SoftBank Group faced a severe market blow on Wednesday as its shares sank over 14%. The slump mirrored a broader decline across Asian technology stocks closely tied to artificial intelligence. The selloff followed a sharp U.S. tech downturn, igniting fears that AI valuations had reached unsustainable levels.
Analysts warned that global stock markets could be approaching a correction. Wall Street’s overnight pullback deepened concerns, with major U.S. indices ending sharply lower. The Dow Jones Industrial Average slipped 0.53%, while the NASDAQ plunged 2.04%, and the S&P 500 dropped 1.17%. The volatility index, VIX, surged more than 10%, signaling heightened investor anxiety.
AI Exposure Worsens SoftBank’s Market Rout
SoftBank, long celebrated for its high-stakes AI ventures, saw its market capitalization shrink by roughly $32 billion in a single session. Data from LSEG suggested that, if the losses continued, this could become the company’s steepest daily fall since August of last year, when its stock collapsed by 18%.
The Japanese conglomerate’s aggressive expansion into the AI ecosystem has made it particularly vulnerable to the recent tech selloff. Its portfolio spans chip design, infrastructure, and next-generation application startups. The company’s heavy reliance on AI-driven growth now appears to be testing investor patience.
Arm Holdings and AI Investments Under Pressure
SoftBank’s ownership of Arm Holdings, a British semiconductor firm powering both mobile and AI processors, has been central to its AI ambitions. However, Arm’s shares tumbled by nearly 5% in the latest Nasdaq session, deepening the blow to SoftBank’s valuation.
In addition, SoftBank bolstered its AI infrastructure this year by acquiring Ampere Computing to enhance its data-center operations. The company’s exposure to the AI chip industry, once seen as a strategic advantage, is now being reassessed amid the global selloff.
A Portfolio Deep in AI and Risk
Beyond hardware, SoftBank has placed bets on several AI-focused startups, from OpenAI to video-editing platform OpusClip. It also supports Tempus AI, which applies machine learning to healthcare and precision medicine. These investments reflect the conglomerate’s belief that AI would dominate the next decade of innovation.
However, that confidence has come at a cost. Over the past two trading days, SoftBank has lost almost $50 billion in market value, with Tuesday alone seeing a 7% decline in its share price.
Market Chaos Spreads Across Japan
Japan’s broader equity market suffered alongside SoftBank’s collapse. The Nikkei 225 fell 4% by mid-morning, its weakest performance in seven months. Investor sentiment soured rapidly as losses in U.S. tech stocks rippled through Asia.
By midday, the Nikkei hovered around 49,136 points, dipping below the 50,000 mark for the first time since October. Although the index rebounded slightly later in the day, it still ended nearly 3% lower than Tuesday’s close.
SoftBank’s steep drop underscored how quickly enthusiasm for AI-linked stocks can turn into panic when valuations come under pressure.