Missed Lover of Nvidia
$NVIDIA(NVDA.US$ ‘s once missed lover , ARM
1) ARM is SoftBank’s subsidiary, located in UK, a company that provides semiconductor designing software , plans to go public on the NASDAQ stock exchange in the US, which is expected to happen next month in September.
ARM licenses chip designs to various tech companies such as $NVIDIA(NVDA.US$ $Alphabet-C(GOOG.US$ $Amazon(AMZN.US$ $Apple(AAPL.US$ $Qualcomm(QCOM.US$ to make chips for smart phones, laptops, cloud computing servers, and even cars.
ARM holds significant market shares in smartphone (90%), netbook (30%), and tablet (70%) processors.
Basically, it monopolizes a big shares across the chip designs sector , apart from the X86 and RISC-V architectures.
2) ARM’s IPO could be the largest of the year, with an estimated valuation between USD 60 bil -70 bil
3) In 2016 , SoftBank acquired ARM for USD 32 bil, during 2020, a proposed sale of ARM by SoftBank to NVIDIA at a price of USD 40 bil was rejected due to the regulatory pressure from different continents around the world
4) SoftBank plans to sell around 10% of ARM’s shares in the IPO, tech companies like Apple, Amazon, and NVIDIA are considering to join as cornerstone investors
5) Despite its significant market position, ARM’s revenue is a small part of the entire semiconductor industry because it involves in design rather than manufacturing. Annual revenue for ARM in year 2021 is around USD 2.7 bil
6) ARM’s revenue model has faced challenges with declining global smartphone shipments, impacting its sales figures, hence there is a need to go for portfolio diversification, such as to broaden AI chip products offering. Currently , ARM’s architecture are more in favor to CPU , which do not sit in the centre of AI boom
7) ARM can ride on AI boom as GPU chips must be coupled with energy-efficient CPU which is among ARM’s speciality.
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DeeBe : waiting on that ipo AGAIN
King Won : Good analysis
King Won : Thanks
Deftern Tse : Easy to understand. Thank you.