SoftBank (SFTBY) Stock Slides 6.6% Amid Chip Sector Selloff

TLDRs:

• SoftBank shares fall 6.6% as Asian chip sector reacts to Nvidia’s modest US drop.
• SK Hynix, Samsung, and TSMC also see sharp declines following Nvidia market reaction.
• AI server demand and GPU orders remain strong despite short-term selloff pressures.
• ABF substrate capacity and advanced packaging could shape 2025 semiconductor growth.

SoftBank Group Corp. (SFTBY) shares slid 6.6% on Friday amid a broader selloff in Asian semiconductor stocks.

The decline comes after Nvidia, the US-based chipmaker, reported strong third-quarter earnings and a bullish outlook but still saw its shares drop 3% in overnight trading. The selloff rippled across the region, affecting both large and smaller chip manufacturers.

SoftBank, which owns the British semiconductor designer Arm, was among the hardest hit, falling $4.05 to close at $56.93.

Other major Asian chip players also experienced steep losses. SK Hynix dropped nearly 10%, Samsung Electronics lost over 5%, Taiwan Semiconductor Manufacturing Company (TSMC) fell more than 4%, and Foxconn declined by 4%. Renesas Electronics, Tokyo Electron, and Lasertec also recorded notable declines.

SoftBank Group Corp., SFTBY

Nvidia’s Numbers Don’t Calm Markets

Despite the drop in share prices, Nvidia’s quarterly results highlighted record growth in AI-related demand. The company reported Q3 data center revenue of $51.2 billion, surpassing expectations.

CEO Jensen Huang noted that “cloud GPUs are sold out” and highlighted AI chip orders totaling $500 billion for 2025–2026. The company shipped 13,000 GPU samples in the quarter, including its new Blackwell DGX integrated AI server to OpenAI, while Oracle announced AI clusters scaling to over 131,000 Blackwell GPUs.

Industry benchmarks also favor Nvidia’s new hardware. The Blackwell GPU achieved a 2.2x performance improvement over the previous Hopper generation in MLPerf machine learning tests. However, the market remains cautious, partly due to tight supply chains for ABF substrates and advanced packaging components required for AI hardware assembly.

Supply Constraints and 2025 Outlook

The selloff in SoftBank and other Asian chip stocks may partly reflect concerns over supply and packaging bottlenecks.

ABF substrate capacity, the specialized layers used to route power and signals beneath chips, is projected to reach $11.11 billion in 2025, growing at a 9.4% CAGR. New entrants in China, such as Anhui Splendid Technology, Aoxin Semiconductor Technology, and Keruisi Semiconductor Technology, are challenging established leaders that currently hold 70% of the market.

Advanced packaging and substrate supply timing could significantly influence the AI server surge expected in 2025. Analysts note that while the short-term market reaction is negative, long-term demand for AI infrastructure, including pretraining, post-training, and inference workloads, continues to grow. SoftBank and other suppliers with expansions already locked in could benefit from these trends.

Investor Takeaways

While SoftBank’s 6.6% drop may appear concerning, the broader context suggests this is a market overreaction rather than a signal of declining demand.

Nvidia’s AI-related guidance remains strong, and infrastructure investment for AI is expected to increase significantly over the next few years. For investors, current valuations in some Asian chip firms could offer a strategic entry point ahead of sustained 2025 growth.

As AI continues to drive demand for high-performance chips, SoftBank’s Arm holdings and regional semiconductor suppliers remain central players in a market poised for expansion, despite short-term volatility.

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