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Arm Sees Sales Growth of More Than 20% Next Year Boosted by AI

Arm CEO Haas spoke to investors at a luncheon in New York

Chip designer is looking to raise almost $5 billion in IPO

Bloomberg Tweet on ARM IPO

Bloomberg News on ARM

The Arm US headquarters in San Jose, California, US, on Wednesday, Sept. 6, 2023. SoftBank Group Corp.’s Arm Holdings Ltd. is planning to raise as much as $4.87 billion in the chip designer’s long-anticipated initial public offering, marking lowered ambitions for an IPO that was once expected to generate roughly twice that amount.

Arm Holdings Ltd. said on its investor roadshow that it expects revenue growth of 11% in its current fiscal year and an increase in the mid-20% range in fiscal 2025, boosted by demand for chips to power data centers and artificial intelligence, according to people familiar with the matter.

Arm executives made the forecast during an investor luncheon in New York ahead of its initial public offering, the people added, asking not to be identified because the matter is private.

The SoftBank Group Corp.-owned chip designer is looking to raise as much as $4.87 billion in what’s poised to be the largest IPO of the year. Investor reception to Arm’s growth prospects will be key to determining what Arm will be valued at in the listing.

Investors who attended the event cited Chief Executive Officer Rene Haas as saying that price increases have provided the company with a “larger bump than seen historically.”

Arm had an adjusted operating profit margin of 29% in fiscal 2023 with plans to expand that to 40% in the first quarter, according to the presentation.

Arm is expected to price its public offering on Sept. 13 and the stock will start trading the next day

Image: Arm Softbank