TLDRs:
- Nvidia sells all remaining Arm shares while maintaining a long-term engineering partnership.
- Arm technology remains central to Nvidia’s AI data center and Grace CPU plans.
- Stake divestment may reflect strategic shifts as hyperscalers expand custom AI chips.
- Sale does not indicate reduced reliance on Arm or conflict avoidance strategies.
Nvidia (NVDA) has officially sold its remaining shares in Arm Holdings, marking a complete exit from its equity stake in the chip technology company.
According to a regulatory filing, the company disposed of approximately 1.1 million shares, valued at roughly US$140 million based on Arm’s closing price in the fourth quarter of 2025. Following this transaction, Nvidia no longer holds any equity in Arm.
The move comes years after Nvidia initially agreed to acquire Arm in 2020 for a reported US$40 billion. The acquisition, however, was terminated in 2022 due to regulatory hurdles and pushback from Arm’s customers. Nvidia has not publicly commented on the recent sale, and Arm has not issued a statement in response.
Despite this divestment, analysts note that the two companies continue to maintain a close technical partnership.
Long-Term Collaboration Persists
While the stock sale might suggest a step back, Nvidia’s operational reliance on Arm technology remains strong. Nvidia’s Grace CPU, a critical component in its AI supercomputing platforms, is built on Arm’s Neoverse architecture. After the failed acquisition attempt, Nvidia retained a 20-year license for Arm technology, ensuring uninterrupted access for its hardware and software development.
CEO Jensen Huang emphasized that Nvidia would continue to “partner closely with Arm” and remain a “proud licensee for decades.”
This framing positions the relationship as a long-term engineering collaboration rather than a financial investment. The sale of shares, therefore, should not be interpreted as a reduction in strategic alignment between the two companies.
Implications for the AI Chip Race
The divestment comes amid an evolving AI chip landscape. Arm-based technology is increasingly at the heart of custom AI chips being developed by major cloud providers such as Meta, Google, and Amazon.
These hyperscalers are pairing Arm architectures with specialized accelerators to reduce dependence on Nvidia while designing more efficient AI processing systems. By 2025, analysts project that nearly half of hyperscaler AI workloads will run on Arm-based processors, further cementing Arm’s importance in the data center ecosystem.
Some observers suggest that Nvidia’s stake sale could reflect a recalibration of its investment priorities rather than any strategic distancing from Arm. With Arm now powering both Nvidia platforms and competitor products, the divestment may also signal an adjustment to navigate potential conflicts of interest in a competitive AI market.
Market Perspective and Strategic Takeaways
From a market standpoint, Nvidia’s exit from Arm equity holdings has not triggered major volatility in NVDA stock, as investors appear reassured by the ongoing technical collaboration. The move highlights a broader trend in the semiconductor industry, where partnerships and licensing arrangements often carry more strategic weight than ownership stakes.
Nvidia continues to rely on Arm-based IP for its AI supercomputing platforms, ensuring that the company remains competitive in the fast-growing AI chip market.
Analysts argue that the sale reflects financial portfolio management rather than a strategic withdrawal. By focusing on core AI initiatives and maintaining a long-term licensing agreement, Nvidia positions itself to continue benefiting from Arm technology while freeing capital for other growth opportunities.
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