SoftBank, a Japanese investment holding company, has fully backed out of its Nvidia (NASDAQ: NVDA) stake, selling 32.1 million shares for $5.83 billion.
The proceeds will reportedly be used to fund new investments in the artificial intelligence (AI) sector, with $22.5 billion going to OpenAI. What’s more, CEO Masayoshi Son is also courting TSMC (NYSE: TSM) and others to join a proposed $1 trillion AI manufacturing hub in Arizona.
Nvidia started this week on a positive note, closing 5.79% in the green on Monday, November 10. However, it is down 1.66% in pre-market on Tuesday, November 11, trading at $195.74 following the news of SoftBank’s share dump.
Despite the dip, not all analysts believe the sale signals a loss of faith. Rolf Bulk of New Street Research, for instance, argued that SoftBank is merely upping its investment budget for the ongoing quarter.
“This should not be seen, in our view, as a cautious or negative stance on Nvidia, but rather in the context of SoftBank needing at least $30.5 billion of capital for investments in the October–December quarter, including $22.5 billion for OpenAI and $6.5 billion for Ampere,” said Bulk in an interview with CNBC.
SoftBank’s asset monetization strategy
The timing indeed seems to reflect the holding company’s pivot from merely holding tech stocks to directly investing in the AI ecosystem.
For example, the firm’s tech-oriented venture capital branch subsidiary, Vision Fund, posted a record $19 billion gain last quarter, helping SoftBank double its profit year-over-year.
The Nvidia sale is also not unprecedented. Namely, SoftBank had already sold $4 billion worth of NVDA shares back in 2019.
Furthermore, the company still remains a part of Nvidia’s ecosystem through a $500 billion Stargate data center deal announced in February by Son, joined with President Donald Trump, OpenAI’s Sam Altman, and Oracle’s Larry Ellison.
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