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ARM Partnership Is Set To Boost Intel Stock

  • Intel recently struck a licensing agreement with ARM to manufacture its chips.
  • The Move could boost Intel's revenues significantly.
  • It could also bring upon a cash crunch on Intel's competitors, that could ultimately slow down their rate of progression.

It looks like Intel (NSDQ:INTC) has finally realized the potential of ARM (NSDQ:ARMH) business prospects. The chipzilla entered into a licensing agreement with ARM last week, which allows it to manufacture ARM-based mobile SoCs for fabless chipmakers such as Qualcomm, Apple and Nvidia. The move would combine Intel’s industry-leading chip fabrication processes with ARM’s highly efficient mobile designs, and the joint synergies could potentially shake up the entire semiconductor industry. Let’s take a closer look to have a better understanding of it all.

Welcoming ARM, with arms wide open

  • Let me start by saying that Intel has had the world’s most advanced chip fabrication technologies for several years now. It’s manufacturing lead was as long as 18 months, back in 2014 and the chipzilla is expected to still stay ahead of its peers (Taiwan Semiconductor, GlobalFoundries and Samsung) at least up till 2018. Intel’s competitors were thriving till date due to increasing business from ARM, but now that Intel has entered the scene with similar intentions, the bulk of this business would pretty much go to the chipzilla due to its manufacturing lead. After all, in the cut throat semiconductor industry, everyone would want their performance chips to be manufactured on the latest nodes.
2015 Rank 2014 Rank Vendor 2015 Revenue 2015 Market Share (%) 2014 Revenue 2015-2014 Growth (%)
1 1 TSMC1 26,566 54.3 25,175 5.5
2 3 Globalfoundries2 4,673 9.6 4,400 6.2
3 2 UMC3 4,561 9.3 4,621 -1.3
4 4 Samsung Electronics4 2,607 5.3 2,412 8.1
5 5 SMIC 2,229 4.6 1,970 13.1
6 6