Advanced Micro Devices, Inc. (AMD) Turns to ARM Holdings plc (ADR) (ARMH) for Support

How does this help AMD you might ask? It is all about pricing power, which is now in the hands of Intel. Anyone that manages to bring a compelling server chipset to the market stands to gain as buyers buck under the pressure of Intel’s control. While AMD has taken a backseat to Intel in recent years, the company helped pioneer the push into 64-bit architecture and has a wealth of experience in the server market. If Seattle is successful, they have a good shot at recapturing some of the market share they’ve ceded over the years, which would make for a healthier company.

What About Intel?

The last major piece of the puzzle is Intel. The company is not content to just sit and watch its competitors chip away at one of its main sources of revenue. Intel has redirected its research and development toward power efficiency and is pushing for a piece of the mobile computing market. This helps the company on two fronts, helping to stave off the new wave of server challengers while also eventually letting it tap into the fastest growing part of the chip market.

Even with their advances, Intel isn’t immune to the competition. The company’s margins have been under pressure, and it still hasn’t had a major breakthrough in the mobile market. AMD’s move in conjunction with pressure from others could be enough to topple Intel’s dominance.

In the end, it is hard to say which way the winds of change will blow, but there seems to be a place for servers built around mobile chips. To that end ARM Holdings plc (ADR) (NASDAQ:ARMH) stands to be the biggest winner, but AMD stands to gain along the way.

The article AMD Turns to ARM for Support originally appeared on Fool.com.

Chris Moore owns shares of Intel. The Motley Fool recommends Intel. The Motley Fool owns shares of Intel. Chris is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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