Arm Holdings (NASDAQ: ARM) stock surged by 4.6% in Friday’s trading session, marking a significant gain for the semiconductor specialist. This increase in share price can be attributed to reports indicating that Arm is gearing up to reveal its new strategy for the data center market when it reports quarterly earnings later this month. Additionally, recent comments from another major player in the chip industry could be contributing to Arm’s positive momentum.
After the market closes on July 31, Arm is set to release its first-quarter results for the current fiscal year, which ended in June. Along with detailing its performance for the quarter, the company is expected to outline its plan for expanding into the data center market. With the rapid growth of artificial intelligence (AI) and other accelerated computing applications, there is potential for CPUs from Arm and other designers to play a more significant role in data centers alongside Nvidia’s GPUs.
In a recent report, Intel’s chief technology officer Greg Lavender mentioned that Intel could achieve $1 billion in annual software revenue by 2027. While Arm competes with Intel in the PC and server CPU markets, the two companies also collaborate as part of a coalition aiming to challenge Nvidia’s dominance in advanced GPUs and high-performance computing. Intel’s software ambitions could signal increased AI opportunities for Arm in the future.
Before considering an investment in Arm Holdings, it’s essential to note that the Motley Fool Stock Advisor analyst team did not include Arm Holdings in their list of the 10 best stocks for investors to buy now. The stocks selected by the team have the potential to generate significant returns in the years to come. For instance, Nvidia was previously recommended in 2005 and has since delivered substantial returns for investors.
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In conclusion, Arm Holdings’ recent stock surge amid news of its impending data center strategy and Intel’s software ambitions highlights the company’s potential for growth in the evolving chip industry landscape. Investors should carefully consider the company’s position and future prospects before making investment decisions.
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