Santa Clara, CA Nvidia has reduced its stake in British chip designer Arm Holdings, marking a strategic shift as the U.S. tech giant continues to refocus on artificial intelligence (AI) and next-generation computing ventures.

According to Yahoo Finance, Nvidia trimmed its holdings in Arm shortly after the chip designer’s blockbuster IPO in 2023, though exact figures regarding the current sale were not disclosed. Analysts view this move as part of Nvidia’s broader strategy to optimize its investment portfolio, as the company doubles down on AI infrastructure and autonomous driving technologies.

The relationship between Nvidia and Arm has been closely watched since Nvidia’s failed $40 billion acquisition of Arm in 2022, blocked by regulatory authorities in the U.S., U.K., and Europe due to antitrust concerns. Despite the scrapped merger, Nvidia remains a strategic investor in Arm, and the recent reduction in its stake is not seen as a severing of ties but rather a reallocation of capital.

Investors.com highlighted that Nvidia’s partial divestment comes as the company ramps up its AI-focused acquisitions, including investments in autonomous driving startup WeRide and cloud computing provider Nebius. This signals Nvidia’s prioritization of cutting-edge AI systems and autonomous technologies, in which the company aims to maintain its industry dominance.

Shares of Nvidia remained stable following the news, reflecting investor confidence in the company’s strategic direction. With demand for Nvidia’s AI chips surging globally, experts believe that the company’s capital reallocation could fuel further growth in AI development and automotive tech partnerships.