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SoftBank Stock Is a Play on OpenAI. It’s Paying Off So Far.

Nov 11, 2025 08:20:00 -0500 by Adam Clark | #AI #Barron's Take

SoftBank Group CEO Masayoshi Son has championed its investments in OpenAI. (Charly Triballeau/AFP via Getty Images)

Key Points

Nvidia or OpenAI? The two companies are at the heart of the artificial-intelligence boom but Japan’s SoftBank Group has decided to sell its stake in the chip maker in order to fuel an even bigger bet on the ChatGPT developer.

SoftBank sold a $5.83 billion stake in Nvidia in October, it disclosed alongside its earnings on Tuesday.

That brings to an end a long saga between the two companies. SoftBank was once one of Nvidia’s biggest shareholders and even offered to loan Nvidia CEO Jensen Huang money in order to take the company private. However, SoftBank founder Masayashi Son subsequently cut back the investment, missing out on hundreds of billions of dollars worth of potential gains.

So why sell out now?

“It’s nothing to do with Nvidia itself,” SoftBank Chief Financial Officer Yoshimitsu Goto said during an earnings call. Instead, he pointed to the company’s financing needs for its enormous investment in OpenAI.

SoftBank has been leading an investment of up to $40 billion in OpenAI, with plans to syndicate out $10 billion to co-investors. On Tuesday it said co-investors had committed to the entire syndication amount, and that it will invest an additional $22.5 billion in OpenAI through its Vision Fund 2 in December. SoftBank is also a partner with OpenAI in the $500 billion Stargate AI infrastructure project.

Son has been one of OpenAI’s most prominent backers, forging a close relationship with the AI company’s CEO Sam Altman. It has been a lucrative bet so far—SoftBank’s quarterly net profit more than doubled, helped by the revaluation of its OpenAI stake and its shares have more than doubled this year so far.

“This print continues to build on SoftBank’s growth pivot, investing leading AI and automation companies, delivering strong underlying fundamentals, and benefiting from thematic/ secular tailwinds for its equity holdings, and the resilience of its balance sheet,” wrote Macquarie analyst Paul Golding in a research note on Tuesday.

Golding has an Outperform rating on SoftBank stock with a price target of 22,000 yen ($142.94). SoftBank closed up 2% at 22,695 yen on Tuesday.

Son said earlier this year that he expects OpenAI to go public within the next few years and become “the most valuable company on Earth.”

Ordinary investors might prefer the certainty of Nvidia’s revenue right now—which analysts expect to come to around $208 billion in its current fiscal year according to FactSet—to SoftBank’s bet. OpenAI expects to reach over $20 billion in annualized revenue this year, rising to “hundreds of billions” by 2030, according to Altman, while being on the hook for infrastructure spending commitments of approximately $1.4 trillion over the next eight years.

However, Nvidia shareholders might want to keep an eye on OpenAI and SoftBank’s joint chip making ambitions. SoftBank is the majority shareholder of chip-design firm Arm Holdings and invested $2 billion in Intel in August.

SoftBank also held talks about potentially acquiring custom chip designer Marvell Technology earlier this year, according to Bloomberg, although talks reportedly ended without an agreement. Marvell declined to comment on the report and SoftBank didn’t respond to a request for comment.

OpenAI’s Altman has made no secret of his desire to have more control over the company’s chip supply. He previously pitched a plan to raise as much as $7 trillion for a network of chip-manufacturing facilities, according to The Wall Street Journal, although he appears to have backed away from such ambitious projects for now.

Still, it’s a fair bet that whatever OpenAI’s custom chip plans are in the future, SoftBank will be involved. The path is open to switching from Nvidia’s backer to its rival.

Write to Adam Clark at adam.clark@barrons.com