Full Breakdown
SoftBank Launches Record Junk-Bond Sale to Finance AI Push
By Drooid · · How we work
Record-size High-Yield Offering
SoftBank Group issued $11.1 billion of dollar- and euro-denominated senior notes, the largest high-yield bond sale ever by an Asia-Pacific issuer. The filing showed three dollar tranches—$1 billion for 3.5 years at 8.625 % yield, $4.5 billion for 5.5 years at 9.25 %, and $4.5 billion for 7.5 years at 9.75 %—plus two €500 million euro tranches for four- and six-year terms yielding 7.125 % and 8 % respectively. Demand was strong enough to trim the initial pricing ranges, though the yields remain the highest ever for SoftBank’s dollar bonds.
Funding the AI Bet
The proceeds are earmarked for SoftBank’s “mammoth” investment in artificial-intelligence ventures, chiefly its $64.6 billion commitment to OpenAI and additional infrastructure projects. Goldman Sachs Group credit strategists note that AI-related debt issuance worldwide has already exceeded $575 billion in 2026, underscoring the scale of financing behind the sector.
Market Reaction and Credit Risk
Investor wariness surfaced in the credit-default-swap market: the five-year CDS spread rose above 400 basis points this week, up from roughly 280 basis points in June and 200 basis points in October 2025. Despite the higher risk premium, orders for the $10 billion dollar portion topped $30 billion, allowing SoftBank to lower yields from the opening ranges. The company’s shares gained more than 6 % in morning trading after the bond announcement, even as Tokyo’s markets were closed for national holidays.
Official Outlook from Masayoshi Son
Masayoshi Son, SoftBank’s founder and chief-executive, downplayed concerns about the AI funding strategy. He said earlier this year he expects AI-related industries to represent 20 % of global output by 2040, equivalent to $46 trillion, and reiterated confidence that the investments will drive long-term growth.
Implications for SoftBank’s Balance Sheet
SoftBank aims to keep its loan-to-value ratio below 25 % under normal conditions and below 35 % in extraordinary circumstances. At the end of June, the ratio stood at 13 %, indicating ample headroom despite the new debt. Nonetheless, analysts warn that the “ever-growing pile of debt” could create market pressure if AI projects fail to deliver expected returns.