Outside view of Meta’s Facebook data center in Eagle Mountain, Utah, on July 18, 2024.
George Frey | Afp | Getty Images
Arm shares rose 5% after a Thursday report that it was developing its own chip and that it had secured Meta as one of its first customers.
The Financial Times report indicates that Arm is developing a new product that will compete with many of its customers. The semiconductor company currently licenses its technology, called an instruction set, as well as more complicated core designs, to its customers so they can build their own chips.
Arm has historically been known as the “Switzerland” of chip technology firms, a reputation it received by dealing neutrally with competing chipmakers. It counts Apple, Google, Nvidia, Amazon, Microsoft, Qualcomm and Intel as customers.
Meta is spending as much as $65 billion this year on capital expenditures for artificial intelligence development. While much of its spending is on Nvidia-based systems, Meta has also purchased other chips, including AMD’s competitor, and said it is developing its own chip internally.
Arm’s chip will be a central processor for servers, according to the report, not the kind of graphics processor typically used for the heaviest AI workloads.
Nvidia tried to purchase Arm in 2020 from Softbank for $40 billion before the deal was blocked by regulators over Arm’s key role in the chip market. Arm went public in 2023 and now has a market cap above $173 billion.
Arm shares have risen nearly 29% so far in 2025 as it is seen as a core enabler of AI systems. Company leadership has told investors that it is looking to sell more advanced technology to its existing customers to grow revenue.
Rene Haas, Arm’s CEO, cited billions of dollars in planned data center spending from Google for $75 billion, Microsoft for $80 billion and Meta for $60 billion as an opportunity for Arm earlier this month. “No one is pulling back,” Haas said.
“No one is pulling back,” Hass said earlier this month on an earnings call.
Arm is also a technology partner of the Stargate initiative, which plans to spend as much as $500 billion building AI infrastructure for OpenAI.
Arm declined to comment, and Meta did not respond to CNBC’s request for comment.
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