Arm Holdings Plc (NASDAQ:ARM) shares are trading lower on Wednesday amid reports of China working to rival the West for AI chips.



What To Know: A Reuters report said Chinese scientists have built a prototype extreme ultraviolet (EUV) lithography machine, a critical technology used to manufacture the most advanced semiconductor chips.



The prototype was completed in early 2025 and is undergoing testing in Shenzhen. The machine is capable of generating extreme ultraviolet light, a key step in producing advanced chips used in artificial intelligence, smartphones and military applications, though it has not yet produced working chips.



The report said the effort is part of a long-running Chinese government initiative to achieve semiconductor self-sufficiency, with officials targeting production of working chips on the prototype by 2028, while sources cited a more realistic timeline of 2030.



The development raised concerns about potential competition in advanced chip technology, weighing on companies tied to the global AI and semiconductor ecosystem, including Arm.



Additionally, it was reported that Blue Owl Capital will not provide funding for a $10 billion deal to build Oracle’s next data center. 



According to a Financial Times report, Blue Owl had been in discussions with Oracle and lenders to finance a planned 1-gigawatt data center in Michigan, but negotiations stalled, and the agreement will not move forward. The breakdown leaves the financing of the facility uncertain, as Oracle has not yet finalized a deal with a new backer.



The report said the funding setback comes amid growing investor concerns around Oracle's rising debt levels and heavy spending on artificial intelligence infrastructure, which has weighed on sentiment across companies tied to large-scale data center development.



ARM Price Action: At publication on Wednesday, Arm shares are trading 5.31% lower at $114.67, according to data from Benzinga Pro.



This illustration was generated using artificial intelligence via Midjourney.



See Also: • Oracle Stock Sell-Off Intensifies: What’s Behind The Move?

ORCL

Arm shares fell 5.31% on Wednesday amid reports of China's progress in AI chip technology, raising competition concerns. Additionally, Blue Owl Capital withdrew funding for Oracle's $10 billion data center project, affecting investor sentiment due to Oracle's rising debt and AI infrastructure spending.

- Arm Holdings Plc shares fell 5.31% to $114.67 amid reports of China developing a prototype EUV lithography machine to enhance semiconductor self-sufficiency by 2028.  
- The machine, crucial for producing advanced AI chips, is currently being tested in Shenzhen but has not yet created any working chips.  
- Additionally, Blue Owl Capital will not finance Oracle's $10 billion data center project, raising concerns about Oracle's debt and impacting market sentiment towards data center developments.

What's Going On With Arm Shares Wednesday?