NVIDIA's Bid for Arm Still Needs to Clear These 5 Hurdles
Last September, NVIDIA (NASDAQ: NVDA) agreed to buy Arm Holdings from the Japanese conglomerate SoftBank Group (OTC: SFTBF) for $40 billion. Arm, which is based in the U.K., doesn't sell any chips on its own. It licenses its low-power chip designs and architecture to chipmakers like NVIDIA, Qualcomm, and Apple.
More than 95% of the world's smartphones now run on Arm-based CPUs. Arm-based chips are also gaining ground in the PC and data center markets, which mainly run on Intel and Advanced Micro Devices' x86 chips.
By buying Arm, NVIDIA would no longer pay any licensing fees for its own Arm-based CPUs, and it could generate a fresh stream of higher-margin licensing revenue from other chipmakers. It could also design new Arm-based chips internally, which could work alongside its high-end GPUs for data centers.
Source Fool.com
