For Masayoshi Son, the AI boom has been both a blessing and a curse for a conglomerate that had lost its way.
In June, AI returned SoftBank Group to the top. For the first time in 22 years, Son’s conglomerate overtook, for a time, Toyota Motor in market capitalization to become Japan’s most valuable public company. It did so riding a euphoric surge in artificial intelligence shares.
That’s the blessing. Before January, when the AI trade became the financial zeitgeist, SoftBank was still nursing wounds from its WeWork disaster, and the nearly $100 billion Vision Fund that Son launched in 2017 had limped into 2026.
AI flipped the script. Son’s much-maligned 2016 acquisition of British chipmaker Arm suddenly looked like a contrarian masterstroke, turning SoftBank from tech laggard to AI hero. So did its big bets on OpenAI and Nvidia.
Yet SoftBank’s latest earnings were loaded with warning signs. On Thursday, the world’s most important venture fund reported an 18% drop in fiscal first-quarter profit, to $2.2 billion for April-June, down from $2.6 billion a year earlier.
Investors spun it as a win anyway: quarterly sales rose nearly 11%, to 2 trillion yen ($12.7 billion). CFO Yoshimitsu Goto told reporters Arm, its chip-design unit, is thriving, and boosters pointed to a lucrative Intel stake.
That’s the problem, though. Vision Fund’s success – and SoftBank Group’s by extension – has always hinged on the zigs and zags of giant bets: Intel, TikTok parent ByteDance, Japanese payments app PayPay, Taiwan Semiconductor Manufacturing Co. It’s a portfolio, not a strategy, and portfolios can turn.
SoftBank has poured an additional $20 billion into OpenAI and plans more such bets this fiscal year. As Macquarie analyst Paul Golding puts it, Softbank Group “continues to scale in the key enablement vectors of the AI revolution, investing in leading automation companies, software platforms, data centers and semis firms, delivering quality exposure to the theme and benefiting from secular tailwinds for its equity holdings and the resilience of its balance sheet.”
Still, as much as any systemically important company on earth, the conglomerate Son founded in 1981 is a bellwether for whether the world can actually monetize AI – or whether it goes the way of the dot-coms a quarter-century ago.
SoftBank has much left to prove. The $14 billion WeWork write-down raised questions about Son’s judgment. His $60 billion-plus commitment to Sam Altman’s OpenAI revived them. The balance sheet doesn’t help the case: Debt hit $113 billion as of March 31, up from $77 billion a year earlier. In April, SoftBank paid a record 8.5% coupon on a 10-year dollar tranche as part of a $3.6 billion raise – a rate more typical of junk-rated borrowers than a company leading a nation’s stock market.
For Son, the year 2000 looms large here. That’s when he handed an obscure English teacher in Hangzhou $20 million. When Jack Ma took Alibaba public in New York 14 years later, that stake was worth $60 billion, and the “Warren Buffett of Japan” narrative was born. The nine-year-old Vision Fund was an attempt to recapture that magic. With his AI bets, Son is betting he’s done it again – which is why he’s betting investors will look past the debt.
In June, Son told CNBC that AI is “probably 50x bigger than dot-com.” Behind that optimism sits his long-held belief that the “singularity” – the moment AI outsmarts humanity – is near. For years, he’s called himself the “crazy guy who bet on the future.” In 2026, that future seems to have finally arrived.
Only time will tell if he’s right – or if history remembers him as a cautionary tale, the man who turned SoftBank into an AI meme stock. What Son really needs is a page from Buffett’s playbook for stabilizing Berkshire Hathaway’s balance sheet – including some unexpected bets on Japan, of all places.
For Son, Vision Fund was always a way to escape Japan’s rigid, aging, slow-growth economy. It’s no coincidence that the year he effectively discovered Alibaba’s Ma coincided with the Bank of Japan‘s slashing of rates to zero and pioneering quantitative easing. His venture ambitions were an attempt to find growth abroad that no longer existed at home.
Japan’s deflation, dismal demographics and play-it-safe corporate culture pushed Son to deploy billions across China, India, South Korea, Indonesia, Bangladesh, Brazil, Kenya, Israel and beyond – riding a herd of tech “unicorns” toward riches SoftBank could no longer find domestically.
Buffett has been going the other way since 2020. That year, the Oracle of Omaha shocked even Tokyo’s biggest bulls with a $7 billion bet on five centuries-old Japanese trading houses. While financial media gushed over Jack Ma’s Ant Group and the FAANGs, Buffett was getting deliberately old-school, old-economy.
Few are second-guessing that move now. Buffett’s retro-Japan bets are paying off handsomely: shares of “sogo shosha” trading conglomerates have rallied as energy, metals and crop prices surged amid geopolitical tension and supply-chain chaos. Management at Buffett-backed Itochu, Marubeni, Mitsubishi, Mitsui and Sumitomo have boosted forecasts – or look set to shortly.
Turns out Buffett’s “Moneyball” experiment was a hit. He was, in effect, doing for stock-picking what Oakland A’s manager Billy Beane did for baseball in 2002 – using unconventional, data-driven analysis to build a winner on a budget, as Michael Lewis chronicled in his 2003 book and as the 2011 Brad Pitt film dramatized. As Tokyo investment veterans noted at the time, Buffett was running the same play: rebuilding Berkshire’s steady, unglamorous returns through predictable, low-risk Japan. Mission accomplished.
But Berkshire’s success rests heavily on the steady income from General Re. Boring as it is, that reinsurance shock absorber is what lets Buffett take his big swings elsewhere. Son knows it. In recent years he flirted with buying a $10 billion stake in reinsurance giant Swiss Re – a distinctly Buffettesque move. The deal fizzled, but a stabilizer like that is exactly what would lend credibility to Son’s singularity dreams.
If Japanese Prime Minister Sanae Takaichi were wise, she’d find a way to bridge Buffett’s success harnessing Japan Inc. with Son’s quest to discover the next tech unicorns.
One of the few economic-reform wins her Liberal Democratic Party can claim over the past 12 years is nudging CEOs toward internationalized management and higher returns on equity. It’s a work in progress, but Japan Inc. is slowly adding more outside directors. As Takaichi’s LDP looks to reboot structural reform, a smart place to start would be impressing the Buffetts and Sons of the world – and catching the eye of the millennials now calling the shots on Wall Street.
The best way to do that is to accelerate a startup boom that generates economic energy and wealth from the ground up: regulatory and tax tweaks that make a nation of 123 million more entrepreneurial, competitive, and productive. The immediate to-do list is straightforward – cut the red tape that makes starting a business a slog, and build a tax code that rewards innovation and risk-taking.
Japan badly needs to catch up with China, South Korea, Indonesia and other economies that are simply better at producing tech unicorns. Look no farther than Son’s own venture empire, scattering billions across the globe while doling out only scraps at home. SoftBank’s spending pattern is itself an indictment of Japan’s startup climate.
Buffett is reminding the world that Japan Inc.’s biggest names are more than exhibits in a corporate wax museum – they can be genuine profit centers for those willing to look closely and wait patiently. At the other end of the spectrum, Son is betting on “new economy” disruption on a scale arguably never seen before.
Son may be right about the future. But in 2026, SoftBank is reminding the world it still has plenty to prove before it can validate investors’ lofty hopes for its role in an AI future being written on the fly.
