Liquidating NVIDIA shakes the market, this is Masayoshi Son's second time doing so

On Tuesday, the financial report showed that SoftBank founder Masayoshi Son made another eye-catching all-in bet. This billionaire, known for his extreme investment style, completely sold off SoftBank's entire $5.8 billion stake in NVIDIA and redirected the funds into the AI sector, including plans to invest $30 billion in OpenAI and participate in a $1 trillion AI manufacturing center project in Arizona.

SoftBank sold all 32.1 million shares of NVIDIA, exiting at a price of approximately $181.58 per share, just 14% lower than NVIDIA's historical high of $212.19. Although analysts emphasized that this move should not be seen as a negative stance towards NVIDIA but rather as a reflection of SoftBank's need to raise funds for its AI strategy, NVIDIA's stock price still fell nearly 3% after the news broke.

It is worth mentioning that this is the second time SoftBank has completely exited NVIDIA, with the last exit coming at a significant cost. In 2019, SoftBank sold NVIDIA shares worth $4 billion for $3.6 billion, and those shares are now worth over $150 billion. Although the timing was better this time, the decision to fully liquidate has raised questions in the market: Did Masayoshi Son see risks that others did not?

At 68 years old, Masayoshi Son's career has been filled with extreme bets. From the evaporation of $70 billion of personal wealth during the dot-com bubble to the legendary success of his investment in Alibaba, and the painful failure of WeWork, his investment style has always been all or nothing. Now, the market can only look for clues from his past, and this uncertainty is all that investors face.

Continuation of Extreme Investment Style

For Masayoshi Son, moderate compromise has never been an option. During the late 1990s dot-com bubble, his net worth soared to about $78 billion in February 2000, making him the richest person in the world at one point. However, the subsequent burst of the dot-com bubble resulted in a personal loss of $70 billion—at the time, the largest financial loss in history—while SoftBank's market value plummeted 98% from $180 billion to just $2.5 billion.

In that disaster, Masayoshi Son made his most legendary bet: a $20 million investment in Alibaba in 2000. It is said that this decision was made after just a six-minute meeting with Jack Ma. This investment grew to a value of $150 billion by 2020, transforming him into one of the most respected figures in the venture capital industry and providing the funds for his comeback.

Alibaba's success often overshadows the moments when Masayoshi Son stayed too long at the betting table. In 2017, when he needed funds to launch his first Vision Fund, he did not hesitate to seek $45 billion from the Saudi Public Investment Fund—well before it became common for Silicon Valley to accept Saudi funding.

After the murder of journalist Jamal Khashoggi in October 2018, Masayoshi Son condemned the killing as "shocking and deeply regrettable," but insisted that SoftBank could not "turn a blind eye to the Saudi people," maintaining its commitment to managing the country's capital. In fact, the Vision Fund soon accelerated its deal-making pace thereafter.

The Painful Lesson of WeWork

The results of that round of high-stakes gambling were not ideal. The substantial investment in Uber resulted in years of paper losses, followed by WeWork.

Masayoshi Son ignored objections from subordinates and set an astonishing valuation of $47 billion for the co-working company after multiple rounds of investment in early 2019. However, WeWork's IPO plans collapsed after it released a famously troubled S-1 filing.

Even after ousting Neumann and implementing a series of austerity measures, the company failed to truly recover—ultimately leading to SoftBank incurring a $11.5 billion equity loss and an additional $2.2 billion in debt. Reports indicate that Masayoshi Son later referred to it as "a stain on my life."

Market Insights from the Second Liquidation

Tuesday will undoubtedly mark an important moment in Masayoshi Son's comeback story. SoftBank disclosed that it has sold all of its NVIDIA shares—not to diversify its investments, but to double down elsewhere. Although the exit price was close to its peak, this marks SoftBank's second complete exit from NVIDIA, with the first being extremely costly.

This move also shook the market. Although analysts emphasized that this sale should not be seen as a cautious or negative stance towards NVIDIA, Wall Street couldn't help but wonder: Did Masayoshi Son see something that others did not? Based on his investment record, perhaps he did—and this ambiguity is all that investors can rely on at the moment.

Masayoshi Son has been seeking another comeback for years. His career has shown that when this 68-year-old investor does not push his chips to the center of the table, it is even more surprising