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ARM CEO Warren East.  (Source: ARM)
ARM's Race: Deal with Microsoft to power next-gen PCs will continue to propel chip designer.

After beating year-end profit forecasts, thanks in part to iPhone and iPad sales, shares of ARM Holdings hit a 10-year high yesterday, The Telegraph reports.

ARM, chip designer for most of the world's mobile devices, has been at the center of take-over speculation. This speculation helped the company's shares close at 547 1/2p, the highest since the dotcom bubble 10 years ago, according to The Telegraph.

"It's hard to see what could have been better in this set of results. We've had a record in terms of earnings, and a record backlog up 75 percent [compared with last year]," ARM CEO Warren East told The Telegraph. "We are exposed to areas of strong structural growth. Just about everything is being connected to the internet, all of these are opportunities for ARM technology." 

ARM reported a 73-percent increase in pre-tax profits to £167.4 million in 2010. Year-end revenue was up 33 percent, to £406.6 million.

The company is poised for continued success. At CES last month, ARM announced a partnership with Microsoft to power the next generation of Windows PCs -- traditionally Intel territory. Many took the partnership as a sign that Microsoft felt Intel couldn't compete against ARM's power-savvy architecture. Intel countered, claiming that because it would take Microsoft so long to ready its next OS, Intel would have designs ready by then that could take on ARM.  

"Windows will always run best on Intel," an Intel spokesman was quoted saying. "Porting Windows to a new architecture, where chips are generally incompatible with each other and require sizable investment in millions of other software code, applications and middleware will be complex and costly."

As East admitted, ARM would not begin to profit from the Microsoft deal for at least four years, because the new products have to be designed and built. "Clearly the Microsoft announcement is a massive deal," East told The Telegraph. "It's all a question of when [ARM will begin to power desktop computers]. I don't expect a massive share in PCs in the short term but I certainly do from tablets."

While some analysts predict that ARM could one day power half of the world's PCs, the company's true threat to Intel -- especially in the present tense -- remains modest.



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Architecture changes
By MarioJP on 2/3/2011 2:52:17 PM , Rating: 2
I want to say that, even though I praise new processor technologies, I do feel that arm is over hyped a tad bit.

Granted that ARM is a new architecture, but I don't see Intel going away anytime soon in the presence of ARM. while we add it If any CPU should of threaten Intel should of been Sony's Cell Processor.

That CPU is strictly RISC. And I could see that processor being in mobile devices instead. It should of been on the PSP2. But downside is the cell is a nightmare to program.

As for ARM. I could see ARM being Intel's competitor and could possibly beat AMD in the CPU arena. (you hear that AMD). Only if ARM can compete in the high end PC's. With that said, be interesting to see how well ARM does on the High-End PC's if this article is true.

Intel is well established and show no signs of slowing down. After all Intel made profit this year. If it wasn't for tablets which Arm has established well, would be a different story.




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