1. Sector Spotlight: September Recap
Sector Leads
| Media & Entertainment
Jagger Lambert
| Media & Entertainment
James Concepcion
| Technology
Pan
| Technology
Ted
| Healthcare
Avi Krishna
| Healthcare
Michael Reed
| Healthcare
Joe Ames
Project Founders
| Group Lead
Jagger Lambert
| Group Lead
James Concepcion
CONFIDENTIAL
WALL STREET MASTERMIND

2. Technology
Contributors
| Group Lead
Pan
| Group Lead
Ted
| Research Analyst
Jonathan Z.
| Research Analyst
Ben Wang
| Research Analyst
Luis Urbina
| Research Analyst
Tyler Perkins
| Research Analyst
| Research Analyst
Mario D.
Siddhant Bajaj
CONFIDENTIAL
WALL STREET MASTERMIND

3. 4 – 5
Tech M&A Overview
I.
Tech M&A Deal Volume & Trends
7 – 12
Quantum Technology
II.
Overview, Opportunities & Trends
14 – 18
Virtual Reality
III.
Overview, Opportunities & Trends
20 – 27
ARM IPO Analysis
IV.
Arm Holdings plc (Nasdaq: ARM)'s Valuation -
Public Comps, Precedent Transactions & Football
Field
TABLE OF CONTENTS Technology
3

4. QUANTUM TECHNOLOGY OVERVIEW Technology
4 – 5
Tech M&A Overview
I.
7 – 12
Quantum Technology
I.
14 – 18
Virtual Reality
III.
20 – 27
ARM IPO Analysis
IV.
4

5. Technology M&A Activity & Landscape in the Last 4 Years
Tech M&A Deal Activity in the Last 4 Years by Quarter
101
73.1
39.4
45.9 48.8
24.1
68.5
88.9
70.5
102.3
78.8
56.5
173.5
106.6
62
18.6
31.9
7.5
396
429
394
429
459
316
357
306
541
529
544
407
563
319
447
352
425
152
0
20
40
60
80
100
120
140
160
180
200
0
100
200
300
400
500
600
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
Total
Volume
Ttotal
Value
($
in
Billions)
Announced Deal Value Annouced Deal Volume
2019 2020 2021 2022 2023
Factors for Decreased Deal Flow Potential for Rebound
1. Bank stress and persistent inflation problem.
Banks are more cautious about lending money to
tech companies
2. Increased regulatory pressure Tech companies are
facing increasing regulatory scrutiny from
governments around the world
3. The rise in interest rates make it more expensive
for companies to borrow money to finance
acquisitions
1. Companies have healthier balance sheets than in
previous recessions, which gives them more
financial flexibility to make acquisitions
2. Private equity firms with ample capital may
acquire undervalued tech stocks, boosting M&A
activity in the tech sector
3. The Fed paused raising interest rates. This could
give companies and private equity firms more
confidence to make acquisitions
5

6. Notable Large Deals (>$1B Deals) in the Tech Space in the LTM
%
Premium
(W)
TV/LTM
EBITDA
TV/LTM
Rev
Rationale
Buyers/
Investors
Target/Issuer
Total
Transaction
Value ($M)
Close Date
Strategic Buyers:
28.5%
N/A
10.6x
Cisco enhance their data offerings with big data
tools from Splunk, transitioning to a more
recurring revenue model & "driving the next
generation of AI-enabled security"
43,209
09/21/2023
13.2%
2.8x
0.9x
Creates global leader in wireless connectivity.
Combines DISH's satellite tech with EchoStar's
satellite communication solutions for more
financial flexibility
3,570
08/08/2023
-14.3%
13.1x
5.8x
Microsoft takes 4% stake in LSEG to help them
transition to the cloud. Deal represents steady
cash flow stream for Microsoft Cloud Services.
Expected earnings 2.2bn over 10 years
1,845
12/11/2022
Private Equity:
30.3%
28.8x
2.5x
NextGen shares had fallen by 18% in 2021 with
the death of their founder and DOJ lawsuits.
Thoma Bravo looks to turn company around
1,893
09/06/2023
17.3%
27.3x
3.4x
AVID produces leading editing software and
hardware for entertainment industries. STG's
strategic capabilities will help AVID create new
solutions for creative and business needs
1,466
08/09/2023
21.4%
N / A
6.9x
NEWR provides a comprehensive observability
platform for engineers. TPG's Digital's expertise in
infrastructure management will help NEWR
create AI-enabled, innovative products
6,972
07/31/2023
111.5%
15.8x
7.6x
Bain Capital merges their data center platform
(Bridge Data Centers) & CD (leading Asia-Pacific
data center solution provider) to create a pan-
Asian hyperscale data center platform
4,484
06/07/2023
66.3%
19.4x
2.7x
Silver Lake becoming majority shareholder and
will help the company transition to cloud first
business focusing on cloud application and data
integration
3,339
04/21/2023
34%
17.9x
5.0x
Mean
25%
17.6x
4.6x
Median
6

7. QUANTUM TECHNOLOGY OVERVIEW Technology
4 – 5
Tech M&A Overview
I.
7 – 12
Quantum Technology
I.
14 – 18
Virtual Reality
III.
20 – 27
ARM IPO Analysis
IV.
7

8. Quantum Technology Explained
Hardware Superposition
Entanglement
Interference
Probabilistic
Outcomes: Particles
in Superposition affect
each other’s
probabilistic outcome
Nullification and
Augmentation:
Particles can augment
or cancel out certain
outcomes
Qubit Interference:
The user can
effectively control the
likelihood of specific
binary outcomes
Simultaneous
Problem-Solving:
Due to Superposition,
multiple solutions are
explored at once
Computing: Qubits
can have multiple
probabilistic
outcomes in binary
code (1, 0, or both)
Theory: Subatomic
particles can exist in
multiple states
simultaneously
Qubit Connection:
Through
Entanglement, qubits
affect one another
changing their binary
output instantly
Invisible Linkage:
Atom particles link
with each other over
any distance
Synchronization:
After linkage, Atoms
instantly affect each
other through
Entanglement
Faster than HPC:
Complex calculations
are computed in hours
rather than years
Qubit Properties:
Qubits obey quantum
mechanic rules
accelerating data
processing
Classical Vs
Quantum: Qubits
replace classical bits
while still maintain
binary outcomes
8

9. 1905
• Albert Einstein explains the photoelectric effect with the concept of light quanta, which later become known
as photons
• This breakthrough was one of the first indications that light behaves in a quantum way
1960
• Theodore Maiman invents the laser. Lasers are used in a wide variety of quantum technologies, including
quantum communication, quantum computing, and quantum sensors
1982
• Richard Feynman proposes the idea of quantum computers
• Quantum computers have the potential to solve certain problems much faster than classical computers, such
as factoring large numbers and simulating complex molecules
1998
• The first quantum algorithm is implemented on a 2-qubit quantum computer
• This was a major milestone in the development of quantum computing, as it showed that it was possible to
implement quantum algorithms on real hardware
2011
• D-Wave Systems releases the first commercial quantum computer
• This was a significant step towards making quantum computing more accessible to researchers and
businesses
2023
• Microsoft claims to have achieved the first milestone in creating a reliable / practical quantum computer
• This milestone suggests that we may be approaching a point where quantum computers can be used to solve
real-world problems
Quantum Technology Timeline
9

10. MSFT, 31%
AMZN, 20%
GOOGL, 19%
NVDA, 14%
Other, 6%
RGTI, 3%
BABA, 3% INTC, 2% QBTS, 2%
Quantum Computing by Market Cap
LTM
P/E
TEV/
2021
Rev
TEV/
2022
Rev
TEV/
LTM
Revenue
TEV/
2021
EBITDA
TEV/
2022
EBITDA
TEV/
LTM
EBITDA
Enterprise
Value
($M USD)
Market Cap
($M USD)
Shares
O/S
(Million)
% of 52-
Week
High
52w
High
Price
($ USD)
Day Close
Price
($ USD)
Company
Name
133.3x
3.1x
2.8x
2.7x
24.3x
26.6x
19.2x
1,442,544
1,332,228
10,318
89%
$145.86
$129.12
42.6x
12.6x
11.4x
11.0x
25.6x
23.7x
22.2x
2,323,494
2,355,309
7,430
86%
$366.78
$317.01
34.1x
6.1x
5.5x
5.4x
17.1x
17.2x
16.4x
1,562,219
1,651,119
12,632
94%
$139.16
$130.25
149.9x
38.0x
37.9x
31.3x
91.2x
143.6x
81.1x
1,022,698
1,027,767
2,470
83%
$502.66
$416.1
20.8x
1.7x
1.6x
1.6x
10.3x
9.2x
7.8x
194,998
224,584
2,543
73%
$121.3
$88.3
42.6x
6.1x
5.5x
5.4x
24.3x
23.7x
19.2x
Median
76.1x
12.3x
11.9x
10.4x
33.7x
44.1x
29.3x
Mean
Quantum Technology Biggest Players
Other Commentary
1. Governments around the world are investing heavily
in quantum technology, and this support is essential
for the continued development of the field
2. The potential impact of quantum technology on
specific industries. For example, you could discuss
how quantum computers could be used to develop
new drugs, design new materials, and create new
financial algorithms
3. The ethical implications of quantum technology. For
example, you could discuss the potential for quantum
computers to be used to develop new cyber weapons
or to break existing encryption algorithms
10

11. 11% 17% 24% 27% 21%
0% 20% 40% 60% 80% 100%
Headwinds for Quantum Technology / Computing
• Quantum computers are
susceptible to errors
caused by
environmental factors,
such as noise and
vibration
• These errors can lead to
incorrect results, which
can be a serious
problem for applications
such as financial
modeling and drug
discovery
Computational
faulting
Cybersecurity Scalability Cost
• Quantum computers
could be used to break
existing encryption
algorithms, which would
have a major impact on
cybersecurity
• Governments and
businesses are working
to develop new
encryption algorithms
that are resistant to
quantum attacks
• Building and operating
quantum computers is
very expensive and
complex
• This is because quantum
computers require
highly specialized
hardware and software
• As a result, it is unlikely
that quantum computers
will be widely scalable
in the near future
• Quantum computers are
currently very expensive
due to the recently
development of the new
technology. The cost of
developing/operating
QC is high
• The cost is expected to
drop over time, but it is
not clear when quantum
computing will be
affordable for
businesses/individuals
Select
Applications
Testing
Applications
Preliminary
Research (Years
from production)
Conceptually
Interested
Not Discussed
44% 43%
36% 34% 34%
29% 27% 26% 24%
Headwinds of Quantum Computing Quantum Computing’s Slow Adoption
11

12. $812.6
$8,229
$-
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
$9,000
2022 2023 2024 2025 2026 2027 2028 2029 2030
Market
Value
($M
USD)
0
100
200
300
400
$-
$0.5
$1.0
$1.5
$2.0
$2.5
Number
of
QT
Startups
Investments
in
QT
($
Billion
USD)
QT Investments QT Startups Founded
Quantum Technology (QT) Immense Market Growth Quantum Technology Trends
Startups & Investor Interest in QT from 2001 to 2022 Investment Risks
Notable Quantum Tech Companies
Quantum Technology Market Overview / Investment Outlook
Investment Trends:
1. Majority of Investments are in US Companies
(Early-stage startups)
2. VC & Private Investors -> 80% of investments
3. Hardware manufacturers most interested
4. Causes of startup/investments slowdown:
Lack of talent, few practical use cases
Other Trends:
• >50% of QT Patents are owned by Chinese
companies
• Most active QT Startup scenes: US & Canada
• US publication is most impactful (h-index)
• EU has the highest focus of QT Talent
• Universities offering QT degrees increased by
74% since 2021 (from 13 to 50)
• Quantum computing is promising technology with
high development and deployment costs, limiting
investment to large companies and governments
• The ethical implications of quantum computing,
such as the potential for new cyber weapons or the
development of algorithms that can break existing
encryption, must be carefully considered
12

13. Cybersecurity
• Quantum computing could accelerate
trade operations, transactions, and data
processing by orders of magnitude
Energy
• Quantum computing could help optimize
energy grids and improve energy storage
Life Sciences
• Quantum computing in healthcare has
the potential to revolutionize the way we
diagnose and treat disease
Finance
• Applications include portfolio
optimization, risk analysis, fraud
detection, asset pricing, and capital
allocation
Space &
Defense
• Quantum algorithms optimize the
planning/scheduling of mission
operations, machine learning for Earth
science data, and space exploration
Cyber
Security
Energy
Life Sciences
Finance
Space &
Defense
Quantum
Technology
/
Computing
(QT / QC)
• Optimize portfolios and analyze risk more accurately:
Quantum computing can help financial institutions
make better investment and lending decisions
• Detect fraud and forecast markets more effectively:
Quantum computing can help financial institutions
save money and make better market predictions
Quantum Technology Industry Applications
Opportunity for Finance
Opportunity for Life Sciences
• Quantum computing could be used to screen millions of
potential drug candidates to identify the ones that are
most likely to be effective and safe
• It can be used to model the progression of diseases, which
could lead to the development of effective treatments
13

14. VIRTUAL REALITY OVERVIEW Technology
4 – 5
Tech M&A Overview
I.
7 – 12
Quantum Technology
I.
14 – 18
Virtual Reality
III.
20 – 27
ARM IPO Analysis
IV.
14

15. Imagine putting on a
special pair of glasses that
transports you to a new
imaginary world. Even
though you are physically
in the same surroundings
as before, the glasses make
it seem like you
have stepped into a
completely different
environment. As you look
left and right, you see more
of this new world, just like
in real life. One can even
use controllers to perform
different activities with
their hands, whether this be
picking up items or playing
a game of basketball. This
is a 'Magical Way' to
explore new and exciting
places without ever leaving
your own. And when you
are ready to return to
reality, you can simply take
the glasses off
Virtual Reality Explained The Next Frontier of Technology
With VR, you are looking at
two screens right next to your
eyes projecting slightly
different images to each eye
This mimics how eyes work in
real life. There are dual
images, as opposed to a single
flat image, as in a photo
This, in combination with
effects like 360-degree audio,
cause the experience to be
near-indistinguishable from
real environments
Our bodies then adapt to
virtual environments due to
our strong reliance on our
sense of sight in real life; we
perceive up to 80% of all
impressions through sight
Once our body feels as though
the virtual environment is our
actual environment, it
becomes easy to do things
which aren't possible in
reality, such as 3D modeling
The Science Behind Virtual and Augmented Reality
15

16. LTM
P/E
TEV/
2021
Rev
TEV/
2022
Rev
TEV/
LTM
Rev
TEV/
2022
EBITDA
TEV/
2022
EBITDA
TEV/LTM
EBITDA
Enterprise
Value
($M USD)
Market
Cap
($M USD)
Shares
O/S
(Millions)
% of 52-
Week
High
52w
High
Price
($ USD)
Day Close
Price
Latest
($ USD)
Company
Name
42.6x
12.6x
11.4x
11.0x
25.6x
23.7x
22.2x
2,323,494
2,355,320
7,429
86%
$366
$317
58.2x
14.6x
13.1x
12.2x
36.1x
34.3x
32.2x
230,359
233,779
455
90%
$570
$512
40.0x
7.1x
6.9x
7.0x
20.9x
21.4x
19.0x
2,675,444
2,732,701
15,634
88%
$198
$174
34.1x
6.1x
5.5x
5.4x
17.1x
17.2x
16.4x
1,562,219
1,645,318
12,632
94%
$139
$130
17.7x
3.5x
3.0x
3.3x
10.0x
7.8x
9.5x
126,983
120,170
1,116
77%
$139
$107
27.2x
8.0x
7.4x
7.8x
15.0x
13.4x
15.1x
147,223
145,561
908
85%
$188
$160
NM
9.2x
6.4x
6.9x
37.5x
32.3x
45.7x
152,002
155,430
1,615
72%
$132
$96
35.8x
6.4x
6.5x
6.2x
13.8x
17.8x
15.9x
753,113
769,592
2,573
92%
$326
$299
35.8x
7.5x
6.7x
7.0x
19.0x
19.6x
17.7x
Median
36.5x
8.4x
7.5x
7.5x
22.0x
21.0x
22.0x
Mean
Valuation & Multiples Data for the Biggest VR Companies
Commentary
on VR
Investments
&
Companies
• Big Tech companies poured money into VR in 2021, chasing the metaverse and alternate reality
market. Facebook rebranded to Meta, Apple worked on the Vision Pro, and Microsoft bought
Activision to develop metaverse games and software
• The metaverse hype and VR died down in 2023 as generative AI became the next big thing. Big
Tech companies with significant investments in the metaverse began suffering heavy losses:
Meta's Reality Labs lost more than $21 billion, Apple stock fell by 1% after its Apple Vision Pro
emerged costlier than expected (losing Apple $58 billion in market cap), and Microsoft still
faces regulatory issues with its acquisition of Activision Blizzard
• Big Tech's disastrous metaverse bet, coupled with macro challenges and China issues,
depressed stock prices across the board. Generative AI may be the only hope for salvation

17. Notable Transactions Timeline: Last 2 Years Focused on VR Technologies
%
Premium
(W)
TV/LTM
EBITDA
TV/LTM
Revenue
Target Description
Buyers/Investors
Target/Issuer
Transaction
Value ($M)
Close Date
17.2%
27.3x
3.4x
Avid offers VR-specific solutions for content
creation & editing that empower creators to craft
immersive and engaging VR experiences
1,466
08/09/2023
-
-
-
Immersed Inc leverages VR technology to create
VR-based remote work revolution & immersive
workspaces
150
08/09/2023
12.4%
-
7.7x
eMagin Corporation provides advanced OLED
microdisplay tech and solutions to create
immersive and high-resolution displays into their
products
232
05/17/2023
-
22.5x
3.1x
Main Event Entertainment, Inc. is a family
entertainment and dining destination that utilizes
virtual reality (VR) attractions
867
04/06/2022
-
-
8.8x
Sector 5 Digital, LLC specializies in immersive
digital experiences and multimedia production
ultilizing VR technology, revolutionizing how ppl
engage with content
26
12/02/2021
-
-
-
Malka Media Group LLC is a multimedia production
company that embraces virtual reality (VR) as a
dynamic storytelling medium, allowing clients to
leave a lasting impact in the digital realm
75
11/16/2021
-
-
1.6x
Abstract Media, LLC is a multimedia production
company focusing on harnessing the potential of
virtual reality (VR) for creative storytelling,
offering a new approach to content creation
1
10/19/2021
-
-
-
MixComm Inc., a fabless semiconductor company,
develops wireless technology solutions for
communications in electronics, VR headsets, and
radar systems in vehicles and defense electronics
162
10/14/2021
-
-
-
SyncRTC Inc. specializies in real-time
communication solutions for virtual reality (VR)
environments, enabling immersive and
collaborative experiences in the digital VR
landscape
4
09/29/2021
0.1x
24.9x
3.4x
Median
0.1x
24.9x
4.9x
Mean
17

18. Recent Developments in VR
Meta
• Oculus VR headset allows users to immerse
themselves in VR. Facebook Horizon Workrooms, a
virtual office, is accessable through the headset
Magic Leap
• Founded in 2010, providing an AR headset which
allows users to integrate digital content in their
environment
HTX Labs
• VR/AR training company won $90M contract with
USAF Sept 2023
• VR already widely incorporated among the F-35
programs in the joint forces
Lockheed
Martin
• Contracted by NASA for AR technology to fasten the
construction of Orion spacecraft
• Technicians report 8x increase in production rate
Apple
• Apple Vision Pro release date set to early 2024
• Launching new features such as Clip and Arki with
the goal of visualizing 3D projects in real life
1. The increasing cost of
capital. As interest rates
rise, it is becoming more
expensive for companies to
borrow money. This is
making it more difficult for
VR companies to raise
capital, especially through
M&A deals
2. The lack of a clear path to
profitability. Many VR
companies are still not
profitable. This is making
investors more cautious
towards investing in the VR
sector
3. The competition from other
technologies. VR is facing
competition from other
emerging technologies,
such as artificial
intelligence and augmented
reality. This is making it
more difficult for VR
companies to attract and
retain users
Declines in VR Activity /
Investment
18

19. Virtual Reality (VR) Market Growth Virtual Reality (VR) Trends
VR Venture Capital Funding ($M USD) Investment Risks
Notable Virtual Reality Companies
Virtual Reality Market Overview & Investments
Investment Trends:
1. VR headsets that do not require a PC or
smartphone to operate are becoming more
popular and affordable
2. Augmented Reality (AR) and VR technologies are
converging, creating new and immersive
experiences
3. VR is being adopted by businesses for a variety of
uses, such as training, design, and collaboration
4. The amount of VR content available is increasing
rapidly, including games, movies, and education
Other Trends:
• VR eye tracking is improving, which is enabling
new applications, such as foveated rendering, that
can improve the performance of VR headsets
• VR spatial audio is a technology that creates
realistic 3D sound in VR
• VR is still expensive which could limit the adoption
of VR by consumers and businesses
• The VR market is still relatively small. This makes it
difficult for VR companies to generate revenue
• Risk of competition with other technologies like,
augmented reality, an emerging technology that
could compete with VR for users and investment
Source: GrandViewResearch
$59,960
$431,360
$-
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
$500,000
2022 2023 2024 2025 2026 2027 2028 2029 2030
Market
Value
($M
USD)
$2,800
$4,400
$1,900
$1,700
$3,900
509 477 418 313 320
2017 2018 2019 2020 2021
Total $ Invested Number of Deals
19

20. ARM IPO ANALYSIS Technology
4 – 5
Tech M&A Overview
I.
7 – 12
Quantum Tech
I.
14 – 18
Virtual Reality
III.
20 – 27
ARM IPO Analysis
IV.
20

21. •The semiconductor industry is a global industry that
designs and manufactures chips, which are used in a wide
range of products, from consumer electronics to medical
devices to industrial equipment
•The semiconductor industry is essential to the global
economy and employs millions of people around the world
Consumer electronics devices, such as smartphones,
computers, and televisions, are becoming increasingly
complex and feature-rich. This is driving the demand for
more powerful and efficient semiconductors
1
Emerging technologies such as AI, 5G, and the (IoT)
are all heavily reliant on semiconductors. As these
technologies become more widespread, the demand
for semiconductors is expected to increase even
further
2
Semiconductors are used in a wide range of products
that need to be energy efficient / performant, such as
data centers, vehicles, and industrial equipment. The
demand for semiconductors that can meet their
performance and energy efficiency requirements are
growing in demand
3
Semiconductor Industry Overview
•Will create investor interest in new chip companies while
it will help the flow of capital into existing companies
•Strong stock performance for ARM could lead to other
early-stage investors to use arm as a comparable when
underwriting for small companies
Semiconductor Industry
Importance of ARM IPO to Industry
Industry Drivers
Semiconductor Industry Market Share by %
Based on 2022 Revenue
Top Industry Players
Micron ,
5% Applied
Materials,
4%
QUALCOM
M , 7%
Other,
50%
Broadcom ,
6%
Taiwan
Semiconductor
, 12%
NVIDIA ,
4%
Intel ,
11%
21

22. ARM Company History Timeline breakout of Arm Holdings
2023: IPO on the NASDAQ
• 99% of smartphones based on ARM
tech
• 65% of IoT devices built based on
ARM-based system-on-chips (SoCs)
1990 1993 1998 2010 2016 2020 2022 2023
1990: founded as Advanced
RISC Machines Ltd (joint
venture between APPL,
Acorn Computers, VLSI
Tech
1993:
1. Introduced IP model
(licensing model)
2. Signed deal with Texas
Instruments & created
the first ARM-powered
GSM Mobile phone,
Nokia 6610
3. Arm7 became flagship
mobile design for ARM
1998: Listed on London Stock
Exchange. Continued maturing
despite tech crash. Became the
most widely used processor
architecture
2000s:
1. Diversify product line
(Cortex-A/R/M)
2. Created Cortex-A9
CPU as smartphones
are first introduced
3. Tripled headcount
(400 to 1,300)
2016: Softbank complete
acquisition of ARM
2020: NVIDIA
announced plan to
acquire ARM
2022:
• Merger canceled due
to regulatory
pressure &
competition concerns
• Rene Haas takes over
from Simon Segars
2010s:
1. Proliferation of IoT =
new opportunities
2. Launched Neoverse
product line for HPC &
cloud computing
solutions
2006
2006: Purchased
Falanx Microsystem
A/S, leading to the
development of Mali
GPU product line
Key
Business Developments
Financing /Acquisitions
Source: ARM's website 22

23. ARM Discounted Cash Flow Calculation
Unlevered Free Cash Flow Calculation
Projected:
Historical:
FY28
FY27
FY26
FY25
FY24
FY23
FY22
FY21
Units:
ARM Holdings' FCF Projections:
$ 4,467
$ 4,199.0
$ 3,808.0
$ 3,375.0
$2,897.0
$2,679.0
$ 2,703.0
$ 2,027.0
$ M
Revenue:
6.4%
10.3%
12.8%
16.5%
8.1%
(0.9%)
33.3%
–
%
Revenue Growth:
2,365.0
1,899.0
1,585.0
1,286.0
1,020.0
671.0
633.0
239.0
$ M
Operating Income (EBIT):
52.9%
45.2%
41.6%
38.1%
35.2%
25.0%
23.4%
11.8%
%
Operating Margin:
(452.8)
(364.2)
(314.8)
(236.6)
(196.7)
(147.0)
(88.6)
(52.5)
$ M
(-) Taxes, Excluding Effect of
Interest:
1,912.2
1,534.8
1,270.2
1,049.4
823.3
524.0
544.4
186.5
$ M
Net Operating Profit After Taxes
(NOPAT):
Non-Cash Charges Adjustments:
205.1
199.0
190.0
201.0
159.0
170.0
177.0
180.0
$ M
(+) D&A:
(70.4)
(57.1)
(66)
(43.0)
(49.0)
(34.0)
(76.0)
(33.0)
$ M
(-) Deferred Income Taxes:
15.0%
15.0%
20.0%
17.1%
23.1%
23.1%
69.1%
21.6%
%
% Income Taxes:
(147.5)
(209.2)
(273.3)
(225.1)
(84.9)
(73.0)
(188.0)
1,010.0
$ M
(+/-) Changes In OWC:
3.3%
5.0%
7.2%
6.7%
2.9%
2.7%
7.0%
49.8%
%
% Revenue:
(55.0%)
(53.5%)
(63.1%)
(47.1%)
(39.0%)
304.2%
(27.8%)
–
%
% Change in Revenue:
(125.0)
(192.0)
(175.0)
(145.0)
(118.0)
(64.0)
(34.0)
(104.0)
$ M
(-) Capital Expenditures:
2.8%
4.6%
4.6%
4.3%
4.1%
2.4%
1.3%
5.1%
%
% Revenue:
1,774.5
1,275.5
945.7
837.3
730.4
523.0
423.4
1,239.5
$ M
Unlevered Free Cash Flow:
39.1%
34.9%
12.9%
14.6%
39.7%
23.5%
(65.8%)
–
%
Growth Rate:
Source: Calculated from ARM’s 424B4 23

24. 33.37%
8.84%
48.72%
9.06%
External Customers (License & Other Rev) Related Parties (License & Other Rev)
External Customers (Royalty Rev) Related Parties (Royalty Rev)
21.24%
16.24%
54.35%
8.17%
ARM Company Overview
Key Historical Financials
Revenue Distribution Breakdown
Summary Overview of ARM Holdings
Company
Overview
Competitive
Advantage
Financial
Information
Inception
CEO
Main Business
Activities
Main Customers
November 1990 as joint venture
between APPL, VLSI & Acorn
Computers
Rene Haas (Since 2022)
Designing / licensing semiconductor
IP, processor architectures, graphics
processors, and SoC designs
Apple, Qualcomm, Samsung, NVIDIA,
Huawei, Microsoft, LG, Sony, etc.
ARM's processor architecture is the
industry standard in the mobile and
embedded device markets
ARM has a vast ecosystem of partners,
including chipmakers, software
developers, and system integrators
ARM processors are in 99% of
smartphones, giving them a dominant
position in the mobile market
Total Cash & ST
Investments
Total Debt &
Leases
Revenue per
Employee
$449.271
Industry-
standard
architecture
ARM's
Dominance in
Smartphones
Vast and
influential
ecosystem
$2,215
No ST & LT Debt but have
Operating Leases ($223M)
Historical:
Income Statement
FY23
FY22
FY21
(all figures in $M USD)
2,679
2,703
2,027
Total Revenue:
(106)
(131)
(145)
(-) Cost of Sales
2,573
2,572
1,882
Gross Margin:
96.0%
95.2%
92.8%
Gross Margin %
(1,902)
(1,939)
(1,643)
(-) Total Operating Expenses:
671
633
239
Operating Income (EBIT):
25.0%
23.4%
11.8%
EBIT Margin:
841
810
419
EBITDA:
31.4%
30.0%
20.7%
EBITDA Margin:
-
153
458
(+/-) Other Income (Expense)
671
786
697
Earnings Before Tax (EBT):
-
(127)
(156)
(-) Loss from Discont. Ops:
524
549
388
Net Income to Parent:
19.6%
20.3%
19.1%
Net Income Margin:
Balance Sheet
1,153
1,290
-
Total AR & Contract Assets:
1,100
1,126
-
Total Contract Liabilities:
KPIs
7.63%
8.43%
N/A
Return On Assets:
16.56%
17.84%
N/A
Return on Common Equity:
2023
2022
Source: Calculated from ARM’s 424B4 24

25. ARM Discounted Cash Flow Calculation
# in $M USD
Terminal Value - Multiples Method:
18.5 x
Median CY25 TEV / EBITDA of Comps:
36.0 x
Median CY25 TEV / EBITDA of Target:
27.2 x
Baseline Terminal EBITDA Multiple:
$ 69,879.1
Baseline Terminal Value:
7.2%
Implied Terminal FCF Growth Rate:
43,458.5
(+) PV of TV (9.96% WACC):
4,911.7
(+) PV of UFCFs (9.96% WACC):
48,370.2
Implied Enterprise Value:
Terminal Value (Multiple Method)
89.8%
% of Implied TEV from Terminal Value:
(0.002938)
(+) Cash & Investments:
-
(-) Debt, Op. & Finance Leases:
0.591000
(-) Noncontrolling Interests:
48,370.8
Implied Equity Value:
1,026.055
Diluted Shares Outstanding:
$ 47.14
Implied Share Price from DCF:
(9.6%)
Premium / (Discount) to Current:
Sensitivity Tables
WACC
13.0%
12.0%
11.0%
10%
9.0%
8.0%
7.0%
6.0%
4,705.7
%
35.81
37.41
39.10
40.89
42.78
44.77
46.89
49.13
23.2 x
2028 EBITDA Exit
Multiple
37.17
38.83
40.59
42.44
44.40
46.48
48.67
51.00
24.2 x
38.53
40.25
42.07
44.00
46.03
48.18
50.46
52.87
25.2 x
39.89
41.67
43.56
45.55
47.66
49.89
52.25
54.74
26.2 x
41.25
43.10
45.05
47.14
49.3
51.6
54.0
56.62
27.2 x
42.61
44.52
46.53
48.67
50.92
53.30
55.82
58.49
28.2 x
43.97
45.94
48.02
50.22
52.55
55.01
57.61
60.36
29.2 x
45.33
47.36
49.51
51.78
54.18
56.71
59.39
62.23
30.2 x
WACC
13.0%
12.0%
11%
10%
9.0%
8.0%
7.0%
6.0%
4,705.7%
2024 Revenue
Growth
40.17
41.97
43.87
45.88
48.00
50.24
52.62
55.13
5.14%
40.51
42.33
44.25
46.27
48.41
50.67
53.07
55.60
6.14%
40.86
42.69
44.62
46.66
48.82
51.11
53.52
56.08
7.14%
41.20
43.05
45.00
47.14
49.23
51.54
54.0
56.55
8.14%
41.54
43.40
45.37
47.45
49.65
51.97
54.42
57.03
9.14%
41.88
43.76
45.75
47.84
50.06
52.40
54.88
57.50
10.14%
42.23
44.12
46.12
48.23
50.47
52.83
55.33
57.98
11.14%
42.57
44.48
46.50
48.63
50.88
53.26
55.78
58.45
12.14%
Source: Calculated from ARM’s 424B4 25

26. ARM Stock Analysis Analysis of ARM stock price since IPO
Tracking ARM’s Stock Price Since IPO
Source: Yahoo Finance
Tracking ARM Stock Since IPO
ARM
Trading
Volume
ARM
Premium to
9/14/2023
Offer
ARM Initial
Public
Offering
(9/14/2023)
NASDAQ
Daily
Return
NASDAQ
Closing
Price
($ USD)
Arm % Daily
Return from
Previous Close
ARM Closing
Price
($ USD)
ARM
Opening
Price
($ USD)
Date
130,534,500
-
$51.00
-
$13,926.05
-
$63.59
$56.10
9/14/2023
74,568,900
19.12%
$51.00
-1.56%
$13,708.33
-4.47%
$60.75
$68.63
9/15/2023
34,571,900
13.73%
$51.00
0.01%
$13,710.24
-4.53%
$58.00
$57.95
9/18/2023
18,264,300
8.18%
$51.00
-0.23%
$13,678.19
-4.88%
$55.17
$56.25
9/19/2023
8,952,646
3.75%
$51.00
-1.53%
$13,469.13
-4.10%
$52.91
$55.17
9/20/2023
5,014,890,000
2.27%
$51.00
-1.82%
$13,223.98
-1.42%
$52.16
$51.78
9/21/2023
4,302,700,000
0.63%
$51.00
-0.09%
$13,211.81
-1.61%
$51.32
$52.90
9/22/2023
3,643,469,000
6.75%
$51.00
0.45%
$13,271.32
6.08%
$54.44
$51.12
9/25/2023
6,283,500
4.94%
$51.00
-1.57%
$13,063.61
-1.69%
$53.52
$53.93
9/26/2023
6,793,048
3.90%
$51.00
0.22%
$13,092.85
-0.99%
$52.99
$54.40
9/27/2023
IPO Underwriters
26

27. ARM’s Forward Multiples still Indicate that It’s Overvalued
3.3 x
15.2 x
18.8 x
3.2 x
11.4 x
2.9 x
18.5 x
2.9 x
13.6 x 13.0 x
3.0 x
10.1 x
2.8 x
15.9 x
0.0 x
5.0 x
10.0 x
15.0 x
20.0 x
TEV
/
Revenue
EV / FY24 Revenue EV / FY25 Revenue
15.7 x
33.8 x
36.4 x
8.7 x
30.6 x
11.7 x
45.4 x
9.5 x
29.5 x
25.9 x
8.2 x
26.6 x
11.0 x
36.0 x
0.0 x
10.0 x
20.0 x
30.0 x
40.0 x
50.0 x
TEV
/
EBITDA
EV/FY24 EBITDA EV/FY25 EBITDA
37.1 x
55.1 x
43.0 x
14.4 x
47.6 x
17.1 x
60.4 x
18.3 x
45.9 x
27.7 x
12.6 x
38.3 x
15.2 x
48.0 x
0.0 x
20.0 x
40.0 x
60.0 x
P
/
E
Multiples
FY24 P/E FY25 P/E
EV / EBITDA Multiples for 2024 & 2025
P/E Multiples for 2024 & 2025
EV / Revenue Multiples for 2024 & 2025
Source: Calculated from Comparable Companies 10K’s 27

28. ARM Football Field Chart
$- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00
25th to Median
Median to 75th
Current Share
Price
Methodology
Selected Public
Comparable
Companies
Assumptions
LTM TEV / Revenue
CY 24 TEV / Revenue
CY 25 TEV / Revenue
LTM TEV / EBITDA
CY 24 TEV / EBITDA
CY 25 TEV / EBITDA
CY 24 P / E
CY 25 TEV / EBITDA
Transactions between
2020 to 2023
CY 25 P / E
16x - 28x EBITDA
Exit Multiple,
6% - 13% WACC
Precedent
Transactions
ARM Holdings Valuation - Range of Implied Share Prices
Discounted Cash
Flow
Selected Comps
1. Intel
2. Cadence
Design Systems
3. NVIDIA
4. Qualcomm
5. Sypnopsys
6. IBM
Source: Calculated from ARM’s 424B4 & Comparable Companies 10Ks
ARM is
currently overvalued,
based on our DCF projections
and trading multiples
28