I’ve been following ARM for 25 years. I was long ARMH until it was acquired by SoftBank. I’m again invested in ARM but mostly for income via covered calls. Just be prepared for the volatility.
One interesting factoid: Over 20 million software developers working on ARM based chips. Ignore the MBAs, follow the people who do the work.
Interesting factoid #2: Initially ARM’s claim to fame was its low power consumption making it the ideal chip design for mobile devices. Now even data centers are so power hungry that ARM is the ideal chip design for them as well.
Not my type of investing, but I have loved ARM ever since they came on the scene challenging Intel, and quickly found myself spec’ing them even more for their low heat output than their thrift with power (sensor units on a delicate surface).
I will pass your posted links on to my hotspur investing godson.
I worked there for just over 5 years. It amazed me how little money we made given how important we were to various markets. That feeling has not changed. ARM had horrible pricing, making pennies along the way. And it’s worse when you consider Apple, their highest profile customer. Apple does not license a design, which entails paying a (very small) royalty per chip sold. They have an architectural license instead, which is even cheaper, and design their own compatible version of their own. Arm makes nothing on Apple. I won’t comment on Nvidia (current employer).
Arm, important? Yes. Do they have a good business model? No. Also, RISC-V is gaining market share. Direct competitor, even cheaper.
RISC-V International is changing the way the industry works together and collaborates – creating a new kind of open hardware and software ecosystem.
RISC-V is an open standard instruction set architecture based on established reduced instruction set computer principles. The project began in 2010 at the University of California, Berkeley, transferred to the RISC-V Foundation in 2015, and on to RISC-V International, a Swiss non-profit entity, in November 2019.
Open source is not a business model, it’s a commune most of which fail.
BTW, have you checked ARM’s gross margins? Over 95%.
It doesn’t have to be a business model nor investable in order to disrupt ARM. It is also irrelevant if most fail, what matters is if RISC-V does not fail.
I asked a friend at an EDA vendor: “Curious if you still think RISC-V is a threat to ARM or if that is not going to be the case.” The EDA vendors have direct insight into what is being designed and deployed. His answer:
Oh sure. Not in the high-performance area, but already we see lots and LOTS of abandonment of controller/micro-controller ARM solutions for commodity-level, no-royalty-required RISC-V based solutions.
The Server space, and high processing space, isn’t solid enough for RISC-V to be a threat. Not yet. But ARM is giving up the commodity space, which is volume and adoption and ongoing tool/flow improvements.
Automotive, Space, Defense, microprocessing/AI support. Even NVIDIA ships with RISC-V cores on die. Billions have already been shipped.
Sounds most reasonable. The way I see it, the big customers, Apple, Nvidia, Tesla, etc. won’t be switching to RISC-V to save a few pennies specially after the investment in ARM technology.
Apple has gone through a number of chip suppliers:
MOS Technology 6502
Motorola 68000
IBM PowerPC
ARM
