Arm processors gain popularity due to AI: they accounted for a quarter of the server market.
Arm processors are rapidly gaining ground in data centers. The Register discussed a recent report from Dell’Oro Group with an analyst. It showed that a quarter of all servers were running on Arm CPUs in the second quarter, compared to 15 percent a year ago.
Nvidia Makes the Difference
The growth is mainly due to Nvidia’s Grace-Blackwell racks, equipped with 72 Blackwell GPUs and 36 Grace CPUs per system. These chips are based on Arm’s Neoverse V2 architecture and work together with Nvidia’s NVLink interface to efficiently process enormous data streams. Players like CoreWeave used the first units this quarter.
Until last year, Arm was essentially only represented in servers by AWS with its Graviton chips. Now Microsoft (Cobalt) and Google (Axion) also have their own Arm chips for the cloud. As a result, the revenue from Nvidia’s Grace chips is now comparable to that of cloud GPUs, according to analyst Baron Fung.
Ambition and Competition
With a market share of 25 percent, Arm has already grown significantly, but remains far below the target of 50 percent by the end of 2025. New designs could drive that market share higher. Nvidia is working on a next Arm CPU, Vera, but Qualcomm and Fujitsu are also preparing new chips. These would be compatible with Nvidia’s NVLink Fusion technology.
Dell’Oro expects the market for server and storage system components to grow by 46 percent this year.
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