SoftBank Group Corp. (9984) Earnings Call Transcript & Summary

It is now the scheduled time, may I ask Mr. Son to take the chair.

Good morning. I am Masayoshi Son, Chairman and CEO of SoftBank. Thank you all very much for taking time from your busy schedules to attend to. As stipulated in Article 13 of Articles of Incorporation, I will act as Chairperson of this meeting. I hereby Chairman and CEO annual General Meeting you all very much for taking time for allowing shareholders to the [indiscernible]. I will act as Chairperson of this meeting. Our directors, Mr. The agenda today is just as stated in the notice of convocation posted on our website. I also report that meeting has a quorum. Now our moderator will explain the proceedings of this meeting.

Thank you. We will start with reporting matters, then explain the resolutions and our business strategy. Following that, we will proceed to a Q&A session on all reporting and resolution matters. After the Q&A session, we will take vote on the resolutions only. For exercising voting rights, shareholders present will be asked to vote by a polls and shareholders participating online are asked to cast their votes via the Internet. Please note that online voting is already available, but once the vote is cast, it cannot be modified. After explaining the resolutions and business online submitted in advance can be able to invite questions and comments from shareholders attending in person. After explaining the and concise and limit until the start of the Q&A from online shareholders. Then we will respond to the questions submitted online today. Online question submission is already open and will close 5 minutes after the start of the Q&A session. Online shareholders who wish to ask questions should submit them in 200 characters or less. Each person may ask 1 question. Regarding motions, online shareholders cannot submit motions, including those related to the meeting procedures or resolutions as previously notified. In case any attending shareholders submit a motion to amend the resolutions, these will be deliberated together with the original proposals and we will vote on the original proposals first. Thank you very much for your understanding. Now I'd like to call for both to confirm if this procedure is acceptable. Online participants, please press applaud the bottom, if you agree. Those attending in person, please applaud.

Thank you very much. Let us now confirm the voting results. Please wait for a moment. Thank you. As the majority is in favor, we will proceed with this procedure. The reporting matters are shown on the screen. And we have prepared a video to explain our business overview. Please watch. [Presentation]

That concludes the video presentation. Let me now present today's resolutions. Details are available in the notice of complication on our website Proposal 1, appropriation of surplus. Proposal 2, partial amendment of the Articles of Incorporation. Proposal 3, election of 9 members of the Board. We will now proceed with the business strategy presentation. Recently, AI is a buzzword. I myself using ChatGPT pretty much every day, maybe 10x or 20x a day for asking questions, checking my ideas. So I were doing so many things. In the weekends, maybe 2 hours or so, I will be communicating with AI. Even weak days, maybe 1 hour, 2 hours. Of course, I communicate and discuss with employees every day, but the agenda of the discussion may varies. Asking ChatGPT, how do you think about this? How do you think about that? And AI or chatGPT reply back to me in details, in deep or in a wide range of areas. So it's a great revolution, great devolvements. But so far, AI has been your consultants to answer your questions or generate the videos, clips or voices, but now we are using it as an agent AI or AI agent. So AI itself autonomously think and make an action by itself. So we don't have to ask them to do this, do that in details. But as long as we share the same goal, AI will be working without resting and working for around a clock. So that's how it comes. And this is seeding, a human brain. So now superintelligence. Not only the brain is great. If it's only the brain, then AI may just make its own move. But now if you look at human, we know the ethics. In AI, we will also cherish the things that we cherish. So those are the things being built into these leases models, then we can stop AIs its own move or any things that AI may do. So those can be banished. So we are not -- we are seeing the superintelligence now. So with the superintelligence -- and we would like to be that such a platform provider. In Japanese, it's like a social infrastructure or more simply put, it's like organizer and SoftBank Group is aiming to become the provider of the infrastructure of artificial superintelligence. In my presentation, I have 3 agenda. So ASI, artificial superintelligence. ASI is abbreviations for that. So I would like to discuss and present my vision on ASI. And to remain -- 2 agenda is the 1 [indiscernible] yen. What is [indiscernible], second agenda of mine. And third, as we say, we would like to be the platform provider of ASI, but maybe I should be more -- put more colors on what -- how we picture ourselves how are we going to increase, that will be another -- a third agenda of mines for today's presentation. About 16 years ago, SoftBank Group actually celebrated 30 years since its foundation. So maybe the second week of the anniversary, I said we discussed the next 30-year vision to my employees. Maybe I discussed about 30 minutes or so. And then for this next 3-year plan, I want to be making our sales for JPY 1 trillion, JPY 2 trillion. That's the size that we are aiming for. That's how I explain to my employees back then, and the next day that they left the company. That's very beginning. That's the very first 30-year vision. So after 30 years, about 16 years ago, we celebrated the next 30-year vision. So when I was 19-year-old, I had a 50-year life plan as a business person before we discuss about 30-year plan. In my 20s get acknowledged as a business person, in my 30s, finance watches, so on and so on. So there are 3 chapters that I set out for my 50-year life plan. Now I am 68 years old. 60s, handover business to next generation. That was my original plan as a 50-year life plan. But now becoming 68, I became more greedy. I'm still doing healthy. 50 year ago, the life -- average life was not this long. And when you imagine when you are 60, I will be a very old man, but for my health, I will play the ping-pong with young employees. So I have 3 young employees, and they will change the part, and I will be playing by myself for 90 minutes or so and play the ping-pong. Might actually ping-pong is all the smashes in the heads. So I'm the risk taker, so I just make a smash here and there. So it's like a kind of a -- quite a wild pimple game and jumping around and play very hard. -- until I'm so sweated and are tired, [indiscernible]. But still, those 3 young employees they have to switch the part. Otherwise, they will not be able to sustain, and we all exhausted. And I myself, the latter half, I will be even more energetic. So I think I still can do. If I retire now, maybe I cannot really kill the time anymore. So -- and at the same time, for the growth of SoftBank Group, I wanted to be more contributor for the growth of the company. So as a result, I decided to revise my 50-year life plan. 70s, maybe 10 years, 15 years, I would like to do more. Of course, I will stay healthy. as long as I can be staying as healthy and also sound. But so far, I'm doing so great. Every month, I will making a business trip overseas twice or 3 times a month, but still doing great in very good health. And 70s. So I'm 68 now and in my 70s, I will be doing -- so in my 70s -- as I mentioned in the very beginning of my presentation, I would like to pursue official superintelligence. As far as we do, I want to be #1, of course. It has to be #1. That's my character. Of course, in Japan, I have to be overwhelming #1. And even in the world, we want to be -- in our business area for ASI, we want to also target for becoming #1 in the world as well. So we will do it. I will do it. There has been evolution of humanity history for about 200,000 years or so. Most high-level or highest capacity, highest levels has been reached by human, but the constraint of such humans evolution has been intelligence. So nothing can be more intelligence than ours or our -- than humans. And at the same time, execution has to be come along with intelligence. Compared to other animals, human is the superior and that itself is actually the evolution of humanities. So that's the power of ASI and 1 that we have combining human and I, so we can take the best of the intelligence. And then that we can extend the intelligence even further and at the same time, we can have his II for the execution of such intelligence, then so many things will be even more evolved. As I mentioned, about 16 years ago, we announced next 30-year vision. So when I start saying about AI in super intelligence robots, that's not something that new. When I was 19 years old, we -- I created my 50-year life plan. But even 2 years before, when I was 17, I first time saw Microchip computer, photo of the Microchip and I imagined, but then that Actually, the way we should be heading -- I should be heading in human may be creating something exceeding human in the future. So that was when I was 17, and now is the time that we are about to see by our own eyes. So this next 30-year vision, and we're about half of it. So this is 16 years now. So it's about half that has come. And I would like to look back once again. That time, I said we will be seeing the brain computer to life. So it's not a simple programming but the computer itself is going to be think autonomously, that kind of compute is going to be born and that's how it comes as a result. And at the same time, this brain computer will be connected to robots. And once robot coexistence with intelligent, then the things that 2 dangerous or too boring those kind of actions can be replaced with robot. So next, the vision actually announced 2 things. One, is, ASI; another thing was Robots with superintelligence, called PiscaIt's about, I mean, AI robots here. And first, this is SP310560143 Once you see more evolution of is, it's not only the simple answer, -- but actually, sales going to work on behalf of you. And 1 person will be able to play 1,000 people's labor. So many things. So many calculations, so many tasks that the 1 person has been doing can be a super white color. At the same time, 1,000 agents per person Ubi actually worked out quicker, faster and also a better way. I myself, actually applying for the patent for 1,000 cases by myself, that's how I like to think hard. So invention, think about it. I drew design and so on. How do you think about this idea? What do you think about these things? That's something that I asked ChatGPT and we create the design details made together with ChatGPT so many times so that we'll be able to brush it up. So not only the simple calculation, but think, create and generate we can draw the design or we can build the business plan together. Or at the home, your kids, your grandkids. -- 1 teacher can be -- what, 10 expertises can be provides education to each individual kids, that's also available in the future or researchers engineer for the 1 person -- for each individual researchers or an engineer, so many artificial -- excuse me, the superintelligence will be provided so that they will be able to amplify their power. And each individual has a different status of the house every day. Even you want to check with your doctors, doctor may be very busy or doctors may not be the expertise of what you are feeling. Then you'll be able to receive the best care of the superintelligence doctor. Will you be able to consult with such doctors -- of course, they will evolve to AI, but human will not be replaced or should not be replaced. Human needs to connect to human and try to aim for the happiness for each other. So you cannot replace but you can evolve the human. So this is a tool to evolve. This is a colleague, partner of yours to evolve the humanity. That's how I see the ASI. The second agenda for the next vision was fiscal AI. So-called AI in the industry. So robot with intelligence with the body. 24x7 autonomous operation in the factories, robot -- and robot will be communicating each other, corporate each other and make the operation or going to the high-risk work space, disaster areas deep in the ocean? Or we can also use the -- for the rescue from the disaster when we have any threats for the people's life. For those areas that the people cannot really go and rescue. At the factories, there are the labor shortage. Especially in Japan, we are in the aged society. So the labor power is in short here and there. Even the farm, there are difficulty finding the successor, but that's also the area that AI robot can help and support. So as you can see, AI is evolving at a tremendous speed, which is exciting. And again, it's evolving in the process of ASI advancement, what can SoftBank Group do? We have 4 main themes of our focus. First, AI model, which is related to AI intelligence. We want to make sure that we have the best AI model. We alone cannot do. So we work with open AI, which is a creator of chatGPT and OpenAI was the trial blazer of AI. So we work together with OpenAI to keep evolving AI models. And ARM, 1 of our core businesses or core companies, and CEO of ARM Rene is with us today as a Board member. And again, will play a key role and the chip is not only a potential bottleneck, but also power can be a limitation. So AI infrastructure or data center which can be a limitation of AI evolution, we want to be the best AI infrastructure provider in the world. In terms of robot, we want to be the best robotics company in the world. So let me dive into those 4 focuses more in detail. First, AI model. In the last 3 years, OpenAI has been helping evolving products. ChatGPT is for chat and not only chatting, but also image creation, video creation and program coding and cybersecurity. So OpenAI has been enhancing their capabilities. So going forward, towards the ASI OpenAI will keep evolving and expanding into new domains. When I talk to the Head of the development team, Mark Chem. So whenever I talk to him and his team. It's really exciting because they are getting ready for new programming and new products. Next, semiconductor. NVIDIA has the top market cap. Just 3 years ago, not so many people heard about the NIM, but NVIDIA surpassing Google, Microsoft and Apple and NVIDIA's market cap is the biggest at the moment. NVIDIA is good at generative AI, creating talks creating images, creating videos in the area of generative AI. NVIDIA is best at GPU, which originally was designed in create images. So speech image are the leading areas where NVIDIA can support. And I strides. And NVIDIA has the biggest market cap at the moment. But in the next phase, not just creating communications or images, but each and every agent thinks and acts and things and act like 1,000 people working at the same time. That's what it calls Asian AI. -- or I would say, agent AI. So in the world of Agentic AI, not a GPU for graphics but CPU will play a more central role in terms of CPU design RMS absolute #1 in the world. Army is listed now, but still, SoftBank Group owns around 90% of its stake. So ARM is effectively our company, your company, you are a shareholder of ARM effectively. So Arm will play the key role in the world in terms of chip. In the past, just made a design and provided the design to the manufacture of chips. So not only creating design but also creating chip itself is something that ARM is now going to do, which was announced a month ago. In the last several months arms of stockpile has been skyrocketing because of those 2 reasons. CPU will play a key role in AI and ARM evolves itself from just the designer to chip maker. That's the reason why I think Arm's market cap is around JPY 70 trillion or something which is well beyond Toyota and Kioxia in Japan. But I think ARM can grow even more 10 times and even more, is just at the starting point. So Arm's chip and ridership. Those chips are needed to build a server as a system. And the data center is a place where those servers will work. That infrastructure has a complex pipeline and wiring and that would emit heat. So you need to call the heat in the data centers. So it's like an AI factory. And AI infrastructure or AI data center is an AI factory. And data centers would need a lot of power. So SoftBank Energy we have 90% of the stake in SoftBank Energy. That's 1 of our subsidiaries. So 10 gigawatt of capacity or -- it's equivalent to the capacity of 10 new cola power plants in Japan, I think we have about 30 nuclear power plants in Japan. So 1/3 of the total depends on nuclear power plant capacity -- that will be the capacity of data center in America. So the Secretaries of department comes and department of economy are standing with me. So that's a joint project with the American government -- so this is a absolute #1 data center in America. And that's what SoftBank Group is helped creating. And in Europe, which also suffers from power shortage in France and French President Macron, I met with him earlier this month. and we agreed to create a data center in France as a capacity of 5 gigawatts, which will be the biggest data center in Europe. That's about infrastructure; and fourth, forecast robotics or robots. How prepared are we in terms of robots. We have many robotics companies each -- and each business is #1 in respective sector. We have been acquiring those businesses. I think Pepper is most popular in terms of robot by SoftBank. We started creating pepper like 10 years ago. And Pepper is still working in our retail stores, if you notice, -- and we have acquired robotics companies like them and those businesses include ABB Robotics, which is #2 in the world. In the traditional robots, ABB Robotics is #2 in the world. But now we have ABB Robotics underneath of SoftBank Group. We want to create leading robotic company. So we have those rates company underneath our SoftBank Group umbrella to get ready for AI robotics in the future. So again, we will be the absolute #1 robotics company in the future. So in the times of ASI in those 4 sectors, we will become the absolute #1 provider in the world. In playing author, for example, a board game, it doesn't make sense if you have center areas. The key is to get 4 quarters in the times of AI -- we want to create a new social infrastructure and we want to take control of the 4 corners of ASI bog game, if you will. And we want to be #1 in the world. SoftBank Group started from domestic business. But recently, we entered overseas markets like America, China and Europe. And we started investing in those markets through our Vision Fund. And now generative AI gets evolved into ASI the -- in other states is most powerful at the moment, and we want to compete in the United States and we want to have #1 position in each and every fourth quarter. And as we try, as we strive, we want to be the #1. Last year we had AGM around the same time. Since then, our share price has been up a little bit. But most of them, most of the shareholders may still be skeptical about our story. You might believe in me today, but you might get again, skeptical, and you may feel sad or happy by looking at SoftBank Group share prices because our share prices are so volatile. And maybe our financial statements are too complex, even to the professionals. So I understand if you have convinced but half as skeptical. But I'm not, though, I am 100% convinced I have no skeptics at all. But looking at the share price, I understand some of them -- some of you have conversed, half capital. But think about it. SoftBank is a strategic holding company. We have operating companies in our group, but SoftBank Group is rather not doing our businesses, but we are a strategic holding company, having equity of different group companies, whether arm or OpenAI SoftBank Group is strategic holding company, an investment company. And our market cap compared to ARM's value, we have about 90% of its stake in ARM. And our Arm's equity value of holding is bigger than SoftBank Group's market cap. We have about JPY 55 trillion of ARM, and we are -- looking at the value every day. According to the latest value, our equity value of our holding is JPY 61 trillion. -- and PayPay, Yahoo LINE and Stock bank, we have those subsidiaries in group, Battens and others. So putting them all together, we have borrowings as well. But against the value that we have maybe the debt percentage is about 11%. So just 10% borrowing debt, what should we be afraid of? Because we have a strict financial policy with a set LTV target. So anyway, just a net Asset value is JPY 74 trillion as of today. So 2x bigger than our market cap is our net asset value. Most of the companies that we own are listed which means those values are being evaluated every day. And as of today, our net asset value is twice as our market cap. I think you share is maybe JPY 6,500 per share and arms equity value sorry, OpenAI's equity value of our holding and SoftBank's equity value of our holding value, less net debt, we have net asset value of JPY 74 trillion. In new wallet, you have cash and you have shares. And all the half of that value in your wallet is not seen, clearly, you keep holding your value because you believe in the value. You may be much richer than you think actually because unrealized value has twice as the share price that your share has, but until you monetize, it's not cash. But looking back our history, 16 years ago, when we announced a new 30 years plan at the General Shareholders Meeting. So 16 years ago, equity value of holdings was JPY 5 trillion. A few years ago, I talked about goose story. So let's say 1 golden egg equals to JPY 1 trillion. So 16 years ago, we had 5 Golden X or JPY 5 trillion. But we had JPY 2 trillion of borrowing. So shareholders' value 16 years ago was JPY 3 trillion or 3 Golden X. So equity value of holding minus net debt equals shareholder value, which was JPY 3 trillion, 16 years ago. So the net asset value or NAV was JPY 3,000,000,000,016 years ago. NAV is 1 of the key metrics in the financial sector. And NAV 16 years ago, was JPY 3 trillion. SoftBank's market cap was around JPY 3 trillion 16 years ago. So again, market capped JPY 3 trillion, and the net asset value, JPY 3 trillion. That was 16 years ago. That means even though a goose lease eggs, but the value of that growth was valued at 0. Only the 3 eggs were seen as SoftBank's value. So the goods has no value at all. That was what the market saw or thought. But think about that. In the last 16 years, we increased the number of growth in x from 3 to 74 million. Again, 3 eggs increased to 74 eggs but eggs don't lay eggs, goose lay eggs. Eggs don't they eggs, which means who helped increasing the Golden X. That's what I want to ask. Again, eggs do not lay eggs. The goose increased the number of eggs laid. Future value of the Golden X was calculated already at present. And 16 years ago, the value of the goose was seen at 0, but we -- I found the value of the goose. And it was proved history proves, was that by chance? Well, looking back, the time since listing will we were listed. It was JPY 2,000 billion. And I started this company with only JPY 10 million. And we got listed at the value of JPY 200 billion, sorry. And in 16 years, our value increased 15x. Then the number of golden eggs was 3. But then, we grew by 25x. And now we have 74 Golden eggs. In the last 15 years, it was not just by chance. So how many years do I have to fight to prove myself and convince you that all the goose did a good job. So the things that you have to count is not only the number of golden egg that you see now, but -- you have to look at potential eggs that the group can may in the future like AI data centers and everything. Those are the things that are not seen yet, but they are inside the goose, if you will. So again, you should not look at only the golden eggs. In front of you, you have to find value of the goose because the goods has a capacity to keep laying eggs 40 years, see, the only people who believe in that story I think you are those people. You have an opportunity. You still have an opportunity. So you feel good, you feel better now. But what about the future? Now, you may start being skeptical, but stop. So it's been just half of the new 30-year vision. So the next 16 years, so 15x increase, 25x increase in the last 2 phases of 16 years. So for the next 16 years, should be. Well, I have to be brave enough to say this, believe me, because -- if I turn out to be wrong, people start criticizing me and giving me hard time. But I have a small pride myself since the foundation of SoftBank. Every time, we have not disclosed profit outlook in the following year, more major companies do, but we don't. We are holding company and our share prices go up and down. So if we say that our outlook for next year's income would be like that. And if you don't hit, we will get criticized. And sometimes we announce, but whenever we announced next year's outlook, we never miss. We have made mid long-term business plans, and we never missed the outlook target. That's what I am proud of and my commitment. And whenever I say something, I will just do it -- or in other words, I wouldn't say anything that we -- I don't have confidence to achieve. I think talk big is not a bad thing. If you talk big, sometimes may call you a lie, but I would say big vision. When you have a vision when you have a big mid long-term vision, you have a dream, you have a vision and -- you have a specific image with a specific target date in numbers. And imagine like that you have already achieved. When we talk about the big vision, I think in the last 30 years, what's missing is big business leaders big vision. Kokatha or Sorona or Amrita they all talked about a big vision, remember? But now, the major business leaders don't talk about the big visions because they need to be brave enough to do that. And the founder had confidence to grow their own business. So I think that's why they would talk about big vision. Again, 1 quadrillion, 1,000 golden eggs, from 3 to 74 golden X, again, extend the eggs, the goose late eggs. So SoftBank Group is the factory of Golden eggs. Our role is to help the businesses that we have to become a golden egg. We invest and we nurture the businesses that have potential to be a golden egg in the future. And then they will get listed. They will go public. Why? Because those leaders should seen by analysts, sometimes get criticized, so that they keep motivated by themselves to grow further. So we, as a holding company, help them to nurture making sure that they can create and enjoy synergies. Again, those golden eggs were laid not by accident, not by chance, our set focus is to own specific areas that we identified AI, for example, and we have built our expertise in the last 40 years. So the value of Golden eggs and the value of the goose should be seen not only just by ag value. So still, plus alpha of gross value should be there. So 74-plus alpha, which is goose value is truly valuated. So maybe the value of the goose should be or could be JPY 900 trillion. So call me Sonatrach, which is Chairman Son. So joking aside, I know what role I should play. And the goose value should be upside and again, shareholders or some people even though AI chips, memories and those companies' share prices are going up, but some people may wonder, AI might be a bubble like in the area of net bubble so-called and some people call it Internet bubble. So AI revolution has just started. bubble, I think it's an insult of AI, if you say it's an AI bubble because it's just the beginning. AI's potential will be unlocked. So in the third year of the Internet revolution, if you could go back to the area, a Google, Microsoft, Yahoo and Amazon Bate, maybe those were still start-ups since their foundation like a 3-year old. And if you could go back the years, you would have bought more shares of those companies. And AI, again, is still beginning, and it's been maybe 3 years since AI was born. And I talked a bit and AI and AI will be coming, and we will control the 4 corners of ASI, the Board. That big vision at least in Japan, nobody else, but me talks about that big vision. In the United States, maybe somebody takes control of 1 of only 1 of 4 corners, but I don't think many leaders try to take control of 4 corners every 4 corner. But out I will do so. 5 years ago, I lost my daddy. fought against cancer, and he suffered from pain, cancer spreaded from the long to every corner of his body. And I visited him every day, and I spoke with him every day. And on the day he passed away, it may be before 2 hours before he passed away. He was too weak to talk. He was too weak to talk. And I was with my brother Tide visiting him at the hospital. And we cried and screened like don't give up to my father and he was too weak to say, but he just opened his eyes and set award. Tiger leaves behind is skin when he dies. And human leaves behind his reputation when he's dead. So that's the last thing that he said to me. And I screamed like crazy, like a father and debt. And I often looked back the time when he said that right before he died, what did he want to say. When I was kid, he went back from work. And here enjoyed sake at home, and he often said to me when I was little, -- you said you I do generation Don't leave life for the sake of money he said to me. Don't leave a life for the sake of money. You should live a life to make millions of people happy. He talked to me. He said to me always with tears in his eyes. I talked about goose and Golden eggs, but I'm not doing this for the sake of money. Otherwise, my dad will be mad. To make people happy to make billions of people happy, that's what I want to do with AI and robots. I want to develop technology to make people happy. I want to create AI revolution, ASI to make people happy. Robots should help suffer from disease I should educate people. AI should make people smile that SoftBank is trying to achieve count on us. And I really, really appreciate your support and help us to do this. Well, I took so much time. I was too passionate. Thank you for your patience and listening. Now we will begin the Q&A session. The moderator will explain how it will proceed.

We will first address pre-submitted the questions followed by questions from in-person shareholders. If you wish to speak, please raised 1 of the colored papers provided at the reception, so the Chairperson can see it. A staff member will bring your microphone. Please note that each person is limited to 1 question. Shareholders speaking from the floor are asked to begin by stating only the numbers shown on their admission card. There is no need to state your name. Please stand when asking your question. Keep your remarks concise and limit them to no more than 1 minute to allow as many shareholders as possible the opportunity to ask questions.

The moderator will provide a reminder when your remarks have reached the 1 minute guideline. We will answer online questions submitted today regarding the matters presented at the meeting next. Each 1 line participant may submit 1 question. the deadline is 5 minutes from now. Let us begin with pre-submitted questions. The moderator will read them aloud.

What is the growth outlook for the company's major business other than ARM? As I mentioned in my presentation, just before AI model, AI Robert, -- and those 4 corners, 1 of them is ARM. So the 3 other corners will be blooming from now on. -- what are the expected ROI and revenue prospects for the data center business, including project in Milan County, Texas.

Yes, in Ohio, like I said earlier, we are building the number of data centers in the world like capacity worth 10 nuclear plants, investment is big, but also we expect a lot of revenue from the data center. We signed memory -- we are signing MOU with potential customers once official agreement is in place, we should expect a huge revenue. that MOU signing process is underway. So we should expect a huge revenue only from Ohio. So we can expect many, many golden eggs from only Ohio project, but not only Ohio, but the Milan and Texas and other areas. In parallel, we are getting prepared. And also France. Eventually, in Japan, we want to extend more -- so definitely, you should be excited. There are a lot of golden eggs are being lead.

What was the strategic rationale for investing in Intel?

It's been 6 months since we invested in Intel JPY 300 billion, we invested right after the investment, a lot of criticism, why Intel, so people say that. What happened? What are they looking at? So we've been criticized why Intel and especially among the specialists in those who are familiar with this industry grid-sized a lot. But in 6 months, Intel's actually became 5x or 6x bigger so market cap already seen the fit of 1 trillion level. So in the world, chips hub manufacturing makers, wafers to chips that foundry TSMC in Taiwan is overwhelmingly #1 right now. The second is Intel. The third is Samsung in Korea. So the intel in the U.S., it's a second, but still there is a big gap from the top one. So under the National Security, initiatives. So the U.S. Intel has to be nurtured more, enhanced more. So under such were the circumstances and considering the situation in Taiwan, Intel had to be reinforced and put more focus on. So that's why we also invested in Intel. So there will be more and more important roles for Intel. And so right now, you see Apple, NVIDIA, all these big names are signing contract or planning to sign contract with Intel. So it's been announced. So that's why its share price has increased fivefold or 6 folds. So I answered 3 key questions pre-submitted. Since there are a lot of shareholders here today in the venue, I would like to take questions from the venue. If you have a question, please raise on 1 of the colored papers. After I call on you, please stand up and state your admission card number only. You don't have to say your name. Are there any questions?

My number 1012, 7 years ago, when we had AGM, you talked about the big vision. It was amazing. Back then, you said 2040, year 2040 market cap, JPY 200 trillion. I think you are in a good progress. Don't you think that you can achieve a target well before 2040? Yes. Should it come much before 2040.

I said 16 years ahead -- so I believe that we can surpass that target that we set for 2040, we should achieve that much earlier. I have confidence. That's why I said in front of you. I'll do it. Thank you.

My number is 0206. I have a question about physical AIUs. So in the image so is that the fiscal AI will be replacing the existing tasks. So do you have any plan to build a physical AI foundry using the physical robots, AI robots.

Yes, I do. I haven't announced yet official yet. So already in the existing factory, our robots, fiscal actually started already mass manufacturing, mass-producing Roberts. I think it's the very first in the world. AI already started mass producing of AI. I would like to make an official announcement when the right time comes, when the right time comes, you will be surprised, but I'll make it happen.

My number is 2. So I want to talk with chappy a lot, but I'm concerned about privacy issue. And Mr. Son I think you may talk with chappy, and you may talk with them about your privacy or personal things. So I wonder if privacy protection is in place in your GPT. So you have and paid GPT, I use paid.

I don't know difference between free GPT and paid chatGPT. I talked to GPT every time, at least paid chat GPT I'm using has a long memory based upon the past conversation, CaP response back to me. Even though I didn't tell the chat, my name, but the chatGPT guessed -- and correctly guessed, you are Masayoshi Son. Correct? So whenever I talk to them recently. It said Mr. Song it's not good enough or something. So as a serious partner of conversation, Micha GPT is really helpful. And as an OpenAI as a company policy, -- your private information, they should not -- they will not tell you private information to others. So be rest assured. My will happiness information revolution, happiness for everyone. That's the philosophy of SoftBank Group Corporation.

So -- about the successor, you said that the successor will be coming from the company is under SoftBank Group and after competition. So what kind of system do you think you need to realize that -- that's a very important question. And to me also, and I've been asking to myself again and again. From outside, actually, of cider does not have deep understanding.

So that's why I believe that success should be from -- within our group. -- because I'm not going to leave not 300 years. So as a company a corporate culture -- and the vision and the policy and the philosophy have to be repeated over and over by my successor and its successor and so on. So the -- it's been 200 or 300 years since Industrial Revolution and this intelligence revolution will continue last another 300 years. So the brain is the most important function in human body. And so the next 300 years, AI revolution will be the center of the next 300 years or so where we, SoftBank is going to concentrate on in order to make everyone happy, which has no need to be changed. This vision does not have to be changed. So under this philosophy and -- we would like to have a success if we can maintain these 2 important pillars of our visions. So we have 2,000 group companies means that there are 2,000 candidates of my successor, and I hope that they will be competing each other to come out.

My number 1202. I came from Fukuoka, where you created your company. Last year was the first time I joined AGM and you said you'll be a #1 platformer and I brought my wife together with me this year, and you talked big vision last year. And also you talk a big vision today. And if you surpass NVIDIA, you would be about JPY 1,000 trillion. And you talked about JPY 1,000 trillion now. So I think that my wife is convinced.

Anyway, for you to become #1 Who is the #2? Who would be #3 as your tender our arrival, if you will, you would imagine would be the top 10 market cap companies. They have a great capacity capabilities and most of them work on AI. So the top 10 market cap companies are working on AI in the world. AI or AI related businesses are those companies. So I wouldn't call them arrivals, we are much smaller in terms of market cap. In other words, we have potential -- we have a tremendous potential. And I believe that we can deliver on those potentials, at least take control of 4 corners -- we start -- we will start from the 4 corners of the board game [indiscernible]. So it will be easy to win the game if you start from taking control of the 4 corners. So again, I will make it happen. So those are the companies that will see the rivals as well as partners.

My number 1207. At the time of Reman shock, I bought the share of SoftBank Group for the very first time that was at JPY 700. So the fleet and I hold nearly 10,000 shares. Well, I'm earning a lot to be straightforward. Well, Mr. Son, you have big vision. You have great scale and I have been a simple house wide, but. -- is 1 of the contributor to Alibaba's -- on the 3 -- the proposal 3, you're nominating 9 directors, nomination of 9 directors. I wonder if you could nominate my son next year. case here is in a cloud business and he's I would like my son to become like Mr. Son. Yes, if there is IM 1307, my number is 1.307 once again -- thank you.

Okay. I'll remember that. I'll keep that in mind -- next question.

My number 638. My question ARM CP business, Intel is 1 of your competitors, and according to latest news, NVIDIA plans to create GPU for the data center. So NVIDIA can be your competitor, but what's ARM's strength -- compared to other companies or is Arm's strength? That's my question.

You know good about NVIDIA, AMD, Arm. So strength of ARM, I would say is arms power per power consumption is tremendously good compared to NVIDIA, like in the first stage of AI evolution, NVIDIA was #1 in the area of graphics. But at the second stage of AI evolution, so again, the first stage NVIDIA was #1. But second phase, agent AI is the key player where CPU plays a more important role in terms of CPU, ARM is the world's #1 and ARM will be the winner. -- in the world of CPU. And ARM AMD are good CPU players and AMD copies Intel. So it's like a Pepsi to Coca-Cola. -- that's AMD in the space of CPU. Intel and AMD consumes a lot of power to run CPU. Electricity and power is the limitation of the data center capacity because they need more power -- and ARM has twice as much efficiency. So you don't need much electricity. You need only half of the electricity to perform as good as others. So ARM will be the absolute number one. That's why when we acquired ARM, the value was JPY 3.4 trillion, 3.4 trillion back then, but now JPY 70 trillion. 20x bigger than when we acquired, and we paid a 40% premium to acquire your arm. So right after we announced to purchase ARM, our share price dropped by 40%. And people said you were crazy. And I said, -- you don't -- maybe you don't see. Again, people say it's crazy for SoftBank to buy arm. But I said, I look ahead, 50 steps beyond 50 steps ahead. In my mind, I have a vision for 40 steps ahead. Again, ARM will be the winner. ARM has still potential to grow further. So no, maybe I should ask Rene to talk about ARM's strength because 1 is CEO of ARM.

That's a very good answer. I don't know what to add on to that. Just to maybe add a few other comments. The growth rate that we are seeing with AI, as we move into the agentic era means more and more compute. And when you add more and more agents to everything that's going on with artificial intelligence, all the tokens that are generated all of the distribution of those tokens, that is only work that can be done by CPU. And that's the work that needs to be done by the CPU, needs to be done by the most power-efficient CPU. So that's why we are very confident about our growth rate. We're very confident about our opportunity, and I think the best is yet to come for Arm. Thank you. [Foreign Language]

Always Rene, I talk to him over the phone or exchange e-mails on daily basis almost every day, especially for these 3 years. So it's amazing. He is amazing, and I believe that we are best partners. So time is running. I think I've spoken quite a lot. Next question.

My number 740 and IT industry -- the U.S. is leading the industry and Japanese companies. Well, what if a Japanese company becomes #1 in the AI field, it's so exciting. It's like almost my dream also will come true. So when you have actually come close to realize the AI platform Well, recently, as the government suspended the release of Anthropics, you product. So I wonder what will be any constraint.

Well, the entropic matter, it's not all of the anthropic products, but a certain services is now banned due to some security issue. So a certain model of a certain company may be suspended temporarily. It could be possible, but not AI as a whole. Well, the Chinese ones will be proceeding, moving forward while we are in post, so well, we have to compete each other and I believe that AI as a whole will not be banned, but there are some rules need to be made. And when you drive a car, you are not supposed to drive when you are drunk and you have to follow certain rules and certain discipline, it is possible to use AI as well. So 3 more questions.

1212 is my number. Golf painted Hemso because he was poor. When you were 16 years old, you painted your picture by them by yourself. I saw it, and it was completely different from what you look like now. And the paint looks like he was convinced or he was committed, and it's been 50 years. And looking at you now, you look like 16-year-old boy and next 50 years, Mr. Son I believe that you stay like year old boy, and I keep coming back to AGM because I want to keep watching you. I am so impressed. You believe in yourself and you have a strong commitment and are convinced yourself, I learned a lot from you. So rest in peace for your passed for your Daddy.

I remain as 16 years old. Spirit-wise, well yes, definitely young as 16 years old. I went to U.S. for the first time. Again, I will make it happen. -- count on me. Okay 2 more.

At the beginning of this year, you met President Trump. And my mother who is 80 years old, she's suffering from leukemia. And I -- so your picture with President Trump with big smile and my mother saw that picture. And what -- how do you look at present Trump. Maybe there is the phase that he does not show to public and where you know more.

Well, I've met him several times. I believe he's a great person. Of course, media has lots to say. Pros and cons. But the person who could be become a President of such a big country, so he's a great person. So of course, politically, there are many different opinions, but what he believes and is that he wants America to prosper and his 80 years old and he's very healthy, it's very powerful, even 1 hour, 2-hour media conference. -- he delivers messages in his own words. And so I believe he's a great person. I sometimes play golf with him, and I'm a pretty good player, golfer, my best score is 68 I think there are a lot of people play golf. 68 is quite tough to achieve as an amateur player. So I'm a single player, and he -- it's driver quite long distance, and he -- his score is always better than mine. And he always end finishes at like score of 70 range and considering his age, but he's physically strong, and he eats well, and he's very, very powerful. And I -- we would like him to stay well. And since the war in the Middle East is okay. So another question. So the last question from the venue.

My number 658. So thank you for that positive talk. My question is about AI infrastructure. you announced a big investment in the U.S. and in France, but I believe that you have some plan in Japan. Like you said, data center location and the power can be potential limitations then to have Tokyo Power as a group company or partner could be significant. So Tokyo Power, do you think how much you would need for you to grow further?

Tokyo Power as the next owner of that company, our SoftBank Corp, our telecom business said they want to be a next owner of Tokyo Power and SoftBank Corp. is one of the candidates for the future owner of the company. If or when it comes true, I know we should have data centers in Japan. Otherwise, we will be left behind. But we don't have enough power in Japan. Too much regulations, to be honest. It takes 6 years only for application of the permission. And in 6 years, how much AI can advance? So if Tokyo Power were to be our group companies, bring AI data centers back in Japan will be the role that they should play. Well, at the end, I would like to take questions on the internet. Yes. The question submitted online and the moderator will read them out loud.

Regarding the physical AI and AI profitability projection you may have, outlook, please?

Well, so PaaS is the patching as a service. Last week or so, we made an announcement together with OpenAI management members and so this PaaS model is the technology to identify the cyber attack and this is to protect from cyber attacks in order to identify cyber attacks, so we need to have a deeper understanding of that first. So well, OpenAI and Atopic developed that. And in 6 months or a year or so, soon, China and North Korea or Russia will be launching its copied versions soon. So the cyber attack is getting more and more serious issues all over the world in order to protect companies and the country. So this is our mission, and this is what we should be doing as our mission. So the Internet security companies will do as their mission plus they also have to generate revenue and profit. So this business is also profitable as well. And this sits like Secom and the house and total security. So the services aligned with this kind will be launched more.

So total dividend payment is JPY 330 billion, which is too little, I think you prefer the cash just in front of you or future golden eggs, which would you prefer?

Future golden eggs can be reflected in share price. Getting a dividend by cash and she price growing 2x, 3x. Dividend is what we continue to deliver, but golden eggs or share price, we want to focus more on them as a return to you, shareholders. We need money to grow. But please be excited about the future return.

Regarding the target plan, do you have a plan to scale?

Yes, we do. Target plan is an OpenAI and us and OpenAI and Oracle. So to enhance the data center and its infrastructure on the facility investment, which is away ahead of schedule and it's under construction. As for us, the data center for OpenAI, but other for other hyperscalers, which are in need of AI data centers. So align with that demand, and we would like to deliver our data center services. So we spent over time on my presentation and Q&A, let's now move to voting. The moderator will explain how to proceed.

Online shareholders, please catch your votes on all proposals and then click the exercise button 1. Voting is done in 1 batch. While tallying the online votes we will proceed with the in-person vote.

Now we will vote on each resolution. Online shareholders, please cast your votes via the Internet. Proposal 1 appropriation of surplus, that is to say, dividend, if you agree, please applaud. [Voting]

Thank you. Proposal 2, partial amendment of the articles of incorporation. If you agree, please applaud. [Voting]

Thank you very much. Proposal 3, election of 9 members of the Board. If you agree, applaud. [Voting]

Thank you very much. Please wait while we confirm the voting results. Voting results have been confirmed. Proposal 1 and 3 received majority approval and proposal 2 obtained 2/3 majority. As such, all 3 proposals have been passed as proposed. That concludes the proceedings of this meeting. I hereby declare the 46th Annual General Meetings of Shareholders closed. Mr. Iijima and Mr. Erikawa retire from their roles as members of the Board at the conclusion of the meeting. We have received messages from both individuals, which I will now read on behalf of the meeting. We have received the following message from Ms. Keiko Erikawa. I'd like to express my sincere gratitude for all the support I received during my tenure as an external director of SoftBank Group. Although I am stepping down from this position, I'm confident that our Chairman and CEO, masalas Son will continue to demonstrate his exceptional leadership and sincerely Bank Group continued growth and success in the years ahead. I am truly sorry and disappointed that I am unable to attend today's Annual General Meeting of Shareholders has been a great honor to serve SoftBank Group over the past 8 years during a period of significant change in the world. I would like to express my sincere gratitude to our shareholders your continued support even after stepping down from the Board, I'll remain a strong supporter of SoftBank Group and look forward to its continued success as it enters a new entrepreneurial chapter in the age of AI. Thank you so much, both of you, and I appreciate your precious advice. Thank you. Thank you so much. And here a newly appointed members of the Board, Mr. Hashi and Mr. [indiscernible]. First, Mr. [indiscernible], could you give us a few words.

I am Mia Omori. Thank you so much for appointing me. So far, I have been in the financial industry, the trading, M&A, private banks and corporate banking and also the bond and insurance where I was in charge of. When I was a junior trader, I experienced bubble in Japan, and I experienced the difficult times and in work. And also, I faced the huge impact what can impact in the insurance industry as well, but the Reman shocking -- shock was a huge surprise to me. And so when my new team was resolved and I had to deal with the restructural matters and I had to go through how the risk has to be governed and it was to make sure of all this complication. So after Reman shock under the U.S. new policy and -- so there was a difficult time for the financial industry in the U.S. and that balance to keep balance has been a big challenge for me. And SoftBank Group is where I feel very impressed by because adjusting the direction in a very quick manner. And when I see it from the objective perspective, and this company has a great passion and then keep progressing aggressively. And as Mr. Son presented today with a great vision and challenging to -- the challenging to the new things. And I would be very happy to be able to work with you. Thank you so much.

Thank you. Now please watch this brief video message from Mr. Ohashi.

Hello, everyone. My name is Ohashi and I am honored to assume the position of external Board Director of SoftBank Group. My professional background spans approximately 50 years at Komatsu Limited manufacturing company. In the manufacturing sector, building long-term relationship with clients is vital. It is a business that requires a wide range of long-term perspectives. I believe SoftBank Group is a pioneer that will lead the world into the AI era. In this upcoming era, the key challenge will be bringing the real and virtual world. In that sense, physical AI will become crucial. I hope to leverage my extensive background in manufacturing and my long-term strategic perspective to contribute to this area. As an external Board Director, I'm committed to supporting the continued growth of SoftBank Group. Thank you very much.

That's really encouraging. So new 2 Board members are pleased to welcome. Sorry, we ran out of time of my presentation, but I hope that my passion was well understood by you. I would keep talking for another 5 hours, but we now can close this meeting. I wish I could answer to more questions. But through our business operations, in next year, I look forward to seeing you again and the goose, we will play the role as the goose for you. Thank you very much. That will be all for today.

Once again, thank you very much for joining us today. Well, once again, thank you very much for attending today's general meeting of shareholders. Please make sure you have all your personal belongings with you. The exit can be crowded, so please proceed slowly. Thank you once again for your participation. [Statements in English on this transcript were spoken by an interpreter present on the live call.]