SoftBank Group has revealed a striking ¥517.2 billion (approximately $3.5 billion) net profit for its fiscal fourth quarter ending March 31, 2025, significantly outperforming analyst expectations of a loss. This financial resurgence, detailed in the company’s official earnings release, also marked SoftBank’s first full-year profit in four years, totaling ¥1.208 trillion. The Japanese technology investor’s improved fortunes arrive at an important moment, as it channels substantial capital into artificial intelligence, a domain founder Masayoshi Son views as transformative.
The robust quarterly results were primarily driven by gains in SoftBank’s telecommunications holdings, such as T-Mobile US and Deutsche Telekom, and enhanced valuations for key investments like e-commerce firm Coupang and TikTok parent ByteDance within its Vision Fund 1.
This upswing provides critical financial underpinning for SoftBank’s extensive AI initiatives, including a commitment for follow-on investments of up to $40 billion in OpenAI Global, with an initial $10 billion closing on April 15, 2025, as per SoftBank’s financial results. Furthermore, SoftBank is a key financial force behind the ambitious Project Stargate, an initial $100 billion venture to erect significant AI infrastructure, predominantly in the United States, in collaboration with OpenAI, Oracle, Microsoft, and Nvidia, according to the Financial Times.
Despite this positive financial momentum, the execution of these large-scale AI projects, especially Stargate, remains paramount. Kirk Boodry, an analyst at Astris Advisory, told the Financial Times, “It’s a surprise . . . but in the bigger scheme of things what really matters is their plans for Stargate and OpenAI.”
This perspective highlights how the current profitability, while beneficial, is secondary to the successful deployment of SoftBank’s long-term AI strategy. SoftBank also announced plans to consolidate its robotics-related businesses and proposed maintaining its annual dividend at ¥44 per share.
Stargate’s Ambitious Blueprint And Emerging Headwinds
Project Stargate, which commenced officially in January 2025, envisions a massive build-out of AI data centers. As of that month, ten such facilities were reportedly already under development in Texas. Masayoshi Son has previously described Stargate as a venture of national strategic importance for the U.S. and its allies.
However, this colossal undertaking faces notable challenges with potential financing delays, stemming partly from the risk of U.S. tariffs increasing the cost of essential technology equipment.
As of February 2025 only $45 billion of the initial $100 billion Stargate commitment was definitively secured. SoftBank was reportedly seeking a substantial bridge loan of up to $16.5 billion to facilitate the project’s early stages.
The sheer scale and financial intricacies of Stargate have also attracted scrutiny, with figures like Elon Musk publicly questioning the extent of SoftBank’s secured funding.
Some investors are also growing wary of potential overcapacity in the AI sector, especially with the rise of more cost-effective AI alternatives. Richard Kaye of Comgest Asset Management, speaking to Bloomberg, noted the uncertainty, stating, “It would be great to be able to say exactly where all the money’s going in the next couple of quarters. I don’t think anybody can right now, and probably Mr. Son himself hasn’t decided.”
OpenAI’s Evolution And SoftBank’s Deepening Alliance
SoftBank’s AI aspirations are intrinsically linked with OpenAI. Following a $40 billion SoftBank-led tender offer finalized in early 2025, OpenAI’s valuation reached $300 billion, positioning SoftBank as its largest investor. This tender offer primarily provided liquidity to OpenAI’s employees and early backers, rather than new operational funds for the AI company.
OpenAI is concurrently reshaping its operational strategy. Since February 2025, the company has been reducing its exclusive reliance on Microsoft’s Azure cloud services, aiming to diversify its infrastructure through Stargate partners and other avenues. This strategic shift is propelled by OpenAI’s massive and escalating demand for computing power.
The company reportedly lost $5 billion in 2024 and anticipates annual compute costs surpassing $9.5 billion by 2026. To address this, OpenAI secured an $11.9 billion compute deal with CoreWeave and is actively developing its own custom AI chips with Broadcom and TSMC. This move reflects an understanding within SoftBank, whose CEO Masayoshi Son has stated, “Software alone won’t be enough”
The partnership with Microsoft, while evolving, remains a key component. Microsoft CEO Satya Nadella previously affirmed OpenAI’s significant commitment to Azure, explaining that its APIs would remain exclusive to the platform due to this deep commitment.
However, Nadella also acknowledged that the terms had been adjusted, allowing OpenAI to seek compute resources elsewhere if Microsoft’s capacity cannot meet its expanding needs. He explained that Stargate is part of the answer to Sam Altman’s desire to scale compute, and if Microsoft cannot meet those needs, Altman “can go elsewhere”.
Powering AI’s Future And Navigating A Complex Landscape
The immense energy demands of AI projects like Stargate, estimated to require at least five gigawatts of power, are a critical factor. In response, both Sam Altman and SoftBank have invested in Helion Energy, a nuclear fusion startup working towards commercial power generation by 2028.
Microsoft has also entered into a power purchase agreement with Helion, underscoring a broader industry trend towards securing novel, high-capacity energy sources, as detailed by Winbuzzer.
Beyond technological and financial aspects, OpenAI continues to operate within a challenging legal and regulatory environment. An ongoing lawsuit from Elon Musk regarding OpenAI’s restructuring into a Public Benefit Corporation alleges, through his attorney, that it is a “transparent dodge.”
OpenAI has refuted these claims, with a spokesperson calling them “baseless” and an attempt to slow the company down. The situation prompted Columbia Law School professor Dorothy Lund to comment to the Financial Times that “when you’re a mission driven company which needs money from investors, you are in a dangerous position.”
While Project Stargate’s immediate development is centered in the U.S., SoftBank and OpenAI are also reportedly considering European expansion, with sites in the United Kingdom, Germany, and France under evaluation.
OpenAI CEO Sam Altman had previously expressed a desire to establish a “Stargate Europe”. This global perspective unfolds as SoftBank’s Vision Fund 1 reported an investment gain of ¥940 billion, while Vision Fund 2 booked an investment loss of ¥526 billion for the quarter, illustrating the varied outcomes within SoftBank’s vast investment portfolio. The company also plans to centralize its robotics-related companies.
