SoftBank’s Arm Gears Up to Launch Revolutionary AI Chip Next Year

  • Editor
  • May 13, 2024
    Updated
SoftBanks-Arm-to-Unveil-Next-Gen-AI-Chip-in-Upcoming-Year

SoftBank Group’s subsidiary, Arm Holdings, is gearing up to transform the AI chip industry by planning to launch its Artificial Intelligence chips by 2025.

This ambitious move by the UK-based chip designer, where SoftBank holds a 90% stake, is a huge part of its strategy to become a leader in the burgeoning AI market.

Arm aims to establish a dedicated AI chip division, with plans to develop a prototype by the spring of 2025 and initiate mass production by the fall of the same year.

These developments are expected to bolster Arm’s strategic expansion beyond its traditional business model of licensing chip designs.

As soon as this news broke online, people around the world started sharing their views and opinions. Some were found asking if Softbank still wants to sell Arm.

The company is currently negotiating with contract manufacturers, including Taiwan’s TSMC, to secure production capabilities for these chips. The financial backing for this venture will be substantial, with initial development costs projected to reach hundreds of billions of yen, a commitment that underscores the strategic importance of this initiative to SoftBank.

Arm’s foray into the AI chip market is anticipated to significantly enhance its market valuation, which has already seen a near 45% increase in its share price this year, bringing its market capitalization to over $113 billion.

The company, which was acquired by SoftBank in 2016 for $32 billion and went public on Nasdaq last year, is expected to leverage its established prowess in chip design to carve out a new niche in the AI sector.

Some were found speculating that next is Nvidia!

Moreover, SoftBank’s CEO, Masayoshi Son, envisions transforming the group into a sprawling AI powerhouse, integrating AI with semiconductor and robotics technologies.

This vision includes expanding into AI data centers equipped with Arm’s homegrown chips across the U.S., Europe, Asia, and the Middle East by 2026.

Additionally, SoftBank plans to explore sustainable energy options for these data centers, including windmills and solar power farms, with an eye on next-generation fusion technology.

This strategic step from licensing technology to manufacturing AI chips positions Arm Holdings to potentially disrupt its current business relationships with key partners such as Nvidia and Qualcomm.

The shift could also set the stage for Arm to compete directly with major cloud service providers like Amazon Web Services and Microsoft Corp., which currently license Arm’s circuit architecture for their processors.

For more news and insights, visit AI News on our website.

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Dave Andre

Editor

Digital marketing enthusiast by day, nature wanderer by dusk. Dave Andre blends two decades of AI and SaaS expertise into impactful strategies for SMEs. His weekends? Lost in books on tech trends and rejuvenating on scenic trails.

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