Arm is recruiting staff from its own customers and it is competing with them to win deals as the company works to sell its own chips.
This is reported by sources familiar with the matter; it also appears from a document viewed by Reuters. Arm provides the crucial know-how that companies such as Apple, Nvidia and Qualcomm license to develop their own CPUs. The company is now trying to increase its profits and revenues through several strategies. One is the ability to sell its own chips.
Recruiting staff from customers
UK-based Arm has been trying to recruit executives from licensees, two sources told Reuters. It is also competing with Qualcomm, one of its largest customers, to sell data center CPUs to Meta. This reports a person familiar with the matter. An Arm spokesman declined to comment on the reports.
The technology provider’s moves to expand its own chip business could revolutionize an industry that Arm has long considered a neutral player. The new strategy will force companies dependent on Arm to question whether they will compete directly with the company in the future.
Lawsuit against Qualcomm
Arm took a dispute with Qualcomm over license fees to court in December. The former company lost crucial parts of that case. During the hearing, Arm CEO Rene Haas was asked about Arm’s ambitions to build its own chips. At the time, he stated he did not build chips. But according to a document viewed by Reuters, Arm was trying to recruit customer executives as early as November, several weeks before that statement.
A recruiter working for Arm sent a message to a customer’s executive asking to recruit employees. The message, a copy of which Reuters studied, said Arm was looking for an executive to help transform from solely processor architecture (IP) designs to also selling proprietary chips. This with a focus on AI applications in data centers and other devices. Arm recruiters also contacted other chip designers in Silicon Valley to attract talent for the same purpose, according to two industry sources.
Arm is also competing with Qualcomm for customers. Qualcomm was in talks with Meta to supply a data center CPU based on Arm’s computing architecture. But according to one source, Arm has secured at least part of that deal. However, another source said talks between Meta and Qualcomm are still ongoing. Spokesmen for Qualcomm and Meta also declined to comment.
Deal with Broadcom
According to a research note from J.P. Morgan analyst Harlan Sur, Arm might also compete with Nvidia. Broadcom has won a contract to work with the Bitse company and SoftBank Group to develop a custom AI chip that will power data centers at SoftBank in Japan, Sur wrote. The deal could generate sales of up to $30 billion for Broadcom.
Also read: Arm and Qualcomm clash in lawsuit