SoftBank Shares Drop By 11% As Credit Risk Hits 4-Year High Amid AI Concerns

SoftBank Group shares plunged nearly 11% on Friday as the cost of insuring its debt against default climbed to its highest level in four years, reflecting growing investor concerns over the profitability of artificial intelligence (AI) investments and a potential slowdown in data center development.Credit risk risesSoftBank's five-year credit default swap (CDS) spread widened to as much as 466 basis points on Friday, its highest level since October 2022, before easing to 457.5 basis points, Reuters reported, citing Markit data. The latter level implied a 30.6% probability of default, according to the report.The Japanese investment group's shares closed 10.83% lower at $22.46 (¥3,549) on the Tokyo Stock Exchange on Friday, extending losses amid a broader selloff in technology stocks.The decline followed sharp losses in US technology stocks on Thursday, with the Nasdaq NDTX index falling 7.8% to 14,450.3 and the Nasdaq Composite dropping 5.5% to 24,315, as investors reassessed the pace of AI infrastructure spending following the US midterm elections."There's been a steady decline in the credit standing of AI infrastructure firms and this week equity markets are finally pricing in a slowdown in data centre development, but I think we've hit the bottom near term," Amir Anvarzadeh, Japan equity market strategist at Asymmetric Advisors, told Reuters.SoftBank's AI investmentsSoftBank's growing exposure to AI has raised concerns about its ability to generate returns from substantial investments in the sector, particularly as questions emerge over the pace of infrastructure development and the profitability of AI companies.SoftBank has invested a total of $64.6 billion in OpenAI and holds a 13% stake in the company. Both companies have each invested $500 million in SB Energy, a SoftBank subsidiary.SB Energy filed for a public listing in September at a potential valuation of $50 billion, although the offering has reportedly been delayed until December or later. OpenAI's reported decision to postpone its own potential listing until 2027 has added to investor uncertainty over when SoftBank could realize returns on its investment.In September, SoftBank issued $11.1 billion in US dollar- and euro-denominated bonds to finance a $10 billion payment for the third and final tranche of its $30 billion follow-on investment in OpenAI. The investment agreement was reached in February 2026 and completed in October.Net worth dipsSoftBank founder and CEO Masayoshi Son's net worth fell by approximately $8 billion in a single day to $44.8 billion as of November 6, 2026, according to Forbes, as the selloff in SoftBank shares weighed on his fortune.