The Japanese technology investor SoftBank intensified the debate about valuations in the artificial intelligence world on Tuesday by revealing it had sold its stake in the chipmaker Nvidia.
In its latest quarterly results, SoftBank showed it had sold its shares in Nvidia for $5.8bn (£4.4bn) in October, as it doubles down on its bets on OpenAI, the group behind the ChatGPT chatbot. It also reported that second-quarter net profit more than doubled to 2.5tn yen (£12.2bn), driven by valuation gains in its OpenAI holdings.
SoftBank also sold part of its stake in T-Mobile, as it assembled funds to bankroll its AI investments.
Asked about the timing of the sale of the Nvidia stake, the chief financial officer, Yoshimitsu Goto, told reporters that because SoftBank’s investment in OpenAI was very substantial, the company had to use its existing assets to finance new investments.
“This year our investment in OpenAI is large – more than $30bn needs to be made – so for that we do need to divest our existing portfolios,” Goto said. “We did not have a specific [reason to sell] in October and it was nothing to do with Nvidia itself.”
Shares in Nvidia, whose high-powered chips are in hot demand to power AI datacentres, fell by 3.5% in morning trading in New York after SoftBank’s announcement.
Other tech shares also slipped, pulling the Nasdaq Composite index down by 0.85% in early trading. Arm, the Cambridge-based chip designer, fell 5.1%, as did the computer memory and storage developer Micron.
Russ Mould, the investment director at AJ Bell, said: “People are looking for clues that the tech rally is close to the top, and SoftBank’s profit-taking in the chip giant is significant.
“Investors typically sell out of positions when they believe the valuation is too rich, the growth prospects for the company are less attractive than before, or they’ve found something better to back and need cash to make that investment.”
Nvidia’s market value had soared during 2024 and 2025, helping to fuel concerns in recent months that an AI bubble was forming. At the end of October it became the world’s first $5tn company but has since fallen back from that high.
Mould suggested SoftBank had topped up its war chest for the next wave of AI-related investments by cashing in its stake in Nvidia.
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“Nvidia has had a storming run on the markets and SoftBank might think it is prudent to cash in while the going is good.
“Nvidia’s role in an AI world is already well known, yet OpenAI’s position is still evolving, so it might simply be that SoftBank sees the latter as a better way of profiting from the tech explosion going forward, rather than sticking with yesterday’s trailblazer.
“What’s important for markets is the fact that SoftBank’s exit from Nvidia isn’t the Japanese group washing its hands completely of all things AI,” Mould said.