Nvidia Stock (NVDA) Dips Pre-Market as SoftBank Sells Entire Position

Nvidia's stock (NVDA) is down 1.66% in this morning's pre-market, as SoftBank Group (SFTBY) disclosed the sale of its entire Nvidia holdings for $5.8 billion in October. This divestment marks a significant shift in SoftBank's investment strategy, focusing more heavily on artificial intelligence (AI) ventures.

The sale involved 32.1 million shares of Nvidia. The markets reacted negatively to the news, with Nvidia's stock price reflecting investor concerns over the departure of a major institutional shareholder. This dip highlights the sensitivity of Nvidia's stock to large-scale transactions and strategic realignments by key investors.

SoftBank's decision to liquidate its Nvidia stake aligns with its broader strategy to reallocate capital towards AI-driven initiatives. The company reported a net profit of 2.5 trillion yen (~$16.6 billion) in the fiscal second quarter ending September 2025, more than doubling the previous year's figure. This surge was primarily fueled by valuation gains from its investment in OpenAI, with the Vision Fund unit posting a substantial 3.5 trillion yen investment gain, of which 2.16 trillion yen was attributed to OpenAI.

Further underscoring its commitment to AI, SoftBank has approved the final $22.5 billion installment of a total $30 billion investment in OpenAI. This substantial funding is contingent upon OpenAI completing a corporate restructuring to facilitate a future public offering, signaling SoftBank's long-term vision for AI's potential.

SoftBank's strategic realignment extends beyond OpenAI, encompassing investments in AI infrastructure and chipmakers. The company is involved in a joint $500 billion “Stargate” project with OpenAI and Oracle, aimed at building advanced data centers to support AI development. Additionally, SoftBank has invested in chipmakers like Arm Holdings and Taiwan Semiconductor Manufacturing Co., positioning itself as a key player in the AI ecosystem.

Analysts have responded positively to SoftBank's AI-focused investments, with several upgrading the company's share price targets. This optimism is tempered by caution regarding the potential for an AI investment bubble, reminiscent of past market cycles. Institutional investors remain cautiously optimistic about SoftBank's strategic direction, recognizing the potential rewards and inherent risks of investing heavily in the rapidly evolving AI sector.

SoftBank's sale of Nvidia shares creates a dual narrative for the market. While Nvidia faces scrutiny after losing a major backer, SoftBank's aggressive reinvestment into the broader AI ecosystem signals strong long-term confidence in the sector. Investors will now closely watch how Nvidia performs independently and whether SoftBank's concentrated AI bets will pay off.