In a recent U.S. Securities and Exchange Commission filing, Arm announced that it has struck a deal with Apple, securing access to the Arm architecture for its iPhone and Mac chips through 2040 and beyond. This agreement ensures that Apple will have continued access to a core piece of intellectual property for its devices in the foreseeable future.

Arm, owned by SoftBank, is set to debut on the Nasdaq stock exchange in the coming weeks with a total valuation that could reach $52 billion, making it the largest technology initial public offering of the year.

This deal between Apple and Arm reassures Arm’s customers that at least one of its major partners will continue to use its technology. It quells concerns about potential changes in Arm’s corporate structure leading customers to seek alternative technological solutions.

Arm stated in its SEC filing, “Further, we have entered into a new long-term agreement with Apple that extends beyond 2040, continuing our longstanding relationship of collaboration with Apple and Apple’s access to the Arm architecture.”

Arm’s architecture is integral to nearly every smartphone chip, including Apple’s A-series for iPhones. Switching to different instruction sets is not only costly but also time-consuming, making Arm’s technology a preferred choice for many companies.

Arm, founded in 1990, experienced significant growth following the release of the iPhone in 2007, as smartphone manufacturers sought chips with low-power usage capabilities. This differentiated Arm’s architecture from the x86 architecture used in PC and server chips by Intel and AMD.

One of the key reasons why companies like Apple rely on Arm’s architecture is that it has not been owned by a competitor. Arm, as a British company, licensed its technology to all parties, allowing its customers to invest billions in developing Arm chips without concerns about restricted access to the technology.

According to the SEC filing, over 230 billion chips have been shipped using Arm’s architecture. However, approximately half of the company’s royalties revenue comes from products released between 1990 and 2012.

Concerns about access to Arm’s technology were a major factor in regulators blocking Nvidia’s attempt to acquire Arm in early 2021. This led to Arm’s decision to proceed with an IPO.

Several companies, including Apple, Google, Nvidia, Samsung, AMD, Intel, Cadence, Synopsis, and Taiwan Semiconductor Manufacturing Company, have expressed interest in purchasing shares of Arm as part of the IPO. These “cornerstone investors” could collectively invest up to $735 million, gaining a stake in Arm’s ownership and influence on its management.

Representatives from Arm and Apple have yet to comment on the deal.