SoftBank Plans Record Retail Bond Issuance Amid AI Push — Update

By Megumi Fujikawa

TOKYO--SoftBank Group plans to issue a record volume of retail bonds to partly fund its expanding artificial intelligence investments, as the company deepens its multi-billion-dollar commitments to OpenAI and related infrastructure projects.

The Japanese technology conglomerate said Monday that it plans to issue 1 trillion yen, equivalent to $6.3 billion, of yen-denominated retail bonds. The seven-year bonds will be priced on Sept. 4, with an indicative coupon of 4.3% to 4.9%.

Proceeds from the issuance will be used for AI-related investments and to repay previously issued bonds, a company spokeswoman said.

SoftBank's latest issuance will be the biggest retail bond offering ever by a Japanese company and ties with NTT Finance's 1-trillion-yen issuance of debt to institutional investors, according to I-N Information Systems.

The fundraising comes as SoftBank seeks to finance an increasingly ambitious AI strategy. The group has emerged as one of OpenAI's largest backers, with cumulative investments and commitments expected to exceed $60 billion.

SoftBank regularly taps the domestic retail market with "Fukuoka SoftBank Hawks Bonds." Named after a baseball team owned by the company, the notes offer higher yields than traditional bank deposits.

Retail bonds have been a vital source of financing for SoftBank, which has been the most prolific issuer among Japanese corporates in recent years in volume terms, I-N Information Systems data shows.

Although the upcoming issue is long-dated, a coupon above 4% should appeal to investors seeking higher yields than low-paying bank deposits, said Masahiro Ichikawa, chief market strategist at Sumitomo Mitsui DS Asset Management. Retail investors are generally more flexible than institutional buyers regarding issuer credit risk, which could also support demand for the bonds, Ichikawa said.

"With the market pricing the Bank of Japan's terminal rate at just under 2%, this level seems reasonably appealing" for mom-and-pop investors, he added.

The latest offering is expected to provide more firepower for SoftBank's long-term AI investment agenda, including its growing exposure to OpenAI, analysts said. But some of them warned that rising interest rates could add to concerns about the group's financial position.

While Japanese credit rating agencies give SoftBank solid marks, major foreign agencies maintain speculative-grade ratings on the company due to its high leverage and exposure to volatile tech assets.

To help fund the AI push, SoftBank has also monetized portfolio holdings, including the sale of its entire stake in Nvidia, and expanded financing secured by its shares of Arm, the chip designer majority-owned by the Japanese investment company.

Shares in SoftBank Group fell 5.3% Monday to their lowest since late July, tracking weakness in other AI-related stocks.

Write to Megumi Fujikawa at megumi.fujikawa@wsj.com

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August 24, 2026 03:40 ET (07:40 GMT)