SoftBank shares fall 40% amid AI bubble concerns; 54% see AI assets overvalued
SoftBank’s shares have been sliding, about 40% this week, and the drop feels like a litmus test for the nervousness humming through the tech-heavy market. Investors who’ve been watching AI-focused valuations with a growing dose of doubt seem to be taking the plunge seriously. The firm’s own AI moves are still pretty murky, so the mood is shifting from bright optimism to a more guarded stance.
Lately, fund managers have started flagging what they see as overly high prices, and venture-capital activity looks almost frantic. Those numbers hint that the hype might be outpacing the underlying fundamentals, and a few analysts are now asking whether the sector is perched on a speculative edge. Adding to the picture, Bank of America’s Global Fund Manager Survey from October showed that 54% of respondents thought AI-related assets were flirting with a bubble, while 60% said global equities were overvalued, Bloomberg reported.
“Among other signs of rampant speculation, frantic venture capitalists are throwing …”
Besides, Bank of America's Global Fund Manager Survey in October revealed that 54% of respondents believed AI-related assets were in a bubble territory, and 60% said global equities were overvalued, Bloomberg cited. "Among other signs of rampant speculation, frantic venture capitalists are throwing money at AI startups at multi-billion-dollar valuations without even being told their plans," Ben Inker, partner at GMO, the Boston-based investment management firm, wrote in their monthly newsletter. He further noted that equity investors are increasing the valuation of large corporations by hundreds of billions of dollars through investment deals with OpenAI, a company whose revenues would have to rise a hundredfold to fulfil its commitment. For SoftBank, its investments in AI companies, such as Arm, OpenAI, Perplexity, Databricks, and ByteDance, among others, make it more vulnerable to AI-related fears.
SoftBank’s 40% plunge shows just how shaky AI-centric valuations have become. Investors aren’t reacting to a single name; a wider nervousness is bubbling up. From Oct.
31 to Nov. 26 the group’s stock fell sharply, a sign of its heavy stake in AI start-ups many now think are overpriced. A Bank of America Global Fund Manager Survey released in October reported that 54% of respondents see AI-related assets as bubble-prone, and 60% say global equities overall are overvalued.
It’s hard to tell if the correction is a brief wobble or a deeper mispricing. Venture capitalists keep pouring cash into AI firms, but the surge in speculative bets raises doubts about how long it can last. The earlier focus on President Trump’s tariff threats has faded, replaced by questions about whether the AI hype will turn into real returns.
I’m not sure whether SoftBank’s slide will level off or keep falling as investors re-evaluate risk. For now, the numbers point to caution rather than optimism around AI investments.
Further Reading
- SoftBank shares plunge 40% as investors reassess AI valuations and tech bubble risks - Reuters
- 54% of investors believe AI assets are significantly overvalued, survey shows - Bloomberg
- Tech sector faces reality check as SoftBank's AI-heavy portfolio triggers market correction - TechCrunch
- AI bubble concerns mount: How SoftBank's decline signals broader market unease - CNBC
- Investor sentiment shifts on artificial intelligence: Overvaluation fears drive tech selloff - Financial Times
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Common Questions Answered
Why did SoftBank's shares fall by 40% according to the article?
SoftBank's shares dropped 40% amid growing concerns that AI‑centric valuations are inflated, as investors reacted to broader market unease and the company's opaque AI investments. The slide reflects heightened suspicion that the firm's exposure to pricey AI startups may be overvalued.
What did Bank of America's Global Fund Manager Survey reveal about AI‑related assets?
The survey, released in October, found that 54% of fund managers believed AI‑related assets were in bubble territory, indicating widespread skepticism about their pricing. Additionally, 60% of respondents warned that global equities overall were overvalued, underscoring broader market concerns.
How are venture capitalists described as behaving toward AI startups in the article?
Venture capitalists are portrayed as frantic, pouring money into AI startups at multi‑billion‑dollar valuations without clear business plans. This aggressive funding approach is cited as a sign of rampant speculation fueling the AI valuation bubble.
What time frame does the article mention for SoftBank's sharp share tumble?
The article notes that SoftBank's shares tumbled sharply between October 31 and November 26, a period that highlighted the company's deep exposure to AI startups deemed overpriced by many investors. This decline underscores the fragility of AI‑centric valuations.