The company was founded in a barn 30 years ago and has grown into one of the most important and innovated businesses in the world. What makes it unusual is that, unlike traditional semiconductor companies, Arm Holdings uses a unique business model that focuses on intellectual property (IP). Instead of manufacturing chips, it licenses their designs to other companies.
This model translates to consistent and scalable revenue, as licensee companies are required to pay royalties on each chip sold. This strategic approach minimizes manufacturing risks and capital expenditure, while providing steady cash flows and high profit margins.