Cash-strapped Japanese conglomerate SoftBank is weighing the future of Arm Holdings. While the semiconductor designer's fate remains unclear, The Wall Street Journal reports a full or partial sale and even an initial public offering are on the table.

A return to the public market for Arm shouldn't come as a surprise. Since acquiring the British chip designer for $32 billion in 2016, SoftBank has alluded to its return to the public market. However, The Wall Street Journal reports these plans may have new urgency as the Japanese conglomerate seeks to appease Elliot Management, which has been pushing for changes.

While best known for its low-power smartphone processors, Arm's portfolio now extends well beyond consumer electronics. The chip designer has developed architectures that run the gamut from ultra-low power chips for IoT to 128-core, 250-watt data center chips. In fact, Arm-based processors are now used by multiple public cloud providers, including Amazon, Microsoft, and Oracle.

However, it now appears Arm may be reassessing this strategy. Last week, Arm announced, "strategic organizational changes" aimed at improving its profitability. The company has proposed transferring its two IoT Services Group businesses, IoT Platform and Treasure Data, to new entities that would be owned and operated by SoftBank.

The Wall Street Journal reports SoftBank's interest in Arm was largely motivated by a desire to corner the IoT market. However, Arm's profitability has proven a sticking point for the conglomerate.

Making matters worse, the IoT market has stalled out as industries face the economic consequences of the global pandemic, a recent ABI Research report found. While interest in IoT remains high, analysts noted that the industries that fuel IoT were in decline, and COVID-19-related supply chain and manufacturing delays have only made the situation worse.

"SoftBank’s portfolio is hurting given huge misses with OneWeb, WeWork, and its vision fund," wrote Will Townsend, senior analyst of networking infrastructure and carrier services at Moor Insights & Strategy, in an email to SDxCentral. "It’s not surprising given it also is seeking to divest its post T-Mobile, Sprint merger holdings. Arm is solid and any company that wants to enter or strengthen its position in edge would find Arm attractive."

SoftBank has pledged to sell $41 billion in assets to boost liquidity and fund a major stock-buyback program. As part of this effort, the company signaled its retreat from the U.S. wireless market earlier this spring.

SoftBank entered the U.S. cellular market in 2012 with a $22 billion investment in Sprint. However, the company struggled to right the carrier and soon after began investigating a merger with T-Mobile US, initially in 2014 and again in 2017.

The merger took years to materialize, held up by lengthy regulatory battles. T-Mobile US and Sprint were eventually allowed to combine with the deal closing in April.

Following the successful acquisition, SoftBank garnered a 25% stake in T-Mobile US, which it now plans to sell to the carrier's majority shareholder, Deutsche Telekom.

Editors Note: This story has been updated to include analyst commentary.