Softbank Group Corp has reported an increase its operating income for the third quarter of 7.3% on new wireless customers in Japan. Masayoshi Son, the billionaire chairman, is starting to see signs of the beleaguered Sprint Corp turning around.
Operating profit was up, ending the quarter at 189.6 billion yen equal to $1.65 billion in the three-month period that ended on December 31. Net income was down 88% to just 2.3 billion yen.
Softbank shares have been hammered by the pessimism over the ability of Son to turn around Sprint after he spent $22 billion to gain a controlling stake in the U.S.-based company in 2013.
With close to $100 billion in debt, ending losses at the wireless carrier has been seen as critical to the revival of its stock, with Son saying on Wednesday the struggling unit was making progress.
Son said that Sprint was showing signs of turning around, yet more opportunities exist for cost cutting as well.
Sales for Sprint s third quarter were up 4.3% to just over 2.4 trillion yen. The company did not provide a forecast for the full year.
Softbank shares were down 3.5% in Japan before the earnings report being announced. This year alone, the stock has lost 25% of value.
Sprint, which has been spending massive amounts of cash the past 12 months, was able to increase cash and its equivalents by nearly 12% to more than $2.2 billion during the December ending quarter.
The U.S. wireless carrier increased its forecast for profit calling for its earnings prior to EBITDA of $8 billion for its fiscal year 2016 in comparison with an outlook released previously of $7.1 billion.
The carrier is the second largest investment of SoftBank trailing just the stake the Japan-based company has in online e-commerce giant Alibaba Group Holding.
Shares of Sprint are down this year by 25% while Alibaba shares have fallen nearly 24%.