ARM euphoria cooling after HP deal

ARM Holdings, the British computer chip designer is still 2.45% above yesterday's close following the announcement last night of a tie up with Hewlett Packard.

HP has announced it will be making low power servers using ARM's chip designs.

ARM's products, which are usually used in mobile phones, require up to 90% less energy than their rivals' Intel, so for some customers with huge "server farms" the new HP devices could be a serious cost saving.

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ARM would make money through a licensing agreement with the actual manufacturer of the chips, Calxeda, based in Texas (and part owned by ARM).

This morning saw investors euphoric over the deal, with shares up nearly 6%. Since then, however, cooler heads have prevailed, leaving the stock at 586p in London, up 14p on the day.

BS