SoftBank CEO Masayoshi Son goes on the 'AI offensive'

As shares of NVIDIA turned lower today, SoftBank CEO Masha Yossi san talking about selling NVIDIA too soon at their annual meeting in Tokyo overnight and double down on the narrative that he's going on the quote AI offensive. Our Deirdre Bose is looking at that for today's tech check with some new details on what that means. Dee Hey, good morning, Carlson. According to a source familiar, this is not going to be like the Vision Fund all over again. VCs like to call Softbank's last offensive era one of quotes, spray and pray. Back then, from about 2016 to 2019, the Japanese conglomerate, they raised a ton of money, more than any VC fund raised before them. And then they deployed it into more than 450 companies, hoping for one big winner to pay for the rest. I'm told that this time around, Masa San is going to be a lot more focused and that ARM will be the centerpiece of its strategy. So instead of spreading his bets across many different startups and industries, he's looking at a smaller universe of companies with a more explicit fit. With ARM now Softbank's crown jewel and really its largest stake, My source says that strategic MA will play a large part and that SoftBank will be more operator this time around, less traditional VC investor, which might help explain some of Masasan's other comments overnight, or we'll call them musings. At the AGM, he talked about NVIDIA as the fish that got away. Back in 2019, he sold a nearly 5% stake in NVIDIA, booking a $3.3 billion return, which was great, but had he held on to that stake, it would be worth about $160 billion today. If given a chance to choose now between ARM and NVIDIA, Masayoshi Son said that he would choose ARM without a second of hesitation. I'm told it's because he believes that through ARM he can build an AI company to rival NVIDIA. Masasan has always been very, very bold. This slide from a SoftBank presentation a few quarters ago underpins that strategy. He believes that building out arms target markets across devices, auto infrastructure and IoT will create a massive AI winner. And as we've highlighted a number of times on Tech Check, Arm is now Softbank's biggest holding, replacing Alibaba, largely thanks to its post IPO run. Over the past year, it has nearly doubled Softbank's net asset value. Yet soft makes market cap. It reflects skepticism from investors around that strategy, that very bold strategy. Its market cap is less than its total holdings. And that's also something that activist investor Elliott Management has taken note of. And it believes that the way to narrow that gap is not necessarily going on the AI offensive, but through a $15 billion buyback. I've reached out to them on what they thought about Massa Son's comments overnight, which seemed to downplay the idea of buybacks. I have yet to hear back guys.

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