Arm Holdings, a UK chip designer, has experienced remarkable growth in its stock market value over the past week, nearly doubling in value. The surge in demand for artificial intelligence (AI) is driving this success, as reflected in the company’s recent financial results showing a boost in sales related to AI technology. This growth has led to a significant increase in the valuation of Arm, which was taken private by Japan’s SoftBank in 2016 and returned to the stock market last September.
Arm chips are used in almost every smartphone around the world and are also used in self-driving cars due to their development. While not directly used for AI, chip manufacturers like Nvidia choose Arm for CPUs that complement their AI-specific chips. In addition to Nvidia and Taiwan Semiconductor Manufacturing Company, Arm’s customers also include well-known consumer brands such as Apple.
The news of Arm’s soaring valuation comes at a time when chipmaker Nvidia has also seen tremendous growth, with its shares more than tripling in value over the past year. As one of the most valuable publicly-traded companies globally, worth around $1.8 trillion, Nvidia’s success highlights the high demand for AI chips. Arm’s rise in stock market value presents new opportunities for both itself and its Japanese owner, SoftBank, which still holds roughly 90% of the business.