SoftBank hits $7 billion quarterly loss due to AI concerns for US data centers

SoftBank Group reported a net loss of 1.1 trillion yen ($7 billion) for the three months ending September. This was a sharp shift from the profit it made a year earlier, as growing concerns about AI investments hurt the Japanese company’s results, the Associated Press reported.

A sharp reversal from a year of profit

The loss is a major change for the Tokyo-based company. SoftBank made a profit of 2.5 trillion yen in the same period a year earlier, the AP reported. However, its revenue continued to grow, rising 16% to 2.2 trillion yen from 1.9 trillion yen a year earlier.

SoftBank’s profits can change quickly because they depend on how the company’s investments perform. The company owns stakes in OpenAI and chipmaker Arm Holdings, among others, via its Vision Funds.

The funds invest in tech startups and large technology companies. As is well known, the values of these companies are prone to sharp rises or dips.

SoftBank founder exits Nvidia before Huang scandal

SoftBank founder Masayoshi Son built the company around internet technology before expanding into AI, telecommunications, robotics and online shopping. He is also close friends with Nvidia CEO Jensen Huang.

Son sold his Nvidia shares before the reports linking Huang to an alleged affair with a Chinese government agent emerged. The matter is reportedly under investigation by Nvidia and US authorities.

U.S. President Donald Trump said the FBI was looking into another matter and expressed confidence that Huang would be fine during a White House briefing on Monday, according to the AP. The reports have also raised questions about whether China has gained access to Nvidia’s AI chips.

Shares rose before results report

SoftBank’s shares have lost almost a third of their value in the past year. However, they rose nearly 14% in Tokyo on Tuesday before the earnings report.

SoftBank’s results show how much it relies on a few major tech investments. Changes in their value can have a big impact on its profits, making its financial results harder to predict.

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