Microsoft has unveiled the Cobalt 200, a custom server processor designed for its Azure cloud infrastructure. According to the company, the chip offers approximately a 50% performance increase over its previous Cobalt 100 design and enhances energy efficiency. Some Cobalt 200 systems are already operational in Microsoft datacenters, with wider customer availability anticipated in 2026. This positions the Cobalt 200 as a key hardware component for many Azure services. The processor is built using Arm Neoverse V3 technology in a dual-chiplet layout, totaling 132 cores, and is manufactured on TSMC's 3 nm node. The design emphasizes precise power control, allowing each core to operate at its own voltage and frequency. This means each core can independently boost performance based on workload demands. The processor also includes a substantial 192 MB of L3 cache and 12 memory channels.

Additionally, Microsoft has integrated specialized accelerators for compression and cryptographic tasks, which the company states make up about 33% of typical cloud operations. This allows these functions to run without occupying general-purpose cores. Microsoft took a unique approach by modeling over 140 real-world Azure scenarios and employing AI-driven simulations to evaluate more than 350,000 configuration options before finalizing the architecture. Initial results from production deployments are promising, with one collaboration service noting a 45% improvement in performance and a 35% reduction in compute requirements compared to the previous platform. The chip also includes hardware memory encryption by default and supports Arm confidential compute features to enhance workload isolation for enterprise customers.