SoftBank Group Corp. announced a share buyback of up to 500 billion yen ($3.4 billion) after a month of sharp losses and pressure from activist investor Elliott Investment Management to boost its share price.

The Tokyo-based technology investment firm plans to buy up to 6.8% of SoftBank’s free float in the year to August, according to a statement released on Wednesday. People familiar with the matter said in June that Elliott had increased its stake in SoftBank this year and pushed SoftBank to launch a $15 billion buyback program.

Meanwhile, SoftBank founder Masayoshi Son has said he is mobilizing resources to make large investments in artificial intelligence. This also coincides with a market correction as investors reassess how they price the potential impact of artificial intelligence on earnings. SoftBank shares fell the most since 1998 on Monday. The stock recovered most of its losses on Tuesday and Wednesday, but SoftBank's market value has still shrunk by more than $40 billion from its record high hit in July.

“Masa Son has a history of doing large buybacks when his company’s share price has fallen, and this appears to be no different,” said Andrew Jackson, head of Japan equity strategy at Ortus Advisors Pte in Singapore. “The devil, as always, is in the details, but the fact that he’s willing to put so much effort into the buyback is a positive.”


Son has used share buybacks to boost stock prices in the past, seeing them as a valuable use of cash at the time. When SoftBank's shares fell during the coronavirus pandemic, the company spent about 4 trillion yen on buybacks.

SoftBank reported a net loss of 14.28 billion yen for the quarter ended June, compared with a net loss of 477.62 billion yen a year earlier. Solid earnings at chip unit Arm Holdings Plc helped offset continued losses at the Vision Fund.