NVIDIA to Buy Arm for $40 Billion

Posted on September 14, 2020 by Paul Thurrott in Cloud, Hardware, Mobile with 12 Comments

NVIDIA announced that it will acquire Arm from SoftBank in a deal that is valued at $40 billion. The firm will pay $21.5 billion in stock, $12 billion in cash, and $2 billion at signing, and SoftBank could receive an additional $5 billion if Arm meets certain performance targets. Also, Nvidia will issue $1.5 billion in equity to Arm employees.

“We are joining arms with Arm to create the leading computing company for the age of AI,” NVIDIA founder and CEO Jensen Huang wrote in an open letter to employees last night. “Someday, trillions of computers running AI will create a new internet—the internet-of-things—thousands of times bigger than today’s internet-of-people.”

I was of the mind that NVIDIA would be the ideal non-partisan suitor for Arm, which makes the reference designs for the chips that power virtually all mobile devices and, increasingly, many that end up in cloud computing data centers as well. But that’s even more true than I had imagined: NVIDIA won over critics by pledging to keep Arm as a separate company with open licensing, and it will honor SoftBank’s promises to keep Arm in Cambridge, England, it’s long-time home.

SoftBank had purchased Arm in 2016 for $32 billion, and Amazon, Apple, Huawei, Qualcomm, and Samsung are among its biggest licensees.

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