"SoftBank profit more than triples to $12 billion on OpenAI stake gains"

From Reuters, May 12/13: 

• Vision Fund booked 3.1 trillion yen quarterly gain
• OpenAI investment gain totals $45 billion
• SoftBank says FY profit is highest in Japan corporate history
• Son is an enthusiastic supporter of OpenAI
• Backing is raising concerns about financing pressures 

Technology investor SoftBank ​Group (9984.T) reported on Wednesday that its net profit more than tripled to 1.83 trillion yen ($11.60 billion) in the January-March quarter, ‌as it booked gains on the value of its investment in ChatGPT-maker OpenAI.

It was SoftBank's fifth consecutive quarterly profit, with the Vision Fund investing arm booking an OpenAI-driven gain of 3.1 trillion yen in the quarter. 

Chief Financial Officer Yoshimitsu Goto said SoftBank's annual profit of 5 trillion yen was the highest ever by a Japanese company.

 

Founder ​and CEO Masayoshi Son is one of OpenAI's most enthusiastic backers, with the group saying its cumulative gains on the investment ​total $45 billion.

But the scale of the OpenAI wager - SoftBank's most ambitious spending programme since the launch of the Vision ⁠Fund investment vehicles in 2017 and 2019 - has raised questions about financing pressures on the group.

Critics also say OpenAI no longer enjoys a ​dominant position among large language model developers as peers such as Alphabet's (GOOGL.O) Gemini and Anthropic's Claude grab market share, while the cost to train ​and run AI models is also rising.

"It's a good thing for the industry that competitors are refining business models and providing new services to new users," Goto told an earnings briefing.
"Overall that increases the value of the industry."

In March, S&P Global Ratings revised its credit outlook for SoftBank to negative, saying that OpenAI was exposed to ​fierce competition and the size of SoftBank's investment would affect the asset quality and liquidity of its portfolio.

FINANCING POSSIBILITIES
SoftBank has sold off stakes in ​holdings such as T-Mobile (TMUS.O) and Nvidia (NVDA.O) issued bonds and taken out loans, backed by its holdings in chip designer Arm and its domestic telecommunications arm SoftBank ‌Corp (9434.T)

SoftBank arranged ⁠a bridge loan agreement totalling $40 billion in March. On Wednesday, it said $20 billion was drawn down in April, primarily for the OpenAI investment, and $2.5 billion had already been repaid....

....MUCH MORE 

As noted introducing April 22's "SoftBank Seeks $10 Billion Margin Loan Backed by OpenAI Shares": 

This is where the risk to the AI juggernaut and possibly the world economy is lurking.

Should SoftBank be unable to repay or refinance the debts it is taking on, the risk goes from theoretical to kaboom pretty fast and all the other daisy-chain financings get stress-tested in a real-world cascade. 

And unfortunately chatbots in general and OpenAI/Sam Altman in particular may not be the future that Mr. Son seems to think. 

Before that it was February 12's "Where Will SoftBank Get The Money To Fund Their Commitment To OpenAI?":

By writing-up their stake in OpenAI, naturellement.

And March 27:

"SoftBank Obtains $40B Bridge Facility for Additional OpenAI Investment"

Of all the possible weak links in the daisy-chain, and there are a few, SoftBank's increasingly central role is the most concerning.

Mr. Son's history, going back to the time he briefly held the title of world's richest person, is leveraged beta. No great technological insight (largest investor in WeWork) no fancy risk mitigation, just leverage in all its forms and like Sam Insull, at every level of the organization.

Throw in the fact that OpenAI and their ChatGPT may not be the ultimate winner of this unprecedented build-out and there are reasons to be hyper-aware. Stay tuned. 

That said, this loan should be okay (barring a depression where it can't be re-financed, à la Insull) it's all the other borrowings and what Mr. Son will do in the next couple years, that could cause worldwide problems.

And last year:

November 2025's - "SoftBank shares slide as Nvidia stake sale highlights AI funding needs"

That was a rookie fund manager's move, using your most liquid asset to fund your least liquid.

In the olden days proprietary traders/stock jobbers/proto-market makers would keep their share and bond certificates in a box—hence short against the box etc. And in that box the most speculative, least-liquid-in-a-crash certificates were on top ready to be tossed into the maw of a descending market, with the highest quality, most liquid shares at the bottom of the box.

It was a tell as to either the individual trader's finances or to the depth of a downturn to see certs from the bottom of the box coming onto the market.

As a side note, you can still get your stock in certificate form but it will cost you at least $500 per cert. The powers that be, Depository Trust, the brokers et al. really prefer you don't ask for the paper.

And dozens more. 

"SoftBank’s Attempt to Get $6 Billion OpenAI Margin Loan Stalls"

Good. I'm not kidding when I say Mr. Son's penchant for leveraged beta could be a threat not just to the AI players but to the world economy. If the largest domino starts dropping it's hard to see it stopping short of a coordinated international bailout.

Keep an eye on 9984 - Tokyo Stock Exchange. Here's the last year of price action via TradingView:

 

6,400 Yen, last, down 648 (-9.19%) 

From Bloomberg, June 9: 

SoftBank Group Corp.’s talks with potential creditors to raise at least $6 billion from a margin loan backed by its OpenAI stake have stalled, people familiar with the matter said, just weeks after the Japanese conglomerate cut its initial target from $10 billion.

The company is considering various fundraising options, according to the people, who asked not to be identified discussing private matters. It could still move forward with the margin loan at a later stage, they added.

It’s unclear why the margin loan discussions stalled. Borrowers and creditors can pause and revisit fundraising discussions for various reasons, and SoftBank hasn’t elaborated on its plans, the people said. SoftBank had secured some $5 billion for the loan before the development, people familiar with the matter said, though it was unclear if those were verbal or written commitments.

SoftBank declined to comment.

The current inaction on the margin loan comes even after some of the potential lenders who had been pitched on it said that they’d started to consider it in a more favorable light, after news last month that the ChatGPT creator was preparing to file for an initial public offering. OpenAI said on Monday that it has filed confidentially for an IPO in the US, joining artificial intelligence rivals in tapping public markets to fund ambitious growth plans. The firm is working with Goldman Sachs Group Inc. and Morgan Stanley on a potential listing as soon as in the fall.

Markets have witnessed a broader debate in recent months about SoftBank’s commitments of more than $60 billion to OpenAI at a time when recent breakthroughs by rival Anthropic PBC have raised doubts for some investors about the business. Within SoftBank itself, some officials had grown anxious about that commitment.

Previously some of the potential creditors pitched on the margin loan had expressed concerns about the difficulty of reaching a valuation for an unlisted company like OpenAI. SoftBank had downsized the loan’s initial target size by 40% after facing hesitation from some of the potential lenders, people familiar with the matter said in May.

The Japanese company has been ramping up its broader AI plans. Late last month, it said that it plans to invest as much as €75 billion ($86.6 billion) to build artificial intelligence data center capacity in France, saying the country is poised to become a top European hub for AI infrastructure.

Looming in the background is a $40 billion bridge financing that supported the conglomerate’s investments in OpenAI, and which SoftBank must repay in March 2027. SoftBank has said that borrowing would likely be repaid “through the utilization of existing assets and other financing measures.”....

....MUCH MORE 

Recently:

June 2 - "AI revolution is ‘50x bigger’ than the dot-com boom: SoftBank’s Masayoshi Son to CNBC"
I assume Mr. Son is aware the term "dot.com" does not have the best connotations.

May 31 - SoftBank Says It Will Invest Up To €75 Billion To Build Data Centers In France

May 13 -"SoftBank profit more than triples to $12 billion on OpenAI stake gains"

As noted introducing April 22's "SoftBank Seeks $10 Billion Margin Loan Backed by OpenAI Shares": 

This is where the risk to the AI juggernaut and possibly the world economy is lurking.

Should SoftBank be unable to repay or refinance the debts it is taking on, the risk goes from theoretical to kaboom pretty fast and all the other daisy-chain financings get stress-tested in a real-world cascade. 

And unfortunately chatbots in general and OpenAI/Sam Altman in particular may not be the future that Mr. Son seems to think. 

Before that it was February 12's "Where Will SoftBank Get The Money To Fund Their Commitment To OpenAI?":

By writing-up their stake in OpenAI, naturellement.

And March 27:

"SoftBank Obtains $40B Bridge Facility for Additional OpenAI Investment"

Of all the possible weak links in the daisy-chain, and there are a few, SoftBank's increasingly central role is the most concerning.

Mr. Son's history, going back to the time he briefly held the title of world's richest person, is leveraged beta. No great technological insight (largest investor in WeWork) no fancy risk mitigation, just leverage in all its forms and like Sam Insull, at every level of the organization.

Throw in the fact that OpenAI and their ChatGPT may not be the ultimate winner of this unprecedented build-out and there are reasons to be hyper-aware. Stay tuned. 

That said, this loan should be okay (barring a depression where it can't be re-financed, à la Insull) it's all the other borrowings and what Mr. Son will do in the next couple years, that could cause worldwide problems.

And last year:

November 2025's - "SoftBank shares slide as Nvidia stake sale highlights AI funding needs"

That was a rookie fund manager's move, using your most liquid asset to fund your least liquid.

In the olden days proprietary traders/stock jobbers/proto-market makers would keep their share and bond certificates in a box—hence short against the box etc. And in that box the most speculative, least-liquid-in-a-crash certificates were on top ready to be tossed into the maw of a descending market, with the highest quality, most liquid shares at the bottom of the box.

It was a tell as to either the individual trader's finances or to the depth of a downturn to see certs from the bottom of the box coming onto the market.

As a side note, you can still get your stock in certificate form but it will cost you at least $500 per cert. The powers that be, Depository Trust, the brokers et al. really prefer you don't ask for the paper.

And dozens more. 

Possibly also of interest: 

April 28 - WSJ Exclusive: "OpenAI Misses Key Revenue, User Targets in High-Stakes Sprint Toward IPO"

April 28 -  "OpenAI-Linked Stocks Slump on Report of Startup Missing Targets"

"SoftBank Seeks $10 Billion Margin Loan Backed by OpenAI Shares"

This is where the risk to the AI juggernaut and possibly the world economy is lurking.

Should SoftBank be unable to repay or refinance the debts it is taking on, the risk goes from theoretical to kaboom pretty fast and all the other daisy-chain financings get stress-tested in a real-world cascade. 

And unfortunately chatbots in general and OpenAI/Sam Altman in particular may not be the future that Mr. Son seems to think. 

Way back in June 2019 we mentioned:

"Something is not quite right with SoftBank"
Additionally, SoftBank investee WeWork was out looking for  a few billion dollar line of credit.
Shades of another disruptor, Sam Insull, leverage at the holding company level, leverage at the operating company level, leverage all the way down... 

That was around the time SoftBank was rattling the tin cup and using graphics like this to explain the investment:

 

From Bloomberg via the Japan Times, April 23: 

SoftBank is seeking a $10 billion loan secured by its shares in U.S. artificial intelligence giant OpenAI, people familiar with the matter said, as it takes on more debt for its push into AI.

The two-year margin loan would carry an option for the Japanese conglomerate to extend the borrowing by an additional year, according to the people, who asked not to be identified discussing private matters. A margin loan is an arrangement in which companies use their assets such as stock for collateral to borrow against.

A SoftBank representative declined to comment.

SoftBank has been piling on debt as its founder Masayoshi Son seeks to position himself as a linchpin in the global AI boom, with large-scale investments into ChatGPT maker OpenAI. SoftBank recently committed an additional $30 billion to the U.S. firm after having already previously put in more than that same amount. Last month, SoftBank signed a $40 billion loan — its largest-ever lending facility solely denominated in dollars — in part for its most recent follow-on investment.

In March, S&P Global Ratings lowered the group’s credit outlook to negative from stable, citing the danger that its investments in OpenAI may hurt the Japanese company’s liquidity and credit quality of its assets....

...SoftBank is no stranger to margin loans. As of November, it had expanded a margin loan using its shares in Arm to $20 billion.... 

....MUCH MORE 

We used today's intro as part of the outro from March 6's "SoftBank Races to Borrow $40B to Fund Massive OpenAI Stake amid Mounting Debt Pressure": 

Mr. Son is the King of leveraged beta (he was briefly the richest person in the world in 1999) and thus far has managed to bounce back from monster-sized drawdowns but the current situation is wild even for him.

First up, Softbank's last earnings report, February 12:

Where Will SoftBank Get The Money To Fund Their Commitment To OpenAI?

By writing-up their stake in OpenAI, naturellement.

From Nikkei Asia, February 12:

SoftBank profit quintuples as OpenAI bet lifts Vision Funds
IPOs set to to deliver 'significant value' to Japanese tech investor, says CFO 

SoftBank Group on Thursday reported a net profit of 3.17 trillion yen ($20.7 billion) for the nine months through December, five times that of a year earlier, boosted by a rise in the value of its stake in ChatGPT maker OpenAI....

For some reason I've got Churchill giving investment commentary in my head:

"...all Europe may be free and the life of the world may move forward into broad, sunlit uplands. But if we fail, then the whole world, including the United States, including all that we have known and cared for, will sink into the abyss of a new Dark Age, made more sinister, and perhaps more protracted, by the lights of perverted science...."

-Before the House of Commons

18 June 1940

"How Is SoftBank Funding Its Mega Investment in OpenAI? A Lot of Debt"

Leveraged beta, baby!

From the Wall Street Journal, April Fools Day, 2025:

Global tech investor SoftBank Group is turning to a familiar tool to fund its $40 billion investment in ChatGPT maker OpenAI announced late Monday: debt.

The Tokyo-based company, led by billionaire Masayoshi Son, said it expected its first $10 billion chunk of the deal would be financed by borrowing from Japanese bank Mizuho and other lenders and be completed in April. The remaining $30 billion would come by early 2026.

The deal, by far the largest-ever investment in a startup, values OpenAI at $300 billion if all the money is invested.

The bet
Together with SoftBank’s pledge to lead the $100 billion Stargate cloud-computing initiative with OpenAI, the investment marks a massive bet on the artificial-intelligence startup. It entwines the fortunes of SoftBank with a company that expects to lose billions of dollars for years to come.

The hope is that OpenAI emerges as the leader of the pack in a race to spread artificial intelligence throughout society and commerce—a market that many believe could be worth trillions of dollars a year.

The information revolution “has now entered a new phase led by artificial intelligence,” SoftBank said in a statement that called OpenAI its “partner closest to achieving Artificial General Intelligence,” in which computers operate on the level of humans.

(News Corp, owner of The Wall Street Journal, has a content-licensing partnership with OpenAI.)

The risks
SoftBank is taking on a lot of risks for a piece of OpenAI.

Ratings agency S&P Global said Tuesday that SoftBank’s “financial condition will likely deteriorate” as a result of the OpenAI investment and that its plans to add debt could lead the agency to consider downgrading SoftBank’s ratings.

None of the startups with early leads in generative AI have shown they can operate profitably, and the sector is pouring tens of billions of dollars into data centers based on assumptions, not yet proven, of a future in which AI rapidly permeates the globe.

Early tech leaders often falter—a point SoftBank learned when it made a dot-com era bet that Yahoo would be the dominant force in search.

The background...

....MUCH MORE

As we noted introducing last week's "OpenAI Close to Finalizing A $40 Billion SoftBank-Led Funding At A $300 Billion Valuation"

SoftBank's Mr. Son's entire history, going back to the dot.com bust is leveraged beta.

He was very fortunate that the British didn't allow Nvidia to buy ARM Holdings, thus clearing the way for his bid. Otherwise his claim to fame would  be being the largest investor in WeWork....

And from November 2019:

SoftBank’s problems aren’t so surprising if you understand this one thing about the company

Throughout the manic phase of SoftBank and the Vision fund there was almost no mention of the fact that at the start of this century Masayoshi Son was the richest person in the word:

"But Son’s fairytale didn’t last long. After the dot-com bubble burst, his company Softbank’s shares plunged 75 percent in two months and was 93 percent lower by the end of 2000.
The business almost went bankrupt and Son ended up losing USD 70 billion, the highest ever recorded financial loss for a person in history."

—MoneyControl, October 13, 2017

We had a couple posts around the time of the above that touched on the craziness but not the past history:
SoftBank In Talks To Acquire U.S. Treasury
Sprint, T-Mobile Plunge: SoftBank Calling Off Merger, Will Use Cash to Buy Canada

See also semi-variance, after the jump....

**** 

When the swings are as big as Son's are you need a bankroll that is gigantic. Even if you are right and have an edge, the natural variation can kill you and the last downturn will be the last downturn.
Some related links:....

And October 2024:

 

 SoftBank’s Masayoshi Son Sees AI Evolving To A Point Where Your Happiness Will Be its Greatest Reward

Having observed Mr. Son and his position in the parade—from Drum Majorette leading the way, to being the guy cleaning up after the elephants, and then back to the front— we had this introduction in February 2024:

Since the time he almost went broke after the dot.bomb bubble burst (he had briefly been the richest person in the world) I've come to realize this guy isn't some great visionary/grand strategist; he's just leveraged beta. Making big bets, all geared up, on whatever is at the head of the passing parade.

That said, he owns 90% of ARM Holdings and I don't.

Bastard.

—"Masayoshi Son Seeks to Build a $100 Billion AI Chip Venture"

 

Shades of another disruptor, Sam Insull, leverage at the holding company level, leverage at the operating company level, leverage all the way down

"SoftBank Races to Borrow $40B to Fund Massive OpenAI Stake amid Mounting Debt Pressure"

Mr. Son is the King of leveraged beta (he was briefly the richest person in the world in 1999) and thus far has managed to bounce back from monster-sized drawdowns but the current situation is wild even for him.

First up, Softbank's last earnings report, February 12:

Where Will SoftBank Get The Money To Fund Their Commitment To OpenAI?

By writing-up their stake in OpenAI, naturellement.

From Nikkei Asia, February 12:

SoftBank profit quintuples as OpenAI bet lifts Vision Funds
IPOs set to to deliver 'significant value' to Japanese tech investor, says CFO 

SoftBank Group on Thursday reported a net profit of 3.17 trillion yen ($20.7 billion) for the nine months through December, five times that of a year earlier, boosted by a rise in the value of its stake in ChatGPT maker OpenAI....

 And the headline story from TipRanks, March 5:

SoftBank SFTBY -4.02% ▼ is looking to borrow up to $40 billion to keep pouring money into OpenAI. This would be the biggest dollar-based loan in the company’s history, showing just how far founder Masayoshi Son is going to keep his firm at the center of the AI boom.

The loan is expected to last for one year. SoftBank is currently talking to banks like JPMorgan Chase JPM -1.95% ▼ to get the deal done. This cash is meant to act as a bridge, giving the company the immediate funds it needs to meet its huge investment pledges while it manages its other assets.

Son Makes OpenAI the Main Focus of SoftBank

Masayoshi Son has made his bet on OpenAI the main focus of SoftBank. With this new $30 billion pledge, SoftBank’s total investment in the AI maker is set to hit roughly $64.6 billion, giving it a 13% ownership stake. This means the Japanese firm’s stock price is now tied directly to how well ChatGPT performs against rivals like Gemini and Anthropic.

To find the money for these massive payments, SoftBank has sold off its stake in Nvidia NVDA +0.16% ▲ , used its shares in Arm Holdings ARM -2.81% ▼ and SoftBank Corp (JP:9434) to get loans, and spent billions on data centers and robotics to build out the physical tools needed for AI. 

Analysts Express Growing Credit Concerns...

....MORE 

TipRanks trending news 

If interested see also:

June 2019's - "Something is not quite right with SoftBank"

Additionally, SoftBank investee WeWork was out looking for  a few billion dollar line of credit.
Shades of another disruptor, Sam Insull, leverage at the holding company level, leverage at the operating company level, leverage all the way down...

The leverage in all this, with Softbank lending money to Son and other Softbank employees to invest in Vision Fund 2 and the margining of assets is eerily familiar to folks who know the Insull story.  

November 2025's - "SoftBank shares slide as Nvidia stake sale highlights AI funding needs"

That was a rookie fund manager's move, using your most liquid asset to fund your least liquid.

In the olden days proprietary traders/stock jobbers/proto-market makers would keep their share and bond certificates in a box—hence short against the box etc. And in that box the most speculative, least-liquid-in-a-crash certificates were on top ready to be tossed into the maw of a descending market, with the highest quality, most liquid shares at the bottom of the box.

It was a tell as to either the individual trader's finances or to the depth of a downturn to see certs from the bottom of the box coming onto the market.

As a side note, you can still get your stock in certificate form but it will cost you at least $500 per cert. The powers that be, Depository Trust, the brokers et al. really prefer you don't ask for the paper.

November 2025's - "SoftBank stock broke before the market during the dot-com bust, and Citi warns that might be the case this time as well"

December 2025's - SoftBank races to fulfill $22.5 billion funding pledge to OpenAI by year-end (may sell Didi; margin ARM Holdings)

October 2024's - SoftBank’s Masayoshi Son Sees AI Evolving To A Point Where Your Happiness Will Be its Greatest Reward

And possibly related:

• "SoftBank is in talks to invest $15B to $20B in WeWork for a majority stake"
• SoftBank In Talks To Acquire U.S. Treasury

Previously on Baby need a new pair of shoes:

Dreamtime Finance (and the Kelly Criterion) 

I've been meaning to write about Kelly for a couple years and keep forgetting. Today I forget no more.
In probability theory the Kelly Criterion is a bet sizing technique used when the player has a quantifiable edge.
(When there is no edge the optimal bet size is $0.00)

The criterion will deliver the fastest growth rate balanced by reduced risk of ruin.
You can grow your pile faster but you increase the risk of ending up broke should you, for example bet 100% of your net worth in a situation where you have anything less than a 100% chance of winning.

The criterion says bet roughly your advantage as a percentage of your current bankroll divided by the variance of the game/market/sports book etc..
Variance is the standard deviation of the game squared. In blackjack the s.d. is 1.15 so the square is 1.3225.

As blackjack is played in the U.S. the most a card counter can hope for is a 1/2% to 1% average advantage with much of that average accruing from the fact that you can get up from a negative table.
Divide by 1.3225 and you've got your bet size.

It's a tough way to grind out a living but hopefully this exercise will stop you from pulling a Leeson, betting all of Barings money and destroying the 233 year old bank.

I'll be back with more later this week.In the meantime here's a UWash paper with the formulas for equities investment....MORE 

What Proportion of Your Bankroll Should You Bet? "A New Interpretation of Information Rate"
How did Ed Thorp Win in Blackjack and the Stock Market?
Journal of Investment Consulting: Interview With Edward O. Thorp
Markets, Risk and Gambler's Ruin
"Not in my house: how Vegas casinos wage a war on cheating"

Finally, another rule of life:

Cassandra's (Not so) Golden Rules About Investing (And Not Investing)
#21. NEVER double-down (except when you have material non-public information and deep pockets) or if you're Ed Thorp, or if you're playing at The Martingale Room. 

Don't double down, double up.

 

"SoftBank stock broke before the market during the dot-com bust, and Citi warns that might be the case this time as well"

Just something to be aware of, not immediately actionable.

From MarketWatch, November 21: 

As AI angst hits markets, this stock — not Nvidia — is the canary in the coal mine

It’s usually difficult to pinpoint a specific factor that’s caused a stock market sell-off. The current bout of investor angst is no different: a less dovish Federal Reserve, concerns about private credit and wariness about rich valuations, have all been cited as catalysts.

But given that it’s chunky falls for Big Tech stocks that’s doing most damage to equity benchmarks, perhaps much of the blame lies with a cooling of AI fervor.

And a team of strategists at Citigroup, led by Dirk Willer, say the source of that negative narrative is OpenAI, the creator of ChatGPT, that has been central to much of the circular investment in the AI ecosystem.

They ask how a company with revenue they estimate at $12.5 billion — or that OpenAI chief Sam Altman more optimistically puts at $20 billion — can support orders of $1.4 trillion.

OpenAI aims to become profitable only in 2029 or 2030, and until then may burn over $115 billion in cash, according to some estimates. And Citi observes that meanwhile worries are rising that competition in large language models — the latest Google model was released just this week —may cause OpenAI to lose market share.

While OpenAI is private, there is a proxy — Japanese investment firm SoftBank Group which has an 11% stake in the ChatGPT owner.

The Citi team does some math to get the value of OpenAI out of the SoftBank price — they take the enterprise value of SoftBank and strip out the current values of all its publicly held equities, which is mostly ARM. Citi then takes the historical quarterly snapshots of equity holdings from SoftBank to derive the split between the other private investments and SoftBank Vision Fund 2 (SVF2), as shown in the chart below.

Source: Citigroup -

This gives an estimated value to SoftBank’s OpenAI stake of $62.4 billion. In early October SoftBank implied that its 11% stake was worth about $55 billion, valuing OpenAI at around $500 billion.

Citi accepts that its calculations provide “a very rough proxy for OpenAI” because SVF2 also includes other private companies, and it also does not take any holding company discount into consideration. Nevertheless, they reckon that “the OpenAI stake is at this stage dominating the other private investments in the eyes of the market.”....

....MUCH MORE 

For more on SoftBank and its King of Leveraged Beta see October 2025's "SoftBank Seeks $5 Billion Margin Loan Backed by Arm Stock"  and:

October 2024's "SoftBank’s Masayoshi Son Sees AI Evolving To A Point Where Your Happiness Will Be its Greatest Reward" 

Having observed Mr. Son and his position in the parade—from Drum Majorette leading the way, to being the guy cleaning up after the elephants, and then back to the front— we had this introduction in February 2024:

Since the time he almost went broke after the dot.bomb bubble burst (he had briefly been the richest person in the world) I've come to realize this guy isn't some great visionary/grand strategist; he's just leveraged beta. Making big bets, all geared up, on whatever is at the head of the passing parade.

That said, he owns 90% of ARM Holdings and I don't.

Bastard.

—"Masayoshi Son Seeks to Build a $100 Billion AI Chip Venture"

More after the jump....

Thinking about it, an OpenAI IPO might mark a top.

In the interim:

This device was used to resuscitate canaries in coal mines

 

....MUCH MORE at Manchester's Science + Industry Museum via MuseumCrush.

Where Will SoftBank Get The Money To Fund Their Commitment To OpenAI?

By writing-up their stake in OpenAI, naturellement.

From Nikkei Asia, February 12:

SoftBank profit quintuples as OpenAI bet lifts Vision Funds
IPOs set to to deliver 'significant value' to Japanese tech investor, says CFO 

SoftBank Group on Thursday reported a net profit of 3.17 trillion yen ($20.7 billion) for the nine months through December, five times that of a year earlier, boosted by a rise in the value of its stake in ChatGPT maker OpenAI.

The latest result was driven by gains at the tech-heavy Vision Funds, which booked an investment profit of 3.91 trillion yen, reflecting valuation increases in key artificial intelligence holdings, including OpenAI.

At a Thursday earnings briefing, Chief Financial Officer Yoshimitsu Goto said SoftBank was "steadily laying the groundwork" to become "the No. 1 platform player in the age of artificial superintelligence."

The earnings underscore Chairman and CEO Masayoshi Son's renewed push into AI after several years of retrenchment following heavy losses at the Vision Funds. SoftBank, which built its fortune through early bets on companies such as China's Alibaba, has repositioned itself as an AI-focused investment group, with Son describing AI as the company's next core growth pillar.

Son has sharply expanded SoftBank's exposure to OpenAI, investing $22.5 billion in the ChatGPT developer at the end of 2025 and reportedly discussing a further investment of up to $30 billion. The move marks one of SoftBank's largest single-company commitments since the launch of its Vision Fund strategy in 2017.

"We are deeply aligned with OpenAI's vision of ensuring AGI [artificial general intelligence] benefits all of humanity," Son said in a statement in December.

On Thursday, Goto said "no specific decisions have been made at this stage" regarding any additional investment in OpenAI, but added that many late-stage holdings such as OpenAI and ByteDance were likely to move toward initial public offerings and capital recovery on a relatively short timeline, delivering "significant value" for SoftBank....

....MUCH MORE 

If interested see also October 2024's - SoftBank’s Masayoshi Son Sees AI Evolving To A Point Where Your Happiness Will Be its Greatest Reward

And possibly related:

• "SoftBank is in talks to invest $15B to $20B in WeWork for a majority stake"
• SoftBank In Talks To Acquire U.S. Treasury

"SoftBank Obtains $40B Bridge Facility for Additional OpenAI Investment"

Of all the possible weak links in the daisy-chain, and there are a few, SoftBank's increasingly central role is the most concerning.

Mr. Son's history, going back to the time he briefly held the title of world's richest person, is leveraged beta. No great technological insight (largest investor in WeWork) no fancy risk mitigation, just leverage in all its forms and like Sam Insull, at every level of the organization.

Throw in the fact that OpenAI and their ChatGPT may not be the ultimate winner of this unprecedented build-out and there are reasons to be hyper-aware. Stay tuned. 

That said, this loan should be okay (barring a depression where it can't be re-financed, à la Insull) it's all the other borrowings and what Mr. Son will do in the next couple years, that could cause worldwide problems.

From Computing.net, March 27:

Key Points

• SoftBank arranged a $40 billion unsecured bridge facility for additional OpenAI investment
• Facility reaches maturity in March 2027
• Financing consortium includes JPMorgan Chase, Goldman Sachs, Mizuho, SMBC, and MUFG Bank
• SoftBank previously pledged $30 billion to OpenAI through Vision Fund 2
• Proceeds will support both OpenAI investment and broader corporate operations

SoftBank Group revealed on Friday that it has arranged a $40 billion financing package through a bridge loan facility. The capital will support expanded investment in OpenAI, the creator of ChatGPT, alongside general corporate operational needs. 

The bridge facility carries no collateral requirements, indicating lenders approved the arrangement based on SoftBank’s financial standing alone. The repayment deadline falls in March 2027.

A consortium of prominent financial institutions provided the financing. The lending group comprises JPMorgan Chase, Goldman Sachs, Mizuho Bank, Sumitomo Mitsui Banking Corp, and MUFG Bank.

SoftBank previously established a significant position in OpenAI. The Tokyo-based investment firm had committed $30 billion to OpenAI via its Vision Fund 2 vehicle.

The newly arranged $40 billion facility supplements that earlier commitment. Together, SoftBank’s aggregate capital allocation to OpenAI represents a substantial financial stake contingent on deployment strategies.

SoftBank shares climbed 3.24% on the Tokyo Stock Exchange after the disclosure. The company trades under ticker symbol 9984 on the Japanese exchange.

SoftBank’s Expanding AI Investment Strategy....

....MUCH MORE 

"SoftBank Seeks $5 Billion Margin Loan Backed by Arm Stock"

We've seen this movie before.* 

From Bloomberg, October 9: 

SoftBank Group Corp. is in talks to borrow $5 billion from global banks, refilling its coffers at a time Masayoshi Son is accelerating the Japanese investment firm’s bets on artificial intelligence.

SoftBank is close to signing a deal with a handful of lenders for a margin loan secured by shares of its chip unit Arm Holdings Plc., people familiar with the matter said. The capital will fund additional investment in OpenAI this year, the people said, who asked not to be identified discussing private matters.

A margin loan is a type of facility where you borrow money using your investments — like stocks — as collateral. A representative for SoftBank declined to comment.

Softbank shares slid as much as 4.1% to 22,020 yen on Friday, the most since September 26, before pairing some losses to close down 3.1%, according to Bloomberg-compiled data. Meanwhile, the group’s dollar bond due in 2032 declined about 1 cent on the dollar to 102.7 on Friday, its biggest drop since the note was issued in July, the data showed.

Founder Son has embarked on a spending spree this year to try and position the firm as a linchpin in the global AI boom, most recently pledging as much as $30 billion toward OpenAI and buying ABB Ltd.’s robotics arm for $5.4 billion. Arm’s 38% rally this year has in turn granted SoftBank the confidence and leeway to grow its investment war chest.

SoftBank has raised a total of $13.5 billion in margin loans from Arm shares, with $5 billion still undrawn, as of March 2025, according to its earnings statement. The latest facility will increase the total to $18.5 billion.

The group had secured about $8 billion in margin loans ahead of Arm’s initial public offering in 2023. Eleven banks including JPMorgan Chase & Co., Barclays Plc, BNP Paribas SA, Credit Agricole Corporate and Investment Bank and Goldman Sachs Group Inc. provided the facilities by linking mandates for Arm’s IPO to the loans. Earlier this year, the group also raised a $15 billion one-year facility to help fund AI investments in the US, in what is among its largest borrowings raised....

*****

....Son’s insatiable appetite for deals has extended far and wide, centered on ideas to capitalize on the expected exponential growth of AI technologies.

His most ambitious projects include a $500 billion Stargate initiative that aims to build data centers across the US in partnership with OpenAI and Oracle Corp. SoftBank is also exploring the feasibility of a large-scale industrial manufacturing hub in the US, which could encompass production lines for AI-powered industrial robots, Bloomberg News has reported.

....What Bloomberg Intelligence Says

SoftBank Group’s $5.4 billion acquisition of ABB’s robotics arm demonstrates the company’s large M&A appetite, raising credit and bond-supply risks. The company may hit its 25% loan-to-value limit with this deal, along with a $22.5 billion second-tranche investment in OpenAI, the purchase of Ampere Computing and its investment in Stargate, though tech stock values may provide some offset. Funding needs may exceed $30 billion, but asset sales and asset-backed financing could lower reliance on bond markets.

- Sharon Chen, analyst

....MUCH MORE
*April Fools Day, 2025:
"How Is SoftBank Funding Its Mega Investment in OpenAI? A Lot of Debt"
Leveraged beta, baby!

....As we noted introducing last week's "OpenAI Close to Finalizing A $40 Billion SoftBank-Led Funding At A $300 Billion Valuation"

SoftBank's Mr. Son's entire history, going back to the dot.com bust is leveraged beta.

He was very fortunate that the British didn't allow Nvidia to buy ARM Holdings, thus clearing the way for his bid. Otherwise his claim to fame would  be being the largest investor in WeWork....

And from November 2019:

SoftBank’s problems aren’t so surprising if you understand this one thing about the company

Throughout the manic phase of SoftBank and the Vision fund there was almost no mention of the fact that at the start of this century Masayoshi Son was the richest person in the word:

"But Son’s fairytale didn’t last long. After the dot-com bubble burst, his company Softbank’s shares plunged 75 percent in two months and was 93 percent lower by the end of 2000.
The business almost went bankrupt and Son ended up losing USD 70 billion, the highest ever recorded financial loss for a person in history."

—MoneyControl, October 13, 2017

We had a couple posts around the time of the above that touched on the craziness but not the past history:
SoftBank In Talks To Acquire U.S. Treasury
Sprint, T-Mobile Plunge: SoftBank Calling Off Merger, Will Use Cash to Buy Canada

See also semi-variance, after the jump....

**** 

When the swings are as big as Son's are you need a bankroll that is gigantic. Even if you are right and have an edge, the natural variation can kill you and the last downturn will be the last downturn.
Some related links:....

And October 2024:

 SoftBank’s Masayoshi Son Sees AI Evolving To A Point Where Your Happiness Will Be its Greatest Reward

Having observed Mr. Son and his position in the parade—from Drum Majorette leading the way, to being the guy cleaning up after the elephants, and then back to the front— we had this introduction in February 2024:

Since the time he almost went broke after the dot.bomb bubble burst (he had briefly been the richest person in the world) I've come to realize this guy isn't some great visionary/grand strategist; he's just leveraged beta. Making big bets, all geared up, on whatever is at the head of the passing parade.

That said, he owns 90% of ARM Holdings and I don't.

Bastard.

—"Masayoshi Son Seeks to Build a $100 Billion AI Chip Venture"

 

Shades of another disruptor, Sam Insull, leverage at the holding company level, leverage at the operating company level, leverage all the way down

February 2020:
The First Time SoftBank's Masayoshi Son Went Broke
Leveraged beta.
It can work for a very long time, long enough that its practitioners start believing they are invincible when they aren't.....

....We had a couple posts around the time of the above that touched on the craziness but not the past history:
SoftBank In Talks To Acquire U.S. Treasury
Sprint, T-Mobile Plunge: SoftBank Calling Off Merger, Will Use Cash to Buy Canada

See also semi-variance, after the jump....

*****

....When the swings are as big as Son's are you need a bankroll that is gigantic. Even if you are right and have an edge, the natural variation can kill you and the last downturn will be the last downturn....

"SoftBank and OpenAI’s $500 Billion AI Project Struggles to Get Off Ground"

I'm starting to think the manufacturing wizards at TSMC were right: 

Chips: "TSMC execs allegedly dismissed Sam Altman as ‘podcasting bro’ — OpenAI CEO made absurd requests for 36 fabs for $7 trillion"

From the Wall Street Journal via MSN, July 22:

A $500 billion effort unveiled at the White House to supercharge the U.S.’s artificial-intelligence ambitions has struggled to get off the ground and has sharply scaled back its near-term plans.

Six months after Japanese billionaire Masayoshi Son stood shoulder to shoulder with Sam Altman and President Trump to announce the Stargate project, the newly formed company charged with making it happen has yet to complete a single deal for a data center.

Son’s SoftBank and Altman’s OpenAI, which jointly lead Stargate, have been at odds over crucial terms of the partnership, including where to build the sites, according to people familiar with the matter.

While the companies pledged at the January announcement to invest $100 billion “immediately,” the project is now setting the more modest goal of building a small data center by the end of this year, likely in Ohio, the people said.

Stargate’s lethargic launch is a setback to the vast ambitions of Son, who despite spending billions of dollars over the years, has been playing catch-up in the fast-evolving AI sector.

SoftBank committed $30 billion to OpenAI earlier this year. It is by far the largest-ever startup investment—an enormous wager that has led SoftBank to take on new debt and sell assets. The investment was made alongside the plans for Stargate, giving SoftBank a role in the physical infrastructure needed for AI.

Altman, eager to secure the computing power to support the next generations of his company’s signature product, ChatGPT, has plowed ahead without SoftBank, signing deals for data centers with other operators.

The leaders of both companies say all is well in their joint effort. Last week they appeared on video at a SoftBank event, and Altman said they have an initial goal of building 10 gigawatts of data centers together. It is a “wonderful partnership,” he said.

In a joint statement, the two companies said they were advancing projects in multiple states and were “moving at hyperscale and speed to deliver the AI infrastructure that will power the future and serve humanity.”

Stargate’s rocky start hasn’t slowed the data-center development spree that Trump has said is a national priority. AI enthusiasts say the world will require a gargantuan effort to build the warehouse-like structures filled with computer servers—and the electricity needed to supply them—on par with the construction of railroads in the 19th century.

Altman’s OpenAI recently struck a data-center deal with Oracle that calls for OpenAI to pay more than $30 billion a year to the software and cloud-computing company starting within three years, according to people familiar with the transaction.

That deal, which doesn’t involve SoftBank, totals 4.5 gigawatts of capacity, and would consume the equivalent power of more than two Hoover Dams, enough to power about four million homes. The data centers are spread among locations around the U.S., people familiar with the deal said.

data-center deals for nearly as much capacity as Stargate promised for this year in January. (OpenAI has said $100 billion roughly equates to 5 gigawatts of data centers.)

Despite Stargate’s slow start, Son has told associates he is bullish on OpenAI and would like to invest even more in the company, a person familiar with the matter said....

....MUCH MORE 

If interested see also:

"How Is SoftBank Funding Its Mega Investment in OpenAI? A Lot of Debt"
Leveraged beta, baby!
From the Wall Street Journal, April Fools Day, 2025....

SoftBank races to fulfill $22.5 billion funding pledge to OpenAI by year-end (may sell Didi; margin ARM Holdings)

From Japan Times, December 20:

SoftBank Group is racing to close a $22.5 billion funding commitment to OpenAI by year-end through an array of cash-raising plans, including a sale of some investments, and could tap its undrawn margin loans borrowed against its valuable ownership in chip firm Arm Holdings, sources said.

The "all-in" bet on OpenAI is among the biggest yet by SoftBank CEO Masayoshi Son, as the Japanese billionaire seeks to improve his firm's position in the race for artificial intelligence. To come ​up with the money, Son has already sold SoftBank's entire $5.8 billion stake in AI chip leader Nvidia, offloaded $4.8 billion of its T-Mobile U.S. stake and slashed staff.

Son has slowed ‍most other ⁠dealmaking at SoftBank's Vision Fund to a crawl, and any deal above $50 million now requires his explicit approval, two of the sources said. Son's firm is working to take public its payments app operator, PayPay.

The initial public offering, originally expected this month, was pushed back due to the 43-daylong U.S. government shutdown, which ended in November. PayPay's market debut, likely to raise more than $20 billion, is now expected in the first quarter of next year, according to one direct source and another person familiar with the efforts.

The Japanese conglomerate is also looking to cash out some of its holdings in Didi Global, the operator of China’s dominant ride-hailing platform, which is looking to list its shares in ‍Hong Kong after a regulatory crackdown forced it to delist in the U.S. in 2021, a source with direct knowledge said. Investment managers at SoftBank's Vision Fund are being directed toward the OpenAI deal, two of the above sources said.

SoftBank's scramble to marshal funds offers a window into the strain faced even by the world's biggest dealmakers as they scramble to finance ambitious ‌AI data center projects worth hundreds of billions of dollars.

SoftBank declined to comment.

OpenAI has not yet received the remaining funding, but expects the money to come in by the end of 2025, as stipulated in the contract, sources said.

SoftBank has multiple sources ​of capital it could tap, including margin ‌loans, cash on its balance sheet, stakes in listed companies, and corporate bonds or bridge loans, sources said....

....MUCH MORE 

As noted when Mr. Son dumped Nvidia: 

November 12
"SoftBank shares slide as Nvidia stake sale highlights AI funding needs"

That was a rookie fund manager's move, using your most liquid asset to fund your least liquid.

In the olden days proprietary traders/stock jobbers/proto-market makers would keep their share and bond certificates in a box—hence short against the box etc. And in that box the most speculative, least-liquid-in-a-crash certificates were on top ready to be tossed into the maw of a descending market, with the highest quality, most liquid shares at the bottom of the box.

It was a tell as to either the individual trader's finances or to the depth of a downturn to see certs from the bottom of the box coming onto the market.

As a side note, you can still get your stock in certificate form but it will cost you at least $500 per cert. The powers that be, Depository Trust, the brokers et al. really prefer you don't ask for the paper.....

Here's six months of SoftBank stock price action via TradingView:

 

Top tick was around 27,000 yen at the end of October, 17,115 last, up 990 (+6.14%) on Friday.

"SoftBank, OpenAI Japan AI joint venture is delayed, source says"

Another one.* 

From Reuters, September 17/18:

SoftBank's (9984.T), plans to set up a joint venture with OpenAI to bring artificial intelligence services to corporate customers in Japan are significantly behind schedule, according to a source familiar with the matter.

The joint venture was supposed to be set up this summer but preparations are taking longer than anticipated, with an update on progress expected in November, the source said, declining to be named as the details are not public. 

SoftBank said preparations were proceeding but declined to comment on details. OpenAI did not immediately respond to a request for comment.

 

SoftBank CEO Masayoshi Son announced the venture, SB OpenAI Japan, with OpenAI CEO Sam Altman in February. SoftBank said the venture would be owned by OpenAI and a company established by SoftBank and its domestic telecoms unit....

....MORE 

*August 8 - SoftBank Reports, Beats, Apollo Loans $5.4 Billion, Stargate (with OpenAI) Will Be Late

Done Deal: "SoftBank Uses OpenAI Stake to Borrow $10 Billion"

Mr. Son got the money.

From Financial News London, August 6:

Loan deepens tech investor’s entanglement with the ChatGPT maker 

Global tech investor SoftBank Group used its stake in OpenAI to borrow $10 billion from a group of banks, the company said Thursday, dialing up risk on its giant bet on the AI pioneer.

The cash, in turn, helps SoftBank fund an even larger stake in OpenAI: SoftBank is poised to pay another $10 billion for shares in the ChatGPT maker by October, the final chunk of a $30 billion investment announced earlier this year.

The loan, announced alongside SoftBank’s second-quarter earnings, comes as the Japanese group embarks on a wave of hefty new AI spending commitments.

SoftBank, led by billionaire Chief Executive Masayoshi Son, has vowed to become a leading builder of AI data centers and a major investor in AI-powered robotics. It is also setting up its own neocloud—a business that rents AI computing power to major tech companies and startups—similar to CoreWeave.

Many of those broader AI investments rely on OpenAI.

The $10 billion loan is backed by some of the biggest names on Wall Street and in Tokyo. Goldman Sachs, JPMorgan, Apollo, Mizuho Securities and Sumitomo Mitsui all participated.

Thursday’s deal is an unusual move, as backers of OpenAI and other large startups typically don’t invest using debt.

While Wall Street banks routinely offer so-called margin loans to investors in publicly traded companies, they are reluctant to make large loans backed by stock in private, loss-making companies given the risks inherent to startups....

....MUCH MORE 

"SoftBank renews talks for $10 billion loan against OpenAI stake, adds concessions, sources say"

 A lot of red in Asian markets at the moment, down 1% (Shanghai - Shenzhen) to 5% (KOSPI).

From Reuters, July 1:

• SoftBank has reopened talks on $10 billion OpenAI margin loan, sources say
• SoftBank now offering corporate guarantee if OpenAI collateral proves insufficient, sources say
• Lenders in the consortium include Goldman Sachs, JPMorgan and Mizuho, sources say 

SoftBank Group has ​reopened talks with a consortium of lenders for a $10 billion loan backed by its stake in OpenAI, after earlier attempts ‌to secure a loan stalled over concerns about the difficulty of valuing private companies, two people familiar with the matter said.

To make lenders more comfortable, the Japanese technology investor is offering to guarantee repayment of the loan, giving banks recourse to SoftBank if the OpenAI shares pledged as collateral lose value, the people ​said....

....MUCH MORE 

...SoftBank also faces a March 2027 deadline to repay a $40 billion bridge loan ⁠that helped ​to finance its OpenAI investment. SoftBank has said that borrowing would likely be ​repaid “through the utilization of existing assets and other financing measures.”... 

Not Good - "Nvidia in Talks With OpenAI to Guarantee $250 Billion Financing for Data Center"

Not good at all. 

From the Wall Street Journal, July 26:

Project would be one of the largest AI computing hubs and involve power controlled by the U.S. government 

Nvidia NVDA -0.92% is in talks to provide a roughly $250 billion backstop for OpenAI as part of a massive data-center project, one of the most ambitious financial transactions yet in America’s artificial-intelligence boom.

The guarantees from Nvidia would help the ChatGPT maker lease a 10-gigawatt project that SoftBank’s 9434 2.48% energy subsidiary is developing in southern Ohio, people familiar with the matter said. 

In total, the project could cost more than $500 billion, including the chips that would go inside the data centers. It would be the largest data center project announced to date.

The power for the project is controlled by the U.S. government and funded separately by Japan under a recent trade deal. Commerce Secretary Howard Lutnick is involved in deciding who will get the power, some of the people said.

Nvidia’s backing would allow the data center developer, which is owned by Japanese billionaire Masayoshi Son’s investment firm SoftBank, to raise debt at more favorable terms than it could if OpenAI had no financial backer, since OpenAI has no investment-grade credit rating as an unprofitable private company. The AI company has been in advanced talks to lease the site for several weeks, people familiar with the matter said.

OpenAI is among the companies that has shown most interest in the site, while Anthropic, Microsoft and Google have also spoken to Lutnick about it in recent weeks, one of the people said.

AI companies are desperate to secure chips and power needed to run their models, making megaprojects that have government support or guaranteed power increasingly attractive.

Under the arrangement, Nvidia would guarantee a series of financing vehicles intended to make lenders feel more confident that the funding behind the project is secure, the people said. Terms haven’t been finalized and the deal could fall apart. 

The $250 billion guarantee would cover the data center lease and debt needed to fund its build out, but not the Nvidia chips that would go inside it. Nvidia, which has invested $30 billion in OpenAI, is also discussing a deal to finance the chip purchase for OpenAI, which could total $350 billion, people familiar with those discussions said. Such circular funding arrangements have caused concerns that the industry is vulnerable if investor sentiment shifts or growth slows for AI companies....

....MUCH MORE 

The quarter-trillion guarantee would be risky no matter who NVDA was co-signing for but the fact it will be for Mayoshi Son and Sam Altman is nuts.

Our last mention of the Ohio property was February 25's Transmission: "Central Ohio Set for Major Grid Expansion as PJM Approves 765-kV Lines"

We didn't get any further information on the immense Ohio natural gas power plant in last night's State of the Union message but as a possible consolation prize for the hyper-concentrated mini-portfolio we see this from Construction Review, February 17...

Preceded by Feb 24's "Ahead of Tonight's State Of The Union: Hoping For Clarity On The Gigantic Gas-Fired Electrical Generation Plant

Everything other than the fact it is Japanese money funding the beast and a Japanese company (SB Energy sub. of SoftBank) overseeing the project and Japanese companies expressing interest in developing same, a mention of American corporate participation could be rocket fuel for a couple of our favorite names.

First up, Barron's last week, with the overview... 

***

...9.2 gigwatts would make it the second largest electrical plant of it's type in the world.
Both Mitsubishi Electric and Hitachi manufacture utility-scale natural gas turbine generators but if there is room for an American company it would have to be GE Vernova.
Plus transformers and transmission lines and Quanta Services is the go-to.

October 2025 -  "...Ohio lawmaker proposes ban on marriage, legal personhood for AI"

Getting in front of the curve....

August 2025 - Follow-up: SoftBank Was Purchaser Of Foxconn Ohio Plant; From Here It Gets Interesting

Following on August 16's "Foxconn says EV sales are so slow it's converting a factory to build AI servers instead".

July 2025 - "SoftBank and OpenAI’s $500 Billion AI Project Struggles to Get Off Ground"

I'm starting to think the manufacturing wizards at TSMC were right: 

Chips: "TSMC execs allegedly dismissed Sam Altman as ‘podcasting bro’ — OpenAI CEO made absurd requests for 36 fabs for $7 trillion"

The least they could have done is invite GE Vernova to participate in what will be the world's second-largest natural gas-fired power plant but noooo.