SoftBank Establishes New Company to Enter U.S. AI Cloud Services
N.R. Finch
SoftBank is forming joint venture SB Neo this month to lease AI chips and cloud computing power to U.S. enterprises starting next fiscal year; management says the telecom unit's annual profit could grow three to four times — a bet that turns a telco's power-grid access into AI infrastructure.
What exactly is SB Neo?
SoftBank Corp. (SoftBank Group's Japanese telecom unit) holds 51%; SoftBank Group holds 49%. The venture launches this month.
The business model: lease AI chips and cloud computing resources to large U.S. enterprises, including hyperscale cloud providers.
In plain terms = SoftBank isn't building its own AI models. It's selling "compute utilities" — anyone training a large model needs chips and data-center capacity, and SB Neo supplies exactly that.
How big could the profit upside be?
People familiar with the plan say that if the U.S. cloud business ramps successfully, SoftBank Corp.'s annual operating profit could expand three to four times, reaching ¥3–4 trillion (roughly $18.5–25 billion).
CEO Junichi Miyakawa calls this "the company's second founding" and says the new business could generate profit "of a different order of magnitude."
This means → SoftBank Corp. currently earns from Japan's mature telecom market, where the ceiling is low. A successful U.S. AI cloud arm would multiply its profit base several times over — effectively rebuilding the company.
What does the 10-gigawatt target mean?
SB Neo aims to scale data-center capacity to 10 gigawatts by around 2030 — a gigawatt equals one billion watts, roughly the output of a large nuclear plant.
A single data-center project planned in Ohio is sized at 10 GW, placing it among the world's largest.
This means → the scarcest resource for training large AI models is not chips — it's power. Whoever can supply stable electricity has a structural moat. SoftBank's edge: its own gas-fired power plants.
The field is already crowded — what's SoftBank's edge?
Competitors include AI-focused cloud upstarts CoreWeave and Nebius Group, plus the three hyperscale incumbents — Amazon AWS, Microsoft Azure, and Google Cloud. Bloomberg reports Meta is also drawing up a similar plan.
SoftBank's differentiator is power access — gas-fired generation gives it an advantage over pure internet companies in securing electricity.
This reflects a shift: competition in AI cloud is moving from "who has chips" to "who has power." The physical layer of infrastructure is becoming the new bottleneck.
Will OpenAI be the first major customer?
SoftBank Group has committed cumulative investment in OpenAI reaching roughly $65 billion by around October this year. OpenAI is expected to become an early anchor client for SB Neo.
In plain terms = SoftBank invests in OpenAI on one side and sells it compute on the other — acting as both shareholder and supplier, using the investment relationship to lock in a first wave of orders.
The key variable remains unresolved: whether SB Neo can turn its power advantage into a genuine differentiated moat in a crowded field will determine if this play delivers strategic-scale returns or amounts to an expensive entry ticket.
Content is for reference only, not financial advice.