SoftBank in Talks for Major OpenAI Investment

SoftBank Group Corp. is reportedly in discussions to invest between $15 billion and $25 billion in OpenAI, a move that would potentially establish the Japanese investment company as the AI startup's largest backer, Bloomberg reports.

The news follows a previous investment of $15 billion from SoftBank for Project Stargate, a Texas-based joint venture with OpenAI to build data centers and other AI infrastructure.

This investment would be a substantial addition to OpenAI's existing funding. Microsoft, OpenAI's largest current investor, declined to comment on the potential investment. The Financial Times first reported the talks.

OpenAI's need for increased data center capacity is driven by its goal of developing more powerful AI models. The company currently faces intense competition in the AI market, including from Chinese startup DeepSeek, which reportedly achieved comparable AI capabilities at a fraction of OpenAI's cost.

SoftBank's interest in OpenAI stems from its ambition to enter the lucrative AI hardware market. SoftBank CEO Masayoshi Son and OpenAI CEO Sam Altman have a history of collaboration, having first met in 2019 when Son proposed a $1 billion investment that ultimately did not materialize.

News of the potential investment has boosted Asian chip-related stocks, including Advantest Corp. However, SoftBank's shares have experienced a slight decline. "It makes sense that Nasdaq and semiconductor-related stocks are being bought, but SoftBank, which is putting up the money, isn't going to see the same buying momentum," said Takehiko Masuzawa, head of equity trading at Phillip Securities Japan, to Bloomberg.

The potential investment comes amidst some skepticism about Project Stargate and its financing. Elon Musk, CEO of xAI, questioned the ability of companies involved in the project to fulfill their financial commitments. However, SoftBank possesses significant financial resources, including approximately $25 billion in cash and cash equivalents, as well as substantial holdings in various startups and a 90% stake in Arm Holdings Plc, which could be used to fund the investment.