However, smarter money is a little concerned that the company will not do that well in the long term.

Arm wants to raise $5 billion from the IPO, which would value it at over $50 billion and there are signs that this is doable.  Some of this is down to its owner Softbank positioning the British chip designer as an AI play which is “central” to the transition to AI-enabled computing.

Softbank might have overegged the pudding as Arm mainly designs central processing units or CPUs and most of its cash comes from smartphones. More than 50 per cent of this revenue comes from smartphones and consumer electronics. So far, it is not seeing a big boost from AI.

Abrdn investment director Jamie Mills O’Brien said that Arm’s growth in the near term for Arm is really not about AI, it’s about mobile, it’s about royalty increases.

“In the longer term, I think Arm is trying to focus investors' minds on the potential … AI in the edge, AI in the data centre, but at the moment that’s not a huge part of the company’s exposure.”

Arm’s AI future is unlikely to come from the enormous amounts of chips required to train big data models.

Instead, it’s more likely to be a major player in AI on the “edge.” This phrase refers to AI processes carried

All this means that Arm is unlikely to receive any benefit from AI for at least three to five years and by then the excitement will have gone. In fact, if the cynics are to be believed, the AI bubble will have burst completely.