The market may be a sea of red again on Monday but that hasn’t stopped the BrainChip Holdings Ltd (ASX: BRN) share price from racing higher.
In afternoon trade, the artificial intelligence technology company’s shares are up 8% to $1.15.
Why is the BrainChip share price racing higher?
The BrainChip share price is rising today despite there being no announcements or media releases out of the company.
However, something that appears to have caught the eye of investors is the inclusion of Arm among its list of partners.
BrainChip comments on the unannounced partnership, saying:
BrainChip is partnering with Arm, the leading technology provider of processor IP [intellectual property], to provide the most advanced solutions to make sensor products faster, smarter, and safer.
What is Arm?
In case you’re not familiar with Arm, it is a UK-based semiconductor company that designs the components of processors for others to ultimately build.
The company then owns these designs, along with the architecture of their instruction sets, and licenses the IP to other companies, allowing them to build systems that incorporate their own designs as well as Arm’s.
Earlier this year, tech giant Nvidia attempted to acquire Arm for US$40 billion before the deal ultimately collapsed due to regulatory issues.
At the time, Nvidia’s founder and chief executive Jensen Huang commented: “Arm is at the centre of the important dynamics in computing. I expect Arm to be the most important [computer processing unit] architecture of the next decade.”
In light of this, Arm certainly is a company that you would want to partner with if you were operating in BrainChip’s industry. So it isn’t overly surprising to see some investors getting excited and bidding the BrainChip share price higher.
The company could potentially be hit with a price query by the ASX following the rise in the BrainChip share price today. At which point, it may provide further details on the partnership.
Conversely, the deal may be so immaterial to the company’s revenues that management doesn’t feel it worthy of mentioning. You just never know with BrainChip.
The post Why is the BrainChip share price racing 8% higher today? appeared first on The Motley Fool Australia.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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