SoftBank's Son says he cried selling Nvidia to fund AI bets

• StockStory Top Pick NVDA +0.83%
• SFTBF -1.76%

SoftBank founder Masayoshi Son has revealed how reluctant he was to part with the company’s entire Nvidia stake, describing the sale as an emotional decision driven by the need to raise cash for a new wave of AI investments.

Speaking at an investment forum in Tokyo Monday, he said: “I wish to have unlimited money. I respect Nvidia so much, I don’t want to sell a single share. I just had more need for money to invest into OpenAI, invest into our opportunities, so I was crying to sell Nvidia shares. If I had more money, of course, I wanted to keep Nvidia shares, all the time, any time.”

SoftBank’s decision to sell its Nvidia stake for about $5.83 billion caught investors off guard last month, sparking fresh fears that AI-related stocks could be overvalued.

But Son pushed back against warnings that the sector is in a bubble, saying skeptics are “not smart enough.” He added that the economic impact of advanced AI systems will be large enough to justify the enormous sums now being poured into the sector, asking, “Where is the bubble?”

Nonetheless, SoftBank’s stock has slumped almost 40% in U.S. trading since late October as investors grow uneasy about the scale of its AI spending.

Much of that spending has been funneled into ambitious hardware and infrastructure projects such as the company’s “Stargate” data-center plan and its move into in-house chip design via Ampere Computing. Both demand enormous capital outlays long before any payoff materializes.

Son’s comments come as short-seller Jim Chanos, most famous for his prescient Enron call in the early 2000s, warned of the risk of debt defaults in the growing AI cloud computing space.

“Business models like the neoclouds, a lot of the AI companies themselves ... are just loss-making enterprises right now,” Chanos said in an interview with Yahoo Finance last week. “You've gotta hope that changes, because if it doesn't, there's going to be debt defaults on these things.”