SoftBank Borrows Even More Money for OpenAI

SoftBank has once again borrowed money to fund its investments in OpenAI, the maker of the popular ChatGPT software. This time, the firm is issuing an $11 billion bond sale, which includes $10 billion in dollar-denominated notes and €1 billion in euro-denominated notes. The bond sale is potentially the largest Asia-Pacific and Japan non-financial corporate bond deal on record.

SoftBank has a history of taking loans to fund AI, with $41.5 billion borrowed last year alone. In February, the company committed to invest an additional $30 billion in OpenAI, just weeks after borrowing $40 billion in a bridge loan. By October 2026, SoftBank's cumulative OpenAI commitment is projected to reach close to $65 billion.

The company is increasingly relying on borrowed money for its AI investments, rather than asset sales, which comes with credit risk. SoftBank's debt is already speculative grade, and S&P downgraded it to BB in 2023 due to excessive exposure to a single entity. The firm's decision to fund an unprofitable AI lab with borrowed capital rather than equity alone is a risky bet, especially at a time when AI capital expenditure is under scrutiny from investors and analysts.