Pedestrians wearing protective masks walk past signage for SoftBank Corp. near a store in Tokyo, Japan, on May 15, 2020.<\/p>\n
Kiyoshi Ota | Bloomberg | Getty Images<\/p>\n
Shares of SoftBank Group plunged as much as 10% Wednesday after the Japanese giant said it had sold its entire stake in U.S. chip giant Nvidia for $5.83 billion. The capital will be used to fund SoftBank’s $22.5 billion investment in ChatGPT parent OpenAI, a person familiar with the matter told CNBC.<\/p>\n
Shares of SoftBank Group last traded more than 6% lower.<\/p>\n
In its earnings report, SoftBank said it sold 32.1 million Nvidia shares in October. It also trimmed its T-Mobile position, raising $9.17 billion.<\/p>\n
“We want to provide a lot of investment opportunities for investors, while we can still maintain financial strength,” said SoftBank’s chief financial officer, Yoshimitsu Goto, during an investor presentation.<\/p>\n
While the decision to unload Nvidia shares may have caught some investors off guard, it isn’t SoftBank’s first exit from the U.S. chip heavyweight.<\/p>\n
The company’s Vision Fund was an early Nvidia supporter, reportedly building a $4 billion stake in 2017 before fully divesting in January 2019. Despite the latest sale, SoftBank remains closely tied to Nvidia through its broader business interests.<\/p>\n
“This is a bullish signal on the theme from SoftBank doubling down and not a bearish sign in our view,” said Dan Ives, global head of technology research at Wedbush Securities.<\/p>\n
While OpenAI is central to SoftBank’s GenAI portfolio, hardware remains a priority as well, mostly through its stake in British chip designer Arm, with which SoftBank is co-developing products, said Rolf Bulk, equity research analyst at New Street Research. SoftBank has a controlling stake in U.K-based Arm Holdings, whose chip designs power mobile and AI processors.<\/p>\n
Several other tech stocks in the region also declined. Semiconductor testing equipment maker\u00a0Advantest<\/a>\u00a0and Tokyo Electron<\/a>, a chip production equipment maker, slipped over 2%.<\/p>\n