SoftBank shares collapsed after selling a stake in Nvidia. Are they worth buying?

Quotes of SoftBank, actively investing in the development of artificial intelligence, collapsed to a one-month low after the disclosure of information about the sale of the Japanese corporation's stake in the leader of the AI sector Nvidia. This alarmed investors, already concerned about the possible overvaluation of technology companies.

SoftBank shares collapsed by 10% at the opening of trading in Tokyo on November 12. This happened after a day earlier the corporation announced the sale in October of its entire stake in Nvidia for $5.8 billion - to finance other investments in AI. Quotes SoftBank collapsed even though the technology holding company reported quarterly results better than forecasts and announced a 4-to-1 stock split, which usually increases the interest of retail investors, notes Bloomberg.

SoftBank's exit from Nvidia came amid growing doubts as to whether the multi-billion dollar spending on AI by Meta Platforms, Google and other giants would bring a commensurate return. Investors have begun to question the advisability of investing so much in a technology with unclear returns, especially against the backdrop of a sharp rise in the shares of companies leading the AI race.

"The value of the company [ SoftBank] fluctuates depending on the market valuation of its investments, so we think the stock is likely to be extremely volatile going forward," Bloomberg quoted Citigroup analyst Keiichi Yoneshima as saying in a note. - But as NAV (net asset value) is on an upward trajectory, we think investors will warm to the stock."

During the presentation of the quarterly report on November 11, SoftBank management emphasized that the sale of Nvidia shares is not related to the company itself, but due to the need for additional capital to finance projects. SoftBank said it plans to invest $22.5 billion in OpenAI in December 2025, as well as buy chip developer Ampere for $6.5 billion.

After the collapse at the opening of trading in Tokyo, SoftBank quotes have corrected, reducing the drawdown to 3%. According to FactSet, the majority of analysts continue to bet on SoftBank: 12 experts recommend buying shares of the Japanese company (Buy and Overweight ratings), five advise to hold (Hold), two - to sell (Sell and Underweight).

Shares of Nvidia at the trading on November 11 slipped by 3%. Analysts on Wall Street are almost unanimous in their assessments of securities of the key beneficiary of the AI boom: with 60 recommendations to buy (Buy and Overweight), only five - to hold (Hold) and only one rating suggesting advice to sell (Sell).

SoftBank has already fully exited Nvidia once before - in 2019. The Japanese corporation resumed buying small stakes in the chipmaker in 2020 - two years before ChatGPT appeared, which triggered an AI boom on the stock market. By the end of March 2025, the value of SoftBank's stake in the American chipmaker reached $3 billion. Since then, Nvidia's capitalization has grown by more than $2 trillion, Bloomberg recalls.

Despite the sale of its stake in Nvidia, SoftBank's portfolio still includes some of the most sought-after names in the industry, from ByteDance to Perplexity AI, the agency noted. These investments have helped SoftBank's share price rise 78% in July-September 2025, its best quarterly performance in 20 years.

This article was AI-translated and verified by a human editor