"Try" is doing a lot there. I can't see how Arm is even worth the $32 billion SoftBank paid for them now. RISC-V didn't exist outside of Berkeley in 2016 when

"Try" is doing a lot there. I can't see how Arm is even worth the $32 billion SoftBank paid for them now. RISC-V didn't exist outside of Berkeley in 2016 when SoftBank bought Arm, but now it's becoming a serious rival and especially a serious limitation on how much Arm can raise prices. Arm have around 2.7 billion in annual sales with $500m or $600m of profit. That makes $32b a P/E ratio of 50 to 60, and $50b a P/E ratio of 80 to 100. In simple terms, if you pay $50 billion to buy Arm, and they make the same profit every year as they are making now, it will take 80 to 100 years for you to make your investment back. It's like putting your money into a bank paying 1% interest, but a lot riskier. Such P/E ratios can only be justified by the company and its profits growing rapidly. Arm's revenue actually fell 1% from 2022 to 2023. The last four years have been roughly 2.0, 2.7, 2.75, 2.7. Is that a peak, and it's only downhill from now on, because of RISC-V (or otherwise). Or will they start to grow again? Either way, it sure doesn't look like the very high annual growth rate needed to justify a price of $30b let alone $50b.