ARM Holdings PLC ADR (ARMN) AI Stock Analysis

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ARM Holdings PLC ADR

(BMV:ARMN)

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Positive Factors

High-margin revenue growthArm’s combination of sustained revenue expansion and exceptional gross margins supports a durable, asset-light earnings model. High profitability gives the company resources to fund engineering, broaden its platform, and capture additional royalty opportunities as computing demand expands across AI, cloud, mobile, and embedded markets.

Negative Factors

Volatile free cash flowAlthough Arm generates substantial cash, inconsistent free-cash-flow conversion makes near-term funding capacity less predictable than its income statement suggests. Variability can complicate investment planning and capital allocation, particularly while the company is expanding engineering, infrastructure, and newer silicon initiatives.

ARM Holdings PLC ADR (ARMN) vs. SPDR S&P 500 ETF (SPY)

Market Cap: MXN 178.06B
Dividend Yield: ―
Average Volume (3M): 480
Price to Earnings (P/E): 200.7
Beta (1Y): 0.80
Revenue Growth: 10.88%
EPS Growth: 0.39%
Country: Mexico
Employees: 9,584
Sector: Technology
Sector Strength: 61
Industry: Semiconductors

ARM Holdings PLC ADR Business Overview & Revenue Model

Company Description

Arm Holdings plc is a leading technology firm that conceptualizes, engineers, and licenses core processing unit (CPU) designs and complementary technologies. These foundational innovations are crucial for semiconductor manufacturers and original equi...

ARM Holdings PLC ADR Earnings Call Summary

Earnings Call Date:Nov 03, 2026(Q2-2027)|% Change Since:-9.80%|Next Earnings Date:Feb 02, 2027

Earnings Call SentimentPositive

The call was strongly positive, supported by record quarterly revenue, 27% year-over-year growth, 50% licensing growth, doubled data center royalties, improved operating margin, strong cash generation, expanding Arm-based market share, and increased confidence in up to $2 billion of Arm AGI CPU revenue across fiscal 2027 and 2028. The primary challenges were smartphone-related pressure on edge AI royalties, tight supply and cost pressure for the AGI CPU, a first-version gross margin in the high 30%s to low 40% range, and the fact that AGI CPU shipments begin primarily in fiscal Q4 2027. Highlights significantly outweigh the lowlights.

Positive Updates

Record Second-Quarter Revenue

Revenue reached $1.44 billion, up 27% year-over-year, marking the fifth straight quarter of growth above 20%. It was a record second quarter and Arm's second-highest quarterly revenue ever.

Negative Updates

Smartphone Memory-Price Headwinds

Higher memory prices continued to pressure smartphone unit sales, particularly in the mid- and lower-tier segments. As a result, edge AI royalty revenue was roughly flat year-over-year, although higher royalty rates from Armv9 and CSS adoption offset the unit pressure.

Company Guidance

Arm expects Q3 revenue of $1.54 billion, $±50 million, representing growth of approximately 24% year-on-year at the midpoint; license and other revenue is expected to be up a little over 50% year-on-year, royalty revenue is expected to grow low teens sequentially and low single digits year-on-year, non-GAAP operating expenses are expected to be approximately $825 million, and non-GAAP EPS is expected to be $0.56, $±0.04. Arm expects first commercial deliveries of the Arm AGI CPU in fiscal Q4 2027 and has increased confidence in achieving up to $2 billion across fiscal 2027 and 2028; for the first version, gross margin is expected to be in the 30%-40% range, while mobile growth next year is expected to be at least being in the kind of double digits plus in growth rate.

ARM Holdings PLC ADR Risk Analysis

ARM Holdings PLC ADR disclosed 80 risk factors in its most recent earnings report. ARM Holdings PLC ADR reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added

1 New Risk

1.The demand for new products, including those manufactured through third-party foundry partners and contract manufacturers, may be difficult to accurately predict.Q1, 2026

ARM Holdings PLC ADR Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

MX:ARMN against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVDA	79Outperform	$4.38T	23.48	110.11%	0.28%	83.38%	124.42%
MRVL	71Outperform	$117.11B	46.31	16.22%	0.17%	30.62%	―
QCOM	70Outperform	$167.72B	12.92	50.28%	2.19%	-2.63%	157.83%
AMD	69Neutral	$663.25B	96.36	11.58%	―	41.87%	129.15%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
INTC	47Neutral	$277.71B	-23.54	-11.24%	―	12.08%	-17126.43%

* Technology Sector Average

Performance Comparison

MX:ARMN and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
MX:ARMN	ARM Holdings PLC ADR	3210.58	343.58	11.98%
AMD	Advanced Micro Devices, Inc.	449.04	205.06	84.05%
INTC	Intel	56.28	17.83	46.37%
MRVL	Marvell Technology Group	141.20	48.13	51.71%
NVDA	Nvidia Corporation	186.64	-11.93	-6.01%
QCOM	Qualcomm	165.41	-2.66	-1.58%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

ARM Holdings PLC ADR AI Stock Analysis