Semiconductor Stocks: Winners And Losers After Apple's Bombshell

But the most shocking claim was the increase in battery life. The new MacBook Pro's battery life doubles the time of its predecessor – from 10 hours to an almost unheard-of 20 hours.

Still, the real proof would come when the tech media could test these Macs for themselves.

Multiple "geek" websites, from TechCrunch to ExtremeTech to Ars Technica, were slightly shocked to find Apple was not exaggerating.

The M1 Macs not only left their predecessors in the dust – but much of the Intel-powered PC competition as well.

Check out these headlines:

(TechCrunch)

(Ars Technica)

 

(Tom's Guide)

You can see the benchmarks for yourself – and the breathless praise for the M1 – by clicking on the links to those websites.

The M1 Is Just a Glimpse of What's to Come

Apple has achieved what many didn't think possible – an ARM-based chip that can beat Intel on performance while using far less energy, ensuring extraordinary battery life.

And this is just the first of a one-two punch. Apple's iMac and Mac Pro desktops due for their own M1 overhaul over the next two years will get an even better, faster version.

A big part of why the Apple's chip offers such startling efficiency is the integration of its design. It's a true system on a chip (SoC), marrying a traditional CPU with a graphics processor, a machine learning processor (the Neural Engine) and the system memory.

In the ARM world, this sort of integration isn't unusual. But PCs typically have memory and graphics chips separate from the CPU. So here Apple clearly has thrown down the gauntlet to Intel and Advanced Micro Devices Inc. (AMD).

Of further concern to the PC CPU makers is Apple's proven prowess as a CPU designer.

Note the consistent, linear gains Apple has made with successive generations of its A-series chips compared to Intel's relative stagnation (see chart).

I expect the same sort of relentless progress from the M series as well. And don't forget, Apple's vertical integration means it can optimize the M1 for the Mac's operating system in ways the Windows PC world cannot duplicate.

Apple's success here proves ARM can match the power of x86 architecture. And that will light a fire under Qualcomm and other ARM chip designers to try and duplicate what Apple has done.

We're on the cusp of a major shake-up in the $40 billion PC/server processor market.

And since Apple won't be selling its chips to anyone, the door is open to other chipmakers to create an M1-like CPU for servers and Windows PCs. The winner of that race stands to reap huge rewards.

Semiconductor Stocks: the Winners and Losers

Here's my take on how this is likely to play out:

WINNER – Apple Inc.: Yes, I know Apple is not thought of as a semiconductor company. But it does design the M1 in house. And the M1 will benefit Apple stock. The Mac made up just under 11% of Apple's revenue in its 2020 fiscal year, but the M1 could boost that substantially.

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Disclosure: None.

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