SoftBank Earnings to Test Appetite for AI Bets Beyond ChatGPT

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessSoftBank Earnings to Test Appetite for AI Bets Beyond ChatGPTSoftBank Group Corp.’s stock faces a critical test this week as investors seek reassurance that the company’s AI value extends beyond its debt-fueled bet on embattled ChatGPT operator OpenAI.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.j8e1[6kwe}si4(mny{2oxbba_media_dl_1.png Bloomberg Intelligence(Bloomberg) — SoftBank Group Corp.’s stock faces a critical test this week as investors seek reassurance that the company’s AI value extends beyond its debt-fueled bet on embattled ChatGPT operator OpenAI. 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Signs of progress on such deals could help offset doubts about how the company is financing its $65 billion OpenAI stake, especially amid speculation that Sam Altman’s firm may delay its public listing. SoftBank’s results will also serve as a litmus test for the broader AI trade, which has struggled to regain momentum after fears about the sustainability of huge corporate spending triggered a widespread selloff in July.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThe current market environment would react harshly to signs of tapering growth, but resilient results “could just as easily reassure markets that the aggressive pivot toward AI remains well-calculated,” said Nikos Tzabouras, a senior financial strategist at trading platform Tradu. Broadly seen as a bellwether for AI sentiment in Japan, SoftBank briefly became the nation’s most valuable company by market capitalization in June, but has now slipped back to third place. Its shares have lost around 40% from their June 2 peak, although they’re still up around 19% since the start of 2026. Analysts say the key to restoring the market’s faith is more visibility on the planned US listings of subsidiary SB Energy and an entity called Roze that SoftBank aims to set up. The debuts would boost SoftBank’s exposure to some of the power generation and robotics dimensions of the AI infrastructure boom. Investors are paying closer attention to the underlying value of SoftBank’s investments in energy and robotics, said David Dai, a managing director at Sanford C Bernstein in Hong Kong. Any updates on the projects would be a positive, he said, because “having a price tag on those assets would be very helpful.”Similarly, any further information on SoftBank’s pending acquisition of Switzerland-based ABB Ltd.’s robotics business would help lift investors’ mood, according to BTIG analyst Jesse Sobelson. Son’s company announced the ABB deal in October and said it would close in mid-to-late 2026. The purchase would give SoftBank “a scaled industrial robotics platform with revenue, customers and a clearer path to embed AI into real-world automation,” Sobelson wrote in a recent report.Gains from SoftBank’s stake in chip designer Arm Holdings Plc should also help boost the mood around its stock, said Bernstein’s Dai. Arm’s shares rallied more than 200% in the six months through June on expectations of booming demand for the company’s new central processing units — benefiting SoftBank, which owns almost 90% of the company. This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.Arm’s stock has since fallen around 33% amid souring market sentiment, but Dai expects momentum to pick up as investors account for future upside, with revenue from Arm’s in-house CPU projected to materialize around 2029.“OpenAI issues can only affect SoftBank so much, because Arm is a bigger part of its valuation,” he said. That said, investor scrutiny will continue to circle SoftBank’s highly-leveraged investment in the ChatGPT maker. In March, the Japanese company secured a $40 billion bridge loan to finance the bet and recently attracted a new group of 21 lenders, Bloomberg reported in July.That setup is looking increasingly risky due to rising competition from China, AI security challenges and equity market volatility clouding the outlook for OpenAI’s planned IPO. SoftBank’s five-year credit default swaps have widened by around 70 basis points since the start of 2026 to roughly 350 basis points, the widest among all Japanese companies, according to Bloomberg-compiled data.“The key investor question is whether SoftBank Group can clarify cash needs, collateral capacity, and the status of any OpenAI-backed financing,” wrote BTIG’s Sobelson. He expects management to address these issues in earnings, although details around the OpenAI IPO timing will likely be scarce.With exposure to the “full stack” of the AI infrastructure buildout, however, worries about cash flow are more like “mid-term hurdles” than long-term fundamental problems for SoftBank, according to Bernstein’s Dai.“Nobody really has any evidence to say that AI is not delivering its promises,” he said. If SoftBank can persuade investors to see beyond the OpenAI headlines, “it’s fairly likely that they will be back at number one” in Japan’s corporate rankings soon, he said. SoftBank shares currently have 16 buy ratings, six holds and one sell, according to Bloomberg-compiled data. Analysts’ average 12-month target price is ¥8,603, compared with a closing level of ¥5,228 on Tuesday in Tokyo. —With assistance from Umesh Desai.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. 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