SoftBank Group booked a ¥597.2 billion ($3.7 billion) writedown in its fiscal second quarter after cancelling gas turbine orders it had placed to power planned AI data centers in the United States. The charge was a major contributor to a net loss of ¥1.12 trillion ($7 billion) for the three months ended September 30, 2026 — the company's first quarterly net loss in nearly two years.

The disclosure provides a detailed look at the procurement strategy SoftBank used to lock in energy supply for its AI buildout, and at the cost of unwinding it once project plans shifted. It also underscores how power procurement has become a competitive front in AI infrastructure development — one where capacity secured early can turn into a balance-sheet charge when project requirements move.

How Excess Turbine Reservations Became a Multibillion-Dollar Charge

The writedown traces back to Silver Bands 7 LLC, a SoftBank subsidiary whose job was to lock in manufacturing capacity for gas turbines before competitors could secure their own supply. Treating manufacturing slots as a scarce resource to be claimed ahead of rivals is what left SoftBank exposed when its own requirements changed.

Between late 2025 and early 2026, SoftBank reserved more than 13 gigawatts of gas turbines. That exceeded the 9.2 gigawatts its Ohio facility was expected to need, leaving the company committed to manufacturing capacity beyond its actual project requirements — a surplus of at least 3.8 gigawatts.

The Ohio project is tied to the PORTS-Pike Technology Campus, which is leased by OpenAI. As specifications for the build shifted, SoftBank cancelled advance orders that were no longer needed.

By September 30, 2026, cumulative advance payments for US power generation equipment had reached $9.48 billion. Cancelling the surplus orders is what produced the $3.7 billion charge.

There is a partial cushion. SoftBank holds rights to conditional rebates of up to $2.1 billion on future turbine purchases, an offset that would reduce the net cost of the cancellations if exercised. Because those rebates are tied to future purchases, the final net cost of the cancellations hinges on how much additional turbine buying SoftBank actually carries out.

Ahead of its earnings release, SoftBank denied claims that it had defaulted on the turbine contracts. The company characterized the cancellations as a response to changing project needs, not a failure to pay.

First Quarterly Loss in Nearly Two Years

The turbine writedown was a major contributor to the loss, but it was not the only one. High financing costs in a volatile market also weighed heavily on the quarterly result. At ¥597.2 billion, the charge alone accounted for roughly half of the ¥1.12 trillion loss, showing how commitments made during the AI buildout can flow through to reported earnings when conditions change.

None of this has slowed SoftBank's appetite for AI. The company has made a $64.6 billion acquisition of a 13% stake in OpenAI — the company that leases the Ohio campus at the center of the turbine cancellations. It has also announced a $1.85 billion commitment to build AI infrastructure in Malaysia.

What to Watch

Several developments may shape how the situation evolves from here. First is whether SoftBank actually uses its up to $2.1 billion in conditional rebates, which would indicate how much future turbine buying it still plans.

Second is the progress of the OpenAI-linked Ohio campus now that the excess equipment orders are gone. Any further changes to project specifications could reshape what SoftBank needs to purchase.

Third is whether other large buyers of AI infrastructure report similar cancellations or charges in coming quarters.

Source: CryptoBriefing