SoftBank reports $2.4 billion loss as it prepares for major AI investments

SoftBank just took a $2.4 billion hit in its fiscal third quarter, sinking into losses as the Japanese tech giant prepares to throw billions into AI. The company, led by Masayoshi Son, reported the loss on Wednesday, missing analyst forecasts of a $1.57 billion profit, according to LSEG data. It’s a huge downturn from the $6.3 billion gain it reported in the same period last year.

The biggest blow came from SoftBank’s Vision Funds, its massive tech investment arm, which lost $2.3 billion this quarter. The fund had been gaining for the last two quarters, but its private portfolio—still largely undisclosed—dragged it back into the red.

But public holdings weren’t safe either. South Korean e-commerce giant Coupang and Chinese ride-hailing company Didi saw valuation drops, cutting SoftBank’s overall numbers.

SoftBank prepares multi-billion-dollar AI investment push

Son has already committed $15 billion to $20 billion to Stargate, the US-based AI infrastructure project that he announced in January alongside OpenAI CEO Sam Altman and President Donald Trump. According to the deal, over the next four years, Stargate will need up to $500 billion, which makes it one of the biggest AI investments in history.

But that’s just the start. SoftBank is also eyeing a $15 billion to $25 billion stake in OpenAI, aiming to surpass Microsoft as the company’s biggest investor. If finalized, this deal would push OpenAI’s valuation beyond its October figure of $157 billion.

To secure its position, SoftBank has already agreed to spend $3 billion per year on OpenAI’s tech. It’s also launching “SB OpenAI Japan”, a joint venture exclusively marketing OpenAI’s enterprise AI tools to Japanese corporations. This gives SoftBank a tight grip on the AI market in Japan, where businesses are scrambling to integrate automation and machine learning into their operations.

Meanwhile, China continues to push forward with DeepSeek, its new AI model that rattled markets and showed that Beijing is keeping pace with US tech development.

But Europe is struggling to find its footing. At the AI Action Summit in Paris, French President Emmanuel Macron declared that “France is back in the AI race”, unveiling a €109 billion ($112.8 billion) AI investment package.

Europe has long been criticized for overregulating its tech industry, stifling startups, and scaring off investors. Mario Draghi, former European Central Bank president, warned in a 2023 report that Europe is “failing to translate innovation into commercialization.” His findings showed that while the continent has strong research and development, restrictive policies prevent startups from scaling into major players.

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