Chipmaking giant Nvidia (NASDAQ:NVDA) may have to give up on the biggest semiconductor deal in history via the purchase of ARM — a deal that may have been dead on arrival.

What’s the big deal? ARM’s computer chips are found in nearly everything (i.e. phones, cars, equipment, etc). Many feared the acquisition would have given Nvidia too much power in the industry.

It’s been nearly 18 months since Nvidia first announced plans to acquire ARM — but the deal required approval from UK, China and US regulators.

• To block the deal, the US sued Nvidia, along with opposition to the merger from companies including Microsoft, Amazon and Intel.
• Nvidia insiders reportedly said it is done trying — telling ARM the transaction isn’t expected to go through.

Although the two haven’t publicly called it quits, it’s unlikely.

• On Monday, the US Department of Justice warned it’s looking to block more anticompetitive deals.
• Getting China’s approval during the global trade war will also be difficult.

In 2018, competitor Qualcomm gave up on its $44B acquisition of NXP Semiconductors after two years of regulatory issues — similar to Nvidia’s current path.

What happens next? After Nvidia’s 30% plus drop from its November highs, Taiwan Semiconductor (NYSE:TSM) has taken over as the world’s most valuable semiconductor company.

ARM would’ve been nice to have but not necessary for Nvidia’s success — with global chip demand expected to grow 8.8% in 2022. The semiconductor industry has been on a multi-year breakout and increasing demand could position it for another big year.