Many arm chips support both a RISC ISA (the original ARM), and a more CISC-y ISA (thumb2). They consume less power and perform better with the latter. So well, in fact, that some chips don't even bother with the legacy RISC mode.
That said i've heard/read that Thumb2 tends to be the optimum size/space trade-off, but that's not because it's somehow more 'cisc'.
Thumb has benefits, but there are also limitations which is why I wouldn't call it a replacement.
One of the big differences is that you now need a marker instruction for predicated sequences, but obviously the encoding is quite different.