Arm Holdings has priced its initial public offering (IPO) at $51 U.S. a share as the stock prepares to begin trading today on the Nasdaq exchange under the ticker symbol “ARM.”
The pricing is at the top of the expected range of $47 U.S. to $51 U.S. and gives the microchip and semiconductor designer a valuation of $54.5 billion U.S.
The British-based company provides chip designs to semiconductor manufacturers, including the processors used in nearly all smartphones today.
Japan’s SoftBank Group bought Arm for $36 billion U.S. in 2016. It tried to sell the company to chip designer Nvidia (NVDA) for $40 billion U.S. in 2022 but that deal was ultimately canceled after it ran into opposition from regulators.
SoftBank will hold a 90% stake in Arm Holdings once the IPO is completed and the stock begins trading in the U.S.
In its IPO prospectus, Arm reported revenue for its most recent fiscal year of $2.679 billion U.S., down slightly from $2.703 billion U.S. in the previous year.
Net income, or profit, for the most recent fiscal year was $524 million U.S., down from $549 million U.S. in the prior year.
Arm Holdings warned in its IPO filing that a softening market for smartphones is a potential risk to investors who subscribe to its share sale.
Another potential risk is the company’s exposure to China, which accounts for about a quarter of its annual revenue.
Several large technology companies, including Apple (AAPL) and Nvidia, have expressed interest in buying up to $735 million U.S. of Arm’s stock at the $51 U.S. IPO price.
