Arm unveils new AI chip, expects it to add billions in annual revenue

Arm Holdings announced a new artificial intelligence data centre ‌chip on Tuesday which it said will add billions of dollars of ​revenue

Arm Holdings announced a new artificial intelligence data centre ‌chip on Tuesday which it said will add billions of dollars of ​revenue and represent a significant shift in the company’s strategy.

The new ⁠chip, called the AGI CPU, will address data-crunching needed for a specific type of AI that is able to act on behalf of users with minimal oversight, instead of responding to queries as ‌part of a chatbot. So-called agentic AI has jump-started demand for the central processing units (CPUs) produced by the likes of Intel and Advanced Micro Devices.

Arm ‌shares jumped 6.5% in the extended session after the company issued its financial ‌projections. Arm ⁠stock closed down 1.4% on Tuesday and have advanced 22% this year.

For ⁠years, Arm, majority-owned by Japan’s SoftBank Group, has relied only on intellectual property for revenue, licensing its designs to companies such as Qualcomm and Nvidia and then collecting a royalty payment based on the number ​of units sold.

Last year, Arm signaled ‌to investors it was investing in making its own chip, a process that can cost hundreds of millions of dollars, and that the company had hired key executives to assist with the effort. The AGI CPU will be the first chip ‌under that new strategy.

“It’s a very pivotal moment for the company,” CEO ​Rene Haas said in an interview with Reuters.