Follow Arm Holdings to never miss an important update.
After Arm reported its November results, we raised our quality score to 4.6. We moved our rating from Avoid to Buy. We added a $2 billion business that sells finished chip designs directly to customers to our sales projections. We also reset our growth expectations for data center revenue now that Arm designs account for more than half of the chips used by major cloud providers.
Arm reported a strong quarter with revenue reaching $1.44 billion, ahead of the $1.38 billion analysts expected. The company earned $0.52 per share, also beating estimates. The growth was led by a 50 percent jump in licensing revenue, which is what partners pay upfront to use Arm's blueprints, and a doubling of royalties from data centers.
This shift toward data centers is vital because Arm's designs are more power-efficient than traditional chips, making them the top choice for companies building massive AI systems that consume huge amounts of electricity. While the stock fell about 5 percent today, the underlying business is growing fast as it moves from low-cost smartphone parts into these higher-value server and AI systems.
See the full quarter, and how our tracked metrics did
Source: Company earnings report
Arm is scheduled to release its latest financial results today. Analysts expect the company to report earnings of about $0.48 per share on revenue of roughly $1.38 billion. The most important thing to watch is the adoption of the v9 architecture, which is the latest set of blueprints for chip designs. Because Arm earns roughly double the royalty rate on v9 compared to older versions, its growth depends more on this technology shift than on the total number of chips sold. We will also be looking for updates on how much its designs are being used in AI data centers, where power efficiency is a major priority.
Arm will report its quarterly results on Wednesday, November 4. Analysts expect the company to report revenue of about 1.38 billion dollars and earnings of 48 cents per share. The main thing to watch is how quickly customers are switching to the newer v9 chip designs. These blueprints earn Arm roughly double the royalty fees of older versions, which is the primary way the company grows its profits even if the total number of devices sold stays flat.
Taiwan is reportedly moving to tighten controls on AI chips being sent to China. This move would bring the region's rules closer to the strict limits already set by the U.S. government.
This matters for Arm because its blueprints are the foundation for many of the world's AI chips. While Arm is a UK-based company, it relies on the global chip supply chain and has a large business in China. Tighter rules on where its partners can sell their finished products could limit how much royalty revenue Arm collects from that region.
Source: Bloomberg Markets and Finance
Management has beaten expectations every quarter since early 2025, showing they set conservative targets that the business consistently outpaces as AI demand accelerates.
| Expectation | |
|---|---|
| EPS | $0.55 |
| Revenue | $1.53B |
Follow Arm Holdings to get the latest and most important updates.
Follow ARM