Nvidia Chips To Power Softbank's Near $1B AI Investment: Report

Japanese tech giant SoftBank Group Corp SFTBY has announced its plans to invest a significant sum in the development of an advanced artificial intelligence (AI) model, leveraging NVIDIA Corp NVDA chips.

What Happened: SoftBank is set to invest a whopping $960 million over the next two years to create a cutting-edge Japanese-language-specific generative AI model and enhance its computing facilities, as reported by Nikkei on Monday.

These large language models (LLM) necessitate advanced graphics processing units, which SoftBank intends to acquire from Nvidia, the report stated, citing anonymous sources.

The investment, totaling 150 billion yen ($960 million), will be allocated between 2024 and 2025. This sum is in addition to the 20 billion yen that SoftBank spent on computing infrastructure last year.

Once the investment is completed, SoftBank is expected to possess the most powerful computing capabilities in Japan, potentially making it the largest investment of its kind by any Japanese company.

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Japan is currently lacking private companies with the high-performance supercomputers required to build LLM, despite a growing interest in the technology. SoftBank’s reported investments could potentially fill this gap, providing Japan with a strong domestic player in the generative AI space.

Why It Matters: This move by SoftBank is in line with its recent focus on AI and chip development. Earlier in February, SoftBank’s founder, Masayoshi Son, announced plans to raise $100 billion for a new chip venture targeting the AI market, potentially posing a challenge to Nvidia.

SoftBank’s stock price has been on the rise, up by about 20% year-to-date, as the company shifts its focus to AI. The company is also the majority owner of the chip company Arm, which has seen a boost in sales expectations amid the AI boom.

Japan’s AI market is expected to grow to around $13 billion by 2030, about 17 times larger than in 2023, according to data from Statista Market Insights.

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Image Via Shutterstock


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Posted In: AsiaEquitiesNewsGlobalMarketsTechartificial intelligencechipsKaustubh BagalkoteLLMMasayoshi SonSoftbank
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