ARM Holdings’ (ARMH) CEO Warren East warned about weak end-market demand in the second half of 2012. We’re a bit surprised by this announcement, given that Apple’s (click ticker for report: ) iPhone 5 will be released relatively soon and the prospects for demand upside from a possible iPad Mini. ARM Holdings is a key Apple partner.
Instead, we think this announcement may indicate that ARM is losing share to Intel (click ticker for report: ). We previously outlined Intel’s market presence in mobile computing, and given the stock’s relative outperformance in today’s trading, other investors are viewing the news in a similar light. We continue to believe that the iPhone 5 will be a monumental release for Apple, so we don’t expect this negative warning to affect the world’s largest company.