What if Nvidia had acquired Arm?

Back in business school, I had secured an interview for a really great job. The interview was scheduled early in the morning, but I woke up early. Had some coffee. Reviewed my notes. I was ready. This was long enough ago that I was using a cordless, landline phone to call in.

I picked up the phone and there was no dial tone. I burst into my roommate’s room, but his wired phone did not work either. I then turned to my cell phone, but I lived in a large dark zone in the coverage map and could not connect that way either. A complete telecoms failure.

I then had to run around the neighborhood until I found a payphone at a gas station a few blocks from the apartment. (Yes – cordless, landlines, dial tones, urban coverage holes, and payphones – this was a long time ago.) Standing in the middle of a gas station at a busy intersection I finally connected, 30 minutes late. The managing director’s assistant answered the phone and told me “Yes, he understands you were delayed, and asks that you call back when you actually want this job.”

I was prompted to think about this recently while listening to sessions at Nvidia’s GTC developer conference. At one point, someone asked CEO Jensen Huang about their Hopper CPU in its relation to other Arm-based CPUs, and it occurred to me that not so long ago, Nvidia tried really hard to buy Arm. Where would Nvidia be today if that deal had happened?

Nvidia abandoned the deal in early 2022. If the deal had gone through it likely would not have closed until the end of that year. And of course, late that year in November, OpenAI launched ChatGPT and turned the world upside down.

Given that timing, If the deal had gone through, it is very possible that the integration of Arm would have become a second tier problem. Nvidia would still be riding high, and it is hard to see the management team devoting as much energy to boring integration issues when they could literally become AI rockstars. Arm probably would have suffered as a result, still large, but languishing as a bit of an afterthought.

By comparison, what if the deal had sailed through and closed earlier in 2022 and become a focus of Nvidia. Would they have missed ChatGPT? Probably not, Nvidia had been betting heavily on AI for a long time and it is unlikely they would have let the opportunity slip, but they may not have executed as well as they are now, constantly dealing with Arm integration and trying to shoehorn that narrative into the AI narrative.