Arm Holdings plc (ARM) — Company Research

Last Updated: 17 August 2026

Arm Holdings plc designs the instruction set architecture and processor cores that sit inside the overwhelming majority of the world's mobile phones and, increasingly, inside the servers running artificial-intelligence workloads. It does not, historically, manufacture chips. It licenses designs to companies that do, collects an upfront licence fee, and then collects a royalty on every chip shipped for the life of that design — a model that turns a single engineering effort into decades of annuity income. In March 2026 that changed materially: Arm launched its own production silicon for the first time in the company's history. This report sets out what Arm reported for the fiscal year ended 31 March 2026 and for the June 2026 quarter, how the business is structured, what it is building, and where the risks sit. No analyst opinions and no price targets appear anywhere in it.

1. Company Snapshot

Field	Value
Company	Arm Holdings plc
Ticker / Exchange	ARM (American Depositary Shares) / NASDAQ
Headquarters	Cambridge, United Kingdom
Sector	Technology — semiconductor intellectual property
CEO / Leadership	Rene Haas (Chief Executive Officer since February 2022); Jason Child, Chief Financial Officer
Employees	9,584
Fiscal year end	31 March
Revenue (FY2026, ended 31 Mar 2026)	$4,920m, up 22.8% year on year (SEC Form 20-F, accession 0001973239-26-000097)
Revenue (trailing twelve months to 30 Jun 2026)	$5,156m
GAAP diluted EPS (FY2026)	$0.85
Non-GAAP diluted EPS (FY2026)	$1.77
GAAP operating income (FY2026)	$900m (18.3% margin)
Market capitalisation	~$298.4bn (share price $279.44, close 14 August 2026; 1,068.0m ADS outstanding)
Cash and short-term investments (30 Jun 2026)	$3,888m; no borrowings outstanding
Free float	~142.6m shares, roughly 13.4% of the total — SoftBank Group retains the balance
Listed since	14 September 2023 (Nasdaq IPO)

You can follow the price action on our Live Charts page and track the macro releases that move semiconductor names on the Economic Calendar.

2. Bull and Bear Case

Bull Case

• Royalty annuity compounds without new spending: Arm collects a royalty on every chip built to a design it licensed, often many years after the engineering work was paid for. Cumulative Arm-based chip shipments have passed 350 billion, and Neoverse core shipments have passed 1.5 billion — the most recent 500 million of those took nine months, against six years for the first billion.
• Armv9 and CSS raise the price per chip: Armv9 carries roughly twice the royalty rate of Armv8, and Compute Subsystems command roughly twice the rate of a standalone Armv9 CPU licence again, with later CSS generations reaching around three times. This lets revenue grow even where unit volumes are flat or falling, which is exactly what is happening in smartphones.
• Data centre is now a genuine second engine: Data-centre royalty revenue more than doubled year on year in FY2026, and Arm's CPU compute share among the largest hyperscalers is now around 50%. Google, Microsoft and Amazon are each shipping custom Arm-based server CPUs at scale.
• The balance sheet carries no debt at all: Arm ended the June 2026 quarter with $3,888m of cash and short-term investments and no borrowings on the balance sheet, so the entire enterprise value is equity and the company funds its own expansion.
• Operating cash generation has stepped up sharply: Operating cash flow reached $1,524m in FY2026 and $902m in the June 2026 quarter alone, against capital expenditure of $197m — the model converts revenue growth into cash without a heavy asset base.

Bear Case

• SoftBank owns nearly everything and has borrowed against it: With only around 13.4% of the shares in public hands, the price is set by a thin float. SoftBank has pledged Arm shares as collateral for large margin facilities, which creates a structural overhang entirely outside Arm's operational control.
• Competing with your own customers is a new and untested risk: By launching the AGI CPU, Arm now sells finished silicon into a market served by the licensees who pay it royalties. That is a different commercial relationship, and it is the stated trigger for the reported US Federal Trade Commission antitrust inquiry.
• GAAP profitability is going backwards while non-GAAP improves: GAAP operating margin fell to 7.1% in the June 2026 quarter from 10.8% a year earlier as operating expenses rose 28%. The gap between the GAAP result ($0.25 diluted) and the non-GAAP result ($0.45) is largely share-based compensation, which is a real cost of employing engineers.
• Litigation with a major licensee is unresolved and Arm is the losing party so far: The Delaware court entered final judgment for Qualcomm and Nuvia on 30 September 2025 and dismissed Arm's remaining claims; Arm appealed to the Third Circuit on 1 October 2025. Qualcomm's separate April 2024 complaint against Arm also remains outstanding.

3. Business Segments

Arm reports revenue in two categories rather than operating segments. The split below is for the quarter ended 30 June 2026, with the FY2026 full-year split shown alongside for context.

Segment / category	% of revenue	What it is
Royalty revenue	55.5% of Q1 FY2027 revenue ($715m); 53.1% of FY2026 revenue ($2,613m)	A per-chip fee collected every time a licensee ships a product built on an Arm design. Rates rise with architecture generation — Armv9 carries roughly double the Armv8 rate, and Compute Subsystems roughly double that again. Because royalties are earned on designs licensed years earlier, this line is the annuity in the business.
Licensing and other revenue	44.5% of Q1 FY2027 revenue ($574m); 46.9% of FY2026 revenue ($2,307m)	Upfront and subscription fees for access to Arm's architecture and processor designs, including Arm Total Access and Arm Flexible Access agreements. Recognition is lumpy because it depends on when large agreements are signed or renewed. Annualised contract value stood at $1,732m at 30 June 2026, up 13% year on year.

By end market, Arm does not disclose a precise percentage breakdown. It has stated that smartphone unit volumes are projected to be down while its own smartphone royalty revenue grew at a double-digit rate on Armv9 and CSS pricing; that data-centre royalty revenue more than doubled year on year; and that licensing growth came from renewals with handset, automotive and robotics customers.

4. Business Model and Moat

How it makes money. Arm sells the right to use a processor design, then charges again for every physical chip built with it. A licensee pays an upfront or subscription licence fee to get access to the architecture, spends two to four years designing a chip around it, and then pays Arm a royalty on each unit shipped for as long as that chip is sold — frequently a decade or more. The engineering cost is incurred once; the royalty stream is collected many times. This is why Arm's operating cash flow ($1,524m in FY2026) so comfortably exceeds its capital expenditure ($545m), and why it can carry no debt while expanding.

Where the moat comes from. The defensive position is the software written for the architecture, not the architecture itself. Decades of compilers, operating systems, drivers, libraries and developer skill are built around Arm instructions. A chip designer who switches architectures does not merely redesign silicon — they ask their entire customer base to re-validate its software. That switching cost is what has kept Arm dominant in mobile through repeated attempts by Intel and, more recently, by the open-source RISC-V architecture. The moat weakens where the software stack is thin and controlled by one party, which is precisely why RISC-V has made its earliest inroads in embedded and microcontroller applications rather than in phones.

What is changing. Historically Arm's neutrality was itself an asset — it competed with nobody, so everybody could license from it. The AGI CPU ends that. Arm is now a vendor of finished server processors as well as the landlord of the architecture its rivals build on. Management's stated logic is that the royalty on a full compute subsystem is several times the royalty on a bare CPU core, so moving up the stack raises revenue per chip. The counter-argument is that licensees who now compete with their supplier have a fresh reason to evaluate alternatives.

5. Financial Health

All figures below are taken from Arm's SEC filings (Forms 20-F and 6-K) as tagged in the company's own XBRL data. Arm's fiscal year ends on 31 March, so FY2026 covers the twelve months to 31 March 2026.

Fiscal Year	Revenue ($m)	YoY %	GAAP EPS	Adjusted EPS	Dividend/share	Long-term debt (YE)
FY2022 (to 31 Mar 2022)	2,703	n/a — FY2021 not presented	$0.54	Not published †	Nil	Nil
FY2023 (to 31 Mar 2023)	2,679	-0.9%	$0.51	Not published †	Nil	Nil
FY2024 (to 31 Mar 2024)	3,233	+20.7%	$0.29	Not verified ‡	Nil	Nil
FY2025 (to 31 Mar 2025)	4,007	+23.9%	$0.75	$1.63	Nil	Nil
FY2026 (to 31 Mar 2026)	4,920	+22.8%	$0.85	$1.77	Nil	Nil

† Arm listed on Nasdaq on 14 September 2023. FY2022 and FY2023 are pre-IPO periods for which the company did not publish a non-GAAP earnings per share measure. ‡ Arm did publish a non-GAAP EPS figure for FY2024, but it could not be confirmed against a primary filing during the preparation of this update and has been left unstated rather than estimated. Arm has never declared or paid a dividend, and reports no borrowings on its balance sheet in any year shown — the long-term debt column is therefore nil throughout rather than unavailable.

Quarter / Half	Revenue ($m)	Adjusted EPS	GAAP EPS
Q1 FY2027 (to 30 Jun 2026)	1,289	$0.45	$0.25
Q4 FY2026 (to 31 Mar 2026)	1,490	$0.60	$0.30
Q3 FY2026 (to 31 Dec 2025)	1,242	$0.43	$0.21
Q2 FY2026 (to 30 Sep 2025)	1,135	$0.39	$0.22
Q1 FY2026 (to 30 Jun 2025)	1,053	$0.35	$0.12
FY2026 total (Q1–Q4 FY2026)	4,920	$1.77	$0.85

The June 2026 quarter is the first quarter of fiscal 2027 and is shown first; it is not included in the FY2026 total. Q4 FY2026 GAAP EPS of $0.30 is derived as the FY2026 full-year figure of $0.85 less the nine-month figure of $0.55, both as tagged in Arm's own filings.

Cash flow and balance sheet. In FY2026 Arm generated $1,524m of operating cash flow against $545m of capital expenditure, giving free cash flow of $979m. Depreciation and amortisation was $249m. On a trailing twelve-month basis to 30 June 2026, operating cash flow was $2,094m, capital expenditure $588m, free cash flow $1,506m and depreciation and amortisation $264m. At 30 June 2026 the company held $3,058m of cash and cash equivalents plus $830m of short-term investments, total assets of $11,196m and total liabilities of $2,566m, with no borrowings disclosed under any debt tag in its XBRL filings.

6. Valuation Metrics

Raw metrics, August 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Market cap	~$298.4bn (share price $279.44 at the close on 14 August 2026 × 1,068.0m ADS outstanding)
Enterprise value	~$295.0bn (market cap $298.4bn + total debt and lease obligations ~$0.5bn − cash and short-term investments $3.9bn per the 30 June 2026 balance sheet). Arm reports no borrowings, so the only debt-like item is lease liabilities — enterprise value is therefore below market capitalisation.
Trailing P/E (GAAP)	~285x ($279.44 / trailing twelve-month GAAP diluted EPS of $0.98, derived as FY2026 $0.85 less Q1 FY2026 $0.12 plus Q1 FY2027 $0.25). On the company's trailing twelve-month non-GAAP EPS of $1.87 the same price is ~149x; the gap between the two is almost entirely share-based compensation.
P/E (forward)	~91x on a consensus fiscal-2027 non-GAAP EPS of roughly $3.06. Arm's own guidance extends only one quarter ahead — $0.47 plus or minus $0.04 for Q2 FY2027 — so no company-guided full-year EPS figure exists to anchor this against.
P/S (TTM)	~57.9x (market cap $298.4bn / trailing twelve-month revenue $5,156m, derived as FY2026 $4,920m less Q1 FY2026 $1,053m plus Q1 FY2027 $1,289m)
EV/EBITDA (TTM)	~259x (enterprise value $295.0bn / EBITDA $1,141m). EBITDA is trailing twelve-month GAAP operating income of $877m plus depreciation and amortisation of $264m, both taken from the consolidated cash flow and income statements in Arm's filings. Arm discloses a single combined depreciation and amortisation line, so no wider segment-note figure exists.
P/FCF	~198x (market cap $298.4bn / free cash flow $1,506m; free cash flow = trailing twelve-month operating cash flow $2,094m less capital expenditure $588m per the cash flow statement)
52-week high	$452.70
52-week low	$100.02
Short interest (% of float)	11.61% (16.87m shares short against a free float of ~142.6m, settlement date 31 July 2026; the prior period stood at 17.23m shares)
Days to cover	2.68

Two features of this table are worth stating plainly rather than leaving implicit. First, every multiple here is extreme by the standards of the semiconductor sector, and that is a function of the price rather than of any accounting distortion — the underlying cash flows are real and positive. Second, the free float of roughly 13.4% means a comparatively small amount of buying or selling moves the quoted price a long way, which is reflected in the very wide 52-week range.

7. What Are They Building

The AGI CPU. On 24 March 2026 Arm unveiled the Arm AGI CPU, the first production silicon the company has ever sold. It carries 136 Neoverse V3 cores, is built on TSMC's 3nm N3P process and has a 300W thermal design power. Arm's own claim is more than double the performance per rack against x86 alternatives, which it frames as reducing AI data-centre capital expenditure by up to $10bn per gigawatt of deployed capacity. Meta is the lead co-development partner and first customer. Other named committed customers include OpenAI, Cloudflare, SAP, Cerebras, Positron and Rebellions, with systems orderable from ASRock, Lenovo, Quanta and Supermicro. Full production availability is targeted for the second half of 2026, and management stated at the Q1 FY2027 results that customer demand for FY2027 and FY2028 combined now exceeds $2bn.

Neoverse and the data centre. The AGI CPU sits on top of a Neoverse franchise that has already been adopted by the largest cloud operators. Google is replacing x86 host processors with its own Arm-based Axion CPUs alongside its TPU accelerators; Microsoft's Arm-based Cobalt processors run in a substantial portion of Azure regions; and Amazon's custom silicon business built around Graviton, Trainium and Nitro runs at more than $20bn annualised. Arm has stated its CPU compute share among the top hyperscalers is now around 50%. More than fifty companies have publicly supported the silicon expansion, including AWS, Broadcom, Google Cloud, Marvell, Microsoft, Micron, NVIDIA, Oracle, Samsung, SK Hynix and TSMC.

Compute Subsystems. CSS is Arm delivering a pre-integrated, pre-validated cluster of cores and interconnect rather than a bare CPU design. Commercially it matters because it roughly doubles the royalty rate against a standalone Armv9 CPU licence, with later generations reaching around three times. It is the mechanism by which Arm grows revenue in a smartphone market whose unit volumes are not growing.

Automotive and robotics. Arm has cited high-value licensing renewals with automotive and robotics customers as a driver of licensing growth. Wayve's third-generation robotaxi platform, built on the Arm-based NVIDIA DRIVE AGX Thor, is running supervised passenger pilots with Uber in London.

The long-range target. At the FY2026 results Arm reiterated a goal of roughly $25bn of total revenue by FY2031, against $4.92bn delivered in FY2026. That implies a compound growth rate far above anything in the five-year record in Section 5, and is a management aspiration rather than guidance.

8. Competitive Landscape

Arm occupies an unusual position: several of the companies below are simultaneously customers, partners and, since March 2026, competitors. Market capitalisations were re-checked live on 14 August 2026 rather than carried over from earlier in the year.

Peer	Market cap (August 2026)	Key 2025 metric
NVIDIA (NVDA)	~$5,453.6bn	Trailing twelve-month revenue of ~$253.5bn and EBITDA of ~$165.5bn. Builds Arm-based CPUs (Grace, and the announced next-generation Vera) and is therefore a licensee rather than a rival for the architecture itself.
Intel (INTC)	~$541.8bn	Trailing twelve-month revenue of ~$57.0bn against a trailing GAAP loss per share of $2.09. The principal x86 alternative Arm is displacing in the data centre.
Qualcomm (QCOM)	~$174.1bn	Trailing twelve-month revenue of ~$44.1bn and diluted EPS of $8.75. Arm's largest licensing counterparty and its opponent in the Nuvia architecture-licence litigation, in which Qualcomm prevailed at first instance.
Cadence Design Systems (CDNS)	~$89.6bn	Trailing twelve-month revenue of ~$5.84bn and diluted EPS of $5.03. Sells the design tools every Arm licensee uses, so it captures value from the same chip-design cycle without competing on architecture.
Synopsys (SNPS)	~$80.7bn	Trailing twelve-month revenue of ~$8.68bn and diluted EPS of $4.38. Like Cadence, an electronic design automation supplier whose revenue rises with silicon design activity generally.

The competitor that does not appear in the table is RISC-V, an open-source instruction set with no owner and therefore no market capitalisation. It is the structural long-term threat to a licensing business, because its licence fee is zero.

9. Insider Activity

Chief Executive Rene Haas has led Arm since February 2022 and Jason Child has been Chief Financial Officer since November 2022. Insider dealing in Arm ADSs during 2026 has been one-directional: the filings reviewed for this update show sales only, with no open-market purchases by executive officers. Several were executed under pre-arranged Rule 10b5-1 trading plans, which are adopted in advance and remove discretion over timing.

Name	Date	Type	Shares	Price	Value	Plan Type
Rene Haas (Chief Executive Officer)	14 Apr 2026	Sale	9,299	$160.57–$163.00 (three weighted-average blocks)	~$1.5m	Rule 10b5-1 plan
Jason Child (Chief Financial Officer)	22 Apr 2026	Sale	21,280	$180.00 (weighted average)	$3,830,400	Not stated in filing reviewed
Jason Child (Chief Financial Officer)	25 Mar 2026	Sale	21,280	$148.37 (weighted average)	$3,157,314	Not stated in filing reviewed
Rene Haas (Chief Executive Officer)	2 Mar 2026	Sale	6,152	$126.15 (weighted average)	~$776,040	Not stated in filing reviewed

Two points of context. First, a substantial portion of senior pay at Arm is delivered in equity, so scheduled selling is a normal feature of the compensation structure rather than a signal in itself. Second, the absence of any recorded open-market purchase across the period reviewed is itself a data point, and readers can verify the underlying Form 4 filings directly on the SEC's EDGAR system.

10. Key Risks

• Ownership concentration and the SoftBank overhang: SoftBank Group holds the overwhelming majority of Arm's shares, leaving a public float of roughly 13.4%. SoftBank has pledged Arm stock as collateral against large borrowing facilities, including a reported $20bn margin-loan syndicate and a separate facility linked to its OpenAI commitment. Any forced or discretionary disposal of that collateral would meet a very thin market.
• Channel conflict from the move into silicon: Selling the AGI CPU puts Arm in direct competition with licensees who pay it royalties. The commercial risk is that those licensees accelerate evaluation of alternatives; the regulatory risk is the reported US Federal Trade Commission antitrust inquiry, opened in May 2026, into whether Arm might restrict or degrade architecture licences to rivals now that it competes with them.
• Unresolved litigation with its largest licensing counterparty: The Delaware court entered final judgment for Qualcomm and Nuvia on 30 September 2025, dismissing Arm's remaining breach-of-licence claim; Arm filed a notice of appeal to the Third Circuit on 1 October 2025. Qualcomm's separate complaint against Arm, filed 18 April 2024, alleging failure to provide contractual deliverables, also remains outstanding. Both matters are unresolved as at the date of this report.
• RISC-V and the zero-cost alternative: An open-source instruction set architecture charges no licence fee and no royalty. RISC-V adoption has been strongest in embedded and microcontroller applications where the software ecosystem is shallow, and Chinese policy support has been reported as a further accelerant. Arm's own move up the stack is one response, but it does not remove the underlying price pressure.
• China exposure sits partly outside Arm's control: A meaningful share of group revenue is routed through Arm China, an entity Arm Holdings does not fully control and which has a documented history of governance disputes. Layered on top of that are US export controls on advanced compute architectures, whose scope has repeatedly changed and which Arm's own chief executive has publicly described as difficult to enforce.
• GAAP margin compression while headcount and pay costs rise: GAAP operating margin fell to 7.1% in the June 2026 quarter from 10.8% a year earlier, with operating expenses up 28% year on year. Building a silicon business is expensive, and the cost is landing on the GAAP result before the associated revenue arrives.
• Smartphone volume decline is a structural headwind: Arm's historic core market is not growing in units. Revenue growth there depends on continuing to raise the royalty rate per chip through Armv9 and CSS adoption. If that pricing progression plateaus before data centre reaches sufficient scale, group growth slows materially.
• Valuation leaves no margin for disappointment: At roughly 285 times trailing GAAP earnings and roughly 198 times free cash flow, the share price already assumes many years of uninterrupted execution. A single missed quarter or a delay to AGI CPU volume production has a disproportionate effect at these multiples.

11. Recent Developments

• 13 Aug 2026 — Shares rise around 5.5% on raised CPU forecasts. Arm ADSs gained after a Bank of America analyst increased CPU sales growth forecasts and identified Arm as a principal beneficiary of data-centre CPU demand.
• 29 Jul 2026 — Record Q1 FY2027 results, shares fall anyway. Revenue of $1,289m was up 22% year on year, with royalty revenue of $715m and licensing revenue of $574m both quarterly records, and non-GAAP EPS of $0.45 beat the top of guidance. The shares nonetheless fell on the day on valuation and forward-guidance concerns.
• 14 Jul 2026 — HSBC downgrade sends shares down around 6%. The broker cut its rating to Hold, citing foundry capacity bottlenecks as a constraint on near-term earnings upside.
• 2 Jun 2026 — ByteDance and Oracle named as AI data-centre CPU customers. Arm publicly identified two further large customers for its data-centre processors, broadening the disclosed customer list beyond the launch cohort.
• 2 Jun 2026 — Chief executive comments on China export controls. Rene Haas told Reuters that a blanket US ban on AI CPU exports to China would be difficult to enforce in practice given how widely the Arm architecture is already deployed.
• 15 May 2026 — Reported FTC antitrust probe into licensing practices. Bloomberg reported that the US Federal Trade Commission had opened a formal inquiry into Arm's licensing practices following the AGI CPU launch, with a document-preservation order already issued. No formal complaint has been filed.
• 6 May 2026 — FY2026 full-year results. Full-year revenue of $4,920m was up 23%, with royalty revenue of $2,613m up 21% and licensing revenue of $2,307m up 25%. Non-GAAP EPS reached a record $1.77 and Q4 revenue passed $1.49bn.
• 24 Mar 2026 — Arm launches its first production chip. The Arm AGI CPU was unveiled at the company's Arm Everywhere event, with Meta as lead co-development partner and first customer, marking Arm's move from pure licensor to silicon vendor.
• 1 Oct 2025 — Arm appeals the Qualcomm judgment. Following the Delaware court's final judgment for Qualcomm and Nuvia on 30 September 2025, Arm filed a notice of appeal to the United States Court of Appeals for the Third Circuit.

Discussion of these developments and of the wider semiconductor cycle continues on the ChartsView Forum.

12. Key Dates

• 09 Sep 2026 — Annual General Meeting, 3:00pm BST, 110 Fulbourn Road, Cambridge, United Kingdom. Business includes auditor reappointment and a vote on a revised remuneration policy.
• Expected 04 Nov 2026 — Q2 FY2027 results, covering the quarter ending 30 September 2026. Arm has published this as a proposed date on its investor relations calendar; it has not been confirmed by a formal announcement.
• Expected Feb 2027 — Q3 FY2027 results, based on the prior-year reporting pattern.
• Expected May 2027 — Q4 and full-year FY2027 results, covering the fiscal year ending 31 March 2027.
• TBC — Third Circuit appeal in Arm v. Qualcomm and Nuvia. No hearing or decision date has been published.
• TBC — Any formal action arising from the reported Federal Trade Commission inquiry into Arm's licensing practices.

Arm has guided to Q2 FY2027 revenue of $1.38bn plus or minus $50m, non-GAAP operating expenses of approximately $780m and non-GAAP diluted EPS of $0.47 plus or minus $0.04. Full production availability of the AGI CPU is targeted for the second half of calendar 2026, without a specific published date.

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