Transcript
Introduction
Zack
I'm Zack Fuss, and today we're breaking down Arm Holdings. Arm designs the architecture powering billions of devices—from smartphones and data centers to IoT devices and automotive systems. In this episode, we'll explore Arm's unique value proposition and how it thrives as a licensing giant in a market dominated by leading-edge manufacturers. We'll discuss its business model, the partnerships that drive its growth, and its role in enabling companies like Apple, NVIDIA, and Qualcomm.
We will also unpack Arm's business history, including its acquisition by SoftBank, its failed takeover by NVIDIA, and its IPO earlier this year. Arm currently sports a $150 billion market cap with sales approaching $5 billion—a rather robust 30-times-revenue multiple. This valuation is, of course, predicated on its 90%-plus gross margins, complemented by Arm's dominant market share in mobile and its increasing share gains in markets like automotive, cloud computing, and IoT, with its technology being licensed to nearly 30 billion chips annually.