Why SoftBank stock could skyrocket amid Nvidia AI deal

Core Insights - SoftBank Group Corp. has experienced a volatile year, with a year-to-date stock increase of 43.22%, but faced significant declines due to concerns over high AI spending [1] - A new partnership with Nvidia could enhance SoftBank's position in AI and telecommunications, potentially leading to a surge in stock price [2][3] Financial Performance - SoftBank reported its largest quarterly profit in two years for Q2 2024, with net profits of $7.7 billion, surpassing analyst expectations of $1.87 billion and a loss of $6 billion in the same period last year [6] Strategic Developments - The partnership with Nvidia includes plans to build Japan's most powerful AI supercomputer and establish the country's first AI radio access network (AI-RAN), which will enable simultaneous AI and 5G workloads [3][4] - The AI-RAN initiative could transform SoftBank's 200,000 base stations into 'mini data centers', targeting sectors like scientific research, education, and startups [4] Market Reaction - Following the announcement of the Nvidia partnership, SoftBank's stock initially surged by 5.6% to $32.20 before stabilizing at $30.95 [8] - The potential for recurring revenue from AI-RAN servers is significant, with estimates of up to 219% return for each server added [7]