Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier.
Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT.
Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year to 3.7 trillion yen, it said.
Photo: Kazuhiro Nogi
The company's fortunes tend to fluctuate because it invests in a range of ventures, including through its tech-focused Vision Funds. Those recently have paid off.
In February, Softbank chairman Masayoshi Son joined US President Donald Trump, OpenAI CEO Sam Altman and Oracle Corp founder Larry Ellison in announcing a major investment of up to US$500 billion in a project to develop AI called Stargate.
Softbank has invested tens of billions of dollars in OpenAI. The two companies also plan to provide AI services in Japan.
Selling Softbank's stake in Nvidia reflects Son's shift in strategy and also nets his company a healthy profit thanks to the recent runup in Nvidia's market value.
Nvidia recently become the first US$5 trillion company, just three months after it broke through the US$4 trillion barrier. It plans a US$100 billion investment in OpenAI as part of a partnership that will add at least 10 gigawatts of Nvidia AI data centers to ramp up OpenAI's computing power.
The chip maker and other winners in the frenzy around AI technology have been driving much of this year's rally in share prices. Critics say stock prices of the tech giants have soared too high and too fast in the mania around AI, drawing comparisons to the 2000 dot-com bubble that ultimately burst.
Softbank and Nvidia still have strong relations since various ventures that Softbank invests in use Nvidia technology.
Softbank also has investments in Arm Holdings PLC and Taiwan Semiconductor Manufacturing Co (台積電), computer chip makers that like Nvidia are benefitting greatly from the growth of AI.
Softbank stocks have nearly doubled in value in the past year. They gained nearly 2 percent Tuesday.
Nvidia's shares fell 1.3 percent in premarket trading early Tuesday. They jumped 5.8 percent on Monday.
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