Japanese tech giant SoftBank sold its $5.8 billion stake in Nvidia, redirecting its focus and substantial profits towards artificial intelligence ventures, particularly with OpenAI, amidst a booming AI market.
SoftBank Group Corp. announced it sold its stake in Nvidia in October, generating $5.8 billion, a strategic move to reallocate investments towards artificial intelligence, specifically OpenAI, the owner of ChatGPT. The Tokyo-based company also reported a significant financial uplift, with its profit nearly tripling to approximately 2.5 trillion yen (about $13 billion) in the first half of the fiscal year (April-September), and sales increasing 7.7% year-on-year to 3.7 trillion yen ($24 billion). SoftBank's financial success is attributed to its diverse portfolio of tech investments, including through its Vision Funds, which have recently yielded strong returns. Chairman Masayoshi Son has been a key player in major AI initiatives, including a project called Stargate. SoftBank has already invested tens of billions in OpenAI and plans to collaborate on providing AI services in Japan. The article highlights that the sale of Nvidia shares reflects Son's evolving strategy and capitalized on Nvidia's recent market value surge, which saw it become the first $5 trillion company. Nvidia itself plans a $100 billion investment in OpenAI to enhance AI data centers. The broader AI frenzy has driven significant rallies in chip makers like Nvidia, Arm Holdings, and Taiwan Semiconductor Manufacturing Co., all of which SoftBank has investments in. Despite the stock market's enthusiasm, some critics draw parallels to the 2000 dot-com bubble, fearing an overheated market. SoftBank and Nvidia maintain strong ties, as many SoftBank-backed ventures continue to utilize Nvidia's technology. SoftBank's own stock has seen substantial growth, nearly doubling in value over the past year.
