OpenAI and SoftBank Pour $1 Billion Into SB Energy to Fuel Ambitious AI Infrastructure Expansion

In a strategic move that underscores the escalating competition to build the infrastructure necessary for artificial intelligence’s future, OpenAI and SoftBank have announced a $1 billion investment in SB Energy, a renewable energy and data center development company. This partnership marks a critical step in the companies’ ambitious plan to construct a network of massive AI data centers capable of supporting the computational demands of next-generation AI systems.

The announcement, made on Friday, January 9, 2026, represents a significant expansion of the Stargate project, a $500 billion commitment unveiled at the White House in January 2025 by OpenAI CEO Sam Altman, SoftBank CEO Masayoshi Son, and Oracle Chairman Larry Ellison, with President Donald Trump’s backing. The Stargate initiative aims to deploy AI infrastructure across the United States over the next four years, positioning America as the global leader in artificial intelligence development.

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Strategic Partnership Details

Under the new agreement, OpenAI and SoftBank will each invest $500 million into SB Energy, a company backed by SoftBank and Ares Management that specializes in developing, owning, and operating energy projects across the United States. According to the official announcement, SB Energy will build and operate OpenAI’s previously announced 1.2 gigawatt data center site in Milam County, Texas. To put this in perspective, a single gigawatt is enough to power approximately 750,000 U.S. homes at any given moment.

“Partnering with SB Energy brings together their strength in data center infrastructure and energy development and OpenAI’s deep domain expertise in data center engineering,” said Greg Brockman, OpenAI’s president, in a statement. “The result is a fast, reliable way to scale compute through large, highly optimized AI data centers.”

The partnership goes beyond just financial investment. OpenAI, SoftBank Group, and SB Energy have formed a non-exclusive preferred partnership to develop what they describe as “a new model for data center builds.” This approach combines OpenAI’s first-party data center design expertise with SB Energy’s proven capabilities in speed, cost discipline, and integrated energy delivery to create purpose-built AI infrastructure at scale.

The Growing AI Infrastructure Arms Race

For large technology firms, securing reliable power has become paramount in their quest to satisfy ambitious AI goals. This has created an unprecedented race for energy resources to support increasingly larger and more numerous data centers, driving up electricity demand across the United States and globally. The tie-up between SoftBank, OpenAI, and SB Energy adds to a growing web of interconnected deals between tech companies that are helping to prop up the AI sector, while also raising concerns about the potential economic fallout if demand for artificial intelligence falls short of current projections.

OpenAI has been particularly aggressive in its infrastructure buildout. The company has committed to spending approximately $1.4 trillion over the next eight years on data center infrastructure, equating to roughly 30 gigawatts of capacity. This staggering investment includes agreements with chipmakers Nvidia, Advanced Micro Devices, and Broadcom, as well as cloud infrastructure deals with Oracle, Microsoft Azure, Amazon AWS, and CoreWeave.

CEO Sam Altman has stated that the company is on track to generate more than $20 billion in annualized revenue run rate in 2025, with plans to grow to hundreds of billions in sales by 2030. However, the ChatGPT maker is still burning through massive amounts of cash and remains far from profitability, meaning it continues to rely heavily on outside capital to fund its operations and expansion.

SoftBank’s Deep Commitment to OpenAI

SoftBank, led by the visionary and often audacious Masayoshi Son, has become increasingly intertwined with OpenAI over the past year. The relationship deepened significantly when SoftBank led a $40 billion financing round for OpenAI in March 2025, which was announced as the largest private tech funding on record. The round valued OpenAI at $300 billion and included participation from core investor Microsoft, as well as Coatue, Altimeter, and Thrive.

SoftBank’s commitment to OpenAI has been so significant that the Japanese conglomerate made dramatic portfolio adjustments to fund it. In November 2025, SoftBank sold its entire stake in chipmaker Nvidia for $5.83 billion, explicitly citing its need to finance its OpenAI investment. The company’s CFO, Yoshimitsu Goto, stated during an investor presentation that “this year our investment in OpenAI is large, more than $30 billion needs to be made. For that, we do need to divest our existing assets.”

The sale marked SoftBank’s second complete exit from Nvidia – a move that has become something of a cautionary tale in investment circles. SoftBank previously sold a $3.6 billion Nvidia stake in 2019, shares that would now be worth more than $150 billion. Despite this costly historical precedent, Son appears undeterred in his conviction that OpenAI represents the future of technology.

Following its recent investments and the completion of its $40 billion commitment to OpenAI in December 2025, SoftBank’s stake in the AI company increased from 4% to approximately 11%. This makes SoftBank one of OpenAI’s largest investors and positions the Japanese firm at the center of the global AI revolution.

SB Energy’s Expanding Portfolio

SB Energy, founded in 2019, operates as a fully integrated infrastructure development and ownership platform with expertise spanning project development, construction, engineering, supply chain management, financing, and power delivery. The company has offices in Redwood City, California, San Diego, and Denver, and has been developing several multi-gigawatt data center campuses across the United States.

According to the companies’ joint announcement, initial facilities are already under construction and are expected to enter service starting in 2026. SB Energy co-CEO Rich Hossfeld emphasized that “SB Energy’s strategic partnership with OpenAI accelerates our delivery of advanced AI data center campuses and associated energy infrastructure at the scale required to advance Stargate and secure America’s AI future.”

The $1 billion investment builds on previous support SB Energy has received from financial backers. Ares Infrastructure Opportunities funds previously invested $800 million of redeemable preferred equity in 2025 to support SB Energy’s growth, marking the third financing from Ares since 2020. This demonstrates sustained confidence from institutional investors in SB Energy’s business model and execution capabilities.

Beyond just building infrastructure, SB Energy has committed to investing in the communities where its data centers are located through well-paying jobs, workforce development programs, and grid modernization initiatives. The company aims to deliver durable economic growth for partner communities while building the backbone of America’s AI infrastructure.

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The Stargate Initiative’s Broader Impact

The Stargate project has evolved significantly since its initial announcement in January 2025. What began as a plan to invest $100 billion immediately, with commitments to reach $500 billion over four years, has spawned numerous partnerships and initiatives across the technology sector.

President Trump, who appeared at the White House announcement with Son, Altman, and Ellison, proclaimed Stargate as “the largest AI infrastructure project in history.” He pledged to help the project through emergency declarations, stating, “We have to get this stuff built. They have to produce a lot of electricity, and we’ll make it possible for them to get that production done very easily.”

The project’s first site, a massive data center in Abilene, Texas, is already under construction and being developed by Oracle in partnership with Crusoe. Oracle’s Ellison described the facility as consisting of 10 buildings that would eventually expand to 20, with each building spanning half a million square feet.

In September 2025, OpenAI announced five additional data center sites under Stargate, located in Shackelford County, Texas; Doña Ana County, New Mexico; Lordstown, Ohio; Milam County, Texas; and an as-yet-undisclosed Midwestern location. This brings Stargate to nearly 7 gigawatts of planned capacity and represents over $400 billion in investment commitments over three years.

The initiative has also expanded internationally. In October 2025, OpenAI and Sur Energy announced plans to develop an AI data center in Argentina’s Patagonia, representing an estimated investment of up to $25 billion with a capacity of up to 500 megawatts. This marked Stargate’s first site in Latin America. Additionally, OpenAI has announced Stargate facilities in Norway and the United Arab Emirates, signaling the project’s global infrastructure ambitions.

Financial Scrutiny and Market Questions

While the ambition and scale of these infrastructure investments are impressive, they have also raised significant questions from investors and industry observers about financial sustainability. OpenAI’s $1.4 trillion in infrastructure commitments over eight years averages approximately $175 billion annually – a figure that exceeds Google’s entire annual revenue and represents a level of capital deployment unprecedented in the technology sector.

The company’s current revenue, while growing rapidly, pales in comparison to these commitments. With approximately $20 billion in annualized revenue for 2025, OpenAI would need to achieve nearly 900% growth to meet these obligations from operating revenue alone. This creates a substantial funding gap that will need to be addressed through equity sales, debt financing, or partnerships.

Some analysts have expressed concern about what they see as circular financing arrangements in the AI sector. For example, as part of its infrastructure agreements, Nvidia has reportedly discussed guaranteeing loans that OpenAI would use to build its own data centers – a move that could leave the chipmaker on the hook for billions in debt if OpenAI cannot repay the loans. This interconnected web of investments and commitments has led some observers to worry about systemic risk if AI demand fails to meet current projections.

Others, however, remain optimistic about the transformative potential of AI and believe current investments are justified. Tech pundit Shelly Palmer argued that Stargate will give the United States a strategic advantage and bring benefits that cannot yet be fully calculated. “We’ve never had a compute cloud like this – there’s literally no way to calculate the economic impact of this amount of AI compute,” Palmer wrote, adding that millions of jobs would be created as data centers come online.

Competitive Landscape and Industry Implications

The OpenAI-SoftBank-SB Energy partnership exemplifies a broader trend in the technology industry, where companies are increasingly investing directly in power infrastructure as energy access becomes a critical constraint on AI expansion. Meta Platforms has announced plans to spend over $100 billion on capital expenditures in the coming year, much of it directed toward AI infrastructure. Microsoft has committed $80 billion to AI investments, while Google parent Alphabet is also ramping up its data center buildout.

This infrastructure race is fundamentally reshaping power markets and testing the limits of the electrical grid in many regions. The surge in electricity demand from data centers is already driving up energy prices in some areas and fueling political backlash as sprawling facilities become election-season flashpoints in communities where they are being constructed.

Environmental groups have urged technology leaders to prioritize low-carbon energy sources in supporting AI infrastructure. Mandy DeRoche, a deputy managing attorney at Earthjustice, noted that “the projected massive growth in demand for electricity from data centers has already raised electricity rates for households and small businesses in many parts of the country and threatens to increase pollution.”

SB Energy’s focus on renewable energy development alongside data center construction represents one approach to addressing these concerns. The company’s expertise in combining solar power, wind power, and battery storage with data center operations may serve as a model for sustainable AI infrastructure deployment.

The Road Ahead

As OpenAI and SoftBank deepen their partnership through the SB Energy investment, the companies are betting that demand for AI computing capacity will continue to grow exponentially. OpenAI’s Greg Brockman described the challenge of building AI infrastructure as an “end-to-end engineering challenge” that spans everything from model design to chips, servers, and the data centers that power training and inference operations.

The $1 billion investment in SB Energy is just one piece of a much larger puzzle. With SoftBank assuming financial responsibility for the Stargate project and OpenAI taking operational control, the partnership represents a division of labor that plays to each company’s strengths. Son serves as Stargate’s chairman, bringing his experience in scaling transformative technologies, while Altman and his team focus on technical execution and operational delivery.

The success or failure of these massive infrastructure investments will have far-reaching implications not just for OpenAI and SoftBank, but for the entire technology sector and global economy. If AI applications continue to proliferate and demand for computing capacity grows as projected, these investments could generate enormous returns and cement America’s leadership in AI technology. However, if demand falls short or if alternative, more efficient approaches to AI development emerge, the financial consequences could be severe for the companies involved.

For now, the deal signals that OpenAI and SoftBank remain committed to their vision of an AI-powered future, regardless of the risks and uncertainties involved. As Altman stated when addressing concerns about OpenAI’s massive infrastructure commitments, “We are trying to build the infrastructure for a future economy powered by AI, and given everything we see on the horizon in our research program, this is the time to invest to be really scaling up our infrastructure… Massive infrastructure projects take quite awhile to build, so we have to start now.”

Whether this bold bet will pay off remains to be seen, but with the latest SB Energy partnership, OpenAI and SoftBank have once again demonstrated their willingness to stake billions on the transformative potential of artificial intelligence. As the race to build the infrastructure of the AI age accelerates, the partnership between these technology giants and energy infrastructure providers like SB Energy may well determine not just who wins the AI competition, but how the technology reshapes society, economy, and industry in the decades to come.

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By: Montel Kamau

Serrari Financial Analyst

12th January, 2026