SoftBank Fuels Arm's Chip Ambitions with Bold $2B Stake in Intel

SoftBank Group's recent $2 billion investment in Intel Corporation not only signals strong support for Arm Holdings' independent chip development efforts but also provides a potential boost in wafer fabrication capacity. As noted by analysts Joe Quatrochi and Travis Prinn at Wells Fargo, this investment could be perceived by the market as a pivotal move towards the development of autonomous AI chips by Arm. Currently, SoftBank owns a majority stake in Arm, holding 87% of its shares.

It's important to recall that Intel Foundry Services (IFS) and Arm forged a collaboration in 2023 to assist chip designers in leveraging Intel's 18A process to create low-power System-on-Chip (SoC) designs, initially targeting mobile devices. Expanding these applications to include automotive, IoT, and data centers is a planned progression for this partnership.

This strategic investment positions SoftBank as Intel's sixth-largest shareholder, with a 2% stake in the company. Notably, Arm has recently onboarded Rami Sinno, an industry veteran from Amazon, who led the development of proprietary AI chips such as Trainium and Inferentia. This hiring move underscores Arm's commitment to accelerating its complete independent chip development strategy.

Under the leadership of CEO Rene Haas, Arm has increased its research and development spending as it evaluates the feasibility of producing its own chips. The company has brought on board key players like Nicolas Dubé and Steve Holt, who bring deep expertise in large-scale system design and chip engineering from their tenures at companies like Hewlett Packard Enterprises, Intel, and Qualcomm, respectively.

SoftBank's continuous expansion in the AI sector highlights its strategic objective to establish a foothold across the AI industry spectrum. The group's acquisition of Graphcore and Ampere, along with its significant stake in OpenAI, positions it as a formidable player in the high-performance AI computing landscape based on Arm platforms.