- Written by Mariko Oi
- business reporter
image source, Getty Images
Arm returned to the stock market in September last year.
Shares in British semiconductor design company Arm Holdings nearly doubled in less than a week as investors bet on the artificial intelligence (AI) boom.
The Cambridge-based company reported financial results last Wednesday showing demand for AI-related technology is driving sales.
Arm-designed chips are already in nearly every smartphone in the world.
The company was taken private by Japan’s Softbank in 2016 and returned to the stock market in September last year.
This comes after chipmaker Nvidia saw its stock more than triple in value last year as demand for AI chips soared.
Thanks to the AI boom, Nvidia has become one of the world’s most valuable listed companies, with a stock market valuation of around $1.8 trillion (£1.4 trillion).
It also became the fifth publicly traded U.S. company to join the so-called “trillion dollar club,” along with technology giants Apple, Microsoft, Alphabet and Amazon.
While Arm’s technology isn’t used directly for AI work, chipmakers like Nvidia are choosing it for central processing units (CPUs) to complement their AI-specific chips.
In addition to Nvidia and Taiwan Semiconductor Manufacturing Company (TSMC), Arm’s customers include well-known consumer brands such as Apple.
Advances in self-driving technology have increased demand for Arm-designed chips in the auto manufacturing industry.
Arm was founded in 1990 by a group of chip designers in the university city of Cambridge.
It was acquired by SoftBank in 2016 for $32 billion. Four years later, the Japanese conglomerate announced plans to sell Arm to NVIDIA.
But in April 2022, SoftBank shelved the deal following opposition from regulators around the world and announced it would instead sell Arm shares on New York’s Nasdaq stock exchange.
SoftBank still owns about 90% of Arm’s shares, but its own stock has risen nearly 30% in the past week.
