Intel shares plummet on news of Microsoft's development of its own processors

Intel shares plummet on news of Microsoft’s development of its own processors

News of Microsoft’s in-house development of its own ARM-based CPUs has plunged stocks in x86 chip makers. Intel has suffered especially seriously, which, as it now seems, in the future may lose another strategic client.

According to a Bloomberg posting, Microsoft is developing an ARM-based server processor that it plans to deploy in data centers that run Azure services. Currently, the company’s servers are based on Intel Xeon processors. In addition, the original post also talks about another promising Microsoft project ARM processor for Surface mobile devices.

If Microsoft’s projects to create its own chips are crowned with success, this will mean another narrowing of the sales market for the products of manufacturers of x86-processors, primarily Intel. This looks like a very disturbing sign, especially against the background of the fact that other tech giants are gradually leaning towards ARM processors. For example, Amazon has been developing in this direction for a long time and quite successfully, and Apple recently even introduced MacBook Air and MacBook Pro laptops based on processors with ARM architecture, and outlined a plan to completely abandon Intel chips within the next couple of years.

The stock market inevitably reacted to the possibility of radical changes in the processor market. Intel shares immediately fell 6.3%, dropping to $ 47.46. Shares of AMD, which Microsoft’s transition to its own processors may indirectly affect, lost 1% in price, falling to $ 95.95.

Let us remind you that this year is not going very well for Intel’s business. The company faced problems with the implementation of modern technological processes and repeatedly postponed the release of new products, primarily for the server market. All this has led to the fact that since the beginning of 2020, its capitalization has decreased by more than 20%.

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