NextFin News - Shares of SoftBank Group plummeted 10.6% in Tokyo on Thursday, a sharp reversal for the investment giant that recently eclipsed Toyota Motor as Japan’s most valuable company. The sell-off, which saw the stock slide to 7,434 yen, followed an overnight retreat in U.S. technology markets where investors began aggressively locking in profits after a historic run-up in artificial intelligence valuations. The decline was not isolated to SoftBank; South Korean semiconductor leaders Samsung Electronics and SK Hynix also retreated, falling 1.25% and 2.75% respectively, as the broader Asian tech sector buckled under the weight of shifting sentiment.
The primary catalyst for the slide appears to be a growing skepticism regarding the immediate monetization of massive AI capital expenditures. SoftBank, under the leadership of CEO Masayoshi Son, has positioned itself as the central clearinghouse for the AI revolution, leveraging its massive stake in chip designer Arm and a flurry of new investments in AI infrastructure. While this strategy propelled the stock up 70% year-to-date prior to this week, it has also left the firm uniquely exposed to "valuation jitters" when the broader market’s appetite for risk wanes. According to CNBC, the group’s high-risk bets are now facing intense scrutiny as liquidity concerns resurface.
Peter Milliken, an analyst at Deutsche Bank, suggested in a recent investor note that the market has become "fixated on short-term momentum" and may be struggling to "map out the long-term trajectory with detailed assumptions." Milliken, who has historically maintained a rigorous, data-driven approach to SoftBank’s complex valuation, noted that the current volatility reflects a disconnect between long-term potential and short-term price action. His perspective, while influential among institutional investors, remains a cautious counterpoint to the more exuberant "AI-at-all-costs" narrative that has dominated the first half of 2026. It is important to recognize that Milliken’s focus on fundamental modeling often places him at odds with the momentum-driven retail sentiment that frequently moves SoftBank’s needle.
Masayoshi Son remains undeterred by the volatility, maintaining a characteristically aggressive stance. Speaking to CNBC earlier this week, Son argued that the AI revolution would eventually be 50 times larger than the dot-com boom of the early 2000s. He dismissed the prospect of a market correction as a tactical advantage, stating that such a downturn would represent the "best investment opportunity" for the firm. Son’s long-term bullishness is well-documented; he has spent decades navigating extreme boom-and-bust cycles, from the near-collapse of SoftBank in 2000 to the record-breaking profits of the Vision Fund era. However, his appetite for leverage and "big swing" investments continues to be a point of contention for more conservative credit analysts.
Beyond the macro tech sell-off, SoftBank has also been active in rebalancing its portfolio to shore up liquidity. On Wednesday, the firm’s affiliate, SVF II Lightbulb (Cayman), offloaded a 3.25% stake in the Indian eyewear retailer Lenskart. The transaction, valued at approximately 28.73 billion rupees ($345 million), involved selling 56.5 million shares to a group of buyers including ICICI Prudential and the Los Angeles City Employees’ Retirement System. While such divestments provide a cash cushion, they also highlight the ongoing pressure on SoftBank to prove it can successfully exit its private "unicorn" holdings in a more restrictive interest rate environment.
The current downturn serves as a stress test for the "new" SoftBank, which has attempted to pivot from a broad venture capital approach to a concentrated bet on the AI ecosystem. While the 10% drop is significant, it follows a period of extraordinary outperformance. The critical question for the coming weeks is whether this represents a healthy consolidation of gains or the beginning of a deeper reassessment of AI’s capital-intensive roadmap. For now, the market’s reaction suggests that even the most visionary bets are not immune to the gravity of valuation fundamentals when the tide of global liquidity begins to recede.
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