SoftBank Group has officially green-lighted a second payment of $22.5 billion, marking a crucial step toward completing its ambitious $30 billion investment in OpenAI. This landmark decision by the Japanese conglomerate’s board is accompanied by one pivotal condition: OpenAI must successfully restructure into a for-profit entity, a process that necessitates legal endorsement in California and Delaware.
This substantial disbursement emerges as part of a broader $41 billion funding initiative announced earlier this year, that has propelled OpenAI’s market valuation to an impressive $500 billion following a successful employee share sell-off in October.
The transition to a for-profit Public Benefit Corporation—essentially a hybrid structure balancing profitability with social responsibility—has become imperative for OpenAI. Should the company fail to achieve this transformation by the end of 2025, SoftBank’s investment would drastically reduce from the anticipated amount to just $20 billion.
Financial Ascendancy of OpenAI
OpenAI has witnessed meteoric financial growth in recent months, with annualized revenue skyrocketing from $3.7 billion in 2024 to a projected $12 billion by mid-2025. The surge is largely attributed to the booming popularity of ChatGPT subscriptions and an expanding base of enterprise clients.
For investors like SoftBank and tech giant Microsoft, the upcoming restructuring is essential. It allows for expanded investments under a transparent profit-driven framework, a move that aligns with both companies’ interests.
SoftBank’s Strategic AI Movements
Masayoshi Son, the visionary CEO of SoftBank, has been channeling the conglomerate’s resources into AI investments, asserting that OpenAI has the potential to become “the most valuable company in the world.”
Son disclosed that Sam Altman, CEO of OpenAI, first approached SoftBank regarding an investment opportunity well before 2019, although Microsoft ultimately secured the partnership to become OpenAI’s exclusive cloud provider—a status that was relinquished at the start of this year.
With this progressive investment strategy, SoftBank is poised to emerge as one of OpenAI’s most significant shareholders, positioning itself alongside Microsoft as a key player in the AI arena.
In pursuit of further bolstering its AI investments, SoftBank is reportedly negotiating a $5 billion loan backed by shares of Arm Holdings. Moreover, the company has initiated a substantial $2.9 billion bond sale, marking a return to international bond markets with $2 billion in dollar notes and €750 million in euro-denominated notes.
Following news of these financial maneuvers, SoftBank’s stock initially rose by 4.58% to close at $78.76 on Friday. However, the stock later experienced a decline, dropping as much as 4.1% as discussions surrounding the loan came to light.
This latest investment from SoftBank underscores a pivotal shift towards AI-centric strategies, signaling a transformative phase in the technology investment landscape.
“The potential of OpenAI is undeniable, and as investments from leading firms continue to flow into the AI sector, we may be on the brink of witnessing the next major evolution in artificial intelligence.”
