Until this month, Simon Segars had not seen his new boss in person. Arm’s chief executive and Jensen Huang, Nvidia’s billionaire founder, have been in constant contact for months as Huang negotiated a $40bn (£31bn) takeover of the British microchip company. But despite the two living only a short Silicon Valley drive away from one another, this had been done entirely over Zoom.
The two were eventually pushed into proximity out of necessity, taking part in a panel discussion for developers at Arm’s virtual conference last week to answer questions about the deal. “That’s the first time I’ve seen Jensen in the flesh for a very long time,” says Segars. “We didn’t have a face-to-face meeting through the whole process.”
Since Sept 13, when Nvidia announced it had agreed to buy Arm from the Japanese tech conglomerate SoftBank, there have been plenty of questions to answer.
Veterans of the UK tech industry, including Arm’s co-founder, have attacked the deal, claiming it jeopardises the future of Britain’s most successful technology company.
Arm’s customers – many of whom compete with Nvidia – have been calling the company, demanding assurances the sale will not put them at a competitive disadvantage.
And regulators are preparing to cast their eyes over the sale, particularly in China, which fears a famously neutral technology falling into American hands in the middle of a trade war.
Given Arm’s importance to the global technology industry, as well as Britain’s, that is unsurprising.
The company’s microchip designs, which squeeze maximum performance out of low power consumption, have made Arm’s technology central to the smartphone revolution, wearable devices and, increasingly, connected cars and the ubiquitous “internet of things”.
Some 180bn chips have been produced using its technology since the company was founded in 1990 as a joint venture between Acorn Computers, Apple and Silicon Valley’s VLSI.
Segars, 52, has been with Arm since the beginning. He joined as one of the company’s first employees, and was put in charge of engineering shortly after its London flotation in 1998, before moving to the US to run global sales. In 2013, he replaced Warren East as chief executive, and was due to return to the UK until SoftBank swooped with a £24bn takeover offer, weeks after the Brexit vote.
Read more on Nvidia’s bid for Arm
SoftBank was preparing to return Arm to the stock market before Huang came calling towards the start of the summer.
Despite more than a decade in Silicon Valley, Segars has not entirely drunk the Kool Aid, turning up to conferences in suits rather than jeans and gilets, although he does drive a Tesla vehicle.
Nvidia will represent Arm’s third ownership structure in five years, but Segars says that he has no plans to leave the job.
“I didn’t get into the world of tech because I wanted to be the CEO of a FTSE-listed company; that isn’t the way I think about it,” he says.
“In these different phases of our life, we’ve been able to invest in our technology to different degrees; there’s been different constraints, different degrees of freedom. I’m thinking about what impact we can make… and I think this combination with Nvidia is going to allow us to go to that next level.”
Nvidia’s bet is that Arm will make it the world’s leading chip company, owning a chain of technology that runs from the low-power Arm chips in connected cars and high-tech factories to the beefy Nvidia processing units that sit in the data centre.
The company expects the combination will put it at the centre of a revolution in smart machines.
If Huang is right, it will be a profitable endeavour, but the deal’s sceptics still need convincing. Segars says he understands concerns but, unsurprisingly, disagrees with them.
“There are no companies in the UK that are like Arm. So it wasn’t at all surprising that people look at this and [say] it’s a shame that this is happening.
“But I look at this as an opportunity to take what we’ve done and take it even further. There’s a new frontier of computing coming. And I think that the strengths of Arm and Nvidia combined allow us to address this.”
Nvidia has committed to legally binding agreements to keep Arm’s headquarters in the UK, and has said it is willing to sign a pledge on job numbers.
More immediately, Segars is tasked with fulfilling SoftBank’s pledge that Arm will have double the UK staff it had in 2016 by next September. This will require hiring almost 500 new employees over the next year, and hoping that existing ones want to stick with the company as the sale goes through. Nvidia is awarding $1.5bn in equity to Arm employees as part of the deal, which should help.
Arm Holdings timeline
Arm’s boss will also be tasked with keeping existing customers happy, particularly when regulators are likely to question them as part of any competition investigation into the sale. Segars says he has spent much of the four weeks since Nvidia’s swoop was announced on video calls with big customers, assuring them that nothing will change.
“It is business as usual. The intent is to keep licensing technology, and to broaden our product portfolio, make it stronger and keep working with our partners, so that’s the message I’ve given to people.”
Arm’s technology itself continues to advance. This year, a Japanese supercomputer based on Arm chips was declared the world’s fastest, a first for the company’s designs. And Apple – which began the smartphone age that has been Arm’s main driver of success – said it would start using Arm-based chips in its Mac computers.
Segars says technological progress will get harder as Moore’s Law – the process by which shrinking transistors mean processors roughly double in speed every 18-24 months – comes to an end. However, he says the industry will find other ways to make gains.
“We’re moving from a world where transistor scaling delivers you this free prize every 18 months or so, to one where you have to really work hard. There are a lot of other dimensions that we can explore that I think will bear fruit over the coming years.”
Semiconductors have found themselves at the centre of US-China trade wars, with Donald Trump using export controls to cut off Huawei’s access to American chip technology, and considering using similar tactics to hurt Chinese chipmaker SMIC.
This has led to warnings the global supply chain that electronics currently relies on could be split in two, with severe costs for customers. Segars is more optimistic than most, however.
“A modern product laps the planet a few times before it ends up in your hands. And that’s led to enormous cost efficiencies. [But] I do think if there’s any industry that has a lot of ingenuity, it’s the tech industry.
“And I think it will work out how these factors come to bear in terms of keeping innovation going.”
It is a suitably even-keeled answer for the boss of a company that has been known as the “Switzerland of chips” for its ability to avoid getting caught up in trade tensions. Segars will only hope being owned by an American company does not change that.
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