Google may design its own server processors

Google let it be known yesterday that it is considering designing its own ARM-based server chips – an announcement which sent Intel shares diving over 3%.

The story emerged on Bloomberg yesterday. It is not known whether it was put out in order to squeeze Intel on price negotiations for server processors, or if it wants Intel to license its cores so it can build its own SoCs around them, or if it wants to push Intel into making customised processors for Google, or if it means exactly what it says.

A statement from Google did not deny the story but did not outright confirm it either.

Google has built its own servers from the start, cannibalising old PCs for parts.

Processor sales to Google account for 4.3% of Intel’s revenue and Google is Intel’s fifth biggest customer.

At its recent analyst day Intel said it hoped to balance declining PC sales with increasing server processor sales.

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