ARM Holdings plc (ARM) saw its stock decline by 4% on December 23, 2024, closing at $126.87, down from the previous close of $132.15. The stock opened at $129.89 and fluctuated between a high of $130.11 and a low of $123.26, with trading volume surging to 8,470,338 shares, significantly above the average of 5,316,355. The decline was primarily driven by a legal setback involving Qualcomm. A U.S. jury found that Qualcomm did not breach its contract with Nuvia, a company it acquired, which was a blow to ARM in their ongoing licensing dispute. This verdict has weakened ARM's position, allowing Qualcomm to continue utilizing Nuvia's technologies without current licensing violations, thereby impacting investor sentiment negatively.
Additionally, broader concerns in the semiconductor industry contributed to the downward pressure on ARM's stock. The U.S. government's trade investigation into China's production of older computer chips has raised fears of potential tariffs or trade barriers, which could disrupt global semiconductor supply chains. This investigation underscores the escalating tensions between the U.S. and China over semiconductor production, further unsettling the market.