There May Be a New Catalyst for Nvidia. And It's Only an Arm's Length Away.
In September 2020, semiconductor company Nvidia (NASDAQ: NVDA) reached an agreement to acquire a rival chip maker called Arm Limited from . The proposed acquisition dragged on for over a year, but ultimately failed due to a number of regulatory antitrust concerns. Moreover, earlier this year it was reported that Arm filed confidentially for an initial public offering (IPO), further distancing itself from Nvidia.
Since abandoning the deal in February 2022, Nvidia has turned its focus to its data center operations as well as advancements in artificial intelligence (AI). This has turned out to be a good decision -- during the company's Q1 earnings call, management guided investors that Q2 revenue should be in the ballpark of $11 billion, far higher than the consensus Wall Street estimate of $7.2 billion.
As a result of this bullish outlook, Nvidia stock has rocketed to new highs. In fact, the company has joined the likes of Apple, Alphabet, Amazon, and Microsoft as a member of the trillion dollar market cap club. Despite all of this positive sentiment, there may be yet one more reason to love Nvidia stock. Just this week, news broke that Nvidia may be participating in Arm's IPO as a major investor.
Source Fool.com
