SoftBank reported a gain of $2.4 billion at its Vision Fund during the December quarter, with the increase in the value of its OpenAI investment offsetting losses in some of its other bets.
The Japanese giant reported a 4.2 billion gain on the value of its OpenAI investment in its fiscal third quarter, which extends until the end of December, offsetting losses incurred due to declines in the share prices of Coupang and the Chinese ride-hailing app Didi.
The company further noted that the investment losses were affected by a markdown in its interest in TikTok creator ByteDance.
It assisted SoftBank Group in booking a fiscal third-quarter net profit of 248.6 billion yen ($1.6 billion), which fell below analyst estimates, but represented a reversal of the loss seen in the same period the previous year.
Under the Vision Fund, SoftBank has made investments into AI companies that it believes will be category winners in the hope of becoming at the center of the technology’s development.
However, SoftBank founder Masayoshi Son stated that the world was a decade away from artificial superintelligence, or ASI, which he characterized as technology that was 10,000 times smarter than humans in 2024.
In a presentation on Thursday, Yoshimitsu Goto, chief financial officer at SoftBank Group, added that 60 percent of the company’s assets are now “ASI-oriented investments.”
SoftBank’s AI drive has involved a more than $30 billion investment in ChatGPT developer OpenAI as one of its core companies. Softbank holds about 11 percent of OpenAI.
Therefore, SoftBank reported that it had witnessed a $17 billion gain on its OpenAI investment during the April to December period. Goto said during the presentation that the gain shows the “decision on investment was successful.”
OpenAI is also supposedly raising a new round of funding of approximately $100 billion. Goto stated on Thursday that “nothing has been decided” about whether SoftBank is likely to invest money into OpenAI.
People familiar with the matter reported to CNBC that SoftBank would not disapprove additional funding of OpenAI, though at least as long as the valuation is reasonable.
Another competitor that OpenAI has to deal with is Google and Anthropic. Specifically, Anthropic has publicly swiped at OpenAI regarding its choice to experiment with test ads in ChatGPT and its spending intentions.
Anthropic’s Claude Code and Claude Cowork have gained traction among business customers. CNBC reported that OpenAI chief Sam Altman informed employees last week that ChatGPT is “back to exceeding 10% monthly growth,” while Codex, its Claude Code competitor, was also seeing strong growth.
Goto responded to multiple questions related to OpenAI, such as why SoftBank is thinking of investing in the AI company, particularly after the company declared a “code red” last year, when it faced growing competition.
Goto said, “We assume OpenAI will be able to lead this industry and this era, and we are quite convinced. So that’s [why] we are making an investment in this company.”
SoftBank executives indicated that OpenAI is still in its infancy in terms of monetizing the product, and future revenues would come through enterprise sales, hardware, and advertisements, all of which have the potential to grow the company.
Investors have been concerned about how SoftBank will finance its further investments, especially its OpenAI, which is not profitable at the moment. The Japanese investment group has been selling its interests in other businesses to reinvest the money in OpenAI.
SoftBank sold its entire stake in Nvidia for $5.83 billion in October, and between June and December, it sold $12.73 billion worth of T-Mobile stock. SoftBank has also borrowed money using its other assets, including chip designer Arm.
Meanwhile, SoftBank added on Thursday that it has initiated a new segment in its earnings report called the “AI Computing Segment.” This will cover chip designer Arm, along with Graphcore and Ampere, and other semiconductor enterprises it has purchased.
SoftBank indicated that this segment incurred a loss of 91.8 billion yen within the nine months to December on the impact of the increase in headcount and the purchase costs of Ampere.
Thus, SoftBank posts Arm and its other chip investments as significant in competing in areas from robotics to driverless cars and data centers. SoftBank shares surged this week after robust outcomes at its telecommunications unit and a rally in the price of Arm’s stock.
