SoftBank and ARM Bid to Acquire Cerebras Ahead of IPO
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Should l Buy ARM?
Source: seekingalpha
- Acquisition Interest: SoftBank Group and ARM expressed interest in acquiring Cerebras Systems weeks before its planned IPO, although their offer was rebuffed, indicating a strong strategic interest in the AI computing sector that could influence future business directions.
- IPO Pricing: Cerebras is set to price its IPO on Wednesday, potentially valuing the company at around $34 billion, which highlights the strong market demand for its AI chip technology and could yield significant returns for investors.
- Increased Fundraising: Cerebras raised its IPO fundraising target to $4.8 billion, offering 30 million shares at a price range of $150 to $160, up from the previous 28 million shares at $115 to $125, reflecting heightened investor interest in its stock.
- Strategic Partnerships: Prior to the IPO, Cerebras signed significant deals with OpenAI and Amazon Web Services, further solidifying its position in the AI chip market and likely attracting more investor attention towards its future growth potential.
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Analyst Views on ARM
Wall Street analysts forecast ARM stock price to fall
24 Analyst Rating
19 Buy
4 Hold
1 Sell
Strong Buy
Current: 228.500
Low
120.00
Averages
160.58
High
201.00
Current: 228.500
Low
120.00
Averages
160.58
High
201.00
About ARM
Arm Holdings plc is a United Kingdom-based company. The Company is engaged in the design of central processing units (CPUs) and compute platforms for semiconductor chips. It develops and licenses CPU products and related technology. Its cloud and data center solutions include Arm AGI CPU and Arm Neoverse Compute Subsystems. The Arm Agentic Generalized Infrastructure (AGI) CPU is a production-ready system on a chip (SoC) for artificial intelligence (AI) data centers, delivering compute at scale. The Arm Neoverse Compute Subsystems (CSS) are pre-validated, performance-optimized compute platforms designed to accelerate infrastructure silicon development. The Company's primary markets include smartphone applications, processors and other chips used in mobile phones, consumer electronics, networking equipment, cloud and data center servers, automotive applications, Internet of Things (loT) and other embedded computing devices.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Oil Price Surge: West Texas Intermediate crude oil prices climbed back above $105 per barrel, and this rise in oil prices may exacerbate inflation concerns, potentially impacting consumer confidence and spending, especially in a high-inflation environment.
- Volatility in AI Stocks: Stocks like Arm Holdings and Nvidia experienced profit-taking as enthusiasm for AI waned, indicating a cautious investor sentiment towards high-risk assets amid rising interest rates and oil prices.
- Upcoming Earnings Reports: A significant week of earnings is ahead with key companies like Home Depot and Nvidia scheduled to report, and the market will closely monitor these results for their potential impact on stock prices in the context of increasing economic uncertainty.
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- Disappointment from U.S.-China Summit: The meeting between Trump and Xi failed to deliver major breakthroughs, particularly disappointing investors with Boeing's aircraft commitment, which fell short of the anticipated 500 planes, coming in at around 200, thus pressuring Boeing's stock.
- Volatility in Arm Holdings: Shares of Arm Holdings dropped 7% on Friday, continuing a volatile trend following its earnings report, with Jim Cramer cautioning that the market is anxious about its ability to secure sufficient manufacturing capacity at TSMC for its AGI CPU, recommending a reduction in exposure.
- Rapid Fire Stock Review: Stocks mentioned at the end of Friday's video included Applied Materials, Dexcom, and Texas Roadhouse, with Jim Cramer's charitable trust holding positions in Arm, Boeing, and Nvidia, emphasizing the importance of timely trade alerts for subscribers.
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- Semiconductor Sector Decline: The iShares Semiconductor ETF is poised to end a six-week winning streak, with Marvell and Intel both down 4%, while ASML and Arm dropped over 3.5%, reflecting diminished investor confidence in the industry.
- Figma Stock Surge: Figma's first-quarter earnings of 10 cents per share on revenues of $333 million surpassed analyst expectations of 6 cents and $313 million, leading to a nearly 9% increase in stock price, showcasing strong market demand for its services.
- Magnum Ice Cream Acquisition Interest: Magnum Ice Cream shares jumped over 17% following reports that firms like Blackstone and CD&R are considering a bid, with potential buyers waiting for summer sales data before proceeding, indicating optimism about the company's growth prospects.
See More
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- IPO Pricing Exceeds Expectations: Cerebras Systems priced its IPO at $185, surpassing the expected range of $150 to $160, raising $5.55 billion and achieving a valuation of $56.4 billion, reflecting strong market demand for its AI chips.
- Strong First-Day Trading: Shares opened at $350 on Nasdaq, nearly double the IPO price, and closed at about $311, indicating investor optimism about the company's growth potential, although historical data suggests that such IPOs may underperform in the long run.
- Significant Revenue Growth: Cerebras reported revenue of $510 million in 2025, a 76% increase from $290 million in 2024, showcasing its robust growth in the AI inference market, despite ongoing operational losses.
- Customer Concentration Risk: In 2025, 86% of Cerebras' revenue came from just two UAE-linked customers, and while the long-term agreement with OpenAI provides revenue visibility, the high customer concentration poses risks to the company's future stability.
See More
