Arm set to cut hundreds of positions after deal with NVIDIA crashes, estimated 15% employed could be affected
Recently, NVIDIA was working to acquire Arm Technologies for upwards of $40 billion. Government officials and other companies voiced their disapproval of the acquisition, and in turn, Softbank and NVIDIA canceled the deal. Now, Arm is planning to utilize budget cuts by removing hundreds of employees from the company's workforce.
NVIDIA's loss of Arm acquisition affects the latter company's employees, who may see unemployment in the coming months
Arm's chief executive officer Rene Haas told staff members earlier this week that twelve to fifteen percent employed by the company could be impacted. The estimated amount of jobs lost is close to a thousand employees. To place this into further examination, Arm employs over 6,500 employees globally. The company states that most jobs affected are located in both UK and US workforce locations.
This is going to be a tough time for everyone, so I want to be clear on why we are doing this. 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.
— Email from Haas discovered by The Telegraph
Earlier this year, Softbank, Arm's parent company, expressed it was deserting Arm's deal to NVIDIA due to "significant regulatory challenges." In the latter half of 2020, NVIDIA publicly revealed the $40 billion deal. NVIDIA saw a successive climb in stock cost, rising to as high as $80 billion last year. Unfortunately, with Softbank renouncing the sale, the company stated that they will now plan to take Arm public, allowing them to profit from the change. This acquisition would have been one of the most significant deals in the semiconductor industry.
Former Arm CEO Simon Segars (2013 to 2022) cautioned that its present investment statuses would not remain stable if the company went public. With the now-defunct NVIDIA deal, Arm had plans to increase its workforce to twice the amount after purchase by Softbank.
Like any business, Arm is continually reviewing its business plan to ensure the company has the right balance between opportunities and cost discipline. Unfortunately, this process includes proposed redundancies across Arm’s global workforce.
— Arm official statement to The Telegraph