Arm Predicts Data Centre CPU Market Share to Surge to 50% in 2025
Written by Nicole Cappella Thu 3 Apr 2025
Mohamed Awad, head of infrastructure at Arm, has said that Arm is projecting to have a 50% market share in data centre CPU by 2025, from approximately 15% in 2024.
In an interview with Reuters, Awad attributed this dramatic growth to the increasing demand for artificial intelligence (AI) infrastructure.
Arm’s technology is widely used as the host processor in AI computing systems, acting as a traffic controller for AI chips. One notable example is NVIDIA’s Grace CPU, an Arm-based chip that pairs with NVIDIA’s Blackwell AI processors. Arm’s chips are increasingly favoured for their energy efficiency, making them attractive for AI-driven data centres that require substantial power consumption.
Arm’s lower power consumption compared to rival processors from Intel and Advanced Micro Devices has played a pivotal role in its rising market presence. “In this unprecedented age of AI transformation, we are seeing an insatiable demand for computing, with AI servers set to grow by more than 300% in the next few years,” said Awad in a follow-up statement.
Awad emphasised that power efficiency is no longer just an advantage but a necessity for scaling AI infrastructure. Arm’s Neoverse compute platform, he claimed, has become the preferred choice for major industry players like Amazon Web Services (AWS), Google, Microsoft, and NVIDIA.
Despite Arm’s optimism, some industry analysts are sceptical about whether the company can realistically hit the 50% market share target by year’s end.
Manoj Sukumaran, Principal Analyst of Data Center IT at Omdia, described the projection as “aspirational.” He noted that while NVIDIA’s Grace CPUs could drive some market share gains, the real momentum is coming from custom CPU deployments by hyperscalers like AWS, Google, Microsoft, and Alibaba.
“AWS alone is set to deploy over 1.2 million Arm CPUs in their servers this year,” said Sukumaran.
However, Sukumaran predicted that Arm-based servers would account for merely 20% to 23% of the global server market by 2025, much lower than Arm’s forecast. Omdia estimated global server shipments in the current year will be 12.3 million units, and Arm-based chips will power some of them.
Written by Nicole Cappella Thu 3 Apr 2025