Two separate things, in SoftBank's results of 10 November 2026. It wrote off about $3.7 billion on power equipment for AI data centres, and its net asset value (NAV) fell 37%, from $445 billion in June to $282 billion.
The write-off. SoftBank is building data centres in Ohio and Texas that OpenAI will rent. Power equipment is in short supply, so it paid $9.5 billion in advance to book it before its plans were final. The plans were then changed. $2.85 billion of those advances cannot be refunded, and changing the contracts cost another $0.88 billion. It may get up to $2.1 billion back as rebates over 10 years, but only on future equipment purchases and subject to conditions, and it has not booked that. About $6.6 billion of advances is still on its books. A second, smaller write-down of about $0.45 billion is for a plant in Lordstown, Ohio, bought to make data centre equipment. Its CFO described the approach as "by trial and error", per Reuters.
Where the $163 billion went. More than 90% of the fall is Arm, the chip designer SoftBank controls. Arm's share price went from about $151 at the end of March to a high of $439 on 18 June, and was $186 on 9 November. NAV is still above March's $251 billion, and was $380 billion in September. The $282 billion is SoftBank's estimate, with Arm, SoftBank Corp. and Intel at 9 November prices and the rest at 30 September. Arm is a subsidiary, so the fall does not show in SoftBank's profit and loss.
The borrowing. SoftBank has borrowed about $25 billion against Arm shares, per Reuters, and raised a record $56.5 billion in the September quarter, part of it to repay a bridge loan. Net debt was 15.9% of the value of its holdings at 30 September, against its own policy limit of 25%. That leaves out loans backed by shares, such as the Arm loan. Amar Harolikar works it out at about 20% on the 9 November estimate, or about 22% after the $10 billion paid to OpenAI in October. SoftBank has not published that figure. In the six months to September, operations used about $3.3 billion of cash after $4.6 billion of interest, and net new borrowing was about $50 billion.
OpenAI. The OpenAI stake is still valued as in March. SoftBank said a new funding round could raise the value next quarter.
The read. Anyone who booked equipment or power years ahead in the same rush has a similar risk if plans change. Amar Harolikar's sense is that where there is one write-off there will be more. That is his opinion and not SoftBank's.
Analysis of public sources, for information only. Not investment advice. Full post: https://www.tigzig.com/post/softbank-first-domino-write-off-nav-fall-nov2026. Related: how the hyperscalers are paying for the build and is the US stock market in a bubble?
Building something like this? How I work covers the rates, the availability and what I take on.