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Google (GOOGL.US) adopts new Arm (ARM.US) chips to power streaming services

Market IntelWednesday, Oct 30, 2024 9:00 pm ET

1min read

Alphabet's Google (GOOGL.US) today announced that its Google Cloud is using a new chip designed using Arm Holdings (ARM.US) technology to support streaming services. Google has reportedly already provided the chip to all of its cloud users, with the new Axion chip being used by Spotify Technology (SPOT.US) and Paramount Global (PARA.US) for streaming. Its competitors are more traditional computer hardware manufacturers such as AMD (AMD.US) and Intel (INTC.US).

"So far, we've seen workload performance on Axion be about 250% better than on Google Cloud," said Dave Zolotusky, Spotify's chief engineer.

Amazon Web Services (AWS) also developed chips based on Arm technology for its cloud users, and Microsoft (MSFT.US) also provided the same service for its Azure customers.

Google Cloud is continuing to develop. According to the company's Q3 2024 earnings released yesterday, Google Cloud revenue grew 35% year-on-year to $11.4bn.

"Google Cloud's operating income increased to $1.9bn, and operating margin increased to 17%," said Google CFO Anat Ashkenazi. "The increase in operating margin was driven by strong revenue performance of cloud AI products, core GCP and Workspace, as well as ongoing efficiency initiatives."

This is a positive signal for cloud giants such as Microsoft and Amazon, which will report their latest earnings today and tomorrow respectively.

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