Arm is set to launch its first-ever in-house developed chip this year, marking a significant departure from its traditional business model of licensing chip designs to other companies.
This move will see Arm directly competing with some of its largest customers, including NVIDIA, which builds its own chips based on Arm’s architecture.
Meta has been secured as one of the chip’s first customers, signalling a strong start for Arm’s new venture, the Financial Times reported. The chip, expected to debut as early as this summer, will be a central processing unit (CPU) designed for servers in large data centres. It will be built on a flexible base that can be customised to meet the specific needs of clients like Meta. Production will be outsourced to a manufacturer, such as TSMC.
This announcement has already had an impact on Arm’s stock, with shares rising by approximately 5% following the news. The move signals a shift for the company, as it expands its product offerings beyond licensing and looks to establish itself as a direct competitor in the chip manufacturing market.
In its latest quarterly report, Arm saw a 19% year-over-year increase in revenue, reaching $983 million, driven by strong royalty earnings and robust license revenue. The company attributed its growth to the growing adoption of its Armv9 architecture, increased demand for Compute Subsystems (CSS), and its expanding footprint in data centres and the Internet of Things (IoT) sector.
