Softbank makes $19 billion with OpenAI and wants to dominate AI

Elon Musk predicted it again: artificial intelligence will save billions. According to him, this future is yet to come. Not for Softbank. For the Japanese giant, the billions are already there, and AI is no longer a promise, but a reality. Within a few months, the company turned a bold bet into a historic jackpot. And while others linger, Softbank is diving headlong into the AI ​​revolution, poised to become its global pillar.

OpenAI: the jackpot that pays more than the cryptojackpot

AI news: in September 2024, Softbank enters the capital of OpenAI. It’s been euphoria ever since. The result: $19 billion raised in a single quarter through participation in the Vision Fund. CFO Yoshimitsu Goto sums up the performance bluntly:

The reason we were able to achieve this result is last September: that’s when we first invested in OpenAI.

With a valuation that has jumped to $500 billion, OpenAI is outpacing many star cryptocurrencies such as Ethereum. But for Softbank, the most impressive number isn’t: it’s the speed.

Masayoshi Son, the founder of Softbank, does not hide his ambition: to become a key player in the field of artificial intelligence. He claims that AI will transform all industries and lifestyles.

The group isn’t just gambling: it’s building long-term dominance.

Sell ​​Nvidia and buy the future: Liquid Softbank bets on AI

To keep up, Softbank had to find cash. In October, he sold 32.1 million Nvidia shares, raising $5.83 billion. At the same time, part of T-Mobile’s shares are sold, for 9.17 billion.

But that’s not all. Two bridging loans (8.5 and 6.5 billion) and bonds in dollars, euros and yen increase the envelope. In total, more than 20 billion have been raised for a single goal: OpenAI.

Set goal: invest $34.7 billion in AI by December through Vision Fund 2. At this point, even Meta and Google seem timid.

Softbank doesn’t want to miss the train:

Opinions vary, but SoftBank’s position is that the risk of not investing is far greater than the risk of investing.

Yoshimitsu Goto, CFO of Softbank.

And it’s a shame that some people are talking about a bubble. For Syn, it is better to take a big risk than to remain a spectator.

Dizzying numbers, market tension and the dream of total AI

The results are staggering: a net profit of 2,500 billion yen in one quarter. And yet, as soon as these numbers were announced, Softbank lost 50 billion in stock market capitalization. Volatility is maximum.

However, the vision remains clear. Softbank partners with OpenAI and Oracle to build 5 mega data centers in the United States. Goal: provide 7 GW for AI. It is an investment of 400 billion dollars in 3 years. Never before.

Meanwhile, other large groups such as Amazon or Google are hesitant. Too much risk? Maybe. But for Softbank, it’s now or never.

What to remember in 5 points

• Softbank doubles quarterly profits to ¥2.5 trillion;
• OpenAI delivered 93% annual growth in AI revenue;
• OpenAI valuation: $500 billion;
• Softbank plans to invest $34.7 billion in artificial intelligence by the end of 2025;
• A 4-for-1 stock split makes its shares available to the general public.

But everything is not rosy. A complaint was recently filed against OpenAI. This implicates GPT-4o in cases of suicide. A tragic matter that reminds us that even the most promising technologies can have a human cost. For Softbank, as for AI in general, the real challenge remains: growth without slippage.

DISCLAIMER OF LIABILITY

The comments and opinions expressed in this article are solely those of the author and should not be considered investment advice. Before making any investment decision, do your own research.