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Arm Tops Q2 and Raises Outlook on AI Demand for Power‑Efficient Chips

Executives cited AI compute growth alongside data‑center power limits as tailwinds for its low‑power designs.

Overview

  • Revenue reached $1.14 billion, up 34% year over year, with adjusted earnings of $0.39 per share versus the $0.33 consensus.
  • For the current quarter, Arm guided to roughly $1.23 billion in revenue at the midpoint and projected adjusted EPS of $0.41, both above analyst estimates.
  • Royalty revenue rose 21% to a record $620 million, led by smartphones and higher per‑chip rates, while licensing climbed 56% to $515 million on the timing of large contracts.
  • Shares gained in after‑hours and premarket trading following the beat‑and‑raise report.
  • Arm reiterated plans to invest profits in finished chips and its Compute Sub Systems, highlighting opportunities from custom hyperscaler designs and SoftBank‑linked data‑center initiatives.