There are some companies or technologies that stand out in each era, such as the semiconductor field, the X86 architecture in the PC era maintains an irreplaceable position in the computer field, and into the era of mobile Internet, ARM has almost become the "neck" of the global technology giants, and its focus on computing power and power balance advantages, so that it covers more than 90% of the global smartphone chip market, in addition, ARM has also begun to extend to the PC market in recent years, and the future is limitless.
But it was such an excellent asset, a "cash cow" under SoftBank, that was almost sold by Masayoshi Son!
The "cash cow" was almost sold
As we all know, Masayoshi Son was the largest shareholder behind Ali, and in the past 20 years, he has made a lot of money by investing in Alibaba, and in order to make SoftBank go to a higher level and recreate the glory of investing in Alibaba, Masayoshi Son spent a lot of money to increase the sharing economy, such as Didi, Uber, wework, etc., and became the largest shareholder of these companies.
For example, wework, a co-working space provider, has been questioned about its business model and expansion strategy, which once led to a collapse in the company's valuation; uber's rapid cash burn and slow growth after its IPO, its business model is unsustainable and its market value has plummeted; Sprint's poor performance in the market and its acquisition have also affected SoftBank's return on investment in the later stage.
In the face of the "black hole" general losses, in order to alleviate SoftBank's cash flow, Son finally sold Alibaba's shares, and ARM, a "cash cow", was also put on the shelf.
After the chip war between China and the West began, semiconductor-related companies have become the focus of attention from all walks of life, and ARM, which monopolizes the mobile chip architecture market, has also become a sweet spot in the industry.
In 2020, SoftBank and Nvidia reached an agreement to sell ARM at a sky-high price of $40 billion. However, because of ARM's absolute monopoly advantage in the field of mobile chip architecture, Nvidia is the industry's leading chip company, if Nvidia controls ARM's authorization, it is likely to have an adverse impact on other semiconductor companies, and finally blocked the transaction under the opposition of many countries, and Son's sale plan also completely failed, so SoftBank began to re-list.
For ARM's listing, many investment institutions are not optimistic, after all, ARM cut off the supply of Chinese enterprises, lost its original neutrality, a large number of semiconductor companies poured into the RISC-V track, the development of the electronics consumer industry slowed down, and the isolated Huawei also opened up its own track, many analysts believe that ARM's future growth space is very limited.
However, Son's waiting still ushered in a better result!
Masayoshi Son completely turned over
According to the data, ARM's stock price jumped 47.89% on February 8, soaring 104.12% in four trading days, doubling, and its market value reached more than $140 billion! SoftBank, which holds 90% of ARM's equity, made $7 or 80 billion in four days, totaling more than 500 billion yuan. This also means that Son's losses in Uber, wework and other companies have been fully recovered in just a few days.
What caused the ARM stock market to skyrocket so fast?
In June last year, Son announced that SoftBank would end its "dormant" state and switch to offensive mode, and for the direction of attack, Son hinted that it was the field of artificial intelligence.
Recently, people familiar with the matter revealed that SoftBank is forming an AI industry alliance with Nvidia and joining hands with Huang Jenxun to develop AI business, including communication business segments, 5G, 6G artificial intelligence application platforms, AI data transmission centers, etc.
At the same time, ARM also disclosed the third quarter report of fiscal year 2024, ARM's revenue and operating profit far exceeded analysts' expectations, with revenue of $824 million, a year-on-year increase of 14%, a record high.
This means that Son's strategic expansion has indeed paid off, and it also confirms that Son's development route is "blocked" correctly!
With the rapid development and popularization of AI technology, coupled with the popularity of artificial intelligence tool chatGPT, the market value of the global AI chip giant Nvidia has continued to refresh record highs, and countries have begun to make efforts in artificial intelligence infrastructure and bet on the artificial intelligence industry. In addition to NVIDIA, more AI chip companies will emerge in the market in the future, and ARM, which relies on technology patent authorization, may become a new "trendsetter" in the era of artificial intelligence!
What do you think about this?