Nvidia's latest move will challenge Intel with an Arm-based CPU

The backstory: Nvidia is a tech powerhouse mostly known for its graphics processing units (GPUs). Essentially, GPUs break down complex tasks into manageable bits, supercharging a computer's performance. As of its last reported stats, Nvidia has over 80% market share in the GPU arena, leaving competitors like Intel and AMD far behind. Its market value has even surpassed US$1 trillion, putting it in the same league as tech giants like Apple, Microsoft, Alphabet and Amazon.

On the other hand, central processing units (CPUs) are the brains of your computer that handle the heavy lifting, allowing all the computer’s software to run correctly. Nvidia did venture into the CPU market over 10 years ago with its "NVIDIA nForce" chipsets when Rene Haas was in charge. Haas now leads Arm, a major semiconductor and software design company. But Intel is still majorly in the lead with its market share for CPUs, followed by AMD.

More recently: In 2016, Softbank bought Arm for US$32 billion. Arm is important in the semiconductor market because it licenses its chip designs to big firms like Nvidia, Apple and Amazon. Its designs are basically the foundation technology that companies need to produce chips, and it’s commonly used in smartphones. In September, Arm made waves by going public at US$51 per share in the US, marking the tech world's biggest offering of the year.

In 2020, Intel shares dropped when Apple revealed an in-house-designed chip for its Mac computers. Earlier this year, Apple said its upcoming Mac Pro would use a chip that runs up to three times faster than the fastest Intel-powered Mac Pro, completing its transition to homemade chips. Apple’s nearly doubled its computer market share since creating its own chips, according to data from research firm IDC.

The development: Nvidia is now reportedly gearing up to design new CPUs using Arm’s technology, challenging Intel's dominance in the world of personal computers (PCs). This insider information suggests that Nvidia, already a heavyweight in the AI accelerator chip market, is expanding its horizons into the CPU market. Its CPUs are expected to be Microsoft Windows-compatible. And if all goes according to plan, we might see these Nvidia-Arm-based CPUs hit the market as early as 2025. These sources said that AMD, Intel’s top rival, is also working on Arm-based CPUs. So far, 

Qualcomm is the only other maker of Arm-based chips for PCs. On Tuesday, the company released details on one of its new chips for Microsoft Windows-based laptops, saying it will be faster at some tasks than Apple’s own Mac chip. This Snapdragon Elite X chip will be available starting next year. 

Key comments: 

"Arm is an important element of our ecosystem, our technology and our customers' ecosystem. We want it to be successful; we want it to be healthy. That's the bottom line," said TSMC Chairman Mark Liu on the sidelines of the SEMICON Taiwan summit.

"We view Nvidia as the most important company on the planet in an era that is rapidly changing towards one that will be emphasized by greater AI capabilities," said CFRA Research analyst Angelo Zino.

"Technical traders and AI mania have pushed Nvidia toward the $1 trillion cap, and it is not inexpensive," said Argus Research analyst Jim Kelleher.