Intel Corporation (NASDAQ: INTC) ended about 3.0% down today following a report that Nvidia Corp and Advanced Micro Devices Inc are considering switching to Arm-based PC chips.
Why does it matter for Intel Corp?
Anonymous sources told Reuters on Monday that Nvidia could move to Arm-based chips for personal computers by 2025. AMD is working on a similar change of direction as well, they added.
The report is significant for Intel Corp as it currently leads in PC chips and relies on them for more than half of its overall revenue.
The multinational has already lost Apple Inc that transitioned to in-house Arm processors in June. If Nvidia and AMD switch as well, it will add to the already mounting struggles of Intel Corp.
INTC is expected to report just 4 cents of earnings on a per-share basis for its third quarter versus 59 cents per share a year ago.
Is Arm-based PC chip better than Intel?
Arm-based chips are known to consume less power which makes them all the more suitable for battery-powered devices.
Note that Qualcomm has been committed to chips compatible with the Arm-based instruction set in recent years but has not been able to gain meaningful traction so far. It does have a launch event scheduled in the coming days, though.
Neither Nvidia nor AMD has yet commented on the Reuters report that arrives about a month after Arm Holdings’ debut on Nasdaq.
At the time, the British chip designer had told investors that a number of top chipmakers has signed long-term agreements to use its technology. Arm shares are currently down over 20% versus their high. Watch here: https://www.youtube.com/embed/mYExdSDYbyo?feature=oembed
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