SoftBank's $7.1 billion loss caps AI gas turbine bet

SoftBank's aggressive procurement strategy, ordering more than 13 gigawatts of gas turbines — almost 50% more than needed — was an attempt to corner a portion of the power market as AI data centers raced to secure electricity. The bet was that by deploying its significant war chest, SoftBank could become a key supplier to an AI world hungry for power. But the $7.1 billion quarterly loss, with over half tied to power-equipment write-downs, shows that the market did not develop as expected. Turbine order queues now stretch into the early 2030s, and the swiftness of AI's power demand caught the energy world off guard. As data center operators gain more experience, they may increasingly favor grid connections and large batteries over natural gas, which carries risks like winter curtailments. The magnitude of SoftBank's loss — over $3 billion — reflects the electricity mania, but it is unlikely to trigger mass cancellations of gas plants, as AI's power demand remains too large. Still, SoftBank may have found the ceiling for natural gas in the AI boom.