SoftBank Reportedly Prepares For a Huge AI Venture, As The Firm Seeks $100 Billion

It seems like NVIDIA might have to fasten its seatbelts, as competitors such as SoftBank have planned out a gigantic AI venture backed by huge financial investment.

The AI "gold mine" has brought huge benefits to its "original" diggers, which included NVIDIA and several other firms. However, as we move into the future, the competition is getting tougher, and every tech company that wants to stay "relevant" in this segment is pouring in vast sums of money. Bloomberg reports that SoftBank's CEO Masayoshi Son is making efforts to raise around $100 billion for their firm's AI "journey," which will target the semiconductor supply rather than being directly involved in the integration process.

The semiconductor industry has received similar attention in recent times, with some of the "investment" plans being a bit outrageous, such as those made by OpenAI's CEO Sam Altman, who expressed intentions to raise $7 trillion to build his own chip facilities. However, SoftBank expects to enter the markets with its own semiconductor project, codenamed "Izanagi," which will involve catering to the supply of crucial components for the AI segment. It is said that the firm will invest $30 billion of its own capital, and the rest of the amount will be raised by "potential" Middle East clients.

Masayoshi Son's ambitions, especially regarding the transition of AGL into real-life implementation, have been huge and consistently displayed in the firm's earning calls. He has repeatedly emphasized getting into the "AI race" to stay competitive in modern times, believing that it is the way to lead into the future. His ideas have indeed translated into actions, as SoftBank preps for a new semiconductor division, but Son is known for his sudden "change" in approach to an investment idea, but all of them have been a success, with the likes of Alibaba and ARM.

The key advantage SoftBank has here is being the largest shareholder of the chip design firm ARM, and this could give them an edge since not only do they have the "brains," but ARM has a great reputation in the markets as well, which could give them a boost when it comes to market confidence. Moreover, ARM has great working relations with NVIDIA and AMD as well, so indicators do stack up in favor of SoftBank; the only thing awaited is the execution.

Based on what I see and my understanding of the markets, we will see a radical shift in the upcoming period, where not only will the market competitiveness increase massively, but it will also fuel the fire of innovation. The sudden interest in the dynamics of semiconductors of multiple firms is a positive indicator that development still exists in the segment. Although I am more interested in what this holds for well-established firms like TSMC and Samsung Foundry, we will have to wait and see for now.

News Source: Bloomberg