SoftBank is moving on from the AI boom's signature stock to fund an investment in the owner of the AI boom's signature product. CNBC's MacKenzie Sigalos reports on news regarding OpenAI.

San Francisco

SoftBank has sold its entire stake in Nvidia, generating approximately $5.8 billion, which will be used to fund significant investments in OpenAI. This move is part of a broader strategy to shift focus from AI infrastructure to the application layer, including participation in a $40 billion OpenAI funding round. 

Despite OpenAI's projected losses of over $70 billion in 2028 and a consumer-heavy revenue model, SoftBank is betting on future value creation in AI platforms and tools. In contrast, competitor Anthropic is expected to reach profitability sooner due to its enterprise focus, but OpenAI's leadership remains confident in achieving substantial revenues by 2030.

SoftBank’s Nvidia exit fuels OpenAI push despite mounting losses

SoftBank did what some might have said was unthinkable before. It sold its entire stake in NVIDIA. SoftBank announcing it cashed in all of its NVIDIA chips for about five point eight billion dollars. Masayoshi Son, who runs SoftBank, will use his company and the proceeds to fund massive investments in open A.I. So they're not getting out of A.I. They're going a little heavier into open A.I. Obviously, a lot of questions, a lot of angles here. So let's bring in Mackenzie Sigalos with more big sale. Big news. Yeah, it is, Brian. You've got SoftBank making one of the boldest shifts that we've seen in this A.I. cycle, exiting NVIDIA to go all in on open A.I. And you said it, the firm just sold its entire NVIDIA stake. We're talking about more than thirty two million shares worth nearly six billion dollars. And it is part of this broader repositioning around the application layer of A.I. And that includes participating in opening a secondary share sale, which just closed last month. And of course, SoftBank is leading that 40 billion dollar primary round that it's expected to wrap soon. And I will say this to raise the cash for both of those investments. SoftBank not only exited its NVIDIA stake, it also sold more than nine billion dollars worth of T-Mobile stock and it tapped a margin loan on its arm stake. So it is pulling every liquidity lever here to fuel its next chapter with open A.I. And I will say it is not a call against NVIDIA's future. They've explicitly said that this isn't about valuation. It is about where they see that next wave of value creation. And it's not in the infrastructure layer, but it's in the interface of the platforms, agents, those tools that consumers and businesses are actually using. One other note, Brian, this is not the first time that SoftBank has exited out of its NVIDIA stake. They also did that back in 2019. Had they not, it would be a stake worth 210 billion dollars today. NVIDIA surged 5000 percent since 2019. And even for Masayoshi Son, who I believe is the richest man in Japan, that is still a lot of money. Let's stay on that story because they're planning to really bet the house on open A.I. But here's what's interesting. Their biggest competitor, Anthropic, likely to make a profit a long time before open A.I. Why? Well, the Wall Street Journal just got their hands on some financial documents from both open A.I. and Anthropic. And what they show is just how like just how differently these two A.I. giants are approaching profitability. So the why is that Anthropic has always been focused on enterprise and it's paying off. Roughly 85 percent of its revenue comes from business customers compared to open A.I.'s 70 30 consumer heavy split. And that consumer side, Brian, includes products like Chachi BT, that new video tool called Sora, which is very popular for them, but also deeply unprofitable and a major driver of open A.I.'s infrastructure costs. Why? They've committed one more than one point four trillion dollars to power that consumer facing product. Now, I will say this, some of those numbers that the Wall Street Journal got, the docs, they exposed the fact that opening I expect to lose seventy four billion dollars in twenty twenty eight alone, burning through 14 times more cash than Anthropic before it turns a profit in 2030. And that's a big concern here. Bernstein analysts, they did some back of the envelope math based off of Microsoft's latest quarterly print. Open A.I. burned twelve billion dollars in Q3. So I want to be clear what you just said vis a vis the Wall Street Journal. Open A.I. plans to lose 70 plus billion dollars in three years, not this year, not next year. Three years from now, they still see losses greater than the market cap of the majority of American companies. But CEO Sam Altman would say, in fact, he just said at the end of last week that they are on track to bring in revenue on the scale of hundreds of billions of dollars by 2030. That was a sharp revision upward. So they're saying that, you know, we're spending to make money. Yeah, listen, a lot of companies make a lot of billions. They try to make profit on those billions, not lose money. But it's early. We'll see how it shakes out and we'll see how patient investors are going to be. Mackenzie Segalos, thank you.

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New York

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Breakdown