Posted 3/28/2024, 1:31:00 PM
Nvidia Bets Big on Booming AI Chipmaker Arm Despite Failed Acquisition Attempt
- Nvidia has invested in several AI stocks, with the vast majority going to Arm Holdings ($253M out of $347M total)
- Nvidia previously tried to acquire Arm for $40B but the deal was blocked; Arm later went public in 2023
- Arm designs processors used in smartphones, cloud computing, and data centers where AI processing happens
- Arm's revenue and earnings are growing quickly (14% revenue growth, 32% EPS growth last quarter)
- Arm has strong growth projections (34-42% revenue growth next quarter) and looks undervalued based on its price/earnings-to-growth ratio