TOKYO (Reuters) – Japan’s SoftBank Group Corp announced a $5.5 billion share buyback on Wednesday as it reported a 60 percent rise in quarterly operating profit buoyed by rising valuations for its technology investments.

SoftBank Group said it would repurchase 112 million shares worth 600 billion yen ($5.5 billion) in the next 11 months, or about 10.3 percent of its total outstanding shares, excluding treasury stock.

The buyback comes after SoftBank Group raised 2.35 trillion yen in December by listing about a third of the shares in domestic telco SoftBank Corp, which on Tuesday reported a 24 percent jump in quarterly operating profit.

SoftBank Group said its operating profit in the October-December quarter was 438.3 billion yen ($3.99 billion) versus 274 billion yen a year earlier. The year-earlier figure used previous accounting standards.

Profits at SoftBank Group are increasingly affected by the valuations of big technology bets through its own investing activities and its Saudi-backed Vision Fund, which launched last year with over $90 billion in capital.

At the end of the October-December period, which saw weakness in technology stocks and fears of a China slowdown, the Vision Fund had invested $45.5 billion in 49 firms, including ride-hailing assets transferred from SoftBank Group.

Those investments – including ride-hailing firm Uber Technologies, shared workspace provider WeWork Cos, semiconductor maker Nvidia and chip designer ARM – are valued at $55.3 billion, SoftBank Group said.

“The exact manner in which SoftBank determines the value of its investments remains murky,” Sanford C. Bernstein analyst Chris Lane said in a note ahead of the earnings announcement.

“Without a ‘down round’ we doubt any of the unlisted investment will be revalued,” Lane said, referring to when a company’s valuation is reduced in a subsequent financing round.

Among SoftBank’s stakes in listed companies, weak demand for gaming chips in China helped to push down the share price of U.S. chipmaker Nvidia by 50 percent from its October peak.

SoftBank Group said it had offset most of the fall in Nvidia’s share price through derivatives contracts.

VALUATIONS

China’s slowing growth and its trade war with the United States are affecting valuations of unlisted technology firms.

Stakes in Chinese ride-hailing firm Didi Chuxing, which is backed by SoftBank Group, have traded at prices implying a valuation of $40-44 billion. That compared to a valuation exceeding $65 billion after its 2018 funding round.

WeWork’s higher valuation is based on a further investment by SoftBank Group, which has injected more than $10 billion into the loss-making office-sharing firm now valued at $47 billion.

As the valuations of the technology bets increase, investors are looking at SoftBank’s exit strategy. Vision Fund’s first public exit last year involved the sale of its stake in India’s Flipkart to U.S. retail giant Walmart for a $1.5 billion profit.

A successful IPO by Uber, which is expected to list this year, will bolster Vision Fund’s strategy and serve as a model for other portfolio companies, analysts say.

SoftBank Group shares closed up 0.6 percent ahead of the earnings announcement.

They are up 16 percent this year, but still 26 percent below their September peak, having tumbled on concerns about financial ties to Saudi Arabia following the murder of a Saudi journalist.

The technology and telecoms conglomerate did not release a forecast for the current business year, saying there were too many uncertain factors.

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