SoftBank

SoftBank has sold its 32.1 million NVIDIA shares for $5.83 billion, completely liquidating its position in the chipmaker, according to CNBC. It has also divested part of its stake in T-Mobile for another 9.17 billion. Why is it important. The sale speaks of a radical strategy: SoftBank is abandoning the physical infrastructure (chips) to bet directly on the application layer (AI models). This is not necessarily a lack of trust in NVIDIA (although that is not a great sign), but an extreme concentration of capital in OpenAI, where it has committed up to $40 billion and leads the stargate project of 500,000 million for data centers. The facts. SoftBank announced profits of $16.3 billion in its fiscal second quarter, driven primarily by your investments in OpenAI through the Vision Fund. The fund earned 19 billion in the July-September period, offsetting losses in other positions such as another AI giant: Alibaba. Between the lines. This is not the first time that SoftBank has sold NVIDIA. He already did it in January 2019, then liquidating a position of 4,000 million acquired in 2017. That move, made when NVIDIA shares had fallen more than 50%, received a lot of criticism for its timing. Now it repeats the move, but in a radically different context: NVIDIA is at all-time highs and dominates the AI ​​chip market. The difference is that in 2019 SoftBank sold due to the need for liquidity after the WeWork fiasco. In 2024 he sells by strategy: he needs a lot of cash to finance his bet on OpenAI and he cannot do so without liquidating winning positions. In any case, the reading is clear: when it comes to AI, SoftBank believes more in the profitability of the models than in that of the infrastructure. The money trail. SoftBank has already invested 9.7 billion in OpenAI through Vision Fund 2 since September 2024. The company will lead the Stargate project with OpenAI, contributing 19 billion of the initial 100 billion (OpenAI will put in another 19,000). Each firm will control 40% of the project. To contextualize the magnitude: SoftBank’s total commitment to OpenAI (40 billion) is equivalent to almost seven times the value of the NVIDIA shares it just sold. The contrast. The really surprising thing is not that someone is selling NVIDIA at maximums, but that that someone is precisely SoftBank. Masayoshi Son He has built his reputation as one of the most aggressive investors in the tech world, known for holding positions even when the market turns against him and for doubling down on bets in times of uncertainty. This sale of NVIDIA, the most coveted asset of the moment in technology, would have made more sense coming from conservative funds or traditional institutional investors looking to secure profits. But SoftBank is not that type of investor. That it is precisely the Vision Fund that abandons the star AI stock says more about the magnitude of its commitment to OpenAI than about its vision of NVIDIA. Yes, but. SoftBank remains indirectly linked to NVIDIA. The Stargate project will rely heavily on NVIDIA chips for its data centers. The company also maintains its majority stake in ARM, whose architecture competes with NVIDIA’s in certain segments. In addition, Son’s record in big bets is lime and sand: the Vision Fund lost 27.4 billion in 2022 due to failed investments like WeWork (100 million invested) and FTX. OpenAI could be your great redemption. Or your biggest mistake. At stake. SoftBank’s bet represents a clear hypothesis about where value is captured in AI: not in making the chips that train the models, but in owning the models and the infrastructure that runs them. It is choosing to be OpenAI rather than being the provider of OpenAI. Time will tell if they were right to change picks and shovels for the mine itself. In Xataka | AI is a bonfire of money and the ‘big tech’ have just decided that they are going to add even more fuel to it Featured image | Wikimedia Commons, Wikimedia Commons