SoftBank Group overtook Toyota $TM Motor as Japan's most valuable company on Monday, marking a turning point in how investors are pricing Japan's biggest corporate names amid a global AI rally.
Monday's 14% surge in Tokyo pushed SoftBank's total market value to more than ¥48 trillion, leaving Toyota's roughly ¥46 trillion valuation behind. The last time SoftBank held this position was during the peak of Japan's internet bubble in 2000, according to Bloomberg.
SoftBank's share price has nearly doubled so far this year, with gains exceeding 90% fueled largely by its growing footprint in the AI sector. Through a total commitment approaching $65 billion, SoftBank is on track to hold roughly a 13% ownership stake in OpenAI — the company behind ChatGPT — by October. The run-up in SoftBank shares traces back to last month, when it emerged that portfolio holdings OpenAI and SB Energy Corp. were each eyeing potential listings on U.S. markets.
A weekend announcement that SoftBank intends to pour up to $87 billion into AI data center construction across France added fresh momentum, stoking confidence that appetite for AI infrastructure will keep growing. The company's chip-design unit, Arm Holdings, has also seen gains following Nvidia $NVDA's earnings results.
Toyota's stock has shed more than 10% since January, dragged down by a deteriorating macroeconomic backdrop. The U.S.-Israeli war against Iran has pushed crude prices upward, squeezing household budgets and cooling demand for new vehicles, while automakers everywhere remain under pressure from the expensive, long-running shift to electric powertrains.
"SoftBank has concentrated its management resources on AI-related businesses and has successfully ridden the broader global tech rally," Tomo Kinoshita, a global market strategist at Invesco Asset Management Japan, told Bloomberg. "Toyota, meanwhile, has been hit by rising oil prices stemming from the Iran war, which raises the cost of operating vehicles and weighs on global auto demand."