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Nvidia Close To Buying ARM for $40 Billion: Report

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UPDATE: The deal is now official - Nvidia has announced its purchase of ARM for $40 billion. Head here for our coverage of the official announcement. 

Original Article:

In a deal that would undoubtedly change the semiconductor industry for years to come, according to the Wall Street Journal, Nvidia is close to finalizing a deal with SoftBank to purchase ARM Holdings for more than $40 billion in stock and cash. The deal is expected to be officially announced early next week. While the exact terms and final sale price of the deal are unknown, the $40 billion offer would represent a tidy profit for SoftBank, which purchased ARM for $32 billion four years ago. 

As part of the deal, Nvidia would likely be subject to regulatory approvals that would compel the company to continue to license the ARM architecture to existing customers, but it would still gain access to a treasure trove of IP and engineering talent. That could enable the company to quickly develop custom CPU architectures for its own use, which would then further the company's broadening push into the profit-rich data center market. 

Nvidia has long held the leading position in AI compute in the data center, particularly in the leading supercomputers. However, AMD and Intel, by virtue of having both CPU and GPU production in-house, can tie the CPU and GPU together in much more sophisticated ways than Nvidia due to their purpose-built designs. As a result, the most important supercomputing contracts from the Department of Energy have recently gone to Intel and AMD, both of which have the advantage of tightly-coupled GPU and CPU designs that will power the world's first exascale-class supercomputers. Derivatives of those same designs will eventually filter out to the broader market. 

In comparison, Nvidia's singular focus on GPU compute limits its ability to compete with complex designs that fully leverage the advantages of memory coherency between accelerators (like GPUs) and the CPU. Naturally, custom ARM-based Nvidia CPUs would address that need perfectly, and the company has already paved the way for tighter ARM integration with its recent introduction of CUDA support for ARM architectures

An ARM acquisition would tie nicely into Nvidia's broader aspirations, too. Nvidia recently purchased Mellanox for $6.9 billion and Cumulus Networks, bringing leading networking capabilities into its portfolio, and the company also purchased SwiftStack, a company focused on object storage software for AI and HPC computing. 

As such, Nvidia's own line of custom ARM-based data center chips could be the final piece of the puzzle that allows it to create vertically-integrated data center-scale architectures that would deliver on Jensen Huang's vision for the future of computing

Nvidia could also use custom ARM architectures to address its other target markets, like IoT, autonomous driving, and robotics. ARM architectures currently power billions of mobile devices, and it's also conceivable that ARM's licensing model would help Nvidia leverage its graphics portfolio more broadly in that explosive market. 

However, Nvidia will undoubtedly face daunting regulatory hurdles in its quest to purchase ARM, particularly because of ARM's long-held neutrality that helped foster its broad adoption. There have also been signs of resistance in the UK, the home to ARM Holdings. The worsening US-China trade war could also complicate efforts to gain approval from China's MOFCOM regulatory agency, but Nvidia has already navigated those troubled waters during its Mellanox purchase. The company is obviously confident it can withstand regulatory scrutiny of an ARM acquisition, too. 

Nvidia and SoftBank have kept the details of the negotiations, and even the existence of them, close to the chest. Given the increasing signs of a pending deal, we expect we'll learn more official details soon, with several outlets pointing to an official announcement early next week. 

  • Chung Leong
    The beginning of the end for Adreno? Nvidia can bring a lot to bear in the mobile GPU space.
    Reply
  • digitalgriffin
    Admin said:
    The Wall Street Journal reports that Nvidia is close to finalizing a deal to buy ARM from SoftBank for roughly $40 billion.

    Nvidia Close To Buying ARM for $40 Billion: Report : Read more
    God I hope U.S. gov't steps in and files an anti trust suit. Nvidia has shown time and time again what a bunch of asshats they can be towards consumers and other companies. They have always been anti competitive.
    Reply
  • InvalidError
    Chung Leong said:
    Nvidia can bring a lot to bear in the mobile GPU space.
    If that was the only thing Nvidia wanted, it could already do it by tacking its own GPU to ARM CPUs like it did for the Tegra SoCs. No need to spend a fortune on ARM there, license the CPU either as an IP-core or HDL and go from there.
    Reply
  • spongiemaster
    digitalgriffin said:
    Nvidia has shown time and time again what a bunch of asshats they can be towards consumers and other companies. They have always been anti competitive.
    Name a tech company that can afford ARM that this description doesn't fit.
    Reply
  • Chung Leong
    InvalidError said:
    If that was the only thing Nvidia wanted, it could already do it by tacking its own GPU to ARM CPUs like it did for the Tegra SoCs. No need to spend a fortune on ARM there, license the CPU either as an IP-core or HDL and go from there.

    ARM is valuable mainly because of its market position. Its mobile GPU isn't as dominant as its CPU designs, but it's still widely licensed. Nvidia is pretty strong on the software side. It can really help Mali expand its market share. DLSS, for instance, is even more useful on mobile devices than on desktops.
    Reply
  • InvalidError
    Chung Leong said:
    It can really help Mali expand its market share.
    It would make more sense to divest from Mali and use use the resources it would otherwise have to spend on maintaining Mali's development on adapting Ampere to mobile, automotive and all the other SoC/embedded stuff Nvidia wants to get into.
    Reply
  • nofanneeded
    Looks like Nvidia wants to compete against AMD in the console market thats why they are buying ARM ...
    Reply
  • animekenji
    Apple snubbed NVidia cards in Macs, now NVidia can snub Apple for ARM CPU's in iPhones.
    Reply
  • Jim90
    digitalgriffin said:
    God I hope U.S. gov't steps in and files an anti trust suit. Nvidia has shown time and time again what a bunch of asshats they can be towards consumers and other companies. They have always been anti competitive.
    spongiemaster said:
    Name a tech company that can afford ARM that this description doesn't fit.
    ...being able to "afford ARM" has no bearing on the fact that " Nvidia has shown time and time again what a bunch of asshats they can be towards consumers and other companies. "
    Reply
  • sizzling
    Jim90 said:
    ...being able to "afford ARM" has no bearing on the fact that " Nvidia has shown time and time again what a bunch of asshats they can be towards consumers and other companies. "
    I’m not defending NVidia but you can dig up shady decisions on pretty much any global company. NVidia would probably look well behaved against many. NVidia’s is playing the game. At the end of the day these companies have a legal obligation to their shareholders and like it or not the game is stacked in the favour of the shareholders and not the customer.
    Reply