Arm Holdings chief executive Rene Haas showing the AGI CPU chip during an event in San Francisco on March 24. Under Him, Arm has shifted from its roots as a provider of smartphone technology and taken a greater role in the data centre market.
(BLOOMBERG)
Arm Holdings, which made its name licensing technology to semiconductor makers, will begin selling its own chips for the first time, adding a business that it expects to generate about US$15 billion (S$19.2 billion) annually within five years.
Meta Platforms will be the first major customer for the company’s chip, called an AGI CPU, Arm said on March 24 at an event in San Francisco. The product will have as many as 136 cores — a measure of processing power — and draw 300 watts of electricity, Arm said.
Taiwan Semiconductor Manufacturing Company will produce the chips.
As part of the move, Arm laid out aggressive sales targets for the coming years. The Britain-based company expects revenue from the new chip business to eclipse sales from its current operations, which focus on selling intellectual property (IP).
That will help generate total sales of roughly US$25 billion within five years, five times the level today, Arm said. The IP business will continue growing, hitting about US$10 billion by that point, the company predicted.
Earnings will reach US$9 a share in that time frame. Analysts have estimated that earnings will be US$1.75 a share in the current fiscal year, excluding some items.
Under chief executive Rene Haas, Arm has shifted from its roots as a provider of smartphone technology and taken a greater role in the data centre market. The change is meant to help the business get more of the money generated by what is often complex and expensive work.