ARM Holdings: A Chip Off the Old Block?
ARM Holdings, a powerhouse in developing and licensing cutting-edge IP solutions for CPUs, GPUs, and NPUs, stands as a beacon of innovation in the semiconductor realm. Nestled snugly in the esteemed Zacks Rank #1 (Strong Buy) club, the company has experienced a surge in earnings forecasts, riding high on the wave of AI excitement.
The company’s product suite boasts the trust of numerous prominent semiconductor firms and OEMs, with a notable endorsement in the form of a $150 million investment from the esteemed NVIDIA NVDA. Not just a run-of-the-mill player, ARM Holdings recently trumped analyst projections by 16% in EPS and clinched a 7% sales beat. Revenue royalties hit a record high, fueled by burgeoning licensing growth — a trend that spells sunny days ahead.
Reddit: The Social Media Enigma
Reddit’s IPO, long foretold in whispered exchanges, finally made a grand entrance, beckoning those with a rosy outlook on social media’s future. The first of its kind in years, Reddit’s debut added a vibrant splash to the drab landscape of social media IPOs.
Though Pinterest PINS and Snap SNAP have seen their fortunes rise over the past year, they falter in comparison to the S&P 500. In the dance of shares post-IPO, Reddit experienced a tumultuous ride — shooting up initially only to fall back in recent days. This social media darling’s platform spans a sprawling network of over 100k active communities and a staggering 1 billion posts.
Banking on user engagement for ad revenue, Reddit eyes a potential $1.4 trillion market by 2027. With the blossoming of LLMs, the company sees a bright future in data licensing — a prospect that could potentially unlock new revenue streams.
The Bottom Line
Post the giddy highs of 2021’s record-breaking IPO spree, the landscape bears a desolate look, but amidst the rubble emerge compelling figures such as ARM Holdings and Reddit. With ARM Holdings basking in the golden hue of analyst favor and Reddit poised to tap advertising markets and harness data licensing to its advantage, the IPO market flickers with signs of life.
