Softbank’s semiconductor design company Arm Holdings has applied for the biggest initial public offering of the year at the Nasdaq New York Stock Exchange amid heightened high-performance artificial intelligence chip demand.
The IPO is expected to value Arm at between US$ 60 and $70 billion. This is near or below the tech industry’s largest-ever IPO which includes Alibaba Group Holding’s US$ 25 billion offering in 2014 and Meta’s US$ 16 billion in 2012.
Although Softbank did not disclose the number of shares sold and valuation following the listing, reports say the Japan-based private equity firm initially planned to raise between US$ 8 to 10 billion.
Up until now, Arm’s technology was widely used in powering mobile phones. The chipmaker sells licenses of design blueprints for core semiconductor components that dictate how software programs communicate with semiconductors.
But with the stagnating smartphone market, Arm’s CEO Rene Haas said the company is focusing on making chips used in data centers. Arm sees its products better fit for data centers that consume lots of electricity when running the latest generation of artificial intelligence platforms. Amazon, along with Samsung Electronics and Apple, has recently designed its processors for data centers with Arm’s blueprints.
Arm confirmed revenue had declined by about 1% in the fiscal year that ended on March 31 to US$ 2.68 billion, according to IPO filings. Arm’s recent IPO comes after a failed acquisition by Nvidia in 2022 following intense regulatory moves in several countries including the U.S. and UK.