The company, set up in 2018 as a joint venture of British chip technology firm Arm Ltd, laid off nearly 100 employees last week, most of them engineers, Reuters reported exclusively on Friday.Arm technology powers most global smartphones and the company counts Apple Inc and Qualcomm Inc as customers. SoftBank had said early last year it was aiming to take Arm Ltd public by the end of March; last week Arm's CEO told Reuters the firm was committed to a listing this year.The China business is the exclusive distributor of Arm chip technology in China and develops and sells its own chip designs based on Arm. It accounts for 20%-25% of Arm Ltd's global revenue, according to two sources familiar with the situation. One of the sources said the drop in Arm China's profit would not have a financial impact on Arm Ltd, whose royalty and licensing fee payments come before profit is calculated. In 2021, the China business paid Arm about $500 million, the two sources said. It is not clear how much Arm Ltd made from China last year."The Arm Ltd IP business part of Arm China is performing very well and we are positioned for continued growth going forward. The new management team has quickly restored confidence with our China ecosystem, and we are pleased to have the previous management issues well behind us as we expand Arm technology into the China market," said Phil Hughes, Arm's vice president of external communications, in a prepared statement.SoftBank and Arm China did not respond to requests for comment.Arm China's net profit plunged to $3.2 million last year from $79.2 million in 2021, while revenue grew to nearly $890 million last year from $665 million the year before, according to the company's 2022 unaudited earnings statement, seen by Reuters and confirmed by another independent source.According to the statement's footnote there is a $37 million loss in foreign exchange in 2022, compared with a gain of $9 million the previous year.Both sources declined to be identified as the information was confidential.Arm Ltd has been considered one of the better performing assets at SoftBank, where its startup investment Vision Fund has had four straight quarters of losses. The bulk of the loss at the fund in the latest reported quarter came from a steep decline in the valuation of investments in unlisted companies, but listed portfolio companies, Indonesian ride-hailing company Goto Gojek Tokopedia PT, South Korean e-commerce platform Coupang Inc and workspace provider WeWork Inc also contributed to the loss.ARM CHINA'S STRUGGLESArm China has been a challenging business for SoftBank to navigate. Set up in 2018 with longtime Arm executive Allen Wu as CEO, SoftBank allowed Chinese funds together to take a majority stake in the joint venture.Wu is credited with expanding the China business, according to two sources familiar with the company. But the relationship between Wu and some of the major shareholders soured over conflict of interest issues around Wu's own investment fund. That turned into a two-year public battle as SoftBank worked to oust Wu.To shield Arm Ltd from the China troubles as it aimed to take Arm public, SoftBank last March transferred Arm Ltd's stake in the joint venture into a separate special-purpose vehicle, according to two sources with knowledge of the matter. One of them said, however, that the official Chinese records still show Arm Ltd as a shareholder.By late April 2022, SoftBank pushed out Wu from Arm China by physically and digitally blocking him, and put in place two CEOs, Eric Chen from SoftBank and Liu Renchen, vice dean at the Research Institute of Tsinghua University in Shenzhen. (Reporting by Jane Lanhee Lee in Oakland, Calif., and Kane Wu in Hong Kong; Additional reporting by Josh Horwitz in Shanghai; Editing by Kenneth Li, Gerry Doyle and Matthew Lewis)By Jane Lanhee Lee and Kane Wu