The will-they-won’t-they of the Nvidia Arm acquisition had us in suspense until it finally came to an unsuccessful close in February. After a long haul of investigations from governing bodies, eventually Nvidia had to abandon its purchase, and it seems like losing out on that $40 billion deal has done Arm more harm than expected.
According to The Telegraph (via The Verge), Arm chief executive Rene Haas, advised staff that hundreds of employees will be let go after the acquisition fell through. Between 12 and 15% of the company’s employees are expected to be affected, mostly in the US and the UK. Given Arm’s workforce is over 6,500 people strong, that could be nearly one thousand jobs on the chopping block across the company.
“This is going to be a tough time for everyone, so I want to be clear on why we are doing this,” Haas said in an email according to The Telegraph. “We need to be more disciplined about our costs and where we’re investing. To stay competitive, we need to remove duplication of work now that we are one Arm; stop work that is no longer critical to our future success; and think about how we get work done.”
This sounds like Arm is going to become an even more focussed company than it already was. It could be that Arm’s semiconductor technology may start to go in a new direction after the shuffle is complete, but company layoffs aren’t usually a good sign.
The deal between Softbank and Nvidia regarding Arm’s sale took a long time to fall through, and spent a lot of time in limbo. The acquisition would have been the largest of its kind in the semiconductor industry and could have spelled a huge boon for Nvidia, which made plenty of rival companies and some regulating bodies very nervous. Though, Arm China’s rogue CEO who stayed in the job despite being fired via an ancient loophole, thinks the deal falling through could be a good thing.
The next step for Arm, after letting go a large chunk of its employees is almost certainly to be a public listing. Politicians in the UK were already calling for Arm to be listed in London once the bid inevitably failed, but it looks like Softbank may have plans to list in New York instead. Whether or not trading as a publicly listed company proves successful for Arm, could determine the future of the company.