Arm Holdings Drops 4.29% After Abandoning Alphawave Acquisition

On April 3, 2025, Arm Holdings experienced a 4.29% drop in pre-market trading.

Arm Holdings, a leading chip technology provider under SoftBank, had initially considered acquiring Alphawave IP Group, a prominent player in the SerDes IP market. However, after preliminary discussions, Arm decided not to proceed with the acquisition. This decision comes as Qualcomm has confirmed its interest in acquiring Alphawave, with a potential offer expected by April 29. Alphawave's technology is crucial for data centers, AI, and 5G communications, making it a valuable asset in the semiconductor industry.

Arm's decision to forgo the acquisition of Alphawave may be influenced by its strategic focus on expanding its market share in the data center CPU market. Mohamed Awad, Arm's senior vice president of infrastructure, has stated that the company aims to increase its global data center CPU market share from the current 15% to 50% by the end of 2025. This ambitious goal is supported by the growing adoption of Arm-based servers by major cloud service providers such as Amazon Web Services, Alibaba Cloud, Google, and Microsoft, as well as the increasing demand for energy-efficient and cost-effective solutions in the AI era.