Arm Holdings, a UK-based chip designer, has experienced significant growth in its stock market value over the past week. The company’s value has almost doubled, thanks to the increasing demand for artificial intelligence (AI) technology. Investors are speculating on the company’s success due to its recent financial results showing a boost in sales related to AI technology.
Arm chips power almost every smartphone in the world and are also used in the automotive industry due to the development of self-driving technology. The company’s technology is not directly used for AI, but chip makers like Nvidia are choosing Arm for CPUs that complement their AI-specific chips. In addition to Nvidia and Taiwan Semiconductor Manufacturing Company, Arm’s customers also include well-known consumer brands like Apple.
The news of Arm’s soaring valuation comes at a time when chipmaker Nvidia has also seen extraordinary growth, with its shares more than tripling in value over the past year. This high demand for AI chips has made Nvidia one of the most valuable publicly-traded companies in the world, worth around $1.8 trillion. SoftBank, Arm’s Japanese owner, still holds a roughly 90% stake in the business. The increase in stock market value opens up new opportunities for both companies and highlights the growing importance of AI technology in today’s digital world.