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SoftBank Nvidia Stake Sale: SoftBank Group shook the markets on Tuesday with the sale of its entire Nvidia stake worth $5.8 billion. The move reignited worries that the artificial intelligence boom could be losing steam.
Those fears grew louder following recent caution from major Wall Street leaders and a well-known short seller.
In its quarterly earnings report, the Japanese tech giant confirmed that it sold all 32.1 million Nvidia shares it held in October.
The funds will fuel CEO Masayoshi Son’s ambitious AI plans, anchored by his bold “all in” investment in ChatGPT creator OpenAI.
SoftBank plans to channel the money into some of its biggest projects yet. This includes the $500 billion Stargate initiative aimed at expanding data center capacity across the United States.
It has also pledged up to $40 billion to support OpenAI, though the company shared no details about how that funding will work.
Still, the timing of the sale has unsettled some investors. Many are starting to wonder if the AI industry’s soaring valuations have run ahead of reality.
Nvidia’s stock slipped more than 2% in early trading, putting pressure on the S&P 500 index. Investor anxiety deepened after AI cloud provider CoreWeave cut its revenue outlook because of a contract delay, sending its shares down 9%.
Concerns about an AI bubble have been growing louder in recent weeks. The CEOs of Morgan Stanley and Goldman Sachs have both warned that the market could be due for a correction.
Adding to the unease, hedge fund manager Michael Burry — best known for predicting the 2008 housing crash — has taken short positions against Nvidia and Palantir.
Several analysts believe SoftBank’s latest move shows that Masayoshi Son — known for his bold bets in tech — thinks Nvidia’s remarkable rally may be slowing.
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The chipmaker recently became the world’s first $5 trillion company after its stock skyrocketed more than 1,200% in just three years. Some analysts, however, pointed out SoftBank’s mixed history with Nvidia.
The company reportedly missed out on more than $100 billion in gains after selling its stake back in 2019, just before the AI boom began, and then later bought the shares again.
“Timing hasn’t exactly been Son’s strong suit when it comes to trading Nvidia,” said C.J. Muse, senior managing director at Cantor Fitzgerald.
“This looks more like a strategic move — reallocating funds to chase new opportunities.”
OpenAI in Focus: Son Builds a Growing War Chest
In addition to selling its Nvidia stake, SoftBank has unloaded roughly $9.2 billion worth of T-Mobile shares.
The move gives Masayoshi Son a bigger pool of cash to strengthen his position in the fast-moving AI race — an industry hungry for both funding and chips to build systems that could one day rival human intelligence.
“By cashing out now, he’s securing the resources to go all in on his AI vision,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors.
“That means backing major efforts like OpenAI, Oracle, and the ambitious Stargate project.”
SoftBank’s expanding bet on OpenAI is drawing it even closer to the startup at the center of a web of complex deals — the kind that have sparked fresh concerns about an AI market bubble.
The move comes despite the heavy losses SoftBank has suffered through its Vision Fund investments.
This year, the company’s stock has more than doubled, with much of that momentum tied to its growing exposure to OpenAI.
Shares climbed again last month after news broke of a major restructuring at OpenAI, which marked a clear shift away from its nonprofit foundation.
Reuters reports that the startup is exploring a possible public listing valued at around $1 trillion as early as next year. If that happens, it could bring huge returns for key investors like Microsoft and SoftBank.
The surge in OpenAI’s valuation has already worked in SoftBank’s favor. The company’s net profit for the second quarter more than doubled, thanks in part to its growing exposure to the AI powerhouse.
OpenAI has not yet explained how it plans to finance its enormous $1.4 trillion worth of AI infrastructure projects.
The company expects to end the year with roughly $20 billion in recurring annual revenue and has recently backed away from earlier suggestions that it might need government-backed loans.
“The Vision Fund’s rocky history makes this decision feel a bit like a high-stakes poker game,” said Michael Ashley Schulman.
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