Arm Holdings' Data Center Dreams Will Need to Overcome Intel's 288-Core Behemoth
Shares of Arm Holdings (NASDAQ: ARM) have given up most of their IPO gains as investors cool on the company's long-term prospects. While Arm-based chips are dominant in the smartphone, consumer electronics, and embedded markets, Arm's growth will need to be driven by markets where the company has less of a presence.
The cloud data center is one such market. The effort to bring Arm-based processors to the data center has been ongoing for a very long time, and progress has been slow. Qualcomm, for example, tried and failed with its own line of Arm-based server chips, abandoning the effort in 2018. The data center market is dominated by x86 processors from Intel (NASDAQ: INTC) and (NASDAQ: AMD), and breaking that stranglehold won't be easy.
Still, some progress has been made in recent years. Arm now claims to hold a 10.1% share of the cloud computing market, although that's primarily due to Amazon and its increasing use of homegrown Arm chips. According to TrendForce, Amazon Web Services (AWS) was using its custom Graviton chips in 15% of all server deployments in 2021.
Source Fool.com
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