The SoftBank-funded Arm Holdings Group said that it will choose a US initial public offering (IPO) that is expected to be the largest listing of the year due to the slowing down of its smartphone sales and a 1% decline in annual revenue.
Its IPO is expected to boost the slow IPO market, which has recently seen some high-profile companies delay their plans to list due to market uncertainty. The British business has fared better than others during the chip industry crisis and is growing into areas that are still booming.
For the fiscal year ending on March 31, Arm’s sales declined to $2.68 billion, mostly due to a decline in the shipping of smartphones globally. Sales for the quarter fell by 2.5% to $675 million.
Consumer electronics and mobile devices accounted for over 50% of Arm’s royalty income in its most recent fiscal year. According to Counterpoint Research, the worldwide smartphone market is expected to reach its lowest point in a decade this year.
Although Arm is highly reliant on royalties from cell phones, its revenue has only slightly declined, meaning its per-chip costs have increased.
The company that supplies the chip technology for most devices, including iPhones, has not disclosed how many shares it plans to sell or at what price.
Arm was founded in 1990 as a joint venture by Acorn Computers, Apple, and VLSI Technology. The company was traded on the Nasdaq and the London Stock Exchange from 1998 until SoftBank paid $32 billion to acquire Arm.
SoftBank began preparing for an Arm IPO after a deal to sell the business to Nvidia for $40 billion collapsed last year because of worries from American and European antitrust regulators.