SoftBank is increasingly sinking into a multi‑billion‑dollar debt, betting on AI as the key driver of its development

Brief annotation

SoftBank plans to raise another $30 million to support OpenAI and will review its internal debt‑management rules. This decision comes amid a rising debt burden above 25 % – the threshold the company has traditionally kept below.

1. Why SoftBank is taking new credit
- The goal is to cover AI infrastructure costs and complete an OpenAI funding round.

- Plan – borrow about $30 million in the coming months.

- Mechanism – if needed, the company will sell assets, issue shares or pledge property.

2. Current financial situation
Metric Value
Debt ratio (debt/asset value) last quarter rose from 16.5 % to 20.6 %.
Projected debt‑to‑asset level after new loan ~26–27 %, but can be lowered below 25 % with asset sales.
SoftBank’s net assets >$189 million.
Investments in OpenAI currently ≈$34 million (11 % stake).

3. What key figures say
- CFO Yoshimitsu Goto
- Confirms that the threshold may temporarily be exceeded.
- Promises to reduce debt as soon as possible using asset sales and share issuances.

- MST Financial experts
- Estimate that by 2026 investments in OpenAI will reach ≈$50 million.
- Warn that a high debt level could upset investors.

4. Why this matters for shareholders
- Stock price drop – more than 45 % since last October due to concerns about AI investment payback timelines.

- Credit rating – S&P lowered SoftBank’s rating, citing the rise in private‑asset share (from 42 % to >50 %).

- Potential solution – an OpenAI IPO that could reduce debt and improve market perception.

5. SoftBank action plan
1. Obtain credit – about $40 million from major lenders to cover near‑term needs.

2. Three‑stage investment in OpenAI
- April, July, and October.

3. Bank support – banks continue financing the company, understanding its strategy.

Conclusion
SoftBank intends to use the new loan for further development of OpenAI while being ready to adjust its debt profile. Despite exceeding the traditional 25 % threshold, management promises a swift return to a more sustainable balance using asset sales and potential new share issuances. A successful OpenAI IPO could be key to stabilizing SoftBank’s market position and restoring investor confidence.