SoftBank Corp.’s 38th Annual General Meeting of Shareholders: Investing in AI for Future Business Growth

SoftBank Corp. (TOKYO: 9434) held its 38th Annual General Meeting of Shareholders (AGM) on June 20, 2024, at Tokyo Garden Theater in the Ariake area of Tokyo. President & CEO Junichi Miyakawa chaired the meeting, and after reviewing SoftBank's business progress, strategy and answering shareholder questions, all three proposals were approved.

Strengthening generative AI initiatives

Following the showing of a video that reviewed SoftBank's business results for the fiscal year ended March 31, 2024 (FY2023), Miyakawa gave an update on SoftBank's strategy.

He noted that in the Medium-term Management Plan first announced in May 2023, SoftBank announced an operating income target of 970.0 billion yen for FY2025. Given a strong business performance in FY2023, an operating income of over 1,000 billion yen can be generated on a run rate basis in FY2025, he said. With a view to the next Medium-term Management Plan, Miyakawa explained that SoftBank will allocate a portion of these assumed higher-than-anticipated profits to growth investments.

One key growth area is generative AI. Over the next seven years, the market for generative AI in Japan is expected to grow by 15 times, and all industries in Japan, including finance, healthcare, consumer services and media will see its implementation.

With regard to share price performance, Miyakawa noted that SoftBank's total shareholder return (TSR), which factors in share price and dividend payouts, is outperforming its telecommunications peers in Japan. "We plan to maintain our high dividend ratio of 86 yen per year," he added.

Miyakawa then shifted his focus to SoftBank's long-term strategy. Observing the remarkable evolution of generative AI services in the past two years, he cited call centers as one important use case. In a video demonstration of a joint development project with Microsoft Japan, a call center AI representative quickly helped a customer solve a connectivity issue.

Miyakawa also highlighted the fact that employees have generated approximately 160,000 generative AI business ideas, of which 10,000 patents have been applied for in a wide range of fields, as a result of an ongoing in-house AI contest.

Preparing for the 6G era

Looking to the future, Miyakawa outlined how SoftBank aims to strengthen its core business of telecommunications. "2024 is said to be the first year of 6G," Miyakawa said, noting that work to decide specifications and standards is fully underway. He described three key elements that will be key to SoftBank in the 6G era: 1) applying AI to communications, 2) combining sensing with communications, and 3) ubiquitous communications.

For applying AI to communications, he noted SoftBank's AI-RAN initiatives, including the joint construction of a lab to research AI-RAN with NVIDIA, and for combining sensing with communications, a project at SoftBank headquarters that uses radio waves to monitor building occupants while safeguarding their privacy. To bridge the digital divide and connect unconnected areas, ubiquitous communications, which includes non-terrestrial networks (NTN) such as stratospheric-based communications (HAPS) will be key, he said. Miyakawa explained that SoftBank continues to be a leader in HAPS with its development of foundational technologies and a top-ranking position in acquired patents.

Technology to support the society of the future

In the last part of his presentation, Miyakawa explained the reasoning behind SoftBank's data center initiatives, noting that Japan's data center power capacity has catching up to do, with its current national capacity of approximately 2GW versus data center facilities in the US that have single-digit GW capacity at standalone sites.

With little room for expansion in major urban centers like Tokyo and Osaka, SoftBank is working to build distributed AI data centers in different regions of Japan, including a 300MW facility in Tomakomai City in Hokkaido. "We want to build an ecosystem where electricity is locally produced and consumed while revitalizing industries and creating new services," he said.

Before the close of the AGM, Miyakawa welcomed incoming directors and expressed appreciation for outgoing directors. Long-serving Director and former CEO Ken Miyauchi commented that he is graduating from directorship at the time of a "gold rush" for the company, and expressed his confidence in SoftBank's continued growth and development.

More information on SoftBank's 38th AGM can be found here.

(Posted on June 20, 2024)
by SoftBank News Editors