Semiconductor company Arm Holdings PLC (ARM) is soaring in pre-market trading on Tuesday. The jump follows a report from the Information that OpenAI (PC:OPAIQ) is partnering with Japan’s SoftBank Group (SFTBY) and Arm alongside ChatGPT-maker’s deal with Broadcom (AVGO) to develop AI data center chips. ARM stock is up by 2.65% in pre-market hours after rising 11.07% on Monday.
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Arm Holdings designs chips for a wide range of devices and is majority-owned by Japan’s SoftBank Group.
OpenAI Teams Up with Arm
According to recent reports, OpenAI is partnering with SoftBank’s subsidiary Arm to develop a CPU designed specifically for its server infrastructure.
This collaboration is part of a larger deal announced Monday with Broadcom to produce OpenAI’s first in-house AI processors. Under the agreement, OpenAI will lead the chip design, while Broadcom will develop and deploy the processors, providing the computing power needed to support its AI ambitions. Meanwhile, the Arm CPU will handle general computing tasks alongside GPUs, and the OpenAI–Broadcom chip will focus on AI inference workloads, with production expected in late 2026.
Options Traders Signal Bullish Trend in ARM Stock
On Monday, ARM stock jumped 11.07% as investors bet on its leadership in AI chip design. Meanwhile, bullish activity is evident in ARM options, with 55,814 calls traded—twice the usual volume. Moreover, the put/call ratio is low at 0.14, signaling strong call buying. To simplify, calls are bets that the stock will rise, while puts bet it will fall.
Broadly, ARM stock surged from April lows during a tech rally but lost momentum after mixed Q1 fiscal 2026 results on July 30. Overall, investors were disappointed by soft guidance that didn’t justify its high valuation. The company is set to release its Q2 FY26 results on November 5.
Is ARM Stock a Buy or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on ARM stock based on 18 Buys and three Holds assigned in the past three months. The average Arm stock price target of $172.28 per share is similar to current trading levels.
