The Stock of Softbank Rose on the Ceo's Announcement of a $100 Billion Chip Project

SoftBank Group Corp.'s stock experienced a notable rise as founder Masayoshi Son explores the possibility of establishing a $100 billion chip venture focused on supplying AI-enabled semiconductors. The Tokyo-based tech investor's shares surged by up to 3.2% following reports from Trade Algo News that the 66-year-old billionaire is actively seeking funding for this venture, aiming to compete with Nvidia Corp. The project, codenamed Izanagi, is envisioned as an initiative to create an AI chip venture that would complement Arm Holdings Plc, a chip design company in which SoftBank holds a majority stake.

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In this potential scenario, Masayoshi Son is contemplating SoftBank providing $30 billion, with an additional $70 billion potentially coming from institutions in the Middle East, according to insider sources. If successful, this chip project would not only surpass Microsoft Corp.'s investment in OpenAI but also represent a significant share, approximately a fifth, of the global semiconductor market.

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Named after the Japanese god of creation and life, the Izanagi project underlines Son's unrestrained enthusiasm for the impending era of artificial general intelligence, as he envisions a world where machines surpass human intelligence, contributing to a happier existence.

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Despite facing setbacks in some startup investments, Masayoshi Son has witnessed Arm, a company in which SoftBank holds a majority stake, emerge as a notable success. This success has translated into a remarkable surge of approximately 30% in SoftBank's shares over the last 10 trading days, accompanied by an even more substantial 80% increase in Arm's shares.

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For Son, the venture into AI presents an opportunity to create a company that can rival the prominence of the "Magnificent Seven" stocks, according to insider information. The "Magnificent Seven" refers to the seven-largest U.S. stocks by market capitalization. SoftBank, bolstered by a windfall in T-Mobile US Inc. shares valued at almost $8 billion and its 90% stake in Arm, had ¥6.2 trillion ($41 billion) in cash and cash equivalents as of December 31. This financial strength was fueled by a rebound in global equity markets.

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Masayoshi Son's interest in AI chip development aligns with his optimistic vision for the future, anticipating the rise of artificial general intelligence and machines that surpass human intelligence, leading to a more joyful existence. The potential investment in Izanagi reflects SoftBank's strategic move into the semiconductor market, aiming to play a substantial role in the rapidly evolving field of artificial intelligence.

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The significant financial backing from both SoftBank and potential partners in the Middle East underscores the scale and ambition of the project. If successful, this venture could reshape the landscape of the semiconductor industry and solidify SoftBank's position as a major player in the AI technology sector.

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