Nomura Equity Research’s Stuart Jeffrey today reiterates a Neutral rating on Apple (AAPL) shares and his colleague Romit Shah reiterates a “Reduce” rating on Intel (INTC) in a dual-authored report on the prospects of Apple dumping Intel’s processors in its Mac computers and instead using Apple’s custom-designed processors based on ARM Holdings (ARMH) technology.
In short, the authors think Apple might very well do it, for three reasons: the vertical integration of Mac OS and chipset could aid user experience, the technology is now in place for ARM-based chips that can support a desktop experience, and it would mean saving more than $100 off the cost to Apple of Intel’s “Core” series of chips.
Speaking of Intel, Raymond James’s Hans Mosesmann this morning cuts his rating on the shares to Underperform from Market Perform, warnings that the company faces a “potential gross margin nightmare.” To Mosesmann, there is risk that Intel’s 62% to 65% gross margin range of the last three years was an exception as it took share from Advanced Micro Devices (AMD) “and benefitted from the last real Windows upgrade cycle.” Going forward, with ARM increasingly competitive, Intel might see 50% gross margin, he argues.
There's been speculation that Apple would dump Intel since 2010. That's about how long Getanid61 has specualted that ARM would take over in servers.......lol. Where's ARM servers? or you have no clue, NONE!