SoftBank Q3 financial report outlook: OpenAI investment may become profit engine, market focused on future massive fundraising plan.

Japan's SoftBank Group is set to release its third-quarter report on Thursday, with its stake in OpenAI expected to bring substantial gains. However, the current focus of the market has shifted to how this investment giant will raise funds for its ongoing artificial intelligence investment frenzy. As OpenAI continues to sign billion-dollar deals but still operates at a loss, investors are increasingly concerned about its financing abilities, which is also affecting the market sentiment of major tech companies closely related to it. Last month, it was reported that SoftBank invested over $30 billion in ChatGPT maker OpenAI by 2025, gaining approximately 11% ownership, and is currently in negotiations to participate in the company's latest round of financing, possibly adding up to an additional $30 billion in investment. Analysts point out that due to the significant risk exposure to OpenAI, this Japanese investment company is increasingly seen as the "shadow stock" of OpenAI, with its concentration risk increasing and the market growing more worried about the potential impact on SoftBank's own financial situation. "For SoftBank shareholders, the current reality is that their wealth is deeply tied to OpenAI," said Rolf Bulk, semiconductor and infrastructure research director at Fututum Equities. "Even if they complete another $50 billion financing round, they will still need more funds in the coming years. Companies like Amazon and Google spend over $100 billion in capital expenditures every year." SoftBank's "all in" investment in OpenAI continues the consistent style of its founder and CEO, Masayoshi Son, betting on companies that are not yet profitable. Although recent funding rounds have valued OpenAI at record highs, these profits currently only exist on paper. BTIG analyst Jesse Sobelson estimates that SoftBank should record investment gains of $4.45 billion from its $22.5 billion OpenAI investment made in December last year. Five analysts surveyed by the London Stock Exchange Group expect SoftBank's quarterly net profit to range between a profit of 1.1 trillion and a loss of 480 billion. SoftBank's stock price has been volatile recently, rising by about 2% since 2026 but dropping by about 15% in the past three months. Focus on financing plans Investors will closely observe how SoftBank will finance its future investments in OpenAI, as the company has already sold some of its most liquid assets to fund its AI bet. In the quarter ending September last year, SoftBank announced that it had sold $5.8 billion of Nvidia shares and some T-Mobile equity, raising $9.17 billion. SoftBank also issued more debt to increase its leverage. Shogo Tono, senior credit strategist at Nomura, noted that by the end of December last year, SoftBank's loan-to-asset ratio may have jumped from 16.5% three months before to 21.5%. Even if SoftBank estimates its share value at the target valuation of $830 billion of OpenAI's latest funding round, its leverage rate would only decrease slightly to 19.2%. Although Standard and Poor's has classified SoftBank's long-term credit rating as non-investment grade, it still has some financial flexibility. In November last year, SoftBank increased the amount of loans secured by its stake in chip design company Arm, with $11.5 billion of the total $115 billion still unused as of December. Furthermore, as of the end of September, SoftBank held 3.5 trillion in cash and cash equivalents. Analysts expect that on this basis, SoftBank will further monetize assets and issue more debt. Despite strong external demand for investments in OpenAI, with the syndicated loan of $40 billion last year oversubscribed, and Amazon and Nvidia currently in negotiations to participate in the latest funding round, competition among AI companies is intensifying. "Just six months ago, OpenAI was seen as the leader, but now its growth prospects and revenue forecasts are on par with its competitors," Bulk of Futurum commented.