News The Nvidia-Arm Deal is Dead; Softbank to IPO UK Chip Designer

[Admin]

The Nvidia dream of acquiring one of the most important IP designers in the world, Arm, is no more. Arm's parent company Softbank and Nvidia have both confirmed the deal is off, with Arm being now destined for an IPO.

The Nvidia-Arm Deal is Dead; Softbank to IPO UK Chip Designer : Read more

 

[InvalidError]

March 32st? Is that an alternative name for April 1st?

 

[renz496]

1.2 billions.....that probably equal to ARM 2 or 3 quarter revenue. plus despite failing to own ARM they replace the CEO with nvidia mole haha. but seriously rather than nvidia isn't that softbank that losing the most in this deal? can they even make back the kind of money they initially spend on ARM?

 

[digitalgriffin]

The thing about companies going public is they become beholden to the share holders. Thus ethical treatment of customers and employees becomes a 2, and 3rd priority. Corporate boards to keep stock share, will put people in charge that are only motivated by big performance payouts based on what the company valuation/stock price it. Thus it becomes a conflict of interest. Treat employees/customers ethically, or run them over to collect on a big performance bonus.

"Here, we are giving you a 2% raise that we give everyone for the past 4 out of 5 years (Sorry we didn't give you a raise during covid). Be thankful even if you worked harder than everyone else. So sorry inflation is 7%+. But we must control cost. We don't care our sales increased 12-15%. We wanted 17% increase for you to get that other 1%."

 

[spongiemaster]

The thing about companies going public is they become beholden to the share holders. Thus ethical treatment of customers and employees becomes a 2, and 3rd priority. Corporate boards to keep stock share, will put people in charge that are only motivated by big performance payouts based on what the company valuation/stock price it. Thus it becomes a conflict of interest. Treat employees/customers ethically, or run them over to collect on a big performance bonus.

If people were afraid that Nvidia was going to raise licensing fees, just wait until they see what a bunch of maximize profits at all costs investors do to their licensing fees. ARM has lost money multiple times in recent years. That's not going to work going forward.

 

[digitalgriffin]

If people were afraid that Nvidia was going to raise licensing fees, just wait until they see what a bunch of maximize profits at all costs investors do to their licensing fees. ARM has lost money multiple times in recent years. That's not going to work going forward.

NVIDIA has a proven track record of hurting clients, and ever increasing margins with monopolistic anti competitive behavior. I'll take my chances with soft bank leadership.

 

[spongiemaster]

NVIDIA has a proven track record of screwing over clients and ever increasing margins with monopolistic anti competitive behavior. I'll take my chances with soft bank leadership.

Softbank approached Nvidia about selling ARM to them. They originally told ARM to do what they needed to do, and not worry about profits. After multiple years of losing money, it sure looks like Softbank isn't interested in that strategy anymore. Who knows what the future will hold for ARM, but the status quo is not a financially viable long-term strategy.

 

[digitalgriffin]

Softbank approached Nvidia about selling ARM to them. They originally told ARM to do what they needed to do, and not worry about profits. After multiple years of losing money, it sure looks like Softbank isn't interested in that strategy anymore. Who knows what the future will hold for ARM, but the status quo is not a financially viable long-term strategy.

Again, NVIDIA hasn't ever been known for their generosity. EVER. They are anti competitive and hence why multiple country regulatory agencies were fighting them.

There were failing nForce chipsets.

There were failing laptop motherboards due to bad solder joints on the BGA which were done according to NVIDIA specs.

The reason Microsoft uses AMD is because NVIDIA just didn't want to play ball.

Then there was the NPP Program which is anti competitive.

The renaming of products from adaptive sync to G-Sync compatible....to make it look like it's one of their ideas/products.

And once NVIDIA owned them, it would be much harder to stop them from transforming licensing to be anti competitive or egregious. Looked at what happened to Phys-X and support of previous products. Or how they used DCMA and various driver updates to prevent Phys-X to work when AMD cards were mixed in. I mean 3rd party developers were offering this (and GLide drivers) for free, and NVIDIA shut them down EACH time.

There are more examples of NVIDIA's anti competitive behavior where they use their weight to an unfair advantage.

And look what happened to Facebook + Occulus. Facebook PROMSED and swore up and down that they would NEVER tie facebook accounts to Occulus. They took that back within two years, making facebook accounts mandatory. You can't use a fake account either, or risk losing your library of games you paid for.

That's another company I hope is broken up for anti competitive behavior. The decline of facebook is something I am actually pleased to see because it means people are wising up and are valuing their own mental health + privacy.

 

[spongiemaster]

I'm not talking about Nvidia. I'm talking about ARM. They are not in a great spot right now. You said yourself that going public could have some very negative implications for the company, and I agree. This isn't anything to be celebrating.

 

[InvalidError]

but seriously rather than nvidia isn't that softbank that losing the most in this deal? can they even make back the kind of money they initially spend on ARM?

Unless people suddenly quit using ARM, I have no doubt SoftBank will eventually make back the 32G$ it initially paid for it. If ARM as a self-contained unit earns 1G$ net per year, it'll take 30+ years to make back the capital and several more years on top to cover interests and inflation. SoftBank likely hopes the IPO will get them there much quicker.

 

[VforV]

Again, NVIDIA hasn't ever been known for their generosity. EVER. They are anti competitive and hence why multiple country regulatory agencies were fighting them.

There were failing nForce chipsets.

There were failing laptop motherboards due to bad solder joints on the BGA where were done according to NVIDIA specs.

The reason Microsoft uses AMD is because NVIDIA just didn't want to play ball.

Then there was the NPP Program which is anti competitive.

The renaming of products from adaptive sync to G-Sync compatible....to make it look like it's one of their ideas/products.

And once NVIDIA owned them, it would be much harder to stop them from transforming licensing to be anti competitive or egregious. Looked at what happened to Phys-X and support of previous products. Or how they used DCMA and various driver updates to prevent Phys-X to work when AMD cards were mixed in. I mean 3rd party developers were offering this (and GLide drivers) for free, and NVIDIA shut them down EACH time.

There are more examples of NVIDIA's anti competitive behavior where they use their weight to an unfair advantage.

And look what happened to Facebook + Occulus. Facebook PROMSED and swore up and down that they would NEVER tie facebook accounts to Occulus. They took that back within two years, making facebook accounts mandatory. You can't use a fake account either, or risk losing your library of games you paid for.

That's another company I hope is broken up for anti competitive behavior. The decline of facebook is something I am actually pleased to see because it means people are wising up and are valuing their own mental health + privacy.

I will raise all your anti-competitive valid points about nvidia with some of the scummy and BS things they did like:

• selling the 2080 Ti for over 70% price increase over the 1080 Ti while giving only 30% more performance for that price, $1200 from $700.
• lying and BS-ing about RTX and DLSS for 1.5 years with only 2-3 games supporting them, with horrible implementations for both techs.
• raising the prices again with 3090 at $1500 while being only 10-15% better, at best, than the 3080 at $700.

- shouting from the rooftops that they "care for gamers" while selling directly to miners.

• realizing the mistake with the 3080 being so "cheap" and making it continually unavailable since launch to gamer and selling it directly to miners.
• launching too many SKUs in the upper tiers to confuse and milk every 5% perf increase possible from fools with more money than sense: 3080 to 3080 Ti to 3090 to 3090 Ti (?).

- shouting from the rooftops that they "care for gamers" while selling directly to miners.
- giving those gamer fools false hope with LHR models only to give the miners their driver unlocks directly, while never improving the situation at all.
- shouting from the rooftops that they "care for gamers" while selling directly to miners.
- lunching 3080 12 GB without an MSRP because there are to many fools with more money than sense or common sense or sane principles to actually notice how big of a mockery that is and the precedent it makes.
- shouting from the rooftops that they "care for gamers" while selling directly to miners.
- 3080 12GB without MSRP will probabaly be the start, 3090 Ti and 3070 Ti 16GB most likely will follow the same strategy, no more MSRP.
- shouting from the rooftops that they "care for gamers" while selling directly to miners.

And then comes Lovelace, with all the BS done before it, imagine the BS it will bring... no MSRP or $3000 - $4000 - $5000 price tags, take your pick.

Ngreedia is a great company. Yes.

edit: great auto-format on this forum.

 

[-Fran-]

"ARM is not profitable" is a big fat lie.

SoftBank made a big bet buying into ARM, much like they bet buying into other companies and are losing money currently due to these other purchases. They need to cut their loses and ARM is the best card they can play right now to stop it. As a company ARM is stupidly valuable (just look at what nVidia was willing to spend for it), which is almost double what SoftBank paid for.

ARM as a standalone company can survive just fine. They had been for a lot of years and grew just fine. They didn't have sudden explosive growth, but they have been steadily going up. Hence their market valuation and the confidence of going for an IPO. We did have this conversation not long ago and ARM has been doing fine on their own.

Regards.

 

[spongiemaster]

"ARM is not profitable" is a big fat lie.

Google Softbank 2021 annual report.

Page 98:

Segment income - Segment loss was ¥33,873 million, deteriorating by ¥22,768 million year on year. This was mainly due to the recording of charges relating to the increases in the fair value of share-based remuneration already granted to Arm employees relating to share-based remuneration following the agreement for sale of all shares in Arm to NVIDIA and the expected acceleration of the vesting date that were triggered by the proposed acquisition of Arm by NVIDIA (including one-off charges).

According to Softbank's own financial report, ARM lost 34 billion yen (almost $300 million) this past year, and 11 billion (about 95 million) the year before. I believe the only year Softbank reported a positive income for ARM since their purchase was a year where ARM had a major one time IP sale.

As a company ARM is stupidly valuable (just look at what nVidia was willing to spend for it), which is almost double what SoftBank paid for.

Softbank bought ARM in 2016 for $32 Billion. Nvidia's offer was $40 billion. Not sure how 40 is almost double 32. Adjusted for inflation, $32 billion in 2016 is $37 billion today.

 

[-Fran-]

Google Softbank 2021 annual report.

Page 98:



According to Softbank's own financial report, ARM lost 34 billion yen (almost $300 million) this past year, and 11 billion (about 95 million) the year before. I believe the only year Softbank reported a positive income for ARM since their purchase was a year where ARM had a major one time IP sale.



Softbank bought ARM in 2016 for $32 Billion. Nvidia's offer was $40 billion. Not sure how 40 is almost double 32. Adjusted for inflation, $32 billion in 2016 is $37 billion today.

I definitely remembered the number from the SoftBank purchase wrong. As for the "profitable" bit, it has nothing to do with their yearly performance. To asses whether or not a Company is profitable you don't look at just one quarter or FY. That's like saying "I'll marry that woman" based only on a picture of her.

Regards.

 

[spongiemaster]

To asses whether or not a Company is profitable you don't look at just one quarter or FY. That's like saying "I'll marry that woman" based only on a picture of her.

Did you miss the part where I said that they've been profitable only one year out of 5 under Softbank, and that year gets an asterisk because they had to sell assets to make that happen?

 

[-Fran-]

Did you miss the part where I said that they've been profitable only one year out of 5 under Softbank, and that year gets an asterisk because they had to sell assets to make that happen?

Yep, I did read that.

Regards.