Tech

Nvidia Buying Arm: A Whopping $40B to Continuously Expand its AI Efforts

By Jean Pierrie A. , Sep 14, 2020 10:25 AM EDT
Nvidia Buying Arm: A Whopping $40B to Continuously Expand its AI Efforts (Photo : Christian Wiediger)

Nvidia buying Arm has made headlines recently. The graphics hardware and AI leader has confirmed its acquisition of Arm. It involves a $40 billion transaction that is set to be fully finished after an 18-month period.

Nvidia buying Arm: What to expect

This deal aims to see Nvidia further improving its AI platform for numerous devices and apps. At the same time, this will also reshape the global semiconductor industry.

Nvidia's CEO, Jenson Huang, mentioned, "Uniting NVIDIA's AI computing capabilities with the vast ecosystem of Arm's CPU, we can advance computing from the cloud, smartphones, PCs, self-driving cars and robotics, to edge IoT, and expand AI computing to every corner of the globe."

For Arm's ecosystem, the combination will turbocharge Arm's R&D capacity and expand its IP portfolio with NVIDIA's world-leading GPU and AI technology."

The deal involves Nvidia paying $12 billion in cash and $21.5 billion when it comes to sales. Additionally, Softbank, together with its $100 billion Vision Fund, will get between 6.7% to 8.1% in Nvidia.

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Nvidia Buying Arm: Expansion plans

NVIDIA's plans to push through with its leadership in artificial intelligence with Arm's vast computing ecosystem for driving innovation. To do this, it has to consider $40 billion to be met through a combination of NVIDIA shares and cash. Despite this acquisition, NVIDIA will continue Arm's open-licensing model and customer neutrality.

Nvidia will also strive to expand Arm's IP licensing portfolio with NVIDIA technology. NVIDIA also has plans of expanding Arm's R&D presence in Cambridge, UK. The tech giant plans to do this by establishing a world-class AI research and education center. It will also build an Arm/NVIDIA-powered AI supercomputer that is meant for groundbreaking research.

This combination aims to bring together NVIDIA's leading AI computing platform together with Arm's vast ecosystem. As a result, the partnership will create a premier computing company for the age of artificial intelligence. This, in turn, will provide innovation for the company while expanding into large, high-growth markets. At the same time, SoftBank will remain committed to Arm's long-term success. This ownership stake in NVIDIA is expected to be under 10 percent.

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Furthermore, CEO Jenson Huang mentions that "AI is the most powerful technology force of our time and has launched a new wave of computing.

"In the years ahead, trillions of computers running AI will create a new internet-of-things that is thousands of times larger than today's internet-of-people. Our combination will create a company fabulously positioned for the age of AI.

"This combination has tremendous benefits for both companies, our customers, and the industry. For Arm's ecosystem, the combination will turbocharge Arm's R&D capacity and expand its IP portfolio with NVIDIA's world-leading GPU and AI technology."

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