> SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion as the Japanese giant looks to capitalize its “all in” bet on ChatGPT maker OpenAI.
I would have thought that the OpenAI bet is way more risky, because if someone comes along with a better model it could really hurt OpenAI. NVIDIA seems harder to dethrone imo.
They probably know more than us. Such as alternative chips or that the Chinese will go in-house sooner than we think. Nvidia’s moat is not as permanent as people think.
> They probably know more than us. Such as alternative chips or that the Chinese will go in-house sooner than we think. Nvidia’s moat is not as permanent as people think.
This is Softbank though, they're not really noted for great investment decisions (apart from Alibaba really early on).
Like, my prior is that when Softbank invest in something, the growth is done (but then I am, very much, a cynic).
Softbank had 5% of Nvidia stock just before gen AI boom. Then they sold it when it was at its lowest. If they didn't it would have covered all their losses many times over with a profit of more than 200 billion dollars.
It's just baffling they are still getting billions to spend.
> It's just baffling they are still getting billions to spend.
When you realize that most investors at that level are degenerate gamblers, and that they're even worse about thinking "the Generals were due!" than your buddy who can't look away from the DraftKings app for more than five minutes, it's not so baffling anymore. The only difference is that when you have that much money, you own the casino.
Bill Hwang of Archegos Capital Management is a close second (lost $20B in two days, and basically brushed off margin calls while his highly overlevered bets were collapsing, incurring $10B+ of losses at the investment banks he worked with).
About 7 or 8 years ago I worked at a startup which got money from Softbank / Masayoshi Son. Our founder and our CTO went to meet him in LA IIRC to pitch.
They came back telling us he was basically asleep during the pitch meeting which was scheduled for only 10 minutes anyway.
Our business/product really had no chance of succeeding at this point and most knew it. We got some money from Softbank anyway - forgot how much. Our management was basically laughing about how easy it was to get funding from Softbank.
I jumped ship a year later or so and that was good timing.
This is one of my arguments that startups are mostly about luck - because smart people who are highly incentivised to pick wimmers, with all the data they need to pick winners, all the people and compute they need to pick winners, can't pick winners.
Mayoshi Son isn't playing the VC game like most traditional VC funds. He's operating on a massive scale and his LPs are sovereign wealth funds, who can have other geo-political priorities than pure profit.
Some people don't know that the usual VC game is often still be profitable for the VC even if their fund isn't profitable. VCs are investing the money of their LPs (Limited Partners), who are usually very large institutional investors with billions under management (think state pension funds, Harvard endowment). Most of the LP's funds are invested in a diversified blend of safer, lower-return vehicles but they take up to 5% and invest it in high-risk, high-return things like venture capital and hedge funds. But they spread it across a dozen or more firms with different strategies.
So each VC is playing a portfolio bets and their LPs are playing a portfolio of porfolios. The LPs just need one of their 12+ VC funds to be a lead investor on a unicorn win. This math usually works out in their favor (there's now >50 years of data). VC funds charge their LPs a yearly management fee of a few percent of the invested capital - whether the fund makes money or not. Over the 10 year life of a fund, this adds up and covers the VCs overhead and very generous salaries - usually >$500K at larger firms. In the VC's view, $500K/yr isn't getting long-term "rich" but it'll pay for a pretty lux life. Even with the VC taking out fees, the LP's math still works thanks to only needing one VC firm to win and if one or two more of their VC funds just return 2x or 3x. It maths up even better.
When your personal worst-case downside is $500K/yr minimum with substantial upside, it's not a bad gig. However, these VC types are generally top-of-class Ivy League grads, who are clearly very sharp and ultra high-potential - the type who'd expect $500K earning opptys on Wall Street, consulting, investment banking, etc.
Lottery winners do not tell the world they are smarter than the rest of us, or go on podcasts, write op-eds or start websites telling the rest of us how the world should be run.
> It is hard not to love the degeneracy of Son Masayoshi as a gambler. The trick is to not take it seriously.
Therein lies the problem. People do take it seriously, particularly on the idea that he's now due, and keep feeding him money to make these bets with, instead of tossing him out of the boardroom, like he should have been with his bet on WeWork.
I had 250 shares I bought on a tip and sold for a decent profit then NVDA moon-shotted later that year. That's the story of my stock buying life right there.
Softbank has literally done this before. Several years ago, Softbank sold it's Nvidia stake and later regretted it to such an extent that Masayoshi Son expressed his feelings by crying. They're only selling Nvidia stock now to fulfill a prior giant cash commitment to OpenAI. Also, Nvidia is positioned to own a sizeable chunk of OpenAI.
Not to mention the US companies probably want to develop their own chips to get away from Nvidia too. I don’t really see why any company would want to base their entire business on the whims of nvidia.
Nvidia's moat is their pace of performance growth, which is hardware + software + cultural.
If they skip a beat, or it becomes impossible to increase performance (TSMC node stumble or P4-style dead-end), then it won't take long for someone to catch up.
If they keep executing on better hardware performance + software to support it? They keep the money spigot on.
People are saying that nvidia doesn't have any moat for 20 years. And nvidia hasn't been dethroned, but grown into the largest company in the world in the meantime.
You can make the same comment for pretty much any company that outsources (some of) its production, and it’d be irrelevant, pedantic and off-topic every time.
You’re also wrong. TSMC produces but a small part of the products that Nvidia sells: the silicon. They don’t produce any of the tens of thousands other components that go in a server.
Its not being pedantic at all. Intel designs chips and manufactures chips. Intel’s major issue is not its design chops - some of its most advanced designs today are manufactured by TSMC.
And calling the actual processor a “small part” of where Nvidia’s value is doesn’t jibe with reality.
Softbank is the example that you could use against the conspiracy theorists.
They may know more, but not that much more.
> SoftBank has been a repeat investor in Nvidia. It sold off its investment before the AI boom took off and then bought the chipmaker's shares again before divesting in October to double down on its biggest investment bet, OpenAI.
In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business.
By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.
I'd argue their brand might be too strong, ChatGPT has already begun to enter the same semantic space as "Velcro". Everyone I know seems to have tried it yet quickly you begin to realize that for most people ChatGPT == LLM, it seems everyone is using "ChatGPT" on completely different platforms.
In the end, regardless of technical understanding, people will always shop around on price if the feature set is similar enough I suppose.
The thing is, laypeople aren't using anything other than Google Search even for LLM answers.
If I want an LLM answer to "is erythritol bad for you", I'm not firing up ChatGPT. I'm just typing it into Google, and the LLM answer it spits out is pretty good.
ChatGPT needs to be significantly more compelling for most people to use it for one-shot LLM answers over Google Search. And the minute Google removes the one-shottedness of its search answers, it's over for ChatGPT.
Imo ChatGPT is just "a feature not a product", in the search engine space, as the adage goes.
I have no idea on the data, but anecdotally I'd dispute this. Regular folks in my life (i.e. non-techies) routinely talk to an LLM and use it to answer questions that 5 years ago they'd have searched for.
The techies are the ones who are steering clear and sticking with search engines in my experience.
ChatGPT though isn’t where the profit id going to come from. Businesses using LLMs are and Amazon (AWS) is not selling access to Bedrock and neither is Google (GCP). Models are becoming a commodity. *Every* implementation I’ve done one of the requirements is to easily be able to switch between multiple models
This argument regarding brand loyalty gets repeated but it’s really weak to me. The immense majority of people don’t tie their identity to the software services they are using. Without network effects or an ecosystem locking customers will switch as soon as there is a less expensive and/or better alternative, as the history of software has shown countless of times.
Keep in mind how severely the quality of Google search results or e.g. any consumer facing piece of Microsoft software (Windows, Office, OneDrive, etc.) have deteriorated to the point it has far transcended the more nerdy corners of the web, yet both continue to retain a strict grip, thanks to buy in/brand strength.
People use Google search because they have (or rather, need) a Google account. Also, there are no alternatives really, because search is very difficult.
Microsoft has alternatives, but it doesn't matter, because you're artificially restricted from using them. All your friends (MBAs who cut your check) are using Excel, so why don't you just use Excel too?
There's no viable alternative for either of those yet. Massive network effects around Microsoft office, and Google's only real competition is the equally-bad Bing.
Both DuckDuckGo and Kagi are, purely focused on result quality in 2025 far better than Google currently, but that does not matter if one has no need beyond the most basic results.
And much of the MS Office suite is actually a worse copy of another product, merely copied and forced via network effect. There are more than enough far better alternatives to e.g. Teams and OneDrive. The latter even makes Excel far less reliable to the point of unusability.
Not to mention Windows is easily replaced for the truly average person who spends their entire computer use inside a Chromium browser nowadays. Outside PC Gaming (which is far from the average if we are honest), the vast majority of people never touch software that isn’t already on mobile or more likely exclusively in the browser.
Familiarity and brand strength, not need or compatibility, keep the customer facing offerings of MSFT going. That isn’t inherently unreasonable either, for these people Windows is fine as Chrome works well enough on it and they do not have any needs beyond that, so why switch. Same with search, Google still finds flights, restaurants, Wikipedia, etc.
Being better is worth little if the vast majority are sufficiently well catered to by the incumbent. Even if another OS or search may improve their experience somewhat (better reliability, longer battery life, etc.) that doesn’t trounce the established player as long as the few basics aren’t utterly broken even to them.
You can actively antagonize your users, be worse than the competition, more expensive too, you only loose most if you make the few things most have purely become reliant on and are expecting worse, basically regress.
Reason all the bugs in Windows are fine, after all the memories of most people are dominated by BSODs and just not crashing daily is enough to be considered pretty good, despite the overall experience far worse than most other OS/DE combis.
You don't have to take my word for it. Open the three next to each other, type in a search query. Only one will provide part of the results as a wildly inaccurate "overview" that somehow manages to link to sources telling you the opposite or contradicts itself inside the text box, which can also not be deactivated. Those are the results you get from Google and that alone makes quality worse, pure and simple.
More subjectively, but if you want to ignore the "AI overview" and consider that not results (then why are they on my results page?!), just look for a specific, slightly older video on Youtube, a site Alphabet themselves run. You can provide the exact title down to the letter and are in many instances going to struggle to find it with Youtube search or Googles Video Search, even when wrapping in ", etc. Kagi and DDGs video search tabs meanwhile yield the desired results. Again, this doesn't mean they are amazing or massively far ahead as Google was able to reliably provide such results in the past. It just means that Google Search has regressed, yet users stuck with it because, as I've been saying, quality (or lack thereof) has a hard time overcoming brand strength.
I had DDG set as my default for years and found myself resorting back to google so often I had to finally admit to myself their results were inferior even to the diminished google result. I just didn’t seem to get the result you’re claiming on the everyday type of queries I make.
Kagi gives you free searches and you pay for Google with you data/advertisements so it costs something too, but you knew that already. And both provide more reliable results, so what are you trying to say?
Gaming on PC or using Adobe software is very far removed from the average in 2025. Same if you use any Office application after work hours. Heck, even Canva is, the vast majority of users are not creating on their systems, solely consuming and would be served more than well enough with only their phones. In countries where most of the population has gotten access after modern multitouch smartphones became a thing, most do use these over notebooks/PCs as their primary device, like India.
And friction on MacOS, Linux, ChromeOS, Android or iOS, I don’t see that considering the vast majority still switched to 10 despite the departure from a decades long established environment and, lest we forget, quite a lot of XP/98 software also did not work well on more modern Windows, again, not really a problem for these either. There is no reason not to switch despite the brand, which I again must emphasize, is ok. They are fine enough with the status quo, even though alternatives would be more stable, secure, have better battery life, etc. I just dislike the idea that some in the space cling to that better alternatives are surely going to be adopted and the only reason they aren’t by the masses is compatibility, slight differences in UI, etc.
I have been using DDG for years and even with Google quality having plunged it is neither better nor less expensive (nor the default when non technical users just type in the search bar of their browser). Yahoo has shown that even with immense brand recognition people will still switch if the alternative is really better. And if Google was 2x more expensive than DDG they’d switch too.
Regarding Microsoft it’s not as easy to switch as going on another website, OpenAI doesn’t have that ecosystem lock in.
> Yahoo has shown that even with immense brand recognition people will still switch if the alternative is really better.
But it didn’t, Google users beyond a few initial super users who switched early on in the late nineties/early two thousands, track directly with the massive growth in new active web users. These new first time web users, far more than switching made up the growth between 2002-2006 that made Google dominant over Yahoo. It also should be kept in mind how much better Google was over Yahoo, whereas I am doubtful LLMs will have such deviations in quality, looks more like the opposite.
Point remains, OpenAI will, in my opinion, retain the strongest consumer share of LLMs, regardless of output quality, introduction of ads, etc.
This is not ecosystem lock in, it is solely branding. What do you think most have in mind when you mention search? What when it comes to online shopping? Now do the same for “AI”. Only one brand comes to mind for most.
no but there’s the network effect that Google has / once had with search that OpenAI has with ChatGPT: user interactions. all that data and classification will help tremendously getting better datasets, which is equally important (or more important) than better algorithms.
And defaults matter - every browser that matters except for Edge defaults to Google as well as every mobile phone outside of China.
Both Google and Apple (ie any searches in Safari make money for Apple based on the Google deal) said there was no slowdown on Google searches and the “AI overview” by Google is “good enough”.
Just like Blackberry, but instead of having to buy an new device to switch to the competition, the customer just needs to click on a different website.
Not a great analogy. Blackberry was never really for mass consumers and was always business-first. They lost to Apple because Apple won the mass market, and the mass market overwhelmed the specific niche business use-case that was BB.
OpenAI is already the consumer-first AI platform. And, in my opinion, in the minds of the average consumer, the biggest one that is "an app" with memory and folders, vs. something like Gemini which is perceived as an extension of Google Search and thus doesn't have the same "knowledge database" UI.
If it was OpenAI vs Claude then yeah, ChatGPT is known whereas Claude you have to be an enthusiast to know.
But everyone using Google runs into Gemini and everyone using X runs into Grok, and people talk. Now even the laypeople know there is more than one AI, and they're from big brands that they trust. Which means that people will window shop for the AI with the best performance per cost. Bye bye brand power.
It's run by an insane person and insane people are generally very volatile and difficult to rely on.
I mean, even just the name - 'X'. You can tell that's some Elon Musk bullshit because it's the stupidest fucking name I've ever heard in my life and nobody with even a quarter of a brain would ever suggest that as a brand name.
When that's literally the brand of your company, naturally I question if everyone has the screws tightened up there, you know?
In fairness, that is for their model, not their brand. In this industry, the mind share and buy in OpenAI has is still second to none, even when Gemini 2.5 Pro served the vast majority of users far better than the OpenAI models, the latter MAU trounced all competitors.
We do not know for certain as of yet, but I’d be very surprised if Apple felt the need to loudly communicate to their user base that the upcoming Siri improvements aren’t Apple Intelligence. They won’t lie of course, but Googles brand in the space isn’t nearly as strong with the layperson, whereas they more than happily shouted their use of GPT from the rooftops initially.
If they are able to actually successfully pivot into ads as a business model, it's very easy to justify the valuation: Just look at Google/Meta.
I'm personally skeptical that they are able to pull off ads, at least on the short timescale they likely need to. They more or less have to nurture/disrupt a whole SEO industry, and the way big corps allocate advertising budgets are very slow to shift (many are still struggling to find their footing in social media advertising).
> If they are able to actually successfully pivot into ads as a business model, it's very easy to justify the valuation: Just look at Google/Meta.
Ads are not just a switch one can turn on. Firstly, you need to build a decent ad serving/targeting/pacing engine. Secondly (and more importantly) you need to hire a shed ton of sales people (in many, many geos) and then ramp them all up (difficult if you're building the product at the same time).
And then you need to keep at it for 3-5 years minimum before you'll finally get the bigger/more conservative brands/agencies/etc to buy in properly.
At that point, you'll make decent money, after accounting for all of the costs. I'm not sure that you'll make enough money, but it would definitely stanch their bleeding a little.
tl;dr if they haven't already built this ad product, it's unlikely to make a material difference before 2030.
Why should they give a fuck about the SEO industry? You think Google "nurtures" the SEO industry? They're selling ads to businesses and displaying them to consumers. SEO folks are just parasites in the system.
Yes of course Google nurtures the SEO industry. The first hit I get when I google SEO is a best practice site from Google themselves.
The person/department/agency that is responsible for doing SEO is the same one that is responsible for spending ad money on Google. It's in their best interest to internally sell "search" (no matter if organic/inorganic) as a good advertising channel and that creates great stickiness for Google's ad business.
I can see a world where if everything they do pans out, on average 1B "entities" end up paying 20$/mo to openAI, via the myriad of integrations they end up supporting. Where entity can be a user, and one human can have many entities (i.e. a work account where the company pays, a personal account, etc). That'd be a quarter of a T$ revenue / year. Dunno, while the number is so large it's hard to compute, it somewhat seems plausible.
Their goal is obviously to take a fraction of the world's economy, proportional to the productivity lift they can attribute to themselves. That's in the trillions.
How does one take a fraction of the world economy?
Microsoft sells services pretty much everywhere on earth and has a near-monopoly on PC OSes, enterprise email, productivity suites plus a giant cloud computing service....and their annual revenue last year was just $245 billion.
OAI can't get anywhere close to that, not least because they have multiple competitors and several large corporations (MSFT, Google, Meta) would rather dogfood their own solutions than use a rival's.
Probably so, but that doesn't mean their value can keep scaling without heavy diminishing returns. Softbank must assume they've taken 80%+ of the gains from this phase of NVIDIA's growth, and want to capture the next wave of growth.
I agree with you that OpenAI seems much more risky in terms of it's actual true viability as a business, but the risk:reward must be there for Softbank.
> “This should not be seen, in our view, as a cautious or negative stance on Nvidia, but rather in the context of SoftBank needing at least $30.5bn of capital for investments in the Oct-Dec quarter, including $22.5bn for OpenAI and $6.5bn for Ampere
> That amounts to “more in a single quarter than it has invested in aggregate over the two prior years combined,” Bulk said.
> … Following the recapitalization and SoftBank’s $22.5 billion investment into the ChatGPT maker, the Japanese firm’s 4% ownership of OpenAI will increase to 11%.
It sounds like Nvidia was played out for them and they’re aggressively trying to get in on OpenAI so they can exit sometime after retail investors get in
Selling the _entire_ stake sounds really aggressive though? Is that normal?
Even if you're all-in on OpenAI, does it not make financial sense to have _some_ stake in Nvidia considering they are the only ones with an actual moat?
Unless there are CUDA alternative breakthroughs we will hear about in the next few days.
For researchers and academics, cuda is painful to avoid, but I'm not sure that it is for large companies, once the time comes to train and deploy large models.
> Selling the _entire_ stake sounds really aggressive though? Is that normal?
They did not. They sold MOST of their stake in Nvidia long ago before anyone paid attention to Nvidia vs AI. It's one decision as part of a complex cloud of decisions.
Also this "stake" was around one thousandth of Nvidia. Minor. Most companies have lots of owners with much larger stakes.
If you believe the AI bubble will pop in the same way as the dotcom bubble and feel you can pick winners it makes sense. It would be like selling cisco stock for google. You can still invest in cisco later if you believe they'll grow but you might expect a stagnant period and definitely expect a drop as they don't have as much demand. NVidia is a safe bet to continue exisitng and being profitable but by being so central to the market you could almost guarantee a large drop in stock price while other companies are a gamble.
All you have to look at is ASIC miners. Once they had them, they were 10x faster than GPUs easily and made GPUs useless for those algos. Something very similar can happen soon.
The fundamentals are different. Bitcoin mining is not intrinsically suited to acceleration on a GPU. It is a not-very-wide serial integer operation.
AI inference on the other hand is basically just very large floating point tensor matrix multiplication. What does an ASIC for matmul look like? A GPU.
No, GPUs are not a particularly ideal architecture for AI inference, it's just inference needs way more memory bandwidth than a general purpose CPU's memory hierarchy can handle.
> What does an ASIC for matmul look like?
A systolic array, and ultimately quite different than a GPU. This is why TPUs et all are a thing.
In general with a systolic array you get a quadratic speedup. For example with a 256x256 array, it takes 256 cycles to shift operations in and out, but in doing that you accomplish 65k MACs in 512 cycles for a speedup of 128x over serial.
I'm not an expert in chip design by any means but I think it's fair to say that TPU is a marketing term and it's not substantially different from a GPU like an H100. H100's cores are also called "Tensor Cores."
You are entirely mistaken. The TPU and GPU are organized very differently particularly with how the memory subsystem works.
In the big picture, TPUs are systolic arrays. They don't have threading, divergence, or similar.
GPUs in the big picture are SIMT, a hybrid of SIMD and multithreading where individual data streams in SIMD are relaxed to allow them to diverge somewhat.
Memory Wise the TPU can keep the partial products right in the array. Parameters and weights are held in large on die scratch memories, and backing those are streams coming from the HBM. The TPU acts as a single giant CISC coprocessor, and has much more predictable memory and communication patterns vs a GPU, which its design exploits for higher efficiency at inference vs GPUs.
So even if they use the word "tensor" and both have HBM based memory systems, how those are actually architected is very different.
This was sponsored by AMD for quite a while and dropped. There had to be some talks behind closed doors that resulted in the current situation. I mean, we all know they should've and they're not dumb either.
They recognise that the larger bubble is in the datacenters.
Most of the hardware we are using was designed for computer graphics not AI. Now that China isn't buying Nvidia any longer and actively trying to get their own companies to produce hardware, what happens to all these datacenters when a company produces a device that has 80% of the performance of the current Nvidia hardware but 20% of its power consumption?
Even double the energy consumption is not that bad for half the price. at 20 cents per kWh over 5 years 1 kW load would be 8760. So from 30000 to 15000 you would still come ahead in cost.
lol, after wework you'd be an idiot to think it was nothing more than shilling their "winner" to potentially dump on the public. but i guess as long as you can make money on the way up.
They don't see upside in Nvidia clearly or they wouldn't have completely sold out. If they don't think the risk/reward is worth it why should anyone else? Eventually you'll run out of greater fools.
I personally wouldn’t put much value on this event. I’ve never been impressed by SoftBank’s investment decisions. Of course, it has a good amount of money. But its decisions on ARM, WeWork, etc., have made it seem like it’s just (uninformed/underinformed) gambling.
It looks more like a strategic reallocation than a panic exit. Nvidia has already delivered outsized returns, while OpenAI represents a leveraged bet on the next layer of the AI stack - software and services rather than hardware. SoftBank probably sees more upside (and influence) there, even if the risk is higher
It makes sense when you know the semi industry has always been cyclical and this insane level of spending can't be fueled on debt and VC cash forever. Masayoshison is out and now your 401ks are holding the bag, he'll get one last cashout when Open"AI" IPOs too with his winnings.
In the game of musical chairs, there is no official moment when players need to get in position to reach the closest chair. One second there is music and another second later there isn't. However, the that period exists if you can look at the relevant signs: the host hand and body in relation to the music record player.
No AI player will admit to be positioning for a sector collapse but it would be naïve to believe that anyone close to ground zero isn't planning contingency plans and are just coasting in the golden age of AI. And those who have the most skin in the game are certainly the ones most incentivise to do so while denying their true intentions.
LLMs are going no where but the reality of them not being the civilisation shifting money makers people have hyped them up to be is undeniably setting no matter what the AI astroturfers hiding in HN tell you. People have been jumping off the train or positioning to reach the closest chair when the music stops. Not long ago 2023, the world bubble was just whispered here. 2 years later it has hit mainstream and has been uttered by people holding the money bags. It might be a dream or it might not.
The difference is that, if you were in denial, now you are seeing signs that are much harder to deny. And we should expect the upcoming signs to be harder and harder, until the number of people denying reaches to zero right as the bubble fully bursts and the AI startups layoffs begin.
Would be interesting to have a game of musical chairs where the longer the game goes on, the more each player gets if they grab a chair. And N-1 players get a chair still.
I’m realizing this would be an interesting party game. Could probably do it with any stopwatch app. Everyone starts at the same time and holds their phone under the table, the person who presses stop last (i.e. has the highest time) gets zero points, everyone else gets a score equal to what their stopwatch shows.
By low, sell high. Any Nvidia shareholders would be foolish not to sell at least part of their holdings right now. Don’t ride the bubble to the bottom.
> SoftBank Vision Fund recorded a $3.3 billion return on its Nvidia investment. The fund's February 2019 closeout of its Nvidia position preceded the AI boom and Nvidia's rapid transformation into one of the world's most valuable companies.
Masayoshi Son has form when it comes to calling the top of the market with this particular company.
You're thinking like a lowly retail investor who can only spend his own money. Softbank spends other people's money. They have to show some profits now and then to make their financials look good and thereby attract more funding.
In numbers, yes, a rounding error. In fact, SoftBank was one of Nvidia's backers, and whatever this sell means in the stock markets, this is a strong signal.
Daily trading volume is roughly 200m units at roughly 200 USD per stock which equals 40bn in daily trades. So 5bn isn't nothing but over the course of a month it isn't particularly much.
5 billion is massive. So much of that 40bn daily volume is just leverage. Sort of like the derivatives market, trillions of dollars in volume but nobody has that much money, it is just margin. So even if some trading firm losses 1-2 billion everyone panics and goes out of the market. It actually happened during the flash crash.
Also, I highly doubt they sold those 5bn of shares in any exchange. Most likely they did it over several weeks on a dark pool. Because again 5bn is massive and it would cause a crash in any open exchange.
Saying there's "little risk" to shorting while recommending "margin loans" is a very good indicator that you don't have a lot of knowledge about financial instruments. That's okay.
Did you know that you can be extremely correct in your medium term prediction and still get extremely margin called because of some random short term volatility?
It can be both, likely and risky, timing the market is one of the riskiest things one can do...
It's likely there will be another major stock market crash, it's part of the cycle, and will always happen in its current form, good luck finding a way to time it and make a huge profit though.
Curbstone and Druckenmiller are the noteworthy ones from outsiders. Several Nvidia executives sold millions of their stock (possibly the world's most valuable stock) in the first half of the year and also sold millions of their nvidia stock last year which is roughly when most agreed that OpenAI was not likely to deliver anything groundbreaking anymore from their current transformer tech.
The Gpt-5 release just confirmed what most knew. And we know that the best time to leave is when the market can still get slightly hotter.
Apparently this is in the wake of OpenAI pivoting to a consumer-facing ad business, away from trying to disrupt every white collar worker on the planet. I would say that still points to a bubble beginning to pop.
> SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion as the Japanese giant looks to capitalize its “all in” bet on ChatGPT maker OpenAI.
It doesn’t matter what they say. It matters what they do. As of now they sold all of Nvidia, and the PR department found a way to soften the blow. That’s all.
Probably not bad move. How much upside Nvidia has left? And on other side how much can it go down? At point when you do not see them moving much more up selling is the logical conclusion.
Fun thought experiment: If a company had a product with infinite value it would be irrational to allocate capital to shares since you could own the product instead. So the share price might even go down (it's hard to know what role money will play in a post-agi society).
A smaller scale version of this might be happening here. Or it could be a bubble. Either way it's interesting!
Obviously we’re not ever going to see “infinite value”. I think it’s instructive to think of this on the margin or in terms of limits: would a putative AGI have an inflection point at which more of it produces less value, and even if it’s productive capacity were high, it could not be “infinitely high” (which would make it an economic absurdity).
Additionally, for the AGI producer (or platform host), there would have to be some way of price function that would cover the costs of operating or providing the AGI service.
Thus, a more realistic look at this is “purchasers of AGI would have no reason to purchase “more” of it beyond a certain threshold, after which it is no longer useful to their ends, however purchasing shares of the AGI producer would expose them to value from new customers who could use it better”
I have a LOT of respect for Masayoshi Son. He is the ONLY billionaire on the planet who spends like there is a wealth tax. I wish governments would observe him and eventually impose a wealth tax. It would do everyone a world of good.
Hahah! Fucking hell, openai is going to fail big time, they have nearly a 1,5 TRILLION USD in debt. There is no way they can handle that, their only option is to cozy up with trumo and make the tax payers pay for all that.
Ah, because you didn't post any sort of source I looked it up.
Seems your 1.5Tn figure is in "spending commitments" and not current/hard debts. I.e. budget earmarked for datacenters and research from '25-'35 or so.
Yup. They have minted deals to spend, and im pretty sure there is a hefty fine if they cant pay or do indeed backtrack from the deal. Either way OpenAI is operating in a completely absurd way, and is no where near worth what they claim. Kinda lika Tesla is.
We will find out in next few months but I predict they had a great exit at the high. As the AI bubble seems to be deflating even if not popping with the largest economy in the world insulating itself from western tech and AI.
I wonder if there are people (with money) who have a really good grasp on this market (hardware I mean). For example you could have sold NVDA in August, not much lower than current price, and bought SNDK and 5x-ed your money in 3 months.
They're selling a public asset to the mainstreet dummy, so they can pour money on the AI fire so OpenAI can build more datacenters. This is another vein of circular funding, they're getting their cash from our retirement accounts via institutional investments and index funds.
I'm on investing subreddits all the time, and I'd expect it there.
But I don't see how this is "anything that gratifies one's intellectual curiosity."
If there wasn't an AI bubble narrative, then sure, this this would gratify my curiousity. But now I don't see it, not even in the most charitable way.
I'm curious what the line of thinking is on how this does, in some way, gratifies one's intellectual curiosity.
Edit: I figured that I'd get all the downvotes. I've been here long enough to understand the social dynamics of the site. Funnily enough, I was more in the "Hacker News" demographic between 2015 and 2023. Since then, it has shifted a little. Nowadays, I have to force myself a bit to sound more positive than I actually am in order for my comments to be appreciated (in terms of upvotes, as I do view that as a form of social feedback), and that is fine.
I understand that this post gives bad vibes or sounds perhaps a bit mean? I am not intending it that way. I really just don't get it. Look at my comment history, I sometimes ask questions like this, but not that often. I suspect I'm not the only one in this.
There is an AI bubble narrative, people are curious when it will burst. This is an indicator that people will want to analyse, discuss, and think about (intellectually).
I see. I guess I simply think that Softbank isn't a good indicator for that. To me, they don't seem better than any other investment company that puts their money into technology stocks with a growth narrative. For example, they invested in WeWork and FTX.
They don't know the future, just like the rest of us.
If we're talking indicators, if 5 Softbanks would do it in rapid succession one after another it just mentions to me that the "smart money" is showing signs of moving out.
In terms of whether AI will or will not fuel growth, I think it will fuel growth. Self-driving cars seems to be a solved problem for cities at least fairly soon (e.g. Waymo, anti-example: Tesla, camera's is not the way).
It's a question whether LLMs state of the art models will grow more, but what hasn't been done that well yet is integrating it into current software. I know, because in part, that's my job. There's still a huge productivity unlock there, also in ways that people can't fully imagine.
Right now, LLMs seem to be an enabler for software engineers, especially software engineers on smaller projects (I can't find the research at the moment, it was a while ago that I read it). It seems to be an enabler for many people, but they do need to put time into prompting it in a way that works for them.
Fixing the context window issues and others I think will be really hard tasks, because I suspect we then need to know what goes on inside the black box.
If an LLM could continuously learn, so somehow continuously keep updating its weights such that it learns better, that would be a breakthrough.
I agree to be fair. I see Softbanks move as just wise strategy. Nvidia's growth won't be uncapped.
I wouldn't be surprised if they reinvest some of that money into AMD or similar, as those companies play catch up. AMD is bringing ROCM up to speed with AI models, and their consumer hardware is having pretty good press despite some PR fumbles.
Selling Nvidia stock isn't a sign of lack of faith, it's just an exit after strong results. Softbank think this is a peak or near enough, good for them.
As you say, until there's some breakthrough, there's little point keeping money in the dominant company.
Also, Nvidia appear to have delayed their 60-series GPUs, and this will cascade to their entreprise models, due to the 3GB module memory shortage. The next gen will be VRAM heavy, but you can't do that during a shortage, you need the market to correct tor for supply to increase. So any 'breakthrough' powered by new hardware is now about a year away.
This won't stop people secondguessing on the bubble front though. Personally, I think bubble popping is going to come from a lack of faith from investors in the downstream companies like OpenAI who are struggling to make money from their resource intensive products. Nvidia are already profitable with the hardware, MS/Google/Amazon will always make money with the servers. And if AI bursts, other sectors can soften the blow for those companies. It's the massively inflated AI model makers that need to worry about who makes it out of this profitably.
I mean for me it is, but not in an intellectual sense. Don't get me wrong, there are some good articles on HN about HFT and the technicality of it, but this is just, I don't know. Why Softbank? Didn't other big investment banks/funds sold out of NVidia at some point? Cathy Wood maybe, at some point? Why wasn't that on HN?
Stock news is barely on HN.
Oh, wait, I guess I see it now. It is on HN way more frequently when it involves Big Tech. And NVidia is increasingly seen as part of that. It used to be FAANG but now it's the Magnificent 7. The bias shifted.
After reddit doing IPO and getting blasted by AI content, seems a lot of reddit-only people have come over to HN.
Quality of technical content and discussions has visibly gone down since. More emotional/low-value/political replies everywhere. Slowly turning into /r/programmerhumor...
Note the first line:
> SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion as the Japanese giant looks to capitalize its “all in” bet on ChatGPT maker OpenAI.
They are switching gears, not exiting, folks.
I would have thought that the OpenAI bet is way more risky, because if someone comes along with a better model it could really hurt OpenAI. NVIDIA seems harder to dethrone imo.
They probably know more than us. Such as alternative chips or that the Chinese will go in-house sooner than we think. Nvidia’s moat is not as permanent as people think.
> They probably know more than us. Such as alternative chips or that the Chinese will go in-house sooner than we think. Nvidia’s moat is not as permanent as people think.
This is Softbank though, they're not really noted for great investment decisions (apart from Alibaba really early on).
Like, my prior is that when Softbank invest in something, the growth is done (but then I am, very much, a cynic).
Softbank had 5% of Nvidia stock just before gen AI boom. Then they sold it when it was at its lowest. If they didn't it would have covered all their losses many times over with a profit of more than 200 billion dollars.
It's just baffling they are still getting billions to spend.
[1]: https://www.wsj.com/articles/softbank-sells-entire-nvidia-st...
I'm not sad for Softbank missing out on $200 billion; I'm sad for not getting to witness how much more investment degeneracy that could have funded.
> It's just baffling they are still getting billions to spend.
When you realize that most investors at that level are degenerate gamblers, and that they're even worse about thinking "the Generals were due!" than your buddy who can't look away from the DraftKings app for more than five minutes, it's not so baffling anymore. The only difference is that when you have that much money, you own the casino.
It is hard not to love the degeneracy of Son Masayoshi as a gambler. The trick is to not take it seriously.
https://news.ycombinator.com/item?id=21799821
Bill Hwang of Archegos Capital Management is a close second (lost $20B in two days, and basically brushed off margin calls while his highly overlevered bets were collapsing, incurring $10B+ of losses at the investment banks he worked with).
https://www.bloomberg.com/news/features/2021-04-08/how-bill-... | https://archive.today/lM0SU
https://en.wikipedia.org/wiki/Archegos_Capital_Management
Son made most of his money with Alibaba. I think he made 500x or 1,000x his original investment. Absolutely crazy.
Almost everything he has done since then has lost money. When I read that he is investing in something, I just assume it will end badly.
Isn't that basically the venture capital model, though? Your winners go many times X, and the losers become worthless.
Mayoshi has made a lot of bets since Alibaba. Almost all of them have tanked. Over this amount of time and bets, he should have more winners.
About 7 or 8 years ago I worked at a startup which got money from Softbank / Masayoshi Son. Our founder and our CTO went to meet him in LA IIRC to pitch.
They came back telling us he was basically asleep during the pitch meeting which was scheduled for only 10 minutes anyway.
Our business/product really had no chance of succeeding at this point and most knew it. We got some money from Softbank anyway - forgot how much. Our management was basically laughing about how easy it was to get funding from Softbank.
I jumped ship a year later or so and that was good timing.
At some point, a good VC would have a second winner.
And if that is the VC model, then are the VCs smarter than everybody else?
This is one of my arguments that startups are mostly about luck - because smart people who are highly incentivised to pick wimmers, with all the data they need to pick winners, all the people and compute they need to pick winners, can't pick winners.
> can't pick winners.
Mayoshi Son isn't playing the VC game like most traditional VC funds. He's operating on a massive scale and his LPs are sovereign wealth funds, who can have other geo-political priorities than pure profit.
Some people don't know that the usual VC game is often still be profitable for the VC even if their fund isn't profitable. VCs are investing the money of their LPs (Limited Partners), who are usually very large institutional investors with billions under management (think state pension funds, Harvard endowment). Most of the LP's funds are invested in a diversified blend of safer, lower-return vehicles but they take up to 5% and invest it in high-risk, high-return things like venture capital and hedge funds. But they spread it across a dozen or more firms with different strategies.
So each VC is playing a portfolio bets and their LPs are playing a portfolio of porfolios. The LPs just need one of their 12+ VC funds to be a lead investor on a unicorn win. This math usually works out in their favor (there's now >50 years of data). VC funds charge their LPs a yearly management fee of a few percent of the invested capital - whether the fund makes money or not. Over the 10 year life of a fund, this adds up and covers the VCs overhead and very generous salaries - usually >$500K at larger firms. In the VC's view, $500K/yr isn't getting long-term "rich" but it'll pay for a pretty lux life. Even with the VC taking out fees, the LP's math still works thanks to only needing one VC firm to win and if one or two more of their VC funds just return 2x or 3x. It maths up even better.
When your personal worst-case downside is $500K/yr minimum with substantial upside, it's not a bad gig. However, these VC types are generally top-of-class Ivy League grads, who are clearly very sharp and ultra high-potential - the type who'd expect $500K earning opptys on Wall Street, consulting, investment banking, etc.
VC is just gambling with some status and ecosystem participation.
https://markets.businessinsider.com/news/stocks/charlie-mung...
> At some point, a good VC would have a second winner.
but you don't make the same type of deduction for lottery winners - surely a good lottery number picker should get a second win sooner or later!
Lottery winners do not tell the world they are smarter than the rest of us, or go on podcasts, write op-eds or start websites telling the rest of us how the world should be run.
Or buy american democracy
> It is hard not to love the degeneracy of Son Masayoshi as a gambler. The trick is to not take it seriously.
Therein lies the problem. People do take it seriously, particularly on the idea that he's now due, and keep feeding him money to make these bets with, instead of tossing him out of the boardroom, like he should have been with his bet on WeWork.
I had 250 shares I bought on a tip and sold for a decent profit then NVDA moon-shotted later that year. That's the story of my stock buying life right there.
I doubled my bitcoin profit and got out at $1,000!
I got out of bitcoin when it was at like 50 dollars. Kill me
Thank you - this is an insighful comment, in contrast to many knee-jerk reactions in this thread.
Broken clock is right twice a day.
Softbank has literally done this before. Several years ago, Softbank sold it's Nvidia stake and later regretted it to such an extent that Masayoshi Son expressed his feelings by crying. They're only selling Nvidia stock now to fulfill a prior giant cash commitment to OpenAI. Also, Nvidia is positioned to own a sizeable chunk of OpenAI.
I was just thinking that they must be selling because they need the cash...
Not to mention the US companies probably want to develop their own chips to get away from Nvidia too. I don’t really see why any company would want to base their entire business on the whims of nvidia.
Given how poorly Intel and AMD have fared, it suggests the hardware moat is much deeper than the software one.
Nvidia's moat is their pace of performance growth, which is hardware + software + cultural.
If they skip a beat, or it becomes impossible to increase performance (TSMC node stumble or P4-style dead-end), then it won't take long for someone to catch up.
If they keep executing on better hardware performance + software to support it? They keep the money spigot on.
People are saying that nvidia doesn't have any moat for 20 years. And nvidia hasn't been dethroned, but grown into the largest company in the world in the meantime.
Both realities are true.
They don't have a moat... because their moat is their performance growth rate.
If they stopped today, competition would flood in. But by the time competition catches up to Nvidia today, Nvidia has moved several steps ahead.
Nvidia doesn’t make hardware. It designs hardware. TSMC makes hardware.
You can make the same comment for pretty much any company that outsources (some of) its production, and it’d be irrelevant, pedantic and off-topic every time.
You’re also wrong. TSMC produces but a small part of the products that Nvidia sells: the silicon. They don’t produce any of the tens of thousands other components that go in a server.
Its not being pedantic at all. Intel designs chips and manufactures chips. Intel’s major issue is not its design chops - some of its most advanced designs today are manufactured by TSMC.
And calling the actual processor a “small part” of where Nvidia’s value is doesn’t jibe with reality.
> Nvidia’s moat is not as permanent as people think.
Neither is OpenAI's.
nvidia's moat is still pretty strong and deep, while there have been many other models in competition with openAI's.
> Such as alternative chips or that the Chinese will go in-house sooner than we think. Nvidia’s moat is not as permanent as people think.
SoftBank have holdings in Arm and likely to know what is coming down the pipeline.
Wouldn't that be insider trading?
No: SoftBank bought Arm in 2016, then refloated in 2023. They have good lawyers and a lot money.
They sold all their stake in 2019 too look it up. For sure they know more then .. just missed a 40x bagger
>They probably know more than us.
If they are privy to information that we don't know that led to this discussion, isn't that insider trading?
The entire AI bubble think they know better than us. Thar doesn't means they're right.
Does OpenAI even have a moat?
Softbank is the example that you could use against the conspiracy theorists.
They may know more, but not that much more.
> SoftBank has been a repeat investor in Nvidia. It sold off its investment before the AI boom took off and then bought the chipmaker's shares again before divesting in October to double down on its biggest investment bet, OpenAI.
In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business.
By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.
I'd argue their brand might be too strong, ChatGPT has already begun to enter the same semantic space as "Velcro". Everyone I know seems to have tried it yet quickly you begin to realize that for most people ChatGPT == LLM, it seems everyone is using "ChatGPT" on completely different platforms.
In the end, regardless of technical understanding, people will always shop around on price if the feature set is similar enough I suppose.
The thing is, laypeople aren't using anything other than Google Search even for LLM answers.
If I want an LLM answer to "is erythritol bad for you", I'm not firing up ChatGPT. I'm just typing it into Google, and the LLM answer it spits out is pretty good.
ChatGPT needs to be significantly more compelling for most people to use it for one-shot LLM answers over Google Search. And the minute Google removes the one-shottedness of its search answers, it's over for ChatGPT.
Imo ChatGPT is just "a feature not a product", in the search engine space, as the adage goes.
I have no idea on the data, but anecdotally I'd dispute this. Regular folks in my life (i.e. non-techies) routinely talk to an LLM and use it to answer questions that 5 years ago they'd have searched for.
The techies are the ones who are steering clear and sticking with search engines in my experience.
It's a Google without ads right now. Worth using until that day comes
ChatGPT though isn’t where the profit id going to come from. Businesses using LLMs are and Amazon (AWS) is not selling access to Bedrock and neither is Google (GCP). Models are becoming a commodity. *Every* implementation I’ve done one of the requirements is to easily be able to switch between multiple models
This argument regarding brand loyalty gets repeated but it’s really weak to me. The immense majority of people don’t tie their identity to the software services they are using. Without network effects or an ecosystem locking customers will switch as soon as there is a less expensive and/or better alternative, as the history of software has shown countless of times.
Keep in mind how severely the quality of Google search results or e.g. any consumer facing piece of Microsoft software (Windows, Office, OneDrive, etc.) have deteriorated to the point it has far transcended the more nerdy corners of the web, yet both continue to retain a strict grip, thanks to buy in/brand strength.
It's due exclusively to network effects.
People use Google search because they have (or rather, need) a Google account. Also, there are no alternatives really, because search is very difficult.
Microsoft has alternatives, but it doesn't matter, because you're artificially restricted from using them. All your friends (MBAs who cut your check) are using Excel, so why don't you just use Excel too?
There's no viable alternative for either of those yet. Massive network effects around Microsoft office, and Google's only real competition is the equally-bad Bing.
Both DuckDuckGo and Kagi are, purely focused on result quality in 2025 far better than Google currently, but that does not matter if one has no need beyond the most basic results.
And much of the MS Office suite is actually a worse copy of another product, merely copied and forced via network effect. There are more than enough far better alternatives to e.g. Teams and OneDrive. The latter even makes Excel far less reliable to the point of unusability.
Not to mention Windows is easily replaced for the truly average person who spends their entire computer use inside a Chromium browser nowadays. Outside PC Gaming (which is far from the average if we are honest), the vast majority of people never touch software that isn’t already on mobile or more likely exclusively in the browser.
Familiarity and brand strength, not need or compatibility, keep the customer facing offerings of MSFT going. That isn’t inherently unreasonable either, for these people Windows is fine as Chrome works well enough on it and they do not have any needs beyond that, so why switch. Same with search, Google still finds flights, restaurants, Wikipedia, etc.
Being better is worth little if the vast majority are sufficiently well catered to by the incumbent. Even if another OS or search may improve their experience somewhat (better reliability, longer battery life, etc.) that doesn’t trounce the established player as long as the few basics aren’t utterly broken even to them.
You can actively antagonize your users, be worse than the competition, more expensive too, you only loose most if you make the few things most have purely become reliant on and are expecting worse, basically regress.
Reason all the bugs in Windows are fine, after all the memories of most people are dominated by BSODs and just not crashing daily is enough to be considered pretty good, despite the overall experience far worse than most other OS/DE combis.
> Both DuckDuckGo and Kagi are, purely focused on result quality in 2025 far better than Google currently
I wish this was true
You don't have to take my word for it. Open the three next to each other, type in a search query. Only one will provide part of the results as a wildly inaccurate "overview" that somehow manages to link to sources telling you the opposite or contradicts itself inside the text box, which can also not be deactivated. Those are the results you get from Google and that alone makes quality worse, pure and simple.
More subjectively, but if you want to ignore the "AI overview" and consider that not results (then why are they on my results page?!), just look for a specific, slightly older video on Youtube, a site Alphabet themselves run. You can provide the exact title down to the letter and are in many instances going to struggle to find it with Youtube search or Googles Video Search, even when wrapping in ", etc. Kagi and DDGs video search tabs meanwhile yield the desired results. Again, this doesn't mean they are amazing or massively far ahead as Google was able to reliably provide such results in the past. It just means that Google Search has regressed, yet users stuck with it because, as I've been saying, quality (or lack thereof) has a hard time overcoming brand strength.
I had DDG set as my default for years and found myself resorting back to google so often I had to finally admit to myself their results were inferior even to the diminished google result. I just didn’t seem to get the result you’re claiming on the everyday type of queries I make.
DDG uses Bing's index. Kagi costs money. But you knew that already.
Kagi gives you free searches and you pay for Google with you data/advertisements so it costs something too, but you knew that already. And both provide more reliable results, so what are you trying to say?
>Windows is easily replaced for the truly average person who spends their entire computer use inside a Chromium browser nowadays
Maybe I'm out of touch but I don't know anyone for whom that's true. They all use either games or Office or Photoshop type stuff.
I mean you can replace it but all the options - mac, linux or chromebooks have friction.
Gaming on PC or using Adobe software is very far removed from the average in 2025. Same if you use any Office application after work hours. Heck, even Canva is, the vast majority of users are not creating on their systems, solely consuming and would be served more than well enough with only their phones. In countries where most of the population has gotten access after modern multitouch smartphones became a thing, most do use these over notebooks/PCs as their primary device, like India.
And friction on MacOS, Linux, ChromeOS, Android or iOS, I don’t see that considering the vast majority still switched to 10 despite the departure from a decades long established environment and, lest we forget, quite a lot of XP/98 software also did not work well on more modern Windows, again, not really a problem for these either. There is no reason not to switch despite the brand, which I again must emphasize, is ok. They are fine enough with the status quo, even though alternatives would be more stable, secure, have better battery life, etc. I just dislike the idea that some in the space cling to that better alternatives are surely going to be adopted and the only reason they aren’t by the masses is compatibility, slight differences in UI, etc.
I have been using DDG for years and even with Google quality having plunged it is neither better nor less expensive (nor the default when non technical users just type in the search bar of their browser). Yahoo has shown that even with immense brand recognition people will still switch if the alternative is really better. And if Google was 2x more expensive than DDG they’d switch too.
Regarding Microsoft it’s not as easy to switch as going on another website, OpenAI doesn’t have that ecosystem lock in.
> Yahoo has shown that even with immense brand recognition people will still switch if the alternative is really better.
But it didn’t, Google users beyond a few initial super users who switched early on in the late nineties/early two thousands, track directly with the massive growth in new active web users. These new first time web users, far more than switching made up the growth between 2002-2006 that made Google dominant over Yahoo. It also should be kept in mind how much better Google was over Yahoo, whereas I am doubtful LLMs will have such deviations in quality, looks more like the opposite.
Point remains, OpenAI will, in my opinion, retain the strongest consumer share of LLMs, regardless of output quality, introduction of ads, etc.
This is not ecosystem lock in, it is solely branding. What do you think most have in mind when you mention search? What when it comes to online shopping? Now do the same for “AI”. Only one brand comes to mind for most.
no but there’s the network effect that Google has / once had with search that OpenAI has with ChatGPT: user interactions. all that data and classification will help tremendously getting better datasets, which is equally important (or more important) than better algorithms.
And defaults matter - every browser that matters except for Edge defaults to Google as well as every mobile phone outside of China.
Both Google and Apple (ie any searches in Safari make money for Apple based on the Google deal) said there was no slowdown on Google searches and the “AI overview” by Google is “good enough”.
> They have by far the strongest brand
Just like Blackberry, but instead of having to buy an new device to switch to the competition, the customer just needs to click on a different website.
Not a great analogy. Blackberry was never really for mass consumers and was always business-first. They lost to Apple because Apple won the mass market, and the mass market overwhelmed the specific niche business use-case that was BB.
OpenAI is already the consumer-first AI platform. And, in my opinion, in the minds of the average consumer, the biggest one that is "an app" with memory and folders, vs. something like Gemini which is perceived as an extension of Google Search and thus doesn't have the same "knowledge database" UI.
Yeah but consumers don't want to pay for these 7 second memes or "erotica", blackberries had actual value that companies paid for.
> They have by far the strongest brand
They don't really, because of Gemini and Grok.
If it was OpenAI vs Claude then yeah, ChatGPT is known whereas Claude you have to be an enthusiast to know.
But everyone using Google runs into Gemini and everyone using X runs into Grok, and people talk. Now even the laypeople know there is more than one AI, and they're from big brands that they trust. Which means that people will window shop for the AI with the best performance per cost. Bye bye brand power.
Twitter never had a meaningful customer base compared to Meta and it’s been declining since Musk took over.
Does anyone trust Xitter? If so, they shouldn't.
why?
It's run by an insane person and insane people are generally very volatile and difficult to rely on.
I mean, even just the name - 'X'. You can tell that's some Elon Musk bullshit because it's the stupidest fucking name I've ever heard in my life and nobody with even a quarter of a brain would ever suggest that as a brand name.
When that's literally the brand of your company, naturally I question if everyone has the screws tightened up there, you know?
Probably because something something Nazi.
Well the guy that owns it sieg heiled on stage twice so... Do you not have working eyes, or does something prevent you from acknowledging reality?
It’s going be pretty hard to dethrone Google when even Apple is going to Google for AI with another huge billion $ contract.
In fairness, that is for their model, not their brand. In this industry, the mind share and buy in OpenAI has is still second to none, even when Gemini 2.5 Pro served the vast majority of users far better than the OpenAI models, the latter MAU trounced all competitors.
We do not know for certain as of yet, but I’d be very surprised if Apple felt the need to loudly communicate to their user base that the upcoming Siri improvements aren’t Apple Intelligence. They won’t lie of course, but Googles brand in the space isn’t nearly as strong with the layperson, whereas they more than happily shouted their use of GPT from the rooftops initially.
This year.
Apple is in the business of contracting out new-hotness until their polish is done.
Then they put their name on the thing, pretend it’s new technology – and depending on the named feature, sometimes it is!
It's hard to see how they become profitable enough to justify current valuations.
The numbers are just mind boggling even in the optimistic scenario.
If they are able to actually successfully pivot into ads as a business model, it's very easy to justify the valuation: Just look at Google/Meta.
I'm personally skeptical that they are able to pull off ads, at least on the short timescale they likely need to. They more or less have to nurture/disrupt a whole SEO industry, and the way big corps allocate advertising budgets are very slow to shift (many are still struggling to find their footing in social media advertising).
> If they are able to actually successfully pivot into ads as a business model, it's very easy to justify the valuation: Just look at Google/Meta.
Ads are not just a switch one can turn on. Firstly, you need to build a decent ad serving/targeting/pacing engine. Secondly (and more importantly) you need to hire a shed ton of sales people (in many, many geos) and then ramp them all up (difficult if you're building the product at the same time).
And then you need to keep at it for 3-5 years minimum before you'll finally get the bigger/more conservative brands/agencies/etc to buy in properly.
At that point, you'll make decent money, after accounting for all of the costs. I'm not sure that you'll make enough money, but it would definitely stanch their bleeding a little.
tl;dr if they haven't already built this ad product, it's unlikely to make a material difference before 2030.
Why should they give a fuck about the SEO industry? You think Google "nurtures" the SEO industry? They're selling ads to businesses and displaying them to consumers. SEO folks are just parasites in the system.
Yes of course Google nurtures the SEO industry. The first hit I get when I google SEO is a best practice site from Google themselves.
The person/department/agency that is responsible for doing SEO is the same one that is responsible for spending ad money on Google. It's in their best interest to internally sell "search" (no matter if organic/inorganic) as a good advertising channel and that creates great stickiness for Google's ad business.
I can see a world where if everything they do pans out, on average 1B "entities" end up paying 20$/mo to openAI, via the myriad of integrations they end up supporting. Where entity can be a user, and one human can have many entities (i.e. a work account where the company pays, a personal account, etc). That'd be a quarter of a T$ revenue / year. Dunno, while the number is so large it's hard to compute, it somewhat seems plausible.
And then they'll ruin it all by injecting adverts to get an extra $20b a year in revenue
Their goal is obviously to take a fraction of the world's economy, proportional to the productivity lift they can attribute to themselves. That's in the trillions.
How does one take a fraction of the world economy?
Microsoft sells services pretty much everywhere on earth and has a near-monopoly on PC OSes, enterprise email, productivity suites plus a giant cloud computing service....and their annual revenue last year was just $245 billion.
OAI can't get anywhere close to that, not least because they have multiple competitors and several large corporations (MSFT, Google, Meta) would rather dogfood their own solutions than use a rival's.
It's SoftBank though, weird risk taking investments seems to be their jam.
That's how you get to have $6B to throw around on just one part of one your strategies though to be fair.
It's because they are playing with other (dumb) people's money.
Yea, I was thinking the same thing.
Probably so, but that doesn't mean their value can keep scaling without heavy diminishing returns. Softbank must assume they've taken 80%+ of the gains from this phase of NVIDIA's growth, and want to capture the next wave of growth.
I agree with you that OpenAI seems much more risky in terms of it's actual true viability as a business, but the risk:reward must be there for Softbank.
They want to profit from the IPO of OpenAI. Private investors get a free 20% - 30% gain not available to the retail investors.
SoftBank is the world leader in turning safe bets into risky ones.
Without a doubt, in my opinion, OpenAI is a risky bet, but perhaps Softbank can make some money on OpenAI and then get out.
As usual also "sold its entire stake" can be written as "investors eagerly bought SoftBank's entire stake of nvidia".
Bag holders gonna buy the bag
Also relevant:
> “This should not be seen, in our view, as a cautious or negative stance on Nvidia, but rather in the context of SoftBank needing at least $30.5bn of capital for investments in the Oct-Dec quarter, including $22.5bn for OpenAI and $6.5bn for Ampere
> That amounts to “more in a single quarter than it has invested in aggregate over the two prior years combined,” Bulk said.
> … Following the recapitalization and SoftBank’s $22.5 billion investment into the ChatGPT maker, the Japanese firm’s 4% ownership of OpenAI will increase to 11%.
It sounds like Nvidia was played out for them and they’re aggressively trying to get in on OpenAI so they can exit sometime after retail investors get in
Selling the _entire_ stake sounds really aggressive though? Is that normal?
Even if you're all-in on OpenAI, does it not make financial sense to have _some_ stake in Nvidia considering they are the only ones with an actual moat?
Unless there are CUDA alternative breakthroughs we will hear about in the next few days.
Amazon’s Idaho 2Gw data center it’s building for Anthropic has 0 Nvidia Cuda cores.
https://finance.yahoo.com/news/amazon-says-anthropic-will-us...
> Anthropic is using 500,000 of Amazon’s Trainium2 chips for its Claude AI models as part of the tech giant's Project Rainier
For researchers and academics, cuda is painful to avoid, but I'm not sure that it is for large companies, once the time comes to train and deploy large models.
> Selling the _entire_ stake sounds really aggressive though? Is that normal?
They did not. They sold MOST of their stake in Nvidia long ago before anyone paid attention to Nvidia vs AI. It's one decision as part of a complex cloud of decisions.
Also this "stake" was around one thousandth of Nvidia. Minor. Most companies have lots of owners with much larger stakes.
If you believe the AI bubble will pop in the same way as the dotcom bubble and feel you can pick winners it makes sense. It would be like selling cisco stock for google. You can still invest in cisco later if you believe they'll grow but you might expect a stagnant period and definitely expect a drop as they don't have as much demand. NVidia is a safe bet to continue exisitng and being profitable but by being so central to the market you could almost guarantee a large drop in stock price while other companies are a gamble.
Isn't it merely a matter of time before China has an alternative?
All you have to look at is ASIC miners. Once they had them, they were 10x faster than GPUs easily and made GPUs useless for those algos. Something very similar can happen soon.
The fundamentals are different. Bitcoin mining is not intrinsically suited to acceleration on a GPU. It is a not-very-wide serial integer operation.
AI inference on the other hand is basically just very large floating point tensor matrix multiplication. What does an ASIC for matmul look like? A GPU.
No, GPUs are not a particularly ideal architecture for AI inference, it's just inference needs way more memory bandwidth than a general purpose CPU's memory hierarchy can handle.
> What does an ASIC for matmul look like?
A systolic array, and ultimately quite different than a GPU. This is why TPUs et all are a thing.
In general with a systolic array you get a quadratic speedup. For example with a 256x256 array, it takes 256 cycles to shift operations in and out, but in doing that you accomplish 65k MACs in 512 cycles for a speedup of 128x over serial.
The tensor cores in your NVIDIA chip are systolic arrays.
Not in the same way as a TPU, and again, the ISA and overall threading architecture matter.
Sorta? If that was the full story, TPU would not be a thing.
I'm not an expert in chip design by any means but I think it's fair to say that TPU is a marketing term and it's not substantially different from a GPU like an H100. H100's cores are also called "Tensor Cores."
You are entirely mistaken. The TPU and GPU are organized very differently particularly with how the memory subsystem works.
In the big picture, TPUs are systolic arrays. They don't have threading, divergence, or similar.
GPUs in the big picture are SIMT, a hybrid of SIMD and multithreading where individual data streams in SIMD are relaxed to allow them to diverge somewhat.
Memory Wise the TPU can keep the partial products right in the array. Parameters and weights are held in large on die scratch memories, and backing those are streams coming from the HBM. The TPU acts as a single giant CISC coprocessor, and has much more predictable memory and communication patterns vs a GPU, which its design exploits for higher efficiency at inference vs GPUs.
So even if they use the word "tensor" and both have HBM based memory systems, how those are actually architected is very different.
TPUs are not fundamentally different or more efficient than NVIDIA hardware. They are just cutting out the middleman.
Asic for matmul is systolic array more or less
They don't even need to invent anything. Just put in some work to polish what already exists: https://github.com/vosen/ZLUDA
IMHO AMD should have done this a decade ago.
This was sponsored by AMD for quite a while and dropped. There had to be some talks behind closed doors that resulted in the current situation. I mean, we all know they should've and they're not dumb either.
They recognise that the larger bubble is in the datacenters.
Most of the hardware we are using was designed for computer graphics not AI. Now that China isn't buying Nvidia any longer and actively trying to get their own companies to produce hardware, what happens to all these datacenters when a company produces a device that has 80% of the performance of the current Nvidia hardware but 20% of its power consumption?
Even double the energy consumption is not that bad for half the price. at 20 cents per kWh over 5 years 1 kW load would be 8760. So from 30000 to 15000 you would still come ahead in cost.
Should we just take them at their word? All we know is that they sold all of their Nvidia.
lol, after wework you'd be an idiot to think it was nothing more than shilling their "winner" to potentially dump on the public. but i guess as long as you can make money on the way up.
Maybe they're trying to bail out OpenAI, but that's still not close to the amount they would need to do that. OpenAI needs like 1.3 trillion dollars.
But they didn't think the Nvidia stake would make more $ otherwise they would still retain a percentage, right?
So averaging up then? That's even worse. More like degeneracy and gambling.
the key is "looks to"
Softbank can also choose not to.
Softbank is involved with Lutnick's Cantor & Fitzgerald in crypto deals:
https://www.reuters.com/business/media-telecom/cantor-nears-...
Masayoshi Son is BFF with Trump and Lutnick:
https://asia.nikkei.com/politics/international-relations/how...
There is more going on here than is publicly known. Investing in hot air is of course a specialty of the Trump admin.
They don't see upside in Nvidia clearly or they wouldn't have completely sold out. If they don't think the risk/reward is worth it why should anyone else? Eventually you'll run out of greater fools.
Yes because Softbank never makes mistakes clearly whatever they are doing is optimal.
So are you going to buy Softbank's shares? You are running out of greater fools at these bubble prices.
Nvidia's market cap is only $5 trillion.
California's residential real estate market is $10 trillion.
All it would take for the stock to double is every last person in California selling their house and buying NVDA. /s
There is no craziness here. It's a "Value rotation". Sell high, buy low, repeat. Capture a higher rate of return.
OpenAI just completed separating it's non-profit and for-profit restructuring: https://www.cnbc.com/2025/10/28/open-ai-for-profit-microsoft...
This probably means the for-profit structure will be going public in 2026, and there is probably a last private round happening.
> Sell high, buy low, repeat.
Softbank is known for doing it the other way around...
Clearly they don't see upside in Nvidia, the stock single handedly keeping this bubble intact, nothing to worry about of coarse.
I personally wouldn’t put much value on this event. I’ve never been impressed by SoftBank’s investment decisions. Of course, it has a good amount of money. But its decisions on ARM, WeWork, etc., have made it seem like it’s just (uninformed/underinformed) gambling.
ARM turned out to be a good investment for them, but I think overall you're right. They haven't really done any better than index funds (as is usual).
It looks more like a strategic reallocation than a panic exit. Nvidia has already delivered outsized returns, while OpenAI represents a leveraged bet on the next layer of the AI stack - software and services rather than hardware. SoftBank probably sees more upside (and influence) there, even if the risk is higher
Makes no sense to sell their entire position on a key infrastructure player, if you’re going all in on ai. That’s very odd.
It makes sense when you know the semi industry has always been cyclical and this insane level of spending can't be fueled on debt and VC cash forever. Masayoshison is out and now your 401ks are holding the bag, he'll get one last cashout when Open"AI" IPOs too with his winnings.
"Makes no sense" is basically SoftBank's motto though.
In the game of musical chairs, there is no official moment when players need to get in position to reach the closest chair. One second there is music and another second later there isn't. However, the that period exists if you can look at the relevant signs: the host hand and body in relation to the music record player.
No AI player will admit to be positioning for a sector collapse but it would be naïve to believe that anyone close to ground zero isn't planning contingency plans and are just coasting in the golden age of AI. And those who have the most skin in the game are certainly the ones most incentivise to do so while denying their true intentions.
LLMs are going no where but the reality of them not being the civilisation shifting money makers people have hyped them up to be is undeniably setting no matter what the AI astroturfers hiding in HN tell you. People have been jumping off the train or positioning to reach the closest chair when the music stops. Not long ago 2023, the world bubble was just whispered here. 2 years later it has hit mainstream and has been uttered by people holding the money bags. It might be a dream or it might not.
The difference is that, if you were in denial, now you are seeing signs that are much harder to deny. And we should expect the upcoming signs to be harder and harder, until the number of people denying reaches to zero right as the bubble fully bursts and the AI startups layoffs begin.
Would be interesting to have a game of musical chairs where the longer the game goes on, the more each player gets if they grab a chair. And N-1 players get a chair still.
I’m realizing this would be an interesting party game. Could probably do it with any stopwatch app. Everyone starts at the same time and holds their phone under the table, the person who presses stop last (i.e. has the highest time) gets zero points, everyone else gets a score equal to what their stopwatch shows.
By low, sell high. Any Nvidia shareholders would be foolish not to sell at least part of their holdings right now. Don’t ride the bubble to the bottom.
When money is growing on trees, pick it.
(That doesn't necessarily mean sell it all. But HODL can get you broke. It's prudent to take some juicy gains while they're available.)
You could make a lot of money, historically, by taking positions in opposition to Softbank.
> SoftBank Vision Fund recorded a $3.3 billion return on its Nvidia investment. The fund's February 2019 closeout of its Nvidia position preceded the AI boom and Nvidia's rapid transformation into one of the world's most valuable companies.
Masayoshi Son has form when it comes to calling the top of the market with this particular company.
Last top was 2022
It’s difficult to imagine them generating enough profit to support their current valuations.
The surprising thing to me here is that $5.83B was their entire stake, after NVDA had gone up more that 1000% in the the last 5 years.
yeah it made me wonder what all this fuss is about. perhaps im numb to big numbers now. but $6b is a miniscule fraction of NVDA.
My main thought was "how bad is Softbank at their job to have only been in on NVDA for such a paltry sum?"
Really living up their reputation? Or, am I way off-base here? I am just an outside observer and I would love to be educated.
Did it makes sense for Softbank to be in so little on the company "selling shovels" to all their "gold mining" investments?
Or, how down bad is Softbank that it needs to sell its NVDA stake to raise $6B?
Someone needs to put this guy/team in an asylum, for the betterment of the country of Japan.
Microsoft (which has >50B into OpenAI)->Anthropic for biz use cases
Softbank->OpenAI. Yet again, the dumbest money ever?
There are many, far worse Softbank fails. How does this keep happening? Who is advising this team?
I am available. 80% sure that I could do better. I just genuinely hate to see capital being destroyed like this.
I sold third at 180. I have seen it happen so many times in 50 years. You sit on your pile of gold and just watch it slowly disappear.
But also selling ALL is a bad move, says one who sold all of Nokia at 1000 markka in 1996.
You're thinking like a lowly retail investor who can only spend his own money. Softbank spends other people's money. They have to show some profits now and then to make their financials look good and thereby attract more funding.
Good point to cash out in my opinion. Extremely likely you can buy NVDA back cheaper in the future.
$5.83B is too large to be a round trip. This is clearly an exit.
It's about 0.1% of the company.
Not nothing, for sure, but low enough that you can buy it back in a couple of months.
Why would they exit nvidia while still keeping upwards of $10B or whatever it is in OpenAI? Genuine question.
Nvidia is investing $100bn in OpenAI: https://nvidianews.nvidia.com/news/openai-and-nvidia-announc...
By purchasing OAI shares now, Softbank will probably be able to sell them to Nvidia at inflated prices later.
Nvidia current market cap is 4.84 trillion dollars. Yes, that's roughly 5 trillions of dollars. 5.83B is a rounding error.
In numbers, yes, a rounding error. In fact, SoftBank was one of Nvidia's backers, and whatever this sell means in the stock markets, this is a strong signal.
Market capitalization is not equal to real money. Take a look at how Elon Musk bought Twitter.
Daily trading volume is roughly 200m units at roughly 200 USD per stock which equals 40bn in daily trades. So 5bn isn't nothing but over the course of a month it isn't particularly much.
5 billion is massive. So much of that 40bn daily volume is just leverage. Sort of like the derivatives market, trillions of dollars in volume but nobody has that much money, it is just margin. So even if some trading firm losses 1-2 billion everyone panics and goes out of the market. It actually happened during the flash crash.
Also, I highly doubt they sold those 5bn of shares in any exchange. Most likely they did it over several weeks on a dark pool. Because again 5bn is massive and it would cause a crash in any open exchange.
Maybe. Could go up still, but a surprisingly conservative move for SoftBank.
But hey, maybe the market crashes tomorrow and this is seen as the best piece of timing ever seen, maybe it doubles in the next year.
In any case, you never lose by taking profit.
I’m not calling the top, but I think it’s incredibly likely we’ll see NVDA with a lower market cap than this in the next 3 years.
Softbank is likely in trouble and needs the cash or something.
SoftBank, according to its stock, is in the best shape ever.
https://finance.yahoo.com/quote/SFTBY/
And per the stock prices Tesla is worth more than every other car manufacturer ever, as well.
Until it wasn’t. Then it was again.
Either way, cash flow != stock price, not that SoftBank is in a ‘business’ that likely needs a lot of cash.
Maybe they just needed a new yacht?
Or need to bail out one of their investments?
Interesting - is buying SoftBank a proxy for owning some OpenAI at this point ?
I thought Nvidia was the proxy!
It's proxies all the way down
... to reverse proxy
[flagged]
Why are you assuming people around you automatically have the means and desire to invest their own money into risky financial instruments?
This is so weird.
Risky? He said it's EXTREMELY likely. There's little risk. Margin loans are available.
Saying there's "little risk" to shorting while recommending "margin loans" is a very good indicator that you don't have a lot of knowledge about financial instruments. That's okay.
Did you know that you can be extremely correct in your medium term prediction and still get extremely margin called because of some random short term volatility?
>Margin loans are available.
He can still be margin called even just due to volatility in the market.
It can be both, likely and risky, timing the market is one of the riskiest things one can do...
It's likely there will be another major stock market crash, it's part of the cycle, and will always happen in its current form, good luck finding a way to time it and make a huge profit though.
Bold prediction, saying something might happen some time at some point in the future maybe but nobody knows when.
Isn't that how financial predictions work? No one knows, it's always a gamble, if it wasn't by definition it would have happened earlier.
Not sure why people get so up in arms about it, signs can be seen but the timing is always the impossible thing to predict.
This should be the news of the day, or even should I say, the news of the last 3 years.
The bubble is starting to crack.
SoftBank selling their stake in the AI shovel company to put it all directly in the AI gold rush company is evidence of bubble starting to crack?
> to put it all directly in the AI gold rush company
There are 3 facts here:
1. Softbank's nvidia stake sale has happened
2. Softbank has not put it all directly into the AI gold rush
3. 2 other investment entities have also sold most/all their stake in Nvidia
Do what these 3 facts as you will but these are ripples in the surface of the tech world
What are these two other entities?
Curbstone and Druckenmiller are the noteworthy ones from outsiders. Several Nvidia executives sold millions of their stock (possibly the world's most valuable stock) in the first half of the year and also sold millions of their nvidia stock last year which is roughly when most agreed that OpenAI was not likely to deliver anything groundbreaking anymore from their current transformer tech.
The Gpt-5 release just confirmed what most knew. And we know that the best time to leave is when the market can still get slightly hotter.
Apparently this is in the wake of OpenAI pivoting to a consumer-facing ad business, away from trying to disrupt every white collar worker on the planet. I would say that still points to a bubble beginning to pop.
There's no sign of cracking here:
> SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion as the Japanese giant looks to capitalize its “all in” bet on ChatGPT maker OpenAI.
I think the gulf between what an entity does and what an entity says should at least form part of a measured response to that.
It doesn’t matter what they say. It matters what they do. As of now they sold all of Nvidia, and the PR department found a way to soften the blow. That’s all.
Sure, there is no sign.
-3% straight after opening of the stock market 20 min ago.
A highly-useful autocomplete with a tricky monetization.
If virtualization and cloud computing has shown us anything, it's that software is more profitable than hardware.
The question is: now that Nvidia is the new Intel, is OpenAI the new Microsoft?
Softbank clearly thinks so.
Probably not bad move. How much upside Nvidia has left? And on other side how much can it go down? At point when you do not see them moving much more up selling is the logical conclusion.
Fun thought experiment: If a company had a product with infinite value it would be irrational to allocate capital to shares since you could own the product instead. So the share price might even go down (it's hard to know what role money will play in a post-agi society).
A smaller scale version of this might be happening here. Or it could be a bubble. Either way it's interesting!
Obviously we’re not ever going to see “infinite value”. I think it’s instructive to think of this on the margin or in terms of limits: would a putative AGI have an inflection point at which more of it produces less value, and even if it’s productive capacity were high, it could not be “infinitely high” (which would make it an economic absurdity).
Additionally, for the AGI producer (or platform host), there would have to be some way of price function that would cover the costs of operating or providing the AGI service.
Thus, a more realistic look at this is “purchasers of AGI would have no reason to purchase “more” of it beyond a certain threshold, after which it is no longer useful to their ends, however purchasing shares of the AGI producer would expose them to value from new customers who could use it better”
I have a LOT of respect for Masayoshi Son. He is the ONLY billionaire on the planet who spends like there is a wealth tax. I wish governments would observe him and eventually impose a wealth tax. It would do everyone a world of good.
Related?
https://www.marketbeat.com/instant-alerts/filing-curbstone-f...
https://www.fool.com/investing/2025/11/11/billionaire-stanle...
And all this on a holiday when the markets are closed....
"All in on OpenAI"
Hahah! Fucking hell, openai is going to fail big time, they have nearly a 1,5 TRILLION USD in debt. There is no way they can handle that, their only option is to cozy up with trumo and make the tax payers pay for all that.
Ah, because you didn't post any sort of source I looked it up.
Seems your 1.5Tn figure is in "spending commitments" and not current/hard debts. I.e. budget earmarked for datacenters and research from '25-'35 or so.
Yup. They have minted deals to spend, and im pretty sure there is a hefty fine if they cant pay or do indeed backtrack from the deal. Either way OpenAI is operating in a completely absurd way, and is no where near worth what they claim. Kinda lika Tesla is.
Baka
Softbank has underperformed massively. Also they sold again their total stake in 2019. Why is it front news? To feed the AI bubble talk.
We will find out in next few months but I predict they had a great exit at the high. As the AI bubble seems to be deflating even if not popping with the largest economy in the world insulating itself from western tech and AI.
AI is a gold rush.
Nvidia is the leading shovel maker.
...
I don't understand the rationale here.
[dead]
Totally not a bubble [0], Move along now, nothing to see here. /s
[0] https://news.ycombinator.com/item?id=45795158
Well the news should probably be "sold its entire stake", as in it's already over and done.
I wonder if there are people (with money) who have a really good grasp on this market (hardware I mean). For example you could have sold NVDA in August, not much lower than current price, and bought SNDK and 5x-ed your money in 3 months.
5X is a terrible return if you have a magic orb that can tell you the future.
They're selling a public asset to the mainstreet dummy, so they can pour money on the AI fire so OpenAI can build more datacenters. This is another vein of circular funding, they're getting their cash from our retirement accounts via institutional investments and index funds.
I was a skeptic in AI crapware, but if SoftBank is selling Nvidia to the moon is almost a guarantee
I'm sorry, why is this on Hacker News?
I'm on investing subreddits all the time, and I'd expect it there.
But I don't see how this is "anything that gratifies one's intellectual curiosity."
If there wasn't an AI bubble narrative, then sure, this this would gratify my curiousity. But now I don't see it, not even in the most charitable way.
I'm curious what the line of thinking is on how this does, in some way, gratifies one's intellectual curiosity.
Edit: I figured that I'd get all the downvotes. I've been here long enough to understand the social dynamics of the site. Funnily enough, I was more in the "Hacker News" demographic between 2015 and 2023. Since then, it has shifted a little. Nowadays, I have to force myself a bit to sound more positive than I actually am in order for my comments to be appreciated (in terms of upvotes, as I do view that as a form of social feedback), and that is fine.
I understand that this post gives bad vibes or sounds perhaps a bit mean? I am not intending it that way. I really just don't get it. Look at my comment history, I sometimes ask questions like this, but not that often. I suspect I'm not the only one in this.
I'm curious if this is the beginning of the rumored "pop".
It is not.
There is an AI bubble narrative, people are curious when it will burst. This is an indicator that people will want to analyse, discuss, and think about (intellectually).
I see. I guess I simply think that Softbank isn't a good indicator for that. To me, they don't seem better than any other investment company that puts their money into technology stocks with a growth narrative. For example, they invested in WeWork and FTX.
They don't know the future, just like the rest of us.
If we're talking indicators, if 5 Softbanks would do it in rapid succession one after another it just mentions to me that the "smart money" is showing signs of moving out.
In terms of whether AI will or will not fuel growth, I think it will fuel growth. Self-driving cars seems to be a solved problem for cities at least fairly soon (e.g. Waymo, anti-example: Tesla, camera's is not the way).
It's a question whether LLMs state of the art models will grow more, but what hasn't been done that well yet is integrating it into current software. I know, because in part, that's my job. There's still a huge productivity unlock there, also in ways that people can't fully imagine.
Right now, LLMs seem to be an enabler for software engineers, especially software engineers on smaller projects (I can't find the research at the moment, it was a while ago that I read it). It seems to be an enabler for many people, but they do need to put time into prompting it in a way that works for them.
Fixing the context window issues and others I think will be really hard tasks, because I suspect we then need to know what goes on inside the black box.
If an LLM could continuously learn, so somehow continuously keep updating its weights such that it learns better, that would be a breakthrough.
I agree to be fair. I see Softbanks move as just wise strategy. Nvidia's growth won't be uncapped.
I wouldn't be surprised if they reinvest some of that money into AMD or similar, as those companies play catch up. AMD is bringing ROCM up to speed with AI models, and their consumer hardware is having pretty good press despite some PR fumbles.
Selling Nvidia stock isn't a sign of lack of faith, it's just an exit after strong results. Softbank think this is a peak or near enough, good for them.
As you say, until there's some breakthrough, there's little point keeping money in the dominant company.
Also, Nvidia appear to have delayed their 60-series GPUs, and this will cascade to their entreprise models, due to the 3GB module memory shortage. The next gen will be VRAM heavy, but you can't do that during a shortage, you need the market to correct tor for supply to increase. So any 'breakthrough' powered by new hardware is now about a year away.
This won't stop people secondguessing on the bubble front though. Personally, I think bubble popping is going to come from a lack of faith from investors in the downstream companies like OpenAI who are struggling to make money from their resource intensive products. Nvidia are already profitable with the hardware, MS/Google/Amazon will always make money with the servers. And if AI bursts, other sectors can soften the blow for those companies. It's the massively inflated AI model makers that need to worry about who makes it out of this profitably.
Stock market is really, really interesting
I mean for me it is, but not in an intellectual sense. Don't get me wrong, there are some good articles on HN about HFT and the technicality of it, but this is just, I don't know. Why Softbank? Didn't other big investment banks/funds sold out of NVidia at some point? Cathy Wood maybe, at some point? Why wasn't that on HN?
Stock news is barely on HN.
Oh, wait, I guess I see it now. It is on HN way more frequently when it involves Big Tech. And NVidia is increasingly seen as part of that. It used to be FAANG but now it's the Magnificent 7. The bias shifted.
That'd make sense.
After reddit doing IPO and getting blasted by AI content, seems a lot of reddit-only people have come over to HN.
Quality of technical content and discussions has visibly gone down since. More emotional/low-value/political replies everywhere. Slowly turning into /r/programmerhumor...
> Why Softbank?
most of HN bought their houses on the back of softbank throwing money at everything that moved