The IPO is part of Arm's forecast for the chip design market to reach $250 billion by 2025. Despite going public, SoftBank retains 90% control of Arm. The company, which was acquired by SoftBank in 2016 for $32 billion, has previously had listings in London and New York. Arm's technology is used in most mobile phones today, and the company is looking to expand into advanced computing and designing chips for AI data centers.
Key takeaways:
- Arm Holdings, a chip design company owned by SoftBank Group, has made its debut on the Nasdaq with an initial public offering (IPO) where shares closed nearly 25% higher on the day.
- The company began trading at a valuation nearing $60 billion, selling 95.5 million shares initially trading at $56.10, and closing at $63.59.
- Arm's Chief Financial Officer, Jason Child, stated that the company sold shares worth $735 million to several strategic investors, including Nvidia Corp, AMD, Samsung, Intel Corp, Google, Apple, TSMC, Synopsis, and Cadence.
- Arm is aiming to grow its royalties by providing essential products to customers, with most of its royalties coming from products that are more than a few decades old. In 2022, Arm’s revenue from royalties was $1.68 billion.