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SoftBank aims to become leading platform provider of 'Artificial Super Intelligence'

Masayoshi Son, CEO of the SoftBank Group

$9984 (+2,27%)announced plans to develop the company into a leading platform provider for "artificial superintelligence" within the next decade.

At the annual shareholders' meeting, he compared this goal to the dominance of Microsoft $MSFT (-0,2%), Amazon $AMZN (+1,62%) and Google $GOOGL (+2,74%) and referred to the "winner takes all" dynamic.

He defined artificial superintelligence as a technology that outperforms human capabilities by a factor of 10,000.

By 2025, SoftBank had invested massively in AI, including the acquisition of US chip designer Ampere for USD 6.5 billion and up to USD 40 billion in funding for OpenAI.

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SoftBank's cyclical bets follow a historic boom-bust pattern:

Son's new "all-in" stance on OpenAI (32 billion US dollar investment) mirrors his previous high-risk tech bets that have shaped SoftBank's history.

This reflects a consistent pattern of massive, concentrated investments - from $100 million in Yahoo in 1996, to $20 million in Alibaba in 2000 (whose value grew to $130 billion), to the $100 billion Vision Fund in 2017.

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This approach with high risk and high returnas critics have called it, has changed the risk capital landscape with inflated valuations and pressure on competitors to match the same level of funding.

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SoftBank's strategic positioning mirrors previous battles over technology platforms.

Son's ambition to be the "organizer of the industry" in artificial superintelligence is reminiscent of the platform dominance strategies that spawned trillion-dollar companies like Microsoft, Amazon and Google.

SoftBank is strategically expanding its AI base through talent acquisition and infrastructure investmentsincluding the acquisition of semiconductor designer Ampere for $6.5 billion and a $40 billion commitment to OpenAI.

The company's approach leverages its historical strength in hardware through Arm Holdings to create an integrated AI ecosystem that includes chips, infrastructure and applications.

SoftBank's funding pattern typically encourages market consolidation, providing capital on a scale that forces smaller competitors to merge or exit - a strategy that fundamentally changes the competitive dynamics in target sectors.

This platform strategy is in line with Son's long-term vision, which he has been articulating since at least 2017: a future with one trillion connected devices by 2035, allowing SoftBank to capitalize on the massive data streams powering advanced AI systems.

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https://www.techinasia.com/news/softbank-aims-to-lead-in-artificial-super-intelligence

The share price has also been rising again for some time, as investors are generally becoming more optimistic. Nevertheless, it is still massively undervalued in my opinion. In addition to the crucial AI platform strategy (for which they themselves are creating demand with Stargate (USA, UAE, UK...), so theoretically benefit twice over), there are of course many other interesting investments and initiatives (Wayve, Grab $GRAB (+5,21%)Coupang $CPNG (+3,49%), 21 Capital, Helion, PayPay Expansion.....). Overall, I believe in the company's vision and see many indications that it could succeed :)

10 Commenti

Der Spekulant@Derspekulant1

He should first find the money for the stargate with almost 100 billion in debt 😅

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PikaPika0105@PikaPika0105

@Derspekulant1 The money has already been raised. They are putting around 19 billion dollars into it. Stargate is supposed to run largely on project financing.

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Der Spekulant@Derspekulant1

@PikaPika0105 Nevertheless, softbank is pretty well known for not making the best investments and or getting in far too late, which is why the company has been on the verge of bankruptcy at least 3 times. It's hard to believe that exactly those who see little risk everywhere are doing this. Especially with one of the highest leverage and the highest debt. I just remember what happened in the dot com bubble, Vision Fund crisis and the massive crash in 2022-23 with 30 billion losses. There are definitely better ones.
If they now have problems with their late entry into Openai (300 billion valuation, other funds are in at under 100 billion) due to the fact that Microsoft and OpenAI are currently in a bit of a dispute, I see black.

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PikaPika0105@PikaPika0105

@Derspekulant1 It's also called high risk high reward. "Known for not making the best investments": 70 billion Alibaba profit and 100 billion ARM profit could perhaps also be mentioned instead of always just looking at the failures, which were significantly lower. The 30 billion loss mentioned is also only based on a temporary loss in value of investments, but not a loss of substance in general. All in all, it's just not for conservative investors, who might as well buy Allianz or something. It also bothers me that the strategy or anything else is never discussed in terms of content, but that the fundamental criticism is unpacked directly based on things from the past.

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Der Spekulant@Derspekulant1

@PikaPika0105
Sure, "high risk, high reward" sounds exciting at first - but that's the problem with SoftBank:
The risk is real, the reward mostly theoretical.

Alibaba and ARM were outliers, not the rule. They were bought over 15 years ago, at completely different valuations, in a different market phase. If you use two lucky hits as an argument, you also have to say:
SoftBank subsequently poured 100 billion into venture stuff where the success rate was devastating - WeWork, OYO, Katerra, Greensill, Wag, Zume ... all total failures.

And the reference to "only temporary losses" is window dressing. If you write off 30 billion in value, your creditworthiness drops, your access to capital becomes more expensive and you have to sell assets to stay liquid. SoftBank lives on valuation fantasy, not on stable cash flow. If tomorrow OpenAI is only worth 150 billion instead of 300 billion, that's a real blow to the balance sheet - and that's where the problem lies.

The strategy?
The strategy is: all-in on hype, paid for with debt. No infrastructure moat, no cloud business, no own IP, no operating margin. Only bets on others.

And yes, if you are conservative, you can buy Allianz.
But if you are willing to take risks AND are rational, go for Nvidia, KKR, Microsoft or Brookfield - because the chances of real reward don't depend on whether a single bet works out.

SoftBank is making noise, throwing billions around - but under the surface it is an over-indebted hype machine that could falter again at any time. For me, it's not an investment to be taken seriously, but at best a trade for people with nerves of steel and a penchant for gambling.

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PikaPika0105@PikaPika0105

@Derspekulant1 So the reward for every investment is initially theoretical. To say that the positive investments are luck and the unsuccessful ones are incompetence is ridiculous. Why weren't the others bad luck? It would only be hype if AI had no long-term value. Moreover, it is not true that you don't have your own IP etc., because that is precisely what the current change in strategy consists of, which of course has continued to be skillfully ignored. IP from ARM, Ampere Computing, Graphcore, SoftBank (Telekom), SoftBank Robotics.... is all their IP. Their cash flow is also the holding company's cash flow. And the corresponding synergies are now being created there to build an AI platform. To this end, other portfolio companies in which they only have shares are also being activated (e.g. Agile Robots). Those who continue to focus on mainstream stocks such as NVIDIA, where with a market capitalization of almost 4 trillion dollars there is certainly still a lot of room for growth and competition is guaranteed never to emerge, can do so. It is quite presumptuous to describe oneself as rational and to accuse others of a tendency to gamble.

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Der Spekulant@Derspekulant1

@PikaPika0105

I understand your point that reward is theoretical and that there is always luck in investments. But that's the point: for me, SoftBank makes far too many expensive missteps that can't be glossed over as "bad luck". It's not just about individual slips, but about a recurring pattern of overvaluations and unrealistic expectations.

The "change of strategy" towards more IP and synergies sounds good on paper - but it needs time to prove itself, and so far you mainly see a mountain of debt and high volatility in the balance sheet. ARM, Ampere, SoftBank Robotics - yes, there is IP there, but SoftBank mostly only owns these companies in part or has only recently built them up. The risk is that the long-term potential is not enough to offset the massive debt and write-downs.

The holding company's cash flow is still heavily based on the sale of investments, not on stable operating income. Building synergies is one thing - becoming profitable and sustainable is another.

On the subject of Nvidia: Sure, Nvidia is big, but that is precisely why the risk is significantly lower due to market dominance and massive cash flows. SoftBank, on the other hand, relies on many big bets, only a few of which really hit the mark - for me, this is too speculative a model.

"Rational" does not mean only betting on big names, but realistically assessing the risk and not relying on hopes and visions. For me, SoftBank is more of a playground for risk-taking speculators than a solid investment.

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PikaPika0105@PikaPika0105

@Derspekulant1 So I definitely agree with you that the whole thing is speculative. I also agree with you that it will take time to implement the whole thing. Regarding the IP once again, in the examples mentioned, they own 100% of the companies (ARM 90% due to IPO). Of course, they now have to be properly linked with each other. The potential is massive and I think the next 5 years will show whether the whole thing will be successful.

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Philip Buß@GoldenShield

I also think that artificial intelligence, neural networks, etc. will become increasingly important and effective in the future, but I have the feeling that a lot of things are labeled AI to make them sound modern. It also sounds nice for investors if you can write on the banner that you are investing in AI

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PikaPika0105@PikaPika0105

@GoldenShield I think you're right. Many companies that have some kind of chatbot in their customer service always talk big about AI, but fortunately we are really talking about investments in AI here.

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