Understanding Arm’s Strategic Importance in Chips: QuickTake

One of the most influential businesses in the tech industry is unknown to most consumers: Arm Ltd. The UK-based company designs key parts of the chips that power almost every smartphone on the planet. Its strategic importance is so great that when owner SoftBank Group Corp. decided to sell the company to US chipmaker Nvidia Corp., it sparked an outcry from Arm’s customers that killed the $40 billion deal. SoftBank’s Plan B is to sell Arm shares in what could be the chip industry’s biggest-ever initial public offering.

1. What does Arm do?

Arm doesn’t own factories or produce ...