Why SoftBank's Masayoshi Son ‘was crying’ about selling Nvidia shares, but did it anyway

Masayoshi Son, founder, chairman and CEO of SoftBank Group Corp, said he did not want to sell his stake in Nvidia but needed the money to fund investments in OpenAI and other artificial intelligence (AI) projects.

Speaking at the FII Priority Asia forum on 1 December, Masayoshi Son explained his decision to sell his Nvidia stake and doubled down on AI investments, dismissing concerns about a bubble.

SoftBank's move last month came as a surprise and fueled concerns that the AI boom has overvalued tech stocks.

‘Was crying to sell Nvidia shares’, so why?

Masayoshi Son explained, “I don’t want to sell a single share. I just had more need for money to invest in OpenAI and other projects. I was crying to sell Nvidia shares.”

The Japanese group in November sold its entire stake in Jensen Huang's Nvidia and made a massive $5.83 billion — liquid money that he needs to invest in a plethora of AI projects.

Notably, SoftBank has pledged billions of dollars to AI projects. In February, Masayoshi Son joined United States President Donald Trump, OpenAI CEO Sam Altman and Oracle's Larry Ellison to announce a $500 billion investment in Stargate. Since then, there has been a flurry of projects that include a Stargate data centre with Hon Hai Precision Industry Co, the acquisition of US chip designer Ampere Computing LLC, and plans to invest more in OpenAI by 2025-end.

Those who talk about AI bubble ‘not smart enough’, says Masayoshi Son

Speaking at the event, 68-year-old Masayoshi Son also dismissed concerns over an AI bubble, claiming that people who talk about a bubble in AI investment are “not smart enough”.

Why? He reasoned that in a scenario where AI is able to earn 10% of global GDP over the long term, it more than makes up for even trillions of dollars’ worth of cumulative spending, questioning: “Where is the bubble?”

Speaking to Bloomberg in November, SoftBank's Chief Financial Officer Yoshimitsu Goto was not so confident. “I can’t say if we’re in an AI bubble or not,” he said, adding that the company sold Nvidia “so that the capital can be utilised for our financing.”

What are the concerns over AI bubble, tech overvaluations?

Watchers are concerned about soaring tech stocks, amid fear that valuations have peaked and put at risk the trillions of dollars invested in AI commitments, such as advanced chips and billion-dollar data centres.

Investors' worries have heightened as the US economy bellwether Berkshire sits on record cash reserves instead of investing, and after billionaire Peter Thiel's hedge fund and Masayoshi Son's SoftBank both sold off stakes in Nvidia.

Notably, a few days after SoftBank, reports emerged that billionaire investor Peter Thiel's hedge fund, Thiel Macro, had also sold its entire $100 million stake in Nvidia, spiking anxiety over an AI bubble burst.

Also, last month, while optimistic about AI, Alphabet and Google CEO Sundar Pichai admitted that a potential AI bubble burst would have a widespread impact across companies, including Google. Speaking to the BBC, he admitted that “no company would be immune”, including Google, if “irrational exuberance” in the AI market leads to a market bubble burst.

(With inputs from Bloomberg)