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SoftBank Shares Plunge as AI Safety Concerns Spur Selloff
SoftBank invests a lot of money in artificial intelligence companies.
Its shares dropped sharply after leaders at OpenAI and Anthropic said advanced AI should be developed more carefully.
They are worried that powerful AI systems could create safety problems.
Investors became concerned that slower development might reduce future profits.
SoftBank is especially exposed because it plans to invest billions in OpenAI and other AI projects.
The company is also borrowing money to help pay for these investments.
OpenAI says it will not seek a public listing in 2026.
Anthropic is considering an IPO as early as next month.
These developments made investors question how quickly AI investments will generate returns.
SoftBank shares fell more than 14% in Tokyo on Monday, their sharpest one-day decline since late June.
Investors reacted after Anthropic and OpenAI executives urged a more cautious approach to advanced AI development.
SoftBank’s expected investment in OpenAI could approach $65 billion by October, increasing its exposure to AI-related risks.
The company is raising debt, including a ¥1 trillion retail bond sale and a $10 billion loan tied to its OpenAI stake.
SoftBank shares are down about 30% from their June peak amid concerns over AI returns, competition, security incidents and a possible delay to OpenAI’s IPO.
- Who
- SoftBank Group Corp., its founder Masayoshi Son, OpenAI and Anthropic executives, and investors.
- What
- SoftBank shares plunged more than 14% as concerns about AI safety, investment returns and SoftBank’s leverage triggered a selloff.
- Where
- SoftBank shares fell in Tokyo.
- When
- The decline occurred on Monday, after comments by Anthropic and OpenAI executives over the weekend.
- Why
- Investors worried that a slower pace of advanced AI development could affect expected returns, while SoftBank is making large AI investments and taking on additional debt.
Cautious AI Development
Continued AI Investment and Growth
Development pace
Cautious AI Development
Anthropic CEO Dario Amodei and OpenAI CEO Sam Altman support a more measured pace for developing the most advanced AI systems because of safety concerns.
Continued AI Investment and Growth
SoftBank’s investment strategy assumes continued expansion of AI projects, data centers and related businesses, although the company faces uncertainty over their timing and returns.
Investor outlook
Cautious AI Development
Additional safeguards, including independent assessments proposed by Anthropic, could address risks associated with frontier AI.
Continued AI Investment and Growth
Investors worry that slower development, stronger competition and security incidents could reduce expected valuations and returns from AI investments.
Public listings
Cautious AI Development
OpenAI is prioritizing AI safety concerns and has said it will not pursue a public listing in 2026.
Continued AI Investment and Growth
Anthropic has selected Nasdaq for a proposed IPO that could take place as early as next month, offering a contrasting path for an AI company.
Key facts
- Share decline
- More than 14% in Tokyo on Monday
- Decline from peak
- About 30% below the June peak
- Potential OpenAI investment
- Expected to approach $65 billion by October
- Planned retail bond sale
- ¥1 trillion, or approximately $6.5 billion
- OpenAI-related loan
- $10 billion loan tied to SoftBank’s OpenAI stake
- OpenAI listing plan
- OpenAI has said it will not pursue a public listing in 2026
- Anthropic IPO plan
- Anthropic has selected Nasdaq for a proposed IPO that could occur as early as next month
Quotes
Yugo Tsuboi
Chief strategist at Daiwa Securities
“There’s worry that OpenAI’s value may not be as high as previously expected”
CNBC TV 18
Sources
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