Here's Why Citi Is Still Bullish On Nvidia Despite Arm Deal Fall Out

• Citi analyst Atif Malik reiterated a Buy rating on Nvidia Corp (NASDAQ:NVDA) with a $350 price target. The price target implies an upside of 41.5%.
• The re-rating follows Nvidia's termination of the planned acquisition of SoftBank Group Corp's (OTC:SFTBY) (OTC:SFTBF) ARM Ltd due to significant regulatory challenges to closing the deal. 
• The Street largely expected that the deal would not win regulatory approval, Malik tells investors in a research note. 
• Related Content: SoftBank Aims For Arm IPO After Nvidia Dumps Takeover Plans
• As part of the agreement, SoftBank will retain the $1.25 billion prepaid by Nvidia, and Nvidia will retain its 20-year Arm license, the analyst notes. 
• Nvidia intends to record a $1.36 billion charge in Q1 of the fiscal year 2023, inclusive of the $1.25 billion prepayments provided at signing, Malik adds.
• Nvidia also plans to launch its computer processing unit, Grace, in 2023 and, with the 20-year ARM license, can pursue this strategy without owning Arm, the analyst says.
• Price Action: NVDA shares traded higher by 1.22% at $250.29 on the last check Tuesday.