not able to create Vision Fund. Again, he's been really working hard for us. Companies like Vir Bio, Coupang, Grab, Uber, we often mention those names. And without Vision Fund, we could not have achieved or quite held them, so again, thanks to Rajeev, we can expect more from SoftBank Vision Fund. And not only that, like financing and funding and in any other areas, for example, CFO, Mr. Goto-san always gives me hard time. "Mr. Masa, we don't have that money." But Goto-san is really working very hard. So I should appreciate him. So a lot of people, a lot of excellent people are working in SoftBank, and then put all competencies together. And let me go to the next question. How do you decide dividend amount? It is too low, share with us your view on the return for the next few years. So dividend is low. But you may not be able to see the dividend in future. That's something that I mentioned at the closing of the earnings at the March end. That you may not be able to expect too much on dividend. That's my honest opinion at this moment. Of course, that we will try to provide the good distribution of dividend. But at the same time, at this moment, JPY 4.5 trillion program is going. And rather than distributing as dividend, I think we can also do share buyback of JPY 2.5 trillion that we have announced. That can be also the way of return to shareholders. That's the biggest of the, in Japanese market, in the record. I believe, JPY 2.5 trillion share buyback as one direction that we have already announced to the public. The resolution of the Board meeting and the execution itself will be done in phasely manner at a quarterly basis. So that raise money and purchase those share as phase -- in phasely manner. But we have already announced a direction of that program. So mainly that, that we would like to make a return to the shareholders. Next question. [ Executive compensation is higher than other ] peers, how do you calculate compensation? Well, executive compensation, I like to be generous. And in fact, I want to pay more. Well, maybe I shouldn't say this. In order to grow corporate value, you have to work hard. And if people work hard to increase shareholder value, people who contribute to the increase of increased value, I want to be very generous to pay back to them. So shareholder increased shareholder value. I want to pay back to people who contributed to increase shareholder value, I want to be very generous. In fact, maybe Japanese companies should pay more. I think compensation scheme, traditional Japanese company's competition scheme, is something that maybe I should challenge, because under that traditional Japanese compensation scheme, people may not want to take risks, people may not to borrow money. And without taking risk, how can you grow your company? You should take more risk. That's my argument. What are you afraid of? Even though you may have to borrow money, for example, Sprint's case, we had only [ JPY 0.4 trillion in cash, and we made a ] huge debt. But we reached a goal, and we were able to increase the value 5x. Of course, without confidence to go through the risk, you should not take that risk. But if you have confidence that you can get through, you should be willing to take risks. So the [ managers, executives who are willing to take risks, and if ] they deliver, then they should be paid back. Then they can take another risks. That's my view. Let me go to the next question. So under the COVID-19 situation, I think you should help those companies that's trying to support the future. And you are monetizing those assets. But I think that's inconsistent with your target that are making your market cap at the largest in the world. What do you think? Of course, that umbrella needs to be given to the others. That's -- or the bank actually, sometimes, one expression is that the bank will give you the umbrella when the umbrella is needed. But we are not the financing business. Whenever that you need to -- you make a loan, that collateral is needed. And we are investing in venture companies. So based -- it's not that providing the money for the collateral. We are looking at the future of the company and making the investment in such companies. So actually, the money is going to even higher risk. But still, it's not that everything is always perfect. The business plan is not always perfect. Sometimes that the business plan will not be able to execute and still asking for our money, then that's a little bit strange. That's not -- that's awkward. For example, that could be another WeWork, for example. So WeWork, right now, that trying to recover, is full speed. And actually, it's showing a good sign and making a good progress right now. So that's something that I am expecting on at this moment. But at least, it's not that we will provide the money to rescue the company. In principle, we will provide the money because we are believe -- we have a belief in this company with future. So it's not that we will give to you the umbrella because you have rains, but rather, we will give you umbrella when you're already seeing some shining suns. Next question. Are you going to take the management control of a company that SoftBank Vision Fund invests in? Or are you going to make it in your group [ company? Or are you going to sell the shares? Well, in principle, ] SoftBank Vision Fund will exit from those invested companies. In principle, in 10 years also. But you can extend 2 years. So total, 14 years, you have to recoup the investment. And in principle, we exit. That's basic case or in principle. But sometimes, in some cases, even though we pay back to our investment partner, but the SoftBank's portion will stay, and those companies may become our SoftBank Group's core companies. That's actually exceptional cases because [ impossible ] base case is, once you invest, we exit and recoup investment. [ That's, I think, basic philosophy of venture capital, and our Vision Fund is considered ] as venture capital, if you will. Next question is about our business. So main chip, more than 95% smartphone are adopting chip technology. And what is the technology like? That's the question. So in my presentation earlier, I mentioned Arm -- it's like a CPU, it's like an engine for the car. So the engine for the car is built in the body of the car. So which means that the chip, so it's like an [ engine in the smartphone. So almost all around the world that adopting ] a chip. And this not only for smartphone, but actually, it is built in automobiles, games, electricity, home appliances or the clouds. And this is recently also providing the AI features or adding the AI chip next to it, so that's something that enhancing features. So you can use for the IoT-type of things, you can use it for a large one. So AI is actually developed in there. The next question about our policy on share buyback. Like I said earlier, we made announcement of share buyback worth JPY 2.5 trillion. The announcement was on 23rd of March. So that's a direction. It's not a commitment or promise, excuse me, but JPY 4.5 trillion, 80% of the program we have already gained. And also, we have confidence with remaining 20%. So we could utilize that fund to repurchase our shares. One another question. Any -- what is the synergy for investees? Who is taking responsibility to enhance the synergies between the investees, and I want you to explain about that. Synergy, when you talk about it, it's not something you can force them to do. We are not the holder of more than 51% or 100%, anything like that. We are just about 20% or 30% holdings or the ownership of those companies. For Alibaba, we have about 25% ownership, and for Alibaba we never ever force them to generate any synergy with something. Even without forcing them or forcing the company, as long as they are a great company, they will be able to grow by themselves. And without forcing anything, Alibaba and our group companies has been creating the partnership to generate the synergies in between. And actually, we have been seeing great results here and there. So synergy itself is just to encourage them to think about that, so that they will be able to create even stronger ties in between those companies. So us being a big shareholder, as long as we can be happy and they may be able to promote their partnership with synergies to make us happy as a big shareholder. If they don't really try to make us happy, then that we may not want to get hold on to it, then that's going to be disposed. So having them family members in our group, and if we are comfortable and convinced, then we have a relationship between big shareholder and the kids or those companies, and we have such strong tie, and that's a good thing so that you try to make each other happy. You don't -- even that the father and the son, or the mother and the daughters, that whatever it is that they try to make counterpart happy, then if there is any dangers, so you try to comfort each other to overcome the difficulty. That's the kind of family is. Next question. When you acquired Arm, you said that Arm would become one of your core companies in the group. And I keep saying that Arm's great. I love Arm. And I believe that Arm's presence in our group is getting stronger and stronger. In Information Revolution, Information Revolution is caused by CPU, and CPU can be an engine to drive Information Revolution. And data is energy for the engine. So engine is Arm, and data is like oil for the cars. So putting engine and oil together, or putting Arm and data together, we can generate Information Revolution. So in any way, our group companies are using Arm. I think that almost all phone -- mobile users are using Arms. And the way company, and the one way that you have recorded a loss, but nobody is taking responsibility. And actually, big compensation is given. I can't understand that those directors should return the compensation taking the responsibility. The biggest responsibility comes to me. WeWork, for example, our management's employees, many people actually against the idea from the beginning, as a matter of fact. In the middle of the process, people were showing the -- against the idea. Some people were upset. And I was also speaking back. But in the course of the discussion, we have come to the decision and made the investment. So I believe I have the biggest responsibility for this, and the biggest compensation return should be coming from me. And I, myself, have reduced my compensation from SoftBank Group this time that I have [ rebuilt business ] as well. I speak to HR the other day, spoke to the HR the other day, and that they asked me for the compensation. And I said, I'm okay. JPY 0 is fine. I have to reduce my compensation. Otherwise, I am so sorry about the situation. But if we make it to JPY 0, then that's going to be -- some things are some issues there, here and there. So I think it was JPY 100 million or something like that, is a compensation. But those compensation I received, JPY 100 million, not JPY 200 million -- from JPY 200 million to JPY 100 million. So that's a deduction that I have made. But actually, I can't -- so I am actually not using -- they are actually donating all those compensation to the other. So actually, the money that's receiving from SoftBank Group is JPY 0, as a matter of fact. And once it comes to JPY 0, there is no further deduction of the compensation. What should I do? And I would say, I am, as a major shareholder of the SoftBank Group, so share price going down of SoftBank Group will be the biggest deduction of my compensation. So share price going down, we're going to be making trouble for you, but also the biggest trouble and the biggest penalty for me as well. So I believe not me deciding, but actually, investor, yourself, and shareholders are deciding that if you need to punish me, then that the share price may go down. But if even that we failed here and there, but still making up by the other success, and that success is bigger, then I believe share price will go up. So that's kind of a comprehensive view that I want you to think about. And I believe that judgment is made every day basis as share price. And also, I think that we should evaluate our other management with total, not only one case or one project, but I would like to evaluate in total as a comprehensive way. And next question. In new normal post-COVID-19, what service area you want to focus on most? That's the question. Like I said earlier, online shopping, online education, online entertainment, online work, online in medical consultant, that's something that I want to work on to help Information Revolution. And everything will be digitally transformed, hotels and offices in the middle of COVID-19 pandemic, some people are restricted going outside. But eventually, post-COVID-19, people will get back to life more actively, and autonomous driving will grow further. And what's in common around everything is there's still transformation driven by AI, and the company that will drive digital transformation on AI is going to be something that will grow further. And we are not planning to invest in old economy. So you are increasing your Board of Directors by 2 members. And what is the reason? So independent director that has decreased to 2, and we double, and now we have 4 independent directors. And we would like to receive the good feedback opinion from independent directors, so that we can enhance our corporate governance. And stop me if I'm making any bold move, and I believe many people and many managements and executives also are making a lot of comments to me bold enough. And sometimes, I give back to them as well. But we are always having a healthy arguments in between the Board and the management. But also, it is important for us to have an independent director. And rather than executives, internal executive telling me, but sometimes that makes more effective by independent director speaking. So that's the reason why that we increase the number of Board members. Next question. Of 88 companies that you invested in, how many would become like Alibaba, you think? Well, Alibaba has become a big company. But again, like I said, it still grows. In terms of market cap, Alibaba is one of the world top 5, maybe 1, 2 out of 88 might be like that company like Alibaba. Of 88 companies, like I said at the previous earnings result, 15 may not survive. But 15 may fly for success, and successful potential 15 are in sight. And I have huge expectation from those. And next question. So this time of AGM, you just accepting the easy question, and that may doubt on -- that will cast a doubt on the untransparency of the AGM. Well, thank you for your question. Because of COVID-19, it was difficult for us to let the people gather together. But once situation improve, then of course, we would like to convene the meeting in person. And here, the questions strictly from you, shareholders, and so within the same room, feeling the same air that I would like to have a meeting again when the situation change. And hope we will be able to see that day as early as possible. But this Internet online meeting had some advantage as well. For example, of course, although -- the other day, SoftBank Corp. or Z Corporation may convene the online AGM. And there are about 40,000 viewers at the same time, if I remember correctly, and that 40,000 simultaneously gathering together, holding a meeting, is not possible, or if it's physical meeting, but by having this as online, we were able to convene even more people and also have opportunity to make questions and we can answer those questions. So complete online AGM is the first time for us, so we would like to evolve and develop further for the next time. Next question. Of the new Board of Director candidates, can anybody put control of you? I mean, to make sure that you go out of control? We had executive meetings, and we received a lot of constructive questions from those candidates. And we believe that our future will be great, thanks to those outside director. And I'm talking specifically about [ Ms. Kawamoto, Professor Kawamoto in Waseda University, and she is a financial professional. And ] obviously, she has expertise and she has given us -- and she will give us very constructive opinion and feedback, and we will welcome that. And Mr. Iijima and Dr. Matsuo, who are our Board members currently, give us great opinion and feedback. And Lip-Bu Tan is one of our candidate directors. And in fact, he has been serving Boards in many, many companies, and he has been running businesses also, many companies. And he is a Chairman of [ venture ] company, Cadence. And since he became Chairman, their market cap grew, I believe, 20x or 40x. So I respect him. So we are looking forward to hearing a lot of constructive opinions from them. Well, sometimes, just putting brake is not good. Sometimes maybe you put off your foot from the brake engine. So in the interest of time, and I understand there are more questions, but we will address 2 more questions from here. So next question. Thank you very much. Purchase of share back if the share price goes above JPY 7,000. And also T-Mobile, I don't want you to sell any further more. Those are the questions that I have received. What is the right price to buy back? That's also depending on the situation and depending on the value of our assets. Also all the circumstance, environment, our cash management situation. We need to see in comprehensively. So what is the right price to do the share buyback is not something I can make any comments about here. We will, of course, like to make good progress on our program in a phasely manner. And T-Mobile, don't want you to say any further. That's your also opinion. I believe that you are very much expecting on the body of the T-Mobile in the future. Between us, Deutsche Telekom and T-Mobile, the remaining share will be kept -- a majority will be kept in 4 years. So that's the agreements between the concerned parties. So that's the kind of way in principle, I believe. Of course, this is the depending on the situation and negotiation with the counterpart is subject to change. This time, again, because of negotiation, we have changed the situation. So depending on the many mobile factors and situation. But in the amendment of the agreement this time, Deutsche Telekom has the [ lower ] from us, and also or possibility is to execute that in earlier phase. That, I believe, is still one of the terms for the agreement. So that's another thing that may be decided depending on the situation. But growth of the T-Mobile is something that we are very much expecting on. Under the monetization program, those that has been disposed, that's not because we are selling or disposing that they are not growing, but rather because we needed money. So that's why that we have disposing of those assets. That's also the case. Now we will address last question. You talk about the Information Revolution. Are you going to enter satellite business? Well, with OneWeb, we wanted to build telecommunication network using OneWeb technology. But like a shooting rocket and operate a satellite, I don't think we will do that. Well, of course, you never know what will happen. But at the moment, at least, I don't have any plan to go into a satellite business.

Well, in the interest of time, maybe we should go on to taking votes. So now I'd like to close the Q&A session and move on to taking both on matters for approval. I will take a vote on proposal 1, appropriation of surplus or dividend payment. All those in favor, please select Approve on the screen, then click Send. [Voting]

We will report results of the votes later. Now I will take a vote on proposal 2, election of 13 Board Directors. All those in favor, please select Approve on the screen, then click Send. [Voting]

Please wait for a moment. We are confirming the result. So we've been receiving many questions, and I was taking and I became passionate, and I was like making a speech or something. So first, I was told that we should be closing the meeting in 1 hour. And because of COVID situation, and they are actually telling me to close in 1 hour -- but sorry, I passed the hours already. So we already exceeded the time. But I wanted to answer as many questions because we received a lot of meaningful questions. So thank you very much for that. Yes. Thank you for your patience. I will report the confirmed results. Both proposal 1 and 2 have received the majority of affirmative votes and have been approved in the form proposed. Ladies and gentlemen, this concludes today's agenda. And I hereby declare the 40th Annual General Meeting of Shareholders of Softbank Group Corp. closed. Please note that the newly elected Board members are shown on the screen. We hope you have a chance to meet them in person in the future. And last, but not least, the term of office of Yun Ma, who was on the Board for 13 years, has expired at the conclusion of this meeting, so as of today. A few days ago, I believe he has already expressed to step down from the Board of SoftBank Group, and also, he has already announced that he is stepping down from Alibaba Group. Stepping down from CEO position of Alibaba Group. And Daniel, Mr. Daniel Zhang is already received the torch from Jack. So with today's expiry of his term, and also on same day, I, myself, would like to step down from the Board of Alibaba Group. So with my hope that I have already spoken to Alibaba and Jack is stepping down, and along with that, that I, myself also like to step down from the Board of Alibaba Group, it's not that any arguments in between us and them or anything like that, it's just a happy ending. Actually that with Jack is kind of graduating from SoftBank Group, and I am graduating from Alibaba Group as a Board. And on the same day, as of today, I am stepping down from the Board of Alibaba Group. So with this, taking this opportunity, I wanted to communicate it to you. And I would also like to extend my sincere appreciation to his greatest contributions to SoftBank Group Corp. And even after he stepping down from the Board, we are the large shareholder of Alibaba. And also, we are both great -- they are a very important asset of ours and also one of the core assets as well. As I mentioned, Jack, has already stepped down from CEO of Alibaba Group last year. So me and Jack, and after we are stepping down from respective Board, Mr. Daniel Zhang has already succeeded the CEO position of Alibaba Group, and hope he will continuously lead the great Alibaba as a young and a great leader. And we are so convinced that he will be able to make that happen, and we are so grateful that he is such a trustful person to lead. And we would like to celebrate him, me, myself, and Jack's retirement from the Board is sign of trust to Daniel, and sign of respect to Daniel as well, because we are so convinced that he can lead the great company. But still, Alibaba share, of course, we would like to be a long holder as much as possible. That is all from me. Thank you so much, once again, for joining us at the General Meeting of Shareholders today. [Statements in English on this transcript were spoken by an interpreter present on the live call.]