SoftBank Reports $7 Billion Quarterly Loss After U.S. Data-Center Hit

SoftBank Group reported a quarterly net loss of about $7 billion Tuesday, as a costly change in plans for U.S. artificial-intelligence data centers and weaker investment performance weighed on the Japanese technology investor's earnings.

The company posted a net loss of 1.12 trillion yen for the July-September quarter, compared with a profit of about 2.5 trillion yen a year earlier. Quarterly revenue was 2.22 trillion yen.

A major setback came from advance purchases of power-generation equipment for AI data-center projects in the United States. SoftBank recorded a loss of 597.2 billion yen, or about $3.7 billion, in the six months through September after changing its procurement plans.

The company had committed money early to secure equipment amid fears of shortages and lengthy delivery times. Some purchases were later canceled or changed as the projects' requirements developed, leaving nonrefundable payments and fees. SoftBank said it could receive rebates of up to $2.1 billion on future purchases.

The episode shows how access to electricity and power equipment has become a central challenge for the companies building large AI facilities. SoftBank's projects include a major development in Pike County, Ohio, where the group has been assembling infrastructure for a much larger AI computing buildout.

Financing costs also increased as the group borrowed heavily to support its investment plans. Reuters reported that financing costs more than doubled during the quarter, while the value of some publicly traded portfolio holdings declined.

SoftBank's AI ambitions remain substantial. CNBC reported that its cumulative investment in OpenAI stood at $54.6 billion at the end of September, with a reported fair value of $99.6 billion. The company said a potential new OpenAI valuation had not yet been reflected in the results.

The loss comes during a period of sharp swings in technology shares and rising scrutiny of the costs of AI expansion. SoftBank shares rose about 14% in Tokyo before the earnings release, despite the large quarterly loss announced afterward.