Nvidia is reportedly in ‘advanced talks’ to buy ARM for more than $32B (bloomberg.com)

Article summary

Nvidia is reportedly in advanced talks to buy ARM for more than $32B. The acquisition price is considered low by some, given that Softbank paid $31B for ARM. The deal's valuation and potential impact on the industry are being debated. The acquisition could have significant implications for the tech industry, particularly with regards to ARM's licensing model and relationships with other companies.

Main themes

• ARM acquisition
• Nvidia valuation
• Tech industry implications
• RISC-V investment
• US-China trade restrictions
• Licensing model revenue streams
• Growth potential and interest rates
• Debt and financial risk

What commenters say

• The acquisition price of $32B is considered low given ARM's value and Softbank's initial investment.
• ARM's growth rate has been tepid since Softbank's acquisition, making a high multiple valuation questionable.
• The acquisition could lead to increased investment in open alternatives like RISC-V, particularly in countries that may be targeted by US trade restrictions.
• Nvidia's ownership of ARM could raise concerns about compliance with US restrictions on dealing with China and potentially harm ARM's relationships with Chinese companies.
• The deal's valuation is justified by the potential for future growth and the current low interest rate environment.
• ARM's licensing model and revenue streams are not as valuable as some companies with higher profit margins.
• The acquisition could give Nvidia a significant advantage in the cloud and server markets, but may not be worth the massive debt it would incur.
• The valuation of the deal is not insane given the current market environment and Nvidia's own high P/E ratio.