ARM Holdings plc (ARMH): Should You Doubt This Company’s Prospects?

Why the Cortex-A12 really matters

Well, for a start, there’s ARM’s newly developed Cortex-A12 processor design, targeted at the mid-range mobile handset market. This, to me, seems to be a very intelligent strategy indeed and I perfectly agree with ARM Holdings plc (NASDAQ:ARMH)’s recent prediction that the mid-range segment will witness a massive boom in the next couple of years. After all, there are no dearth of instances such as the Galaxy Grand Duos and the S4 Mini from handset manufacturers such as Samsung, products that come out after the actual biggies (like the Galaxy Grand and the S4), with the intention of making them more affordable for handset buyers.

And that’s not all. Cortex-A12 keeps up with the ARM legacy of ‘low power and high performance,’ as it promises to be 50% more energy efficient than prior versions, apart from cutting down on battery drainage, the latter being a perennial headache for handset manufacturers.

The LTE chipset scenario

Intel Corporation (NASDAQ:INTC) is yet to make a mark in the realm of LTE-enabled chipsets, an area where ARM Holdings plc (NASDAQ:ARMH) seems to be generations ahead. That also virtually guarantees ARM’s dominance over the crucial U.S. market, where the current trend happens to be a transition into the next generation LTE network technology. In fact, ARM-designed LTE-enabled chips manufactured by its licensing partner QUALCOMM, Inc. (NASDAQ:QCOM) dominate the market for such products and are considered to be the industry benchmark, as I have already stated before.

In fact, with Qualcomm having an impressive record of grabbing a whopping 86% share of the LTE-enabled processor market and having already launched its third generation of LTE-enabled chipsets, Intel sure has a long, long way to go if it wants to make a decent mark. Till now, all that Intel can talk about is an embarrassing less than 1% share of the global mobile processor market.

Wider horizons

That apart, ARM Holdings plc (NASDAQ:ARMH) investors should also consider the sheer range of applications that the company’s chipsets have all over the world. In fact, ARM has a formidable presence in the realm of embedded processing, and its chips have diverse applications ranging from automobile technology to toys to consumer electronics. Not to mention the fact that the company has already dropped broad hints of getting into the wearable devices market, what with Google Glass and the rumored Apple iWatch being the current hot topics of discussion. Intel Corporation (NASDAQ:INTC)’s base is still, unfortunately rooted in personal computers and notebooks.