Arm jumps as new AI chip to drive billions in annual revenue

US-listed shares of Arm Holdings jumped nearly 12% in premarket trading on Wednesday after the chip firm projected billions of dollars in annual revenue from its own new artificial intelligence data-center chip.

The new chip marks a pivot for Arm, which has traditionally relied on licensing ‌its designs ⁠to companies ⁠such as Nvidia and Qualcomm and then collecting a royalty payment based on ​the number of units sold.

Unlike current chips that are designed to respond to queries as part of a chatbot, Arm’s AGI CPU will be able to handle data-crunching needs of “agentic AI”, a system that acts on behalf of users with ⁠minimal oversight.