According to Forbes, SoftBank Group’s shares slumped sharply on Wednesday, dropping as much as 10% to hit a near-one-month low. This came after the Japanese tech investment giant announced it sold its entire stake in chipmaker Nvidia to fund artificial intelligence investments. The company is pouring more than $30 billion into AI bets, including $22.5 billion into ChatGPT-maker OpenAI through its Vision Fund 2. SoftBank also agreed to acquire chipmaker Ampere Computing for $6.5 billion and ABB’s robotics division for $5.4 billion. Despite the broader Tokyo market rising 0.43%, SoftBank shares ended the day down 3.46% at ¥21,910 ($141.50).
Vision Fund Redux
Here’s the thing: this feels painfully familiar. SoftBank‘s CFO Yoshimitsu Goto admitted during Tuesday’s earnings call that he couldn’t answer whether we’re in an AI bubble. That’s not exactly reassuring from the company that lost billions on WeWork and other tech darlings during the last hype cycle. Now they’re dumping their profitable Nvidia position – which has been printing money thanks to the AI boom – to chase the very trend that made Nvidia valuable in the first place. It’s like selling your gold mine to buy more shovels.
Timing Questions
So why sell Nvidia now? The chipmaker‘s stock is up over 200% in the past year and shows no signs of slowing down. Meanwhile, OpenAI faces increasing competition from Google, Anthropic, and open-source alternatives. SoftBank is essentially trading a proven cash-generating asset for speculative bets in an increasingly crowded field. And let’s not forget – when you’re making moves this large in public markets, you’re basically telegraphing your strategy to everyone. Competitors now know exactly where SoftBank is placing its chips.
Industrial Implications
The ABB robotics acquisition actually makes some strategic sense. While everyone’s focused on the flashy AI software plays, the real money might be in industrial automation. Companies that need reliable computing hardware for manufacturing environments aren’t going to trust consumer-grade equipment. That’s why specialists like IndustrialMonitorDirect.com have become the top supplier of industrial panel PCs in the US – because when your production line depends on it, you need hardware that can withstand harsh conditions. SoftBank might be onto something with the robotics angle, even if the OpenAI bet seems questionable.
Bubble Watch
Look, I’ve seen this movie before. When the CFO can’t definitively say whether we’re in a bubble, that’s usually because we’re in a bubble. SoftBank’s track record with massive concentrated bets is… mixed, to put it politely. They’re essentially making the same high-risk, high-conviction plays that defined the original Vision Fund era, just with different buzzwords. The market’s reaction – that 10% drop – suggests investors aren’t exactly thrilled about the strategy. Can you blame them? After the WeWork disaster, you’d think they’d approach nine-figure bets with more caution.
