[News] Arm to Develop AI Chip Next Spring and Start Mass Production in Autumn 2025

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SoftBank Group’s global IP leader, Arm, has reportedly announced the establishment of an AI chip division with the goal of developing AI chip prototypes by spring 2025. According to a report from DRAMeXchange, mass production will be handled by contract manufacturers, with initial production slated to begin in autumn 2025.

Arm will cover the initial development costs estimated to reach several trillion yen, funded by SoftBank Group. Once a large-scale production system is built, Arm’s AI chip business may be spun off and incorporated into a SoftBank Group division, which is because SoftBank holds a total of 90% of Arm’s shares and has been in talks with TSMC to secure production capacity.

Arm is a significant player in the global semiconductor industry, renowned for its energy-efficient Arm architecture, which commands over 90% of the global market share in smartphone chip field. SoftBank acquired Arm in 2016 for USD 32 billion, empowering Arm to go public on the US stock exchange in September 2023.

Last week, Arm reported fiscal 2024 fourth quarter revenue of USD 928 million (+47% YoY) and adjusted operating profit of USD 391 million. It forecasts first-quarter revenue for fiscal year 2025 to be USD 875-925 million, expecting annual revenue to be USD 3.8-4.1 billion.

According to Canada’s Precedence Research, the current market size for AI chips is USD 30 billion, expected to exceed USD 100 billion by 2029 and USD 200 billion by 2032. Despite NVIDIA’s dominant position in AI chip technology, it is unable to meet the growing demand.

Eyeing on the opportunities presented by the AI wave, SoftBank Group founder Masayoshi Son has identified AI as a key focus area for development and is seeking to raise USD 100 billion to found an AI chip company to compete with NVIDIA.

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• [News] SoftBank Founder Masayoshi Son Plans to Raise USD 100 Billion to Establish AI Chip Company

(Photo credit: SoftBank News)