SoftBank Group-backed Arm Announces Plans to Build Advanced Semiconductor

UTC by Steve Muchoki · 3 min read
SoftBank Group-backed Arm Announces Plans to Build Advanced Semiconductor
Photo: Depositphotos

With the growth of artificial intelligence (AI) amid the booming blockchain technology Arm is assured of a growing semiconductor market.

A subsidiary of SoftBank Group Corporation (LON: 0R15), Arm Ltd., is reportedly working on its advanced prototype semiconductor. In a bid to attract customers and investors ahead of its Initial Public Offering (IPO) later this year, Arm Ltd is developing its semiconductor to ostensibly showcase the capabilities of its products. According to a report by Financial Times, Arm anticipates teaming up with manufacturing partners to ramp up the production of the semiconductors. People familiar with the matter informed the media outlet that the company has built a new engineering team to lead the semiconductor development.

The British semiconductor and software design company based in Cambridge intends to quench the tech companies in search of quality manufacturing chips amid a global shortage. Furthermore, geopolitical differences in Europe, Asia, Russia, and the United States have increased the need for locally developed semiconductor chips for scalability purposes. Moreover, Arm is a major supplier of semiconductor chips to many mobile and computer hardware manufacturers.

The announcement did not have a visible positive impact on SoftBank shares which were down approximately 3.33 percent during the weekend.

Arm and the Market Outlook

With the growth of artificial intelligence (AI) amid the booming blockchain technology, Arm Ltd. is assured of a growing semiconductor market. Earlier this month, Arm announced a strategic partnership with Intel Foundry Services (IFS) to enable chip designers to build low-power compute system-on-chips (SoCs) on the Intel 18A process.

“Intel’s collaboration with Arm will expand the market opportunity for IFS and open up new options and approaches for any fabless company that wants to access best-in-class CPU IP and the power of an open system foundry with leading-edge process technology,” Pat Gelsinger, CEO of Intel Corporation, noted.

The United States and the European countries have teamed up to steer forward the chip industry amid competition from China and Russia. Notably, IFS and Arm will undertake design technology co-optimization (DTCO), in which chip design and process technologies are optimized together to improve power, performance, area, and cost (PPAC) for Arm cores targeting Intel 18A process technology.

The technical advancements are a huge achievement from Rene Haas, CEO of Arm, who just completed his first year as a top official. During the Q3 financial year 2022 announced in early February 2023, the company reported a total revenue of $746 million, up 28 percent YoY. Reportedly, Arm partners shipped a record 8 billion Arm-based chips during the third quarter, thereby bringing the total chips shipped to more than 250 billion.

Forward, the company forecasts strong revenue growth, with double- or triple-digit revenue increases across automotive, client, infrastructure, and IoT. Furthermore, the demand for semiconductor chips is high and the company has increased its capacity to deliver the chips on time.

Artificial Intelligence, Business News, Market News, News, Technology News
Steve Muchoki
Author Steve Muchoki

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