SoftBank, a major tech investor, sold its entire stake in Nvidia for $5.8 billion, sparking concerns of an AI bubble. The divestment will fund other AI investments, including an “all-in” bet on ChatGPT’s OpenAI. SoftBank aims to invest up to $40 billion in OpenAI, aligning with its $1 trillion Arizona manufacturing hub plan.

Despite SoftBank’s exit, Nvidia has consistently beaten analyst expectations and received a price target hike from Citi. The two companies are deeply entrenched in the AI ecosystem, with SoftBank part of a $500 billion AI infrastructure venture alongside Nvidia. The sale helps finance AI investments and positions in companies like ByteDance and Perplexity AI.

Analysts at Wells Fargo have downgraded the S&P 500 Information Technology sector, citing high valuations. Famed investor Michael Burry accuses Big Tech of artificially boosting earnings by understating semiconductor depreciation expenses. Burry estimates a $176 billion understatement from 2026-2028, adding to skepticism about the AI boom and tech sector.

Read more at Yahoo Finance: SoftBank Dumps $5.8B Nvidia Stake to Subsidize Other AI Bets