SoftBank rides AI boom with $2.05 billion quarterly profit on OpenAI bet

TOKYO - Japan’s SoftBank Group said on Feb 12 it logged a net profit of 248.6 billion yen (S$2.05 billion) in its third quarter, boosted by the rising valuation of its investment in ChatGPT-maker OpenAI.

The results, which mark SoftBank’s fourth consecutive quarter in the black, compare with a net loss of 369 billion yen over the same period the previous year.

OpenAI delivered a further – though smaller – valuation gain in the third quarter compared with three months earlier. In the nine months to end-December, the start-up has provided a 2.8 trillion yen investment gain.

SoftBank has invested more than US$30 billion (S$37.9 billion) in OpenAI, accumulating an 11 per cent stake as of December, and has been in talks to invest as much as US$30 billion more in a round that would value the startup at about US$750 billion to US$830 billion. As of December, SoftBank’s investment gain on OpenAI stood at an estimated US$19.8 billion.

OpenAI now represents one of SoftBank’s biggest holdings, alongside a roughly 90 per cent stake in chip designer Arm Holdings. SoftBank chief executive and founder Masayoshi Son has made an “all-in” wager that OpenAI will emerge as a winner in the battle between competing developers of large language models, like Google with Gemini and Anthropic’ with Claude.

SoftBank is “the only real way to directly play OpenAI in today’s public markets,” BTIG analyst Jesse Sobelson wrote in a note ahead of the company’s earnings. “Next OpenAI capital raise could spur re-mark of SoftBank equity ownership” and serve as a catalyst, the note said.

To fund its bets, the technology investment group has turned to asset sales, bond issuance and loans backed by its other holdings, such as chip designer Arm.

These come on top of the sales of its US$5.8 billion holding of Nvidia and part of its stake in T-Mobile for US$12.73 billion between June and December 2025, sparking investor concern over its ability to keep bankrolling OpenAI, which does not make a profit.

In December, SoftBank raised the amount it can borrow against its shares of telecoms unit SoftBank Corp to 1.2 trillion yen from 800 billion yen.

While OpenAI was once considered the dominant player among makers of large language models, it has recently been negotiating rising costs to train and run its artificial intelligence models amid intensifying competition from the likes of Alphabet. REUTERS, BLOOMBERG