Stocks rise 40 percent in a British technology company that went public in New York
Stocks in the British technology company Arm have risen to their highest point since its initial public offering in New York last year, on the announcement of strong sales.
Stocks increased by up to 40 percent in trading after the market closed following the company’s third-quarter results—only its second set of financials since the initial public offering in September.
If continued, that would result in Arm being valued at over $100bn (£79bn), although the shares later decreased to a 20% increase.
The Japanese technology giant SoftBank owns the majority of Arm, a company whose microprocessor technology is present in billions of processors, most notably in the majority of smartphones worldwide. SoftBank acquired the former FTSE 100 business in 2016.
Last year, the company went public, this time in New York, in the largest public offering of the year. The decision was a setback for Rishi Sunak, who had personally encouraged management to list the business in London.
On Wednesday night, Arm surpassed the expectations of Wall Street by achieving a 14 percent growth in revenues, reaching $824 million. It experienced a rise in license revenue—payments from clients purchasing its technology—and record royalty revenue—continuous payments made for each chip produced utilizing its technology.
The rise in artificial intelligence (AI), which has increased the demand for various kinds of microchips, boosted sales.
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