Nvidia Is Quietly Backing Down on Its $40 Billion Arm Takeover

According to an anonymous internal source, Nvidia appears to be preparing to abandon its bid to buy Arm Ltd. Initially announced in September 2020, the proposed deal drew strong criticism from regulators and Arm's customers, fearing that it would give Nvidia too much power over the market.

According to a Bloomberg report, the source wished to remain anonymous as the ongoing process is still currently not public knowledge. Both Nvidia and SoftBank (Arm's owner) still remain publicly hopeful the deal will go through. However, SoftBank are also allegedly looking into making a public offering as an alternative to the Nividia proposal.

It's hardly a surprise that this deal was doomed from the start, with Microsoft, Amazon, Intel, and Qualcomm putting forward cases against it and the US and Chinese regulatory bodies attempting to block it at every stage. 

It might be a little early to completely write off the Nvidia Arm purchase though, given that Nvidia's stock price has almost doubled since the announcement of the deal, and the longer SoftBank waits to make an initial public offering (IPO), the more the semiconductor shortage may threaten Arm's perceived wealth.

Either way, don't expect any concrete news soon - the FTC lawsuit won't be over until later in the year, and the initial deal expires in September 2022.

Why Is Everyone Against the Nvidia and Arm Deal?

It seems like the entire industry is against the Arm deal, and while much of it is simple concerns about competition, there are a few thorny issues. 

Nvidia uses Arm products in almost all its devices, from its GPUs through to its single-board computers like the Jetson Xavier NX. A large concern for all is how Nvidia plans to run Arm fairly when it relies on its products as much as everyone else. 

Largely though, it simply comes down to fairness. Nvidia is already the second most valuable chipmaker in the world. Many fear putting them in control of Arm will spell the end of competition in the semiconductor market. What does this mean for us Makers and developers? Not much! We still get to play with all of the cool things Nvidia has made and cry at GPU prices regardless of how the Nvidia/Arm debacle resolves!

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