Japanese conglomerate SoftBank Group (SFTBY), partnering with OpenAI on the $500 billion Stargate data center project, is planning to cut its global Vision Fund team by 20%. The goal of the job cut is to redirect resources to fuel the AI ambition of its founder, Masayoshi Son, according to a memo seen by Reuters, which also cited an insider source.
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The move comes after SoftBank scored a net profit of $2.87 billion during its first quarter, driven by gains from its stakes in chip designer Nvidia (NVDA), e-commerce company Coupang (CPNG), as well as a recovery in its tech funds business.
SoftBank Bets Big on AI
SoftBank’s layoff plan comes as the company continues to ramp up its investments in artificial intelligence in the U.S. It recently made a $2 billion investment in chipmaker Intel (INTC) and partnered with chip manufacturer TSMC (TSM).
The conglomerate’s Stargate project, which was announced in February, seeks to extend AI services to corporate customers. However, the project is now facing extended delays, with an update now expected in November.
Furthermore, SoftBank is working on a massive $1 trillion project called “Project Crystal Land” to build a large AI and robotics manufacturing hub in Arizona. Still in its early stages, the initiative aims to mass-produce semiconductors and industrial robots. The goal is to strengthen U.S. advanced tech manufacturing and reduce reliance on imports, particularly in light of President Donald Trump’s tariff policies.
With these projects and investments, SoftBank’s growing AI portfolio now spans chips, data centers, and AI-powered robotics. Meanwhile, leading U.S. companies are also stepping up their efforts in this area.
For instance, chipmaking giant Nvidia has reportedly spent over $900 million to bring on board Rochan Sankar, CEO of Enfabrica, an AI hardware startup. This is even as the company is said to be looking to license the startup’s technology.
Is SFTBY a Good Stock to Buy?
SoftBank’s American Depositary Receipts are traded over-the-counter and have limited analyst coverage. However, TipRanks’ AI Stock Analyst gives SFTBY stock a Neutral rating score of 64 out of 100. The average SFTBY price target is $56.00, which indicates a possible 10% upside from the current level.
