"The firm will double down on another big bet in the AI space-OpenAI. SoftBank expects to invest $30 billion directly in OpenAI this year, according to its second-quarter financial statement in September. And it had already committed $19 billion to the $500 billion Project Stargate infrastructure initiative (with OpenAI and Oracle). To bankroll these commitments, Masayoshi Son, SoftBank's CEO, likely needed to free up funds. Hence the Nvidia sell-off."
"For years, Son has talked about SoftBank's strategy to invest in the "computing platforms of the future," including artificial intelligence. His firm amassed a reported $4 billion stake in Nvidia back in 2017, only to dump the shares in 2019. At the time Son had called Nvidia the "the core company of the AI revolution." He now believes that OpenAI will be that core company."
SoftBank announced plans to sell its entire 32 million-share stake in Nvidia, triggering a roughly 2% immediate decline in Nvidia shares. The firm plans to redeploy proceeds to significantly increase investment in OpenAI, including an expected $30 billion direct investment this year and earlier commitments of $19 billion to the $500 billion Project Stargate initiative with OpenAI and Oracle. Masayoshi Son views OpenAI as the central platform of the AI future and is positioning SoftBank to take a more active role in that platform’s expansion. Nvidia’s recent revenue and market-cap strength contrast with OpenAI’s later expected profitability, projected in 2029.
Read at Fast Company
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