Apple and Arm’s Chip Tech Deal

You can find out a lot in an SEC filing. For example, information such as Apple‘s new deal with ARM on chip technology through 2040 and beyond.

ARM’s IPO will hit the NASDAQ exchange in the coming weeks at a total valuation as high as $52 billion—the biggest technology IPO this year.

The SEC filing states: “Further, we have entered into a new long-term agreement with Apple that extends beyond 2040, continuing our longstanding relationship of collaboration with Apple and Apple’s access to the ARM architecture.”

ARM’s architecture is currently used in nearly every smartphone chip, including Apple’s A-series for iPhones. ARM’s instruction set outlines how a central processor works at its most basic level, such as doing arithmetic or accessing computer memory. Switching large software projects to other instruction sets is expensive, complicated, and time-consuming.

ARM licensed its technology to all comers, and its customers could plan to invest billions in developing ARM chips without worrying that their access to the technology could be curtailed. According to the filing, 230 billion chips have shipped using ARM’s architecture, although about half of the company’s royalties revenue comes from products released between 1990 and 2012. Access concerns to ARM technology was the main reasons regulators stopped Nvidia’s bid to buy ARM early last year, leading to this fall’s initial public offering.