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SoftBank sells its entire stake in Nvidia

cnbc.com

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Re: SoftBank sells its entire stake in Nvidia

#71

Post by hobofan »

nly wrote: post #57
hobofan wrote: post #49

Earlier quoted context omitted.

In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business. By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.

It's hard to see how they become profitable enough to justify current valuations. The numbers are just mind boggling even in the optimistic scenario.

If they are able to actually successfully pivot into ads as a business model, it's very easy to justify the valuation: Just look at Google/Meta.

I'm personally skeptical that they are able to pull off ads, at least on the short timescale they likely need to. They more or less have to nurture/disrupt a whole SEO industry, and the way big corps allocate advertising budgets are very slow to shift (many are still struggling to find their footing in social media advertising).

Re: SoftBank sells its entire stake in Nvidia

#72

Post by actionfromafar »

viraptor wrote: post #34
l5870uoo9y wrote: post #28

Earlier quoted context omitted.

Isn't it merely a matter of time before China has an alternative?

They don't even need to invent anything. Just put in some work to polish what already exists: https://github.com/vosen/ZLUDA

IMHO AMD should have done this a decade ago.

Re: SoftBank sells its entire stake in Nvidia

#73

Post by chemmail »

hobofan wrote: post #49
randomNumber7 wrote: post #40

Earlier quoted context omitted.

I would have thought that the OpenAI bet is way more risky, because if someone comes along with a better model it could really hurt OpenAI. NVIDIA seems harder to dethrone imo.

In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business. By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.

It’s going be pretty hard to dethrone Google when even Apple is going to Google for AI with another huge billion $ contract.

Re: SoftBank sells its entire stake in Nvidia

#74

Post by chemmail »

l5870uoo9y wrote: post #28
ares623 wrote: post #16

Earlier quoted context omitted.

Selling the _entire_ stake sounds really aggressive though? Is that normal? Even if you're all-in on OpenAI, does it not make financial sense to have _some_ stake in Nvidia considering they are the only ones with an actual moat? Unless there are CUDA alternative breakthroughs we will hear about in the next few days.

Isn't it merely a matter of time before China has an alternative?

All you have to look at is ASIC miners. Once they had them, they were 10x faster than GPUs easily and made GPUs useless for those algos. Something very similar can happen soon.

Re: SoftBank sells its entire stake in Nvidia

#76

Post by chongli »

Tuna-Fish wrote: post #38
reconnecting wrote: post #5

This should be the news of the day, or even should I say, the news of the last 3 years. The bubble is starting to crack.

SoftBank selling their stake in the AI shovel company to put it all directly in the AI gold rush company is evidence of bubble starting to crack?

Apparently this is in the wake of OpenAI pivoting to a consumer-facing ad business, away from trying to disrupt every white collar worker on the planet. I would say that still points to a bubble beginning to pop.

Re: SoftBank sells its entire stake in Nvidia

#77

Post by tasuki »

rdsubhas wrote: post #61

There is no craziness here. It's a "Value rotation". Sell high, buy low, repeat. Capture a higher rate of return. OpenAI just completed separating it's non-profit and for-profit restructuring: https://www.cnbc.com/2025/10/28/open-ai-for-profit-microsoft... This probably means the for-profit structure will be going public in 2026, and there is probably a last private round happening.

> Sell high, buy low, repeat.

Softbank is known for doing it the other way around...

Re: SoftBank sells its entire stake in Nvidia

#78

Post by weego »

randomNumber7 wrote: post #40
lifthrasiir wrote: post #13

Note the first line: > SoftBank said Tuesday it has sold its entire stake in U.S. chipmaker Nvidia for $5.83 billion as the Japanese giant looks to capitalize its “all in” bet on ChatGPT maker OpenAI. They are switching gears, not exiting, folks.

I would have thought that the OpenAI bet is way more risky, because if someone comes along with a better model it could really hurt OpenAI. NVIDIA seems harder to dethrone imo.

Probably so, but that doesn't mean their value can keep scaling without heavy diminishing returns. Softbank must assume they've taken 80%+ of the gains from this phase of NVIDIA's growth, and want to capture the next wave of growth.

I agree with you that OpenAI seems much more risky in terms of it's actual true viability as a business, but the risk:reward must be there for Softbank.

Re: SoftBank sells its entire stake in Nvidia

#79

Post by Topfi »

chemmail wrote: post #73
hobofan wrote: post #49

Earlier quoted context omitted.

In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business. By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.

It’s going be pretty hard to dethrone Google when even Apple is going to Google for AI with another huge billion $ contract.

In fairness, that is for their model, not their brand. In this industry, the mind share and buy in OpenAI has is still second to none, even when Gemini 2.5 Pro served the vast majority of users far better than the OpenAI models, the latter MAU trounced all competitors.

We do not know for certain as of yet, but I’d be very surprised if Apple felt the need to loudly communicate to their user base that the upcoming Siri improvements aren’t Apple Intelligence. They won’t lie of course, but Googles brand in the space isn’t nearly as strong with the layperson, whereas they more than happily shouted their use of GPT from the rooftops initially.

Re: SoftBank sells its entire stake in Nvidia

#80

Post by xnx »

hobofan wrote: post #49
randomNumber7 wrote: post #40

Earlier quoted context omitted.

I would have thought that the OpenAI bet is way more risky, because if someone comes along with a better model it could really hurt OpenAI. NVIDIA seems harder to dethrone imo.

In many ways OpenAI is transitioning towards an end-user facing product business. They have by far the strongest brand among consumers and are positioning themselves to take on Google/Meta in the ad business. By proxy, having the strongest frontier model becomes less and less necessary for them and instead building a strong product by properly layering medium-strong models in a cost-efficient way is the priority.

> They have by far the strongest brand

Just like Blackberry, but instead of having to buy an new device to switch to the competition, the customer just needs to click on a different website.

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