Arm IPO postponed to later next year • The Register

British chip designer Arm’s struggling IPO is likely to be delayed until sometime next year amid fears that deteriorating economic conditions could discourage investors from buying into the company.

Arm was due to go public within the current fiscal year after owner SoftBank’s sale to Nvidia collapsed in February, but that timeframe now appears to have passed and there is some speculation that the IPO may not happen at all.

Reports in the UK media over the weekend showed that Arm had been in touch with shareholders to inform them that the IPO would not take place until well into next year. SoftBank previously stated that it intended to conduct a public offering for Arm within the fiscal year ended March 31, 2023.

arm confirmed The registry that the company’s IPO was likely to be delayed, but claimed the process was still ongoing. Parent company SoftBank was not immediately available for comment.

“Given the state of the financial markets, it is unlikely that Arm will go public in the first quarter of 2023,” a spokesman told us. “However, we are well advanced in our IPO readiness process and remain fully committed to a listing in 2023.”

However, as we reported last week, SoftBank CEO and Chairman Masayoshi Son claimed in the company’s second-quarter earnings report that he will dedicate his life to growing Arm as a company over the next few years, raising the question of whether the IPO could be postponed longer or even canceled altogether.

“For the years to come, I just want to focus on this thing. So Arm’s next explosive growth is something I want to focus on and I’m dedicated to that,” Son reportedly said in a speech that didn’t mention the IPO at all.

Previous reports had indicated that SoftBank may plan to retain a majority stake in the chip design company after the IPO, rather than divest all of Arm’s stake during the IPO.

This may explain why SoftBank originally suggested valuing Arm at up to $60 billion for the purposes of its IPO, but now various media reports are putting lower numbers in the range of $40 billion to $50 billion.

Arm itself recently reported record royalties revenue of $463.2 million for the quarter ended Sept. 30, although the company’s overall revenue fell due to a decline in licensing as the company tries to expand its smartphone and mobile device strongholds to diversify and adopt its chip designs more generally, such as B. in PCs and data centers.

The company is also now embroiled in a legal battle with licensee Qualcomm over its acquisition of chip company Nuvia, which had developed its own data center-class processor cores based on the ARM architecture.

Arm claims that Qualcomm does not have permission to use the Nuvia designs and that the terms of the license agreement require it. Qualcomm has counterclaimed that Arm is attempting to completely subvert its existing model and bypass chipmakers. ®