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Arm shares jump by 50% after positive earnings update

Shares in Arm Holdings leapt yesterday when the company reported quarterly sales of $824m – 8.19% more than analyst expectations.

The chip licensing firm saw its shares surge by 47.3% to USD 113.41 on Thursday. That equates to more than double the USD 51 price set during its September initial public offering (IPO). According to Reuters, Arm raised its sales guidance by roughly USD 100 million thanks to buoyant business in automotive and AI.

For the full fiscal year, SoftBank-owned Arm expects USD 3.18 billion in revenue and adjusted earnings of USD 1.22 per share, both above market projections of USD 3.05 billion and USD 1.07 per share.

Arm earns income from licensing deals for its intellectual property and a royalty from each chip sold that uses its technology. It is confident that AI applications embedded in mobile, PCs and data centres will fuel future growth – especially as Arm-based central processors complement Nvidia's market-conquering AI-centric GPUs.

SoftBank listed UK-based Arm in the US last year. Arm previously had a dual listing on both sides of the Atlantic before it was acquired by SoftBank for £24.6bn in 2016.


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June 12 2024 9:18 am V22.4.54-2