SoftBank Group
9984.TLOWScore: 18.3AI Platform / Investment · Weight: 6%· Data as of 2026-05-13
Investment Thesis
Leveraged call option on AI infrastructure via ARM (~90% of Arm equity) and OpenAI (~13% stake). FY2026 results (May 13): Revenue ¥7.8T (+8%), NI ¥5T (5x YoY) — but ~90% from unrealized OpenAI valuation gains ($45B on $34.6B invested; cumulative $64.6B). ARM Q4: Revenue $1.49B (+20%), data center royalty +100% YoY. ARM plans own AGI CPU chips (product pivot). Market cap ¥34.118T ≈ NAV — minimal holding company discount. LOW conviction maintained: earnings quality poor (unrealized PE gains), FCF negative, no FY2027 guidance.
Risk
MAJOR: Peak earnings trap — ¥5T profit (5x record) driven entirely by unrealized OpenAI private valuation gain. If OpenAI valuation marks down >30%, this reverses to massive losses. ARM Q4 royalty MISSED estimates ($671M vs $693M) — smartphone low-end softness. Cumulative OpenAI investment $64.6B creates concentration risk. FCF -¥1,396B: SoftBank generates no operational cash. No FY2027 guidance — explicit acknowledgment of earnings unpredictability.
Monitoring Trigger
EXIT if ARM royalty growth <10% YoY for 2 consecutive quarters. WATCH: ARM Q4 royalty $671M vs $693M estimate missed — next check Aug 2026. UPGRADE if OpenAI IPO announced (converts unrealized to realized value). DOWNGRADE if OpenAI valuation marks down in next fundraising round. Monitor: ARM quarterly results Aug 2026.
Key Dates
Key Metrics
Business Segments
| Segment | Revenue | Share | Description |
|---|---|---|---|
| SoftBank (telecom) | ¥3,200B | 40% | Domestic telecom — stable cash flow engine |
| Arm Holdings | ¥500B | 6% | Chip architecture licensing — every AI chip |
| Vision Funds | N/A | N/A | SVF1 + SVF2 tech investments |
| Investment/Other | ¥4,300B | 54% | T-Mobile, PayPay, direct holdings |
Supply Chain Evidence
| Evidence | Customer | Product | Detail |
|---|---|---|---|
| confirmed | Apple | Arm architecture licensing (A/M-series chips) | All Apple A-series (iPhone) and M-series (Mac) use ARM architecture. Largest single ARM royalty source. |
| confirmed | NVIDIA | Arm Neoverse for Grace Hopper GB200 AI servers | ARM data center royalty +100% YoY driven by NVIDIA Grace Hopper (Neoverse). ~50% of new hyperscaler server chips use ARM per ARM CEO Haas. ARM to become largest data center architecture. |
| confirmed | OpenAI | $64.6B cumulative equity investment (~13% stake, Stargate infra) | OpenAI cumulative investment $64.6B ($34.6B for ~13% stake + additional). $45B unrealized valuation gain in FY2026. PRIVATE valuation only — not realized cash. IPO timing is key exit. |