Rumors Circulate: Arm Plans to Establish New Division with a Focus on AI Chip Development, Specifically Backed by SoftBank for Funding.

According to a report from Nikkei Asia, Arm is set to establish a new department within the company to develop chips specifically for AI. The initial prototype is expected to be released in early 2025, with production starting at partner factories, likely TSMC, by the end of 2025.

The establishment of a new division will come with research and development costs, with Arm reportedly funding it first, supported by SoftBank, the major shareholder in Arm, providing substantial funding until the production of these AI chips enters mainstream production and generates clear revenue. SoftBank plans to spin off this business segment from Arm into a separate company within the SoftBank group in the future.

Arm’s direction aligns with the current market trend of data center chip development, where major players are focusing on developing chips for AI applications to reduce dependency on major AI chip manufacturers like NVIDIA. The overall AI chip market is expected to continue growing significantly.

Arm, SoftBank, and TSMC have all declined to comment on this report.

TLDR: Arm is establishing a new department to develop AI chips, with initial prototypes expected in 2025 and production likely at TSMC by the end of the same year. SoftBank is providing significant funding for this venture, with plans to eventually separate it into a standalone company within the SoftBank group.