SoftBank Group Corp.

Global credit markets are starting to show signs of slowing, with the yield premium, or credit spread, on corporate bonds worldwide widening by about 5 basis points this week, the biggest increase since March, pushing spreads to their widest level in six months amid concerns over inflation and high interest rates. Data from Bloomberg indices showed early trading in Asian markets on Friday also signalled that selling pressure could continue, with traders saying yield premiums on investment-grade bonds rose by about 2 to 4 basis points. The weakness in credit markets contrasts with a better tone in US Treasuries after most Federal Reserve officials struck a more dovish stance. A surge in new bond supply is starting to weigh on the market, with large companies from Paramount Skydance to SoftBank Group raising funds through massive debt issuance. Paramount Skydance in particular issued 52 billion dollars of debt this week to fund the biggest acquisition in Hollywood history, and its junk-rated bonds were among the heaviest sold in early trading. Just days earlier, SoftBank raised 11.1 billion dollars through high-yield bonds to support a large AI investment plan, forcing the company to offer historically high yields, including 9.75% on 7.5-year notes, to attract investors. Sheldon Chan, a portfolio manager for Asian and emerging-market debt at T. Rowe Price Group, said rising volatility was a key factor prompting some investors to avoid the market for now, and that the market's direction from here would depend mainly on macroeconomic factors and economic conditions. Meanwhile, in the riskier part of the US bond market, credit spreads jumped above 1,000 basis points relative to US Treasuries for the first time since the regional banking crisis in 2023, after spreads rose steadily from April as investors began positioning for the Fed's next rate hike.

Analysts believe the AI sector remains undeterred and is pressing ahead with fundraising, even as the yield on 10-year US Treasuries climbs close to 5.17%, the highest since 2007. JPMorgan Chase estimated in June that companies are likely to take on an additional 4.1 trillion dollars in debt tied to AI investment by 2030. Japan's SoftBank, one of the key financiers for AI projects, raised 11.1 billion dollars this week from the sale of low-rated bonds, with its 7-year notes carrying a yield of as much as 9.75%. CoreWeave, a heavily indebted Neocloud business, said in its latest quarterly earnings report that as of June, every 100 basis point rise in interest rates could add 30 million dollars to its interest expenses. Oracle shares fell 7% this week and are down about 30% since the start of the year, after Bloomberg reported that the company sent a force majeure notice concerning its data center project in New Mexico, known as Project Jupiter, in order to shield itself from rising costs. Despite higher financing costs, demand for AI services continues to grow rapidly. Meta's Muse personal assistant app topped 2.5 million global downloads in its first two weeks and overtook ChatGPT as the most popular app on Apple's App Store. Evercore analyst Mark Mahaney said Muse could reach 100 million users within 6 to 12 months.

The biggest immediate risk to the artificial intelligence boom may be investors losing their willingness to keep funding companies that burn enormous amounts of cash before reaching profitability, The Wall Street Journal reported. The AI buildout already faces potential obstacles including power shortages, uncertain demand, rising borrowing costs and competition among model developers, but a financing shutdown could spread quickly through an interconnected ecosystem in which model developers need billions of dollars to train and operate their systems while chipmakers, cloud providers and data-center operators invest heavily in anticipation of continued AI demand. Some cautionary signs have appeared: OpenAI has ruled out an IPO this year, nuclear technology company Holtec paused its offering plans and Anthropic delayed its planned IPO, though those moves do not yet amount to a broad shutdown in financing. Continued fundraising by OpenAI matters well beyond the company itself, since Nvidia and SoftBank are among the major sources of capital supporting the developer, while Oracle is investing heavily in data centers partly in anticipation of enormous future business from OpenAI. The warning sign would be a genuine funding gap at a major AI company that forces it to cut spending or expansion plans, which could prompt investors to reassess growth assumptions throughout the AI supply chain; for now, the financing window remains open.

SoftBank Group locked in $10 billion of dollar bonds and 1 billion of euro bonds to help fund its final OpenAI investment payment, sending shares down 3.18% to 6,150 at Friday's 3:30 p.m. Tokyo close. The dollar bonds carry rates of 8.625%, 9.25% and 9.75%, adding up to about $941 million in annual interest on the amounts issued, while the euro bonds add roughly 75.6 million. SoftBank expects to issue the notes on September 29 and close the $10 billion OpenAI payment on October 1. Reuters called the transaction the largest high-yield corporate bond sale on record, citing LSEG data. SoftBank's GF Score is 79 out of 100, but financial strength and momentum sit below profitability, leaving the company dependent on the OpenAI stake growing enough to reward shareholders after the cost of borrowing.

SoftBank is set to roll out the new Ray-Ban Meta Gen 3 in Japan on September 25, giving Meta Platforms another distribution channel for its AI-powered smart glasses. The Japanese carrier has been steadily expanding its smart-glasses business, becoming the country's first mobile network operator to sell Ray-Ban Meta Gen 2 glasses in June and enlarging its Meta glasses assortment again in August. Alongside the Gen 3 launch, SoftBank will also add Meta Glasses by LISA to its lineup. The wider retail and carrier availability matters to Meta because smart glasses are a prominent piece of its push to extend artificial intelligence beyond smartphones and PCs, and could help it gauge whether AI-powered wearables can become a substantial consumer hardware category. Meta shares closed up 4.5% at $777.59 on Thursday, while SoftBank Group's U.S.-listed shares slumped 7.6%.

SoftBank Group shares fell nearly 3% in early Tokyo trading before paring the move to little changed after Oracle issued a force-majeure notice to a Blue Owl unit developing Project Jupiter, a large data-center campus that forms part of Stargate, the $500 billion AI infrastructure initiative involving Oracle, OpenAI and SoftBank Group. Oracle is seeking to protect itself from payment obligations if the project is delayed and fails to come online in 2028 as planned, according to people familiar with the matter cited by Reuters and Bloomberg, with the notice tied to potential delays in securing power. The development has raised broader questions over whether the huge amounts of capital committed to AI infrastructure can be deployed on schedule, particularly as developers face constraints around power, construction and financing. The timing is sensitive for SoftBank Group, which has been increasing its leverage to finance its AI strategy and this week raised $11.1 billion through dollar- and euro-denominated bonds, with proceeds aimed in part at funding its investment in OpenAI. Credit investors are becoming more selective toward AI-related debt, with Reuters reporting spreads on AI-linked bonds had widened to about 115 basis points versus 78 basis points for the broader market, while SoftBank's exposure extends into AI power and infrastructure through SB Energy, which is preparing a potential U.S. listing and carries a $430 billion data-center backlog that Reuters noted is concentrated among SoftBank and OpenAI and largely long-dated.

Oracle has sent a force majeure notice to Stack Infrastructure, the developer of the massive New Mexico data center known as Project Jupiter, as it seeks to protect itself financially if the facility is delayed. Oracle is the main tenant of the project, which is being developed by Stack Infrastructure, a portfolio company of Blue Owl Capital, and is designed for 2.45 gigawatts of capacity, making it one of the larger facilities tied to the broader Stargate AI infrastructure buildout involving Oracle, OpenAI and SoftBank. According to Bloomberg, Oracle wants to defer payments if the site misses its planned 2028 opening, though it remains unclear whether the notice would release Oracle from any existing financial obligations. About 20 banks provided an $18 billion loan to support development of the campus, meaning any extended delay could affect more than just Oracle's occupancy timeline. The market reaction was immediate: Oracle shares fell about 4% in premarket trading, Blue Owl dropped roughly 4%, Bloom Energy, whose fuel cells are expected to help power the site, fell 5%, and SoftBank shares declined about 6%.

SB Energy has slowed preparations for an initial public offering that had been discussed around a $50 billion valuation, according to a September 22 Financial Times report, while a $4.9 billion debt package has faced weak demand and yields around 10%. The SoftBank-backed developer says it has signed roughly 8.8 gigawatts of IT lease capacity, including the PORTS-Pike campus in Ohio for OpenAI, and Nvidia is the exclusive AI-compute provider for that site, providing credit support for an initial 4.25 gigawatts with an option covering another 3.75. Nvidia has already invested $1.5 billion and committed another $1.5 billion tied to the IPO, and has disclosed maximum guarantee exposure that can reach $105 billion under defined conditions. American Electric Power sits on the electricity and transmission side of the same buildout through AEP Ohio's regional power partnership around the SB Energy campus, with about 69 gigawatts of contracted load additions through 2030, roughly 90% of it tied to data centers. The IPO slowdown does not mean AI demand disappeared, but it signals that investors are starting to distinguish between contracted demand and financeable returns, and that the cost of capital has become part of the AI thesis.

The Federal Open Market Committee is widely expected to raise its benchmark rate to 3.75%-4.00% from 3.50%-3.75% at its September meeting, with a strong August jobs report and hotter-than-expected core CPI supporting the move. Amazon Web Services said it cannot restore access to resources and data hosted exclusively in its Bahrain region after Iranian drone strikes damaged infrastructure, affecting multiple Availability Zones and exceeding what its regional and multi-AZ services were designed to withstand, while one data-hosting zone in the United Arab Emirates also remains affected. SoftBank Group's five-year credit default swaps hovered near a three-year high at around 383.2 basis points, near their highest level since 2023, as investors assessed its funding plans for OpenAI, to which SoftBank has committed $64.6B. OpenAI has held early discussions with large investors about a new capital raise that could value the company at about $1.2T before an IPO, talks initiated by investors that could fund acquisitions and give the company flexibility to delay its IPO by one or two quarters. The Trump administration has appealed a federal court ruling by Judge Beryl Howell blocking the EPA from sending California's vehicle-emissions rules to Congress for potential repeal, a dispute involving stricter standards for cars, trucks, and lawn and garden equipment.

Credit default swaps (CDS) indicating the credit risk of SoftBank Group are hovering near their highest level in three years. According to data provider CMA, the mid-spread on five-year CDS stood at 383.2 basis points on the 16th, near its highest level since 2023. Portfolio company OpenAI in the U.S. is expected to forgo an initial public offering within the year, leaving uncertainty over when SoftBank Group will recover its investment. Meanwhile, SoftBank Group has secured $11.9 billion, or 1.85 trillion yen, in financing to fund its investment in OpenAI, exceeding its initial target, showing progress on the funding front. Sharon Chen, a credit analyst at Bloomberg Intelligence, noted in a report dated the 16th that funding costs are rising along with higher government bond yields in Japan and the U.S., and said SoftBank Group's overseas bonds are seeing wider spreads amid concerns over increased supply and growing exposure to OpenAI. The company recently issued 1 trillion yen in retail bonds in Japan and is also preparing an overseas bond issuance, and if CDS remain at high levels, it could affect future issuance terms.

AI-related stocks plunged across global equity markets on the 14th, with the Philadelphia Semiconductor Index falling 5.9%. On the 12th, Anthropic CEO Dario Amodei called on companies to slow the pace of development amid growing concerns about AI misuse, and xAI's Elon Musk and OpenAI CEO Sam Altman said they agreed with him. Altman also disclosed that OpenAI will not hold an initial public offering this year, citing safety concerns. Semiconductor stocks led a global selloff, with Nvidia down 3.4%, Advanced Micro Devices down 4.4%, Micron Technology down 5.3%, Lam Research down 8.3%, Applied Materials down 7.1%, and Bloom Energy down 6.8%; in Asian markets, SoftBank Group plunged more than 10%, while Taiwan Semiconductor Manufacturing and SK Hynix also declined. Some voices, however, are not taking the warnings at face value: Michael Burry posted on X that such warnings are hype and bluster, Morgan Stanley forecast that AI-related investment will exceed 1.3 trillion dollars by 2027, and Deutsche Bank indicated it is hard to imagine companies voluntarily pausing. Anthropic is expected to list as early as October and is in talks to bring Nvidia in as an anchor investor.

Artificial intelligence stocks tumbled Monday after leaders of the AI revolution called for a coordinated slowdown in building more powerful AI systems. Over the weekend, Anthropic chief executive Dario Amodei published an essay titled "We Must Pace the Frontier," calling for an industry-wide effort to slow AI development, and executives at OpenAI, SpaceX and Microsoft echoed the concern. Semiconductor stocks bore the brunt: Nvidia fell 3% to $210.96, AMD lost 4% and Intel plunged 6%, while SoftBank Group, an OpenAI shareholder, plunged 11%. OpenAI Chief Executive Sam Altman told Fortune it was an "ill-advised moment" for an initial public offering and said the company won't list this year, and Microsoft published a "humanist" code of conduct pledging its models "will never resist human interruption, correction, or shutdown." Anthropic reportedly disclosed its second consecutive profitable quarter on Sunday as it prepares to go public, with second-quarter revenue surging past $11.5 billion, while Nvidia CEO Jensen Huang dismissed AI doomsday scenarios as totally unfounded and President Trump defended his administration's light-touch regulatory approach.

Wall Street traded lower on Monday as AI-related shares tumbled after executives at leading U.S. AI companies called for a slower pace of development, with SoftBank falling as much as 13.2% in Japan, SK Hynix dropping 6.4%, Samsung Electronics declining 4%, and in the U.S. Nvidia slipping 2.4% premarket while Micron and AMD each fell 5% and Broadcom dropped 3.4%, following an essay Saturday by Anthropic CEO Dario Amodei arguing that progress on improving AI model capabilities should be slowed. Crude oil surged, with front-month Nymex crude jumping 4.3% to $104.37/bbl and Brent rising 4.5% to $109.32/bbl, after Persian Gulf countries called off a planned meeting with Iran on reopening the Strait of Hormuz and a Friday drone strike knocked out Saudi Arabia's East-West pipeline, which feeds the Red Sea port of Yanbu and moves 4M bbl/day; traders estimate the closure could cut off up to 4% of global oil supply, with Yanbu storage covering just 5-7 days of exports. The benchmark 10-Year Treasury yield reached 5% for the first time since October 23, 2023, adding 3 basis points Monday, while the 2-Year yield rose 4 basis points to about 4.66% and the 30-Year added 2 basis points to 5.37%. Kimberly-Clark is preparing possible asset sales to resolve European Union competition concerns over its proposed $40 billion acquisition of Kenvue, with the European Commission expected to notify the company of its concerns this week ahead of a preliminary review deadline on September 29.

AI-linked stocks fell across Asia, Europe and U.S. premarket trading on Monday after Anthropic CEO Dario Amodei called for a deliberate slowdown in AI capabilities development, drawing support from OpenAI CEO Sam Altman and Elon Musk. Nvidia fell nearly 3% in premarket trading, Intel dropped close to 6% and Micron Technology declined around 5%, while in Asia SK Hynix ended the session down more than 6% and Samsung Electronics shed more than 4%. SoftBank, one of OpenAI's largest investors, fell roughly 10% to 11% in Tokyo and South Korea's Kospi dropped 3.3%, while in Europe ASML lost between 5% and 6%, Nokia gave up roughly 8% and Infineon retreated more than 7%. Amodei published an essay on Saturday outlining a three-step plan he called pacing the frontier, which would embed third-party evaluators inside AI companies, establish shared safety benchmarks and agreed limits on how fast capabilities can advance, and eventually coordinate with governments including China. Altman posted on X that he agrees with Amodei's call, Musk wrote that Dario is right, and Altman later clarified that pacing does not mean stopping, while President Donald Trump rejected any reduction in pace on Sunday and China's Foreign Ministry described the warnings as fear mongering.

Oil prices jumped Monday after Saudi Arabia closed its East-West pipeline following drone attacks by Yemen's Houthis, with Brent North Sea Crude up 3.0 percent at $107.71 per barrel and West Texas Intermediate up 2.9 percent at $102.90. US average diesel prices hit a new record high above $6.0 a gallon, reaching $6.23, as markets priced a 92 percent probability of a Federal Reserve rate hike on Wednesday. Anthropic CEO Dario Amodei called on AI firms to slow development of the technology, adding to a selloff in tech stocks that sent Tokyo-listed SoftBank down more than 10 percent and chipmaker Kioxia down more than six percent, with SK hynix, Samsung and TSMC also sharply lower. European markets were mostly lower around midday, though London's FTSE 100 rose 0.7 percent to 10,727.07 points on gains for Shell and BP, while Paris's CAC 40 fell 0.8 percent and Frankfurt's DAX lost 0.5 percent. Russ Mould, investment director at AJ Bell, said oil and AI fears were causing a double headache for investors, compounding inflation worries stoked by last week's elevated US consumer price index data.

China on Monday pushed back on calls by U.S. AI executives for companies to slow down development of cutting-edge technology, with Foreign Ministry spokesperson Guo Jiakun calling such talk "fear mongering" that would disrupt global AI governance. Guo was responding to a question about U.S. CEOs including Anthropic's Dario Amodei, OpenAI's Sam Altman and Elon Musk, who have urged the industry to slow down because of the dangers rapid advances pose. China's Minister of State Security, Chen Yixin, published an article on Sunday calling for acceleration of an AI security risk prevention and control system, saying the field has become "the main battleground for global technological competition and a new arena for strategic rivalry among major powers." AI-related stocks slumped on Monday, with SoftBank, one of the biggest investors in OpenAI, down 10% in Japan. U.S. President Donald Trump also rejected the AI bosses' calls, saying "we're leading China in AI... and, frankly I want to keep it that way because whoever wins AI, wins," while President Xi Jinping said at the weekend's BRICS summit in New Delhi that China will take the lead in fostering AI collaboration among developing countries.

Shares of Japanese investment conglomerate SoftBank Group, a key investor in OpenAI, fell more than 10% on Monday after Anthropic and OpenAI called for slowing AI development for safety, dragging Asian markets to a mixed close. SoftBank stock traded in Japan plummeted 11.2% after OpenAI CEO Sam Altman backed Anthropic CEO Dario Amodei's weekend calls for the AI industry to slow down, and Altman told Fortune on Saturday that OpenAI would not hold its initial public offering this year as it focuses on safety. Other AI-related Asian stocks also fell, with South Korea's SK Hynix down 5.3%, Samsung Electronics off 2.8%, Japan's Tokyo Electron down 0.9% and Kioxia Holdings sinking 6%. South Korea's Kospi lost 2.5% to 6,739.68, Japan's Nikkei 225 slid 0.8% to 63,474.58, Hong Kong's Hang Seng rose 0.3% to 24,886.81 and the Shanghai Composite climbed 0.2% to 3,894.28. Oil prices gained more than 3% after Saudi Arabia shut a major pipeline used to bypass the Strait of Hormuz following an attack, with Brent crude up 3.2% to $107.94 a barrel and benchmark U.S. crude up 3.2% to $103.26 a barrel.

SoftBank Group shares fell more than 13% in Monday morning trading in Tokyo, the steepest drop in nearly three months, after senior executives at OpenAI and Anthropic urged developers to slow the development of advanced AI to prioritise safety, fuelling concern over SoftBank's big bet on AI technology. SoftBank is one of OpenAI's largest backers and plans to raise its cumulative investment in the ChatGPT developer to nearly 65 billion dollars by October. The company also plans to issue retail investor bonds worth 1 trillion yen, or about 6.5 billion dollars, and is preparing to borrow another 10 billion dollars linked to OpenAI shares to support various deals, including the acquisitions of ABB Robotics and DigitalBridge, as well as plans to build data centres in several countries around the world. Yugo Tsuboi, chief strategist at Daiwa Securities, said the market is worried that OpenAI's valuation may not be as high as previously expected, and investors are watching the situation closely because it is still unclear how much AI development will slow. SoftBank shares are down about 30% from their June peak after reports that OpenAI's planned initial public offering may be delayed. Dario Amodei, chief executive of Anthropic, said that slowing the development of frontier AI capabilities does not mean that industry spending or growth will slow along with it.

SoftBank Group has set the interest rate on its retail investor bonds worth 1 trillion yen, or approximately 6.3 billion dollars, at 4.75% for 7-year bonds, amid rising interest rates in Japan, which has increased the attractiveness of investing in debt securities and may encourage more Japanese companies to raise funds from retail investors. The interest rate is at the relatively high end of the 4.3-4.9% range that SoftBank announced in August, and is significantly higher than the average yield of about 2.3% for yen-denominated corporate bonds issued to retail investors in Japan this year. This bond issuance comes at a time when the yield on 10-year Japanese government bonds has surged above 3% for the first time in about 30 years, making debt securities more appealing to Japanese households. Kazuma Ogino, a senior credit analyst at Nomura Securities, believes that both the yield level and the large issuance size of 1 trillion yen could attract new retail investors to the market. Japan's retail bond market is expanding rapidly, with the value of yen-denominated corporate bonds issued to retail investors from the start of the year to September 4 reaching 2.88 trillion yen, including SoftBank's 1 trillion yen deal, and surpassing the total issuance for any full year in the past. This growth comes as Japanese companies have increased capital needs for mergers and acquisitions and growth investments. Ogino noted that turning to retail investors helps diversify funding sources and reduces pressure on credit spreads. This trend could benefit both companies seeking additional funding channels and retail investors looking for higher returns, while helping to expand Japan's retail bond market as the country enters a higher interest rate environment.

SoftBank Group's shares fell about 5.1% to $15.335 as investors weighed the planned U.S. IPO of its AI infrastructure unit, SB Energy, which boasts a contracted backlog of approximately $439 billion but has no operational data centers. In the first half, revenue surged 66.4% to $138.7 million, yet the net loss ballooned from $215.5 million to $3.21 billion. Nvidia has committed $1.5 billion at the IPO price, and OpenAI holds warrants valued at nearly $5.5 billion. The backlog is more than 3,100 times first-half revenue, but it represents long-term contracts rather than immediate cash, and OpenAI and SoftBank are expected to generate a significant portion of early lease revenue, raising concentration and related-party concerns. SoftBank's shares trade 7.77% above its GF Value estimate of $14.23, and while the IPO could unlock billions, SB Energy must deliver working data centers and real cash flow.