SoftBank Vision Fund to cut 20% of workforce, focusing on aggressive AI investments, according to insider information and internal documents.
SoftBank Announces Global Layoffs and Embraces AI-focused Strategy
In a significant move, SoftBank Group has announced plans to lay off nearly 20% of its Vision Fund team globally. This decision comes after the fund reported its strongest quarterly performance since June 2021, driven by gains in public holdings such as Nvidia and South Korean e-commerce firm Coupang.
The Vision Fund, which currently employs 44 people, has been a key player in SoftBank's investment portfolio. The latest reductions mark the third round of layoffs at the Vision Fund since 2022.
SoftBank's CEO, Masayoshi Son, is aggressively pursuing new investments in foundation models and the infrastructure layer for AI. This shift in strategy is evident in the company's recent acquisitions and investments. SoftBank has acquired chip firms Graphcore and Ampere Computing, and taken stakes in Intel and Nvidia.
One of the key initiatives in this new strategy is the proposed $500 billion Stargate project. This project aims to build a vast network of U.S. data centers in partnership with OpenAI. SoftBank has already invested $9.7 billion in OpenAI through Vision Fund 2, and the Stargate project is a significant part of this investment.
The Stargate project, which SoftBank has initiated in partnership with OpenAI and Oracle, is focused on AI infrastructure. The joint venture started with an initial investment of 100 billion dollars, with plans to expand in the United States over the next four years, beginning with a data center project in Texas.
The restructuring marks a return to Son's classic high-risk, high-reward approach. The remaining staff will dedicate more resources to Masayoshi Son's ambitious AI initiatives. SoftBank currently holds a "very safe level" of cash of 4 trillion yen ($27 billion), providing the necessary capital for these ambitious projects.
However, the capital-intensive strategy carries execution risk, as evidenced by recent delays in both the U.S. Stargate project and a similar joint venture with OpenAI in Japan. The aim is to build an ecosystem spanning chips, data centers, and models to support future AI adoptions.
SoftBank CFO Yoshimitsu Goto mentioned the company's cash holdings during the most recent earnings call in August, but no new information about layoffs or staff dedication to AI initiatives was provided in this paragraph. The Vision Fund spokesperson confirmed the layoffs without commenting on the details.
The aim of these changes is to position SoftBank as a leader in the rapidly growing AI sector, and to support the widespread adoption of AI technology in the future.
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