The CPU Land Grab is Officially On

Today's Meta and AWS Graviton Deal along with Intel results paint a clear picture

The CPU land grab is officially on, and the implications of this will be far broader than an x86 versus Arm holy war. Agentic AI workflows use a massive amount of CPU compute. One easy way to think of it is that, instead of scaling tasks based on population, agentic AI scales with the amount of compute you have. This is THE application that the CPU folks have needed for years, as it brings compute into a different productivity category.

This morning, I read several articles on the Meta-AWS Graviton deal since I wrote STH’s yesterday. Many focused on a big win for Arm. I see it as a much more impactful deal than just that Meta is using Arm CPUs, given Arm recently launched its AGI CPU with Meta as a lead customer. Meta’s deal with AWS is much more than the AGI CPU deal with Arm, and signals a full-blown CPU land grab. In this piece, we are going to explore why.

Also, Intel’s earnings call sparked further furor over data center CPU excitement. Although in Taiwan earlier this month, it was clear that Intel has some headwinds as well, which we may save for the next post.

In our STH Labs, we have been profiling dozens of agentic AI workflows and CPUs against them, and we will be sharing those results soon. Anyone saying Meta is doing this solely because of a focus on Arm would be foolish. There is a lot more going on here.

Let us get into it.

The Checkers Versus Chess of the Meta and AWS Announcement

Mainstream media reported that it was a big win for Arm that Meta was using its Graviton chips. That is a simple observation, and a fair one. Meta using more Arm will be good for the Arm ecosystem, even though hyper-scale CPU use is only sufficient up to a point, because their software stacks end up being more homogeneous than the broader market. Meta did not just buy CPUs, and that is what makes this interesting.