Expanded Wagers by SoftBank on Artificial Intelligence and Semiconductor Resources
SoftBank, the Japanese conglomerate, is making significant strides in the AI and chip industries, aiming to create a vertically integrated ecosystem. This strategic move is anchored by key investments and partnerships across multiple fronts.
One of SoftBank's most notable ventures is the Stargate Project, a joint venture with OpenAI, Oracle, and Abu Dhabi’s MGX. The project aims to build advanced AI data centers in the U.S., with an investment of over $500 billion, to train and deploy next-generation AI models critical to various industries, including healthcare and defense.
SoftBank's control over Arm Holdings, a British chip designer valued at roughly $145 billion, plays a significant role in this strategy. Arm Holdings, which went public in 2023, securing a valuation of $54.5 billion, provides the key intellectual property that powers nearly every smartphone in the world and is increasingly integral in AI infrastructure chips.
SoftBank's AI focus extends deeply into generative AI and data infrastructure. Ampere Computing, a U.S. chip designer startup that SoftBank acquired for $6.5 billion, supplies high-performance server chips vital to meeting the rising computational power demands in AI infrastructure. Perplexity AI, another AI-powered startup in SoftBank’s portfolio, though specific details are less emphasized, is focused on generative AI.
To secure its AI chip manufacturing supply chain, SoftBank has significantly increased its stakes in Nvidia and TSMC. Nvidia is recognized as a critical supplier for generative AI's hardware needs, while TSMC is the world's largest contract chip manufacturer.
In addition to these investments, SoftBank announced a $2 billion equity investment in Intel on August 18. The exact amount paid for Graphcore, the British AI chipmaker SoftBank bought in 2024, remains undisclosed. Once touted as a rival to Nvidia, Graphcore had struggled to secure the investment needed to compete.
The chips produced by these companies are based on computing architecture from SoftBank's majority-owned Arm Holdings. This comprehensive ecosystem spans chip design, manufacturing access, AI model leadership, and infrastructure, aiming to capture the massive future AI market, which could reach $1.5 trillion by 2030.
While there are regulatory and geopolitical risks, SoftBank's strategy under CEO Masayoshi Son reflects a bold long-term vision to dominate the AI infrastructure market. The negotiations for Stargate have been delayed, with decisions on sites still pending, but SoftBank remains committed to its ambitious plans.
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