SoftBank CEO Masayoshi Son has made a bold prediction that positions Nvidia’s current valuation as significantly undervalued in the face of an impending artificial intelligence revolution. Speaking at a recent event, Son forecasted that global AI infrastructure spending could reach an astronomical $9 trillion over the coming years, dwarfing current investment levels and suggesting massive growth potential for AI chip manufacturers like Nvidia.
Son’s bullish outlook on AI spending comes as Nvidia has already experienced extraordinary growth, with its stock price surging over 200% in 2023 and maintaining strong momentum into 2024. The company has become the dominant player in AI chip manufacturing, with its GPUs powering everything from ChatGPT to autonomous vehicle systems. However, according to Son’s analysis, even these impressive gains may represent just the beginning of the AI infrastructure buildout.
The $9 trillion figure represents Son’s estimate for the total capital expenditure required to build out the computing infrastructure necessary to support the next generation of AI applications. This includes data centers, specialized AI chips, networking equipment, and energy infrastructure. For context, this amount would exceed the current market capitalization of the entire global semiconductor industry several times over.
SoftBank itself has been a major investor in AI-related companies through its Vision Fund, though the firm has experienced mixed results with some high-profile investments. Son’s comments suggest he believes the AI revolution is still in its early stages, with the most significant investments and returns yet to come. His track record includes early bets on companies like Alibaba, though also notable losses on investments like WeWork.
Nvidia’s position as the leading supplier of AI accelerators has made it the primary beneficiary of the current AI boom. The company’s H100 and upcoming B100 chips have become essential components for companies building large language models and other AI systems. Demand has been so strong that Nvidia has struggled to keep up with orders, with some customers facing wait times of several months.
The prediction also comes amid growing competition in the AI chip space, with companies like AMD, Intel, and various startups working to challenge Nvidia’s dominance. However, Son’s forecast suggests the market will be large enough to support multiple winners.
Key Quotes
The AI revolution will require $9 trillion in infrastructure investment
Masayoshi Son, CEO of SoftBank, made this prediction to emphasize the massive scale of capital deployment needed to support next-generation AI applications, suggesting current market valuations significantly underestimate the opportunity.
Nvidia’s current valuation doesn’t reflect the true scale of what’s coming
Son’s assessment of Nvidia’s stock price indicates he believes the company remains undervalued despite its massive gains, as the AI infrastructure buildout is still in early stages with the majority of spending yet to occur.
Our Take
Son’s $9 trillion prediction should be viewed through the lens of his track record as both a visionary investor and someone prone to hyperbolic forecasts. While the figure may seem astronomical, the underlying thesis has merit. The current AI boom is infrastructure-intensive, requiring massive computing resources that dwarf previous technology cycles. However, investors should consider that such predictions can be self-serving—SoftBank holds significant positions in AI-related companies. The forecast also assumes continued AI advancement without major technical plateaus or regulatory obstacles. What’s most notable is the growing consensus among tech leaders that AI represents a fundamental shift requiring unprecedented capital deployment. Whether it’s $9 trillion or a smaller figure, the direction is clear: AI infrastructure spending will be massive, benefiting companies like Nvidia while potentially creating opportunities for competitors to capture market share in what could be an expanding pie.
Why This Matters
This prediction from one of technology’s most prominent investors signals extraordinary confidence in AI’s transformative potential and has significant implications for the entire technology sector. A $9 trillion infrastructure buildout would represent one of the largest capital deployment cycles in history, comparable to the buildout of the internet itself or the global telecommunications infrastructure.
For investors and businesses, Son’s forecast suggests that current AI investments may be just the tip of the iceberg. Companies across industries will need to make substantial technology investments to remain competitive in an AI-driven economy. This has implications for everything from data center real estate to energy infrastructure to semiconductor manufacturing capacity.
The prediction also highlights the strategic importance of AI chip manufacturing and raises questions about supply chain resilience, geopolitical competition, and technological sovereignty. If Son’s forecast proves accurate, control over AI chip production could become as strategically important as oil production was in the 20th century. This underscores the significance of current policy debates around semiconductor manufacturing, export controls, and technology competition between the United States and China.
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