Google Cloud powers streaming services with new Arm chip

Alphabet’s (NASDAQ:GOOG)(NASDAQ:GOOGL) Google Cloud is using a new chip designed with technology from Arm Holdings (NASDAQ:ARM) to power streaming services, the company announced today.

Google’s new Axion chip is being utilized by Spotify Technology (SPOT) and Paramount Global (PARA) for streaming. Google has made the chips available to all of its Cloud users. It is competing against more traditional manufacturers of computer hardware such as Advanced Micro Devices (AMD) and Intel (INTC).

“Our tests on Axion have shown roughly 250% better performance than we’ve seen on our workloads on Google Cloud to date,” said Spotify’s principal engineer Dave Zolotusky.

Amazon Web Services (AMZN) also creates chips for its cloud users based on Arm technology. Microsoft (MSFT) does as well for its Azure customers.

Google Cloud continues to roll. Cloud revenue soared 35% year over year to $11.4B, according to the company’s third quarter 2024 financial results.

“Google Cloud operating income increased to $1.9 billion and operating margin increased to 17%,” said Google Chief Financial Officer Anat Ashkenazi. “The operating margin expansion was driven by strong revenue performance across cloud AI products, core GCP and Workspace, as well as ongoing efficiency initiatives.”

This is a positive sign for competing cloud giants such as Microsoft and Amazon, who reveal their latest financial results today and tomorrow, respectively.