NVIDIA Corporation (NASDAQ:NVDA), known for its dominance in AI computing chips, is now coming after Intel's (NASDAQ:INTC) personal computer domain. NVIDIA is in the early stages of crafting CPUs compatible with Microsoft's (NASDAQ:MSFT) Windows, leveraging Arm Holdings (NASDAQ:ARM) technology, according to a Reuters report, which cited people familiar with the matter.
This aligns with Microsoft's strategy to support companies in producing Arm-based chips for Windows PCs, in part to compete with Apple's (NASDAQ:AAPL) growing market share from its proprietary Arm-based Mac chips.
Similarly, Advanced Micro Devices (NASDAQ:AMD) is exploring Arm technology for PCs, with both NVIDIA and AMD potentially releasing these chips by 2025. They'd be in the company of Qualcomm (NASDAQ:QCOM), an Arm-based chip producer for laptops since 2016.
The efforts of NVIDIA, AMD, and Qualcomm Incorporated (NASDAQ:QCOM) have the potential to disrupt the PC market, which has been long dominated by Intel, especially with growing challenges from Apple.
Apple's custom Mac chips, with their energy efficiency and speedy performance, are challenging Intel's PC industry lead. Recognizing Apple's success, Microsoft aims for comparable efficiency. Initially, Microsoft selected Qualcomm to develop Windows-compatible chips, offering an exclusivity deal until 2024. According to the sources, has encouraged others to enter the market once that exclusivity deal expires.
Microsoft is urging chip manufacturers to incorporate sophisticated AI functionalities into their CPUs. They foresee AI-driven software, like Copilot, becoming integral to the Windows experience. For this vision, upcoming chips from Nvidia, AMD, and others must allocate sufficient on-chip resources.
However, the success of Microsoft and these chip companies in this venture is uncertain. Developers have spent decades and invested massive funds in crafting Windows code for the x86 computing architecture, which is owned by Intel but also licensed to AMD. Codes tailored for x86 won't directly fit Arm-based configurations, making the shift potentially problematic.
Following the Reuters report, NVIDIA shares jumped more than 3% today, while Intel fell around 3%.