Arm to Launch In-House Chip This Year, Meta First Client

According to reports, Arm is set to unveil its own chip later this year, with Meta Platforms confirmed as one of its first customers. This move signifies a significant shift in the company's business model, traditionally focused on licensing its chip designs to other companies. As a result, Arm's stock saw a notable rise of approximately 5% in the U.S. market.

The launch of Arm's in-house chip will put the company in direct competition with some of its largest customers, including NVIDIA, which builds its chips on Arm's architecture.

Arm, however, remains somewhat insulated from the AI-driven growth spurt enjoyed by chip manufacturers, as it continues to generate revenue through licensing its technology and collecting royalties on chips sold by other companies.

Industry insiders have indicated that Arm's CEO, Rene Haas, is planning to release the company's first internally produced chip as early as this summer. The new chips are expected to serve as central processors (CPUs) for large data center servers, built on a customizable foundation tailored to clients like Meta.

The manufacturing of Arm's chips will be outsourced to major foundries such as TSMC.

Masayoshi Son, founder of Arm's largest shareholder SoftBank, has positioned the company at the core of his broader efforts to expand AI infrastructure. The introduction of Arm's own chip is seen as a pivotal step in Son's larger strategy to enter the AI chip production market.

In addition to this, SoftBank is reportedly set to acquire Ampere, an Oracle-backed chip design firm, for $6.5 billion. This acquisition is considered a crucial move in supporting Arm's chip manufacturing endeavors.