Arm nears bold compute forecast as hyperscalers flourish

At the start of this year, Arm made a bold prediction - that close to 50 per cent of the compute shipped to top hyperscalers in 2025 would be Arm-based. After three quarters of confirmed shipments, the company reveals that the market is bang on track to meet that forecast.

Dermot O'Driscoll, Arm's Vice President of Product Solutions, Cloud AI Business Unit, issued a timely update – and reminder: “These servers aren’t just a statistical milestone. Much more importantly, they form the compute backbone of a new kind of infrastructure – the converged AI data centre.

“From cloud-native services to the most demanding AI workloads, hyperscalers are standardising on purpose-built compute on Arm as the way to balance performance, power, and scale.”

A hyperscaler is a large-scale provider of cloud computing, storage and networking services that uses massive data centres to deliver these resources globally.

AWS Graviton5, just announced, is described as a clear manifestation of this new model. Now in its fifth generation, it reflects years of compounding Arm efficiency and is designed for modern data centre requirements – from high-density inference to scaled-out cloud-native workloads. For the third straight year, Graviton has accounted for over half of all new CPU capacity deployed at AWS, and today 98 per cent of the top 1,000 Amazon EC2 customers rely on it in production, O'Driscoll reports.

Graviton is also part of an all-AWS silicon strategy in which all three AWS custom-designed chips are on the same unified compute sleds in the new AWS Trainium3 UltraServers. In this design, Arm-powered AWS Graviton and AWS Nitro performs host CPU and high performance networking functions respectively for AWS Trainium3 UltraServers.

Arm reports that Graviton5 is part of a broader industry shift as Arm increasingly powers the platforms defining the AI era. Notable developments include:-

Google Axion: Now available with additional virtual machine (VM) options, the Axion family powered by Arm Neoverse processors are delivering new levels of performance for cloud and AI workloads.

Microsoft Cobalt 100 and the newly announced Cobalt 200: Targeting cloud-native workloads in Microsoft Azure’s AI-optimised data centres, these processors power both Microsoft internal services and Azure customers.

NVIDIA Grace Blackwell: Combining Arm-based CPUs with NVIDIA’s AI accelerators to create the most advanced AI computing platform yet.

O'Driscoll says that the world’s leading hyperscalers, chipmakers, and system builders aren’t experimenting with purpose-built – they’re aligning their infrastructure strategies around it. Arm is the trusted foundation making that convergence possible, he adds..

He says: “Taken together, these platforms show how quickly the data centre is evolving. AI is collapsing traditional boundaries within infrastructure, turning what was once a collection of general-purpose servers and appliances into a tightly integrated, AI-optimised environment where compute, acceleration, networking, memory, storage and software are co-designed and operated as a single system.

“In the converged AI data centre, performance and efficiency come from the cohesion of the entire stack – not from any individual component. Arm provides the common architecture that connects these layers, enabling providers to optimise holistically while maintaining the flexibility and efficiency modern workloads demand at massive scale. Each layer of this system contributes differently to AI performance and Arm’s architecture spans all of them.”

With 192 cores and 5x larger cache compared to the previous generation, Graviton5 delivers up to 25 per cent performance gains across the workloads that matter most to AWS cloud customers, illustrating the transformative effect of specialisation while redefining the economics of cloud compute.

O'Driscoll says that this momentum extends well beyond hyperscale. Enterprises are now applying the same purpose-built principles to AI inference, autonomous systems, edge computing, intelligent networking, and much more, he says, adding that these use cases are being powered by the same Arm architecture that underpins the cloud.

O'Driscoll said: “It’s not just the world’s biggest companies that are co-designing the future on Arm. Through initiatives like Arm Total Design, leveraging the Arm Neoverse Compute Subsystems (CSS) platform, we’re enabling a broader ecosystem to design custom silicon with hyperscale-class efficiency and speed. Meanwhile, programs like Arm Cloud Migration make it easier for organisations of any size to adopt Arm-based compute and unlock its performance and efficiency advantages.

“Purpose-built compute is winning. The industry is embracing it. And Arm is the compute platform at the heart of it all, powering what comes next.”