ARM (NASDAQ:ARM) Trading 7.1% Higher on Better-Than-Expected Earnings

ARM Holdings PLC Sponsored ADR (NASDAQ:ARM) was up 7.1% during trading on Thursday following a stronger than expected earnings report. The company traded as high as $112.28 and last traded at $112.3840. Approximately 13,566,017 shares changed hands during trading, an increase of 93% from the average daily volume of 7,042,964 shares. The stock had previously closed at $104.90.

The company reported $0.43 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.41 by $0.02. ARM had a return on equity of 14.36% and a net margin of 17.15%.The company had revenue of $1.24 billion for the quarter, compared to analyst estimates of $1.23 billion. During the same period in the prior year, the company posted $0.39 EPS. ARM’s quarterly revenue was up 26.3% on a year-over-year basis. ARM has set its Q4 2026 guidance at 0.540-0.620 EPS.

Key ARM News

Here are the key news stories impacting ARM this week:

• Positive Sentiment: Q3 results beat revenue and EPS consensus; AI/data‑center demand drove a record quarter and 26% YoY revenue growth, giving investors confidence in secular AI tailwinds. ARM Q3 results (slide deck)
• Positive Sentiment: Management set Q4 FY26 EPS guidance (0.540–0.620) and revenue guidance above street estimates, signaling continued AI/data‑center traction into the quarter. Reuters: Arm forecasts revenue above estimates
• Positive Sentiment: CEO Rene Haas told Bloomberg the data‑center business is “exploding,” suggesting the company sees durable, higher‑margin demand beyond handsets. That bullish management tone supports investor optimism around AI exposure. Bloomberg interview: Arm CEO Says Data Center Business Is ‘Exploding’
• Positive Sentiment: Analyst sentiment remains constructive overall: several firms reaffirmed buy/overweight ratings or upgraded (e.g., New Street upgrade), and price targets — even when trimmed — still imply material upside versus the current share price. The Fly: New Street upgrade
• Neutral Sentiment: Arm announced an “Arm Everywhere” event for March 24 to highlight AI strategy and partner ecosystem — a potential catalyst but with uncertain near‑term impact on numbers. BusinessWire: Arm Everywhere event
• Negative Sentiment: Licensing revenue narrowly missed estimates and sparked an after‑hours selloff; broader industry headwinds (memory shortages, softer smartphone build plans) were cited as near‑term demand risks. These factors create downside risk to handset‑linked royalties. CNBC: Shares fall after licensing miss
• Negative Sentiment: Several firms trimmed price targets (JPMorgan, Wells Fargo, Mizuho, Rosenblatt among others) — signaling some analyst caution on near‑term handset and licensing visibility even as ratings largely stay constructive. Benzinga: analyst price target moves

Wall Street Analysts Forecast Growth

ARM has been the subject of several research analyst reports. Royal Bank Of Canada dropped their target price on shares of ARM from $140.00 to $130.00 and set an “outperform” rating for the company in a research report on Thursday. JPMorgan Chase & Co. lowered their price objective on ARM from $180.00 to $145.00 and set an “overweight” rating for the company in a report on Thursday. Bank of America restated a “neutral” rating and set a $120.00 price objective on shares of ARM in a research note on Tuesday, January 13th. The Goldman Sachs Group lowered ARM from a “neutral” rating to a “sell” rating and decreased their target price for the stock from $160.00 to $120.00 in a research report on Monday, December 15th. Finally, Weiss Ratings reiterated a “hold (c)” rating on shares of ARM in a report on Wednesday, January 21st. Sixteen equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the stock currently has a consensus rating of “Moderate Buy” and a consensus price target of $160.81.

Hedge Funds Weigh In On ARM

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Compound Planning Inc. grew its stake in shares of ARM by 4.6% in the 3rd quarter. Compound Planning Inc. now owns 1,569 shares of the company’s stock worth $222,000 after purchasing an additional 69 shares during the last quarter. Ritholtz Wealth Management lifted its stake in ARM by 3.0% during the third quarter. Ritholtz Wealth Management now owns 2,439 shares of the company’s stock valued at $345,000 after purchasing an additional 70 shares during the last quarter. Rathbones Group PLC boosted its holdings in ARM by 0.7% during the third quarter. Rathbones Group PLC now owns 10,552 shares of the company’s stock worth $1,493,000 after buying an additional 70 shares in the last quarter. Nwam LLC grew its position in ARM by 4.3% in the third quarter. Nwam LLC now owns 1,711 shares of the company’s stock worth $242,000 after buying an additional 71 shares during the last quarter. Finally, Kovack Advisors Inc. increased its holdings in shares of ARM by 2.0% in the third quarter. Kovack Advisors Inc. now owns 3,602 shares of the company’s stock valued at $510,000 after buying an additional 72 shares in the last quarter. 7.53% of the stock is owned by institutional investors.

ARM Price Performance

The company has a fifty day simple moving average of $117.37 and a 200-day simple moving average of $138.33. The company has a market cap of $117.15 billion, a P/E ratio of 147.84, a PEG ratio of 6.28 and a beta of 4.35.

About ARM

Arm Limited (NASDAQ: ARM) is a global semiconductor IP company best known for designing energy-efficient processor architectures and related technologies that underpin a wide range of computing devices. Founded in 1990 as a joint venture between Acorn Computers, Apple and VLSI Technology and headquartered in Cambridge, England, Arm develops the ARM instruction set architectures and core processor designs that chipmakers license and integrate into custom system-on-chip (SoC) products. The company operates a licensing and royalty business model rather than manufacturing chips itself.

Arm’s product portfolio includes CPU core families (such as Cortex and Neoverse lines), GPU and multimedia IP (Mali), neural processing units (Ethos) and a suite of system and physical IP blocks.