SoftBank, led by founder Masayoshi Son, plans to ramp up annual investments in artificial intelligence (AI) to nearly $9 billion, aiming to reshape the company to bolster its UK-based chip designer Arm. This strategic move comes amidst a surge in investment activities and a focus on larger deals, positioning SoftBank to compete with global tech giants investing in AI.
SoftBank is poised to invest nearly $9 billion annually in artificial intelligence (AI), according to founder Masayoshi Son, who emphasizes the necessity to reshape the company to support its core subsidiary, UK-based chip designer Arm. This commitment comes as SoftBank seeks larger deals to transform itself radically.
Over the past year, SoftBank’s annual investments and commitments have surged to $8.9 billion, doubling previous levels. CFO Yoshimitsu Goto asserted that the pace of AI-related investment activities would continue, aiming to utilize the company’s strong balance sheet for potential mega-deals.
Masayoshi Son has previously transformed SoftBank from a broadband provider into a significant player in the telecommunications and investment sector. This shift was supported by major investments, including backing from Saudi Arabia and Abu Dhabi and a profitable stake in Alibaba. The company now faces global competition from tech giants like Microsoft, Amazon, and Google, who are also heavily investing in AI.
Despite setbacks from investments such as the $14 billion in WeWork, SoftBank’s financial standings have improved. Recently, S&P upgraded SoftBank to double B plus, indicating better asset quality. This enhancement allows flexibility for large-scale deals, though Goto mentioned that SoftBank would not solely finance these from its balance sheet without structured financing options.
Recently, SoftBank led a $1 billion investment in the UK self-driving car start-up Wayve, marking a significant European AI deal. Additionally, the company is contemplating acquisitions like UK chip designer Graphcore, though no official comments were made.
Masayoshi Son is expected to provide further details on SoftBank’s AI strategy at the upcoming annual shareholders’ meeting in June. Internally, SoftBank’s Vision Funds are evolving, focusing more on strategic investments rather than merely seeking returns. The company has established a Platform Group to identify AI opportunities, merging international businesses under the “One SoftBank” initiative.
