SoftBank's stock plummeted 12.5 percent this week as cracks emerged in the ambitious Stargate Project. OpenAI and Oracle scrapped plans to expand their flagship Texas data center due to financing difficulties and shifting demand. The bond market is taking notice, with SoftBank's credit default swaps widening as lenders grow nervous about the company's ability to service debt. S&P already cut the company's outlook to negative, threatening higher borrowing costs at a critical moment. Questions now loom about whether SoftBank can meet its substantial April 2026 commitments to OpenAI. The collapse of this expansion exposes the fragility behind the grand announcements that dominated headlines in January 2025, reminding investors to look beyond the rhetoric and follow the actual money trails in the data center boom.
