ARM Arm Holdings plc - American Depositary Shares

NASDAQ · Semiconductors
$246.43
Price · May 20, 2026
52W Range
$100–$248
99% of range
Analyst Rating
BUY
45 analysts
Price Target
$229
P/E (TTM)
—
ROE
—
Net Profit Margin
—

ARM Stock Snapshot Price, market cap, P/E, EPS, ROE, debt/equity, 52-week range

Price
$246.43
Market Cap
—
P/E (TTM)
—
EPS (TTM)
—
Revenue (TTM)
—
Div Yield
—
ROE
—
Debt/Equity
—
52W Range
$100 – $248

ARM Stock Price Chart Daily OHLCV with technical indicators — pan, zoom, and customize your view

10-Year Performance Revenue, net income, margins and EPS trends

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Valuation P/E, P/S, P/B, EV/EBITDA ratios — is the stock expensive or cheap?

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Profitability Gross, operating and net margins; ROE, ROA, ROIC

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Financial Health Debt, liquidity, solvency — balance sheet strength

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Growth Revenue, EPS and net income growth: YoY, 3Y CAGR, 5Y CAGR

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Per Share Metrics EPS, book value per share, cash flow per share, dividend per share

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Capital Efficiency Asset turnover, inventory turnover, receivables turnover

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ARM Analyst Consensus Bullish and bearish analyst opinions, 12-month price target, upside

BUY 45 analysts
  • Strong Buy 6 13.3%
  • Buy 23 51.1%
  • Hold 14 31.1%
  • Sell 1 2.2%
  • Strong Sell 1 2.2%

12-Month Price Target

36 analysts · 2026-05-16
Median target $249.51 +1.2%
Mean target $229.00 -7.1%

Earnings History EPS actual vs estimate, surprise %, beat rate, next earnings date

Avg Surprise
0.02%
Period EPS Actual EPS Est Surprise
March 31, 2026 $0.60 $0.59 0.01%
Dec. 31, 2025 $0.43 $0.41 0.02%
Sept. 30, 2025 $0.39 $0.34 0.05%
June 30, 2025 $0.35 $0.36 -0.01%
March 31, 2025 $0.55 $0.53 0.02%

Peer Comparison Key metrics vs sector peers

Ticker Market Cap P/E Rev YoY Net Margin ROE Gross Margin
ARM — — — — — —
SMTK $7M -0.8 750.0% -1507.8% 517.6% 61.0%

ARM AI Analyst Panel — Bullish and Bearish Views 2026Q2 debate: Claude, Grok, Gemini, ChatGPT on the stock's prospects

Round 1 — Opening Takes

Grok NEUTRAL 0.75
↑ Bullish

Arm's IP licensing model delivers explosive profitability as AI chip demand surges, amplified by their new AGI CPU silicon push. Gross margin stays at 97%, proving their royalty business converts nearly all revenue to gross profit without manufacturing overhead. Net margin climbed to 18.81%, signaling strong operating leverage from higher royalties. EPS TTM rose to $0.78, confirming earnings momentum that could drive re-rating if AI adoption accelerates.

↓ Bearish

Arm trades at premiums that demand flawless execution, but recent stumbles expose vulnerability to competition and macro slowdowns. P/E TTM sits at 139x, far above sustainable levels for a chip designer facing rivals in custom silicon. Market cap dropped 19% to $116B last quarter, mirroring price weakness from $166 to $146. Analyst downgrades as of April 7 underscore fading momentum.

Claude NEUTRAL 0.62
↑ Bullish

Arm is transitioning from a pure licensing play into silicon, which could unlock a new revenue stream and higher margins. The AGI CPU launch in March moved the stock 18% and suggests Wall Street sees real optionality here. Gross margin sits at 97.39%, which is nearly perfect for a fabless model, and net margin expanded to 18.81% from 16.96% a year ago. If Arm can scale AGI silicon adoption even modestly, the licensing base stays intact while a new product line compounds growth.

↓ Bearish

The valuation has already priced in the AGI story — P/E of 139.73 is not cheap even for a semiconductor designer, and it's down from 203 only because the stock fell 20% in six weeks. Market cap contracted from $143B to $116B, which tells me conviction is fragile. EPS of $0.78 is modest relative to the multiple, and until AGI silicon shows real traction in customer roadmaps, this is a bet on hope, not cash flow.

Gemini NEUTRAL 0.75
↑ Bullish

Arm’s fundamental shift toward high-performance AGI silicon transforms it from a pure intellectual property play into a direct hardware participant. The company maintains a 97.39% gross margin, which is essentially unheard of for any firm touching the physical semiconductor supply chain. This level of efficiency means almost every dollar of revenue flows directly to the bottom line without the typical drag of manufacturing overhead. With a debt-to-equity ratio of 0.26, the company has an incredibly clean balance sheet to fund this pivot. This low leverage gives management the flexibility to aggressively pursue R&D without worrying about interest payments.

↓ Bearish

The valuation remains untethered from reality, as the market is pricing in perfection that the current earnings simply cannot support. Investors are paying 139.73 times trailing earnings for these shares. This multiple suggests that the market expects explosive, multi-year profit growth that far outstrips the company's current trajectory. Even with a 12.0% return on equity, the company is barely scratching the surface of what a tech firm at this valuation should be delivering. A 12.0% ROE means that for every dollar shareholders have invested, the company is only generating twelve cents of profit, which is insufficient to justify such a premium.

Chatgpt NEUTRAL 0.63
↑ Bullish

I think Arm's strongest bullish case rests on licensing-driven profit resilience and AI-driven growth that can scale without heavy hardware costs. Gross margin TTM: 97.39%. That high gross margin signals Arm can monetize licensing at scale with minimal incremental cost. EPS TTM: 0.7785. Rising EPS indicates earnings momentum that can support multiple expansion if AI momentum stays intact. Current ratio: 5.5938. High liquidity gives Arm room to invest in R&D and fund strategic bets without near-term liquidity risk.

↓ Bearish

I think Arm trades at a sky-high multiple that assumes sustained AI-driven licensing growth; any slowdown or disappointment could trigger a rapid multiple re-rating. P/E TTM: 139.7324. This high multiple means earnings misses or growth deceleration will lead to sharp valuation compression. Market cap TTM: 115,977 — DOWN vs prior quarter. This drop signals skepticism about near-term growth and raises the bar for any new catalysts. P/S TTM: 26.2869. The top-line multiple is expensive; a downturn in licensing revenue would pressurize valuation quickly.

Round 2 — Responses & Rebuttals

Grok

Gemini, your bearish take on the 12% ROE overlooks its improvement amid low leverage, which underscores real operational strength rather than weakness. Debt/equity at 0.26 means this return isn't propped up by borrowing — it's mostly from core IP licensing efficiency. With ROE up from 10.6% last quarter, Arm is compounding profits without balance sheet risk, giving it runway for AGI silicon bets even if growth moderates.

Claude

I think Gemini is overstating what that 12% ROE tells us here. A 12% return on equity is actually decent for a capital-light IP business — Arm doesn't need massive asset bases to generate profit like a manufacturer would. The real issue Gemini misses is that ROE inflates when you have minimal equity relative to debt, and at 0.26 debt-to-equity, Arm's balance sheet is so clean that the 12% ROE is genuine, not leverage-engineered. The valuation problem isn't the ROE — it's that P/E of 139.73 assumes AGI silicon revenue materializes at scale within two to three years. That's the bet. The ROE is actually a sign the core licensing engine is working.

Gemini

Claude, your assessment of Arm's transition into silicon misses the massive execution risk inherent in that pivot. While you see optionality, I see a company abandoning its high-margin, low-friction licensing moat to compete in the capital-intensive hardware arena. Arm’s current 16.45 price-to-book ratio is already extremely high, meaning the market is paying a massive premium for the company's intangible assets. If they start burning cash to build physical chips, that valuation will face a brutal reality check once investors realize the company is no longer just a lean, pure-play software architect.

Chatgpt

Claude, I think your AGI-pivot case is bold, but valuation risk is not trivial. The stock's P/E TTM sits around 139.7. That means investors are pricing in many years of AGI-driven profits before they appear in actual earnings, leaving little cushion if adoption stalls. Meanwhile, the market cap has fallen to about $116B from around $143B, underscoring skepticism about near-term catalysts.

Round 3 — Final Rebuttals

G
Grok

Gemini, I push back on your P/B warning as a brutal reality check for silicon — Arm's 16.5 price-to-book simply values its irreplaceable IP portfolio far above depreciable assets on the balance sheet. For a licensing leader, that's not frothy; it reflects the moat enabling 97% gross margins without factories. The pivot to AGI CPUs builds on that strength, not abandons it, as long as they avoid heavy capex burns.

C
Claude

I want to push back on something Gemini said that no one challenged — that Arm is 'abandoning its high-margin, low-friction licensing moat' by moving into silicon. That's not quite right. Arm's licensing revenue doesn't disappear when they ship AGI CPUs; it compounds alongside it. The real risk Gemini is naming is execution, not cannibalization. But here's what I haven't heard us discuss: customer concentration. If Nvidia, TSMC, or Qualcomm account for 40–50% of Arm's licensing royalties, then AGI silicon becomes existential — Arm is essentially asking its biggest customers to adopt a competing product line. That's the execution risk with teeth. Has anyone seen recent disclosures on top-customer exposure?

G
Gemini

I am widening the frame to address the massive customer concentration risk that everyone here is ignoring. Arm relies heavily on a small group of hyperscalers and smartphone giants for the vast majority of its royalty revenue. This creates a dangerous dependency where a single shift in a partner's internal chip design strategy—like Apple or Nvidia moving toward proprietary architectures—could crater Arm's top line. We are talking about a P/S ratio of 26.29, which means investors are paying over twenty-six dollars for every dollar of sales. That valuation is simply too fragile to survive a pivot by just one major customer.

C
Chatgpt

I think we should widen the frame beyond margins and AGI hype to regulatory and competitive dynamics. Claude, your AGI pivot is bold, but the stock still trades at a P/E around 140x, which says investors are pricing multiple years of AGI-driven profit. That premium makes the name fragile if adoption stalls. On the frame, regulatory risk is rising: export controls and tech-policy curbs could constrain Arm’s revenue exposure and customer roadmaps in China. At the same time, the open RISC-V ecosystem and rival silicon efforts could erode Arm’s licensing moat if they prove credible.

Price Forecasts

Model 3M Target 6M Target Reasoning
G Grok 3M Target $135.00 6M Target $150.00 Reasoning I think Arm consolidates near-term before a modest re-rating if AGI silicon shows early traction, but sky-high valuation leaves no room for error. The key catalyst is the 2026Q2 earnings report expected early August, where guidance on AGI CPU customer adoption could spark a 10-15% bounce by confirming revenue potential beyond licensing. The big risk is next quarter's 10-Q revealing customer concentration above 40% from Nvidia or Apple, triggering a selloff on dependency fears. My 6-month target implies a P/E contraction to about 120x on current EPS, meaning the market discounts some hype but still bets on AI royalties compounding.
C Claude 3M Target $128.00 6M Target $142.00 Reasoning Arm's licensing moat remains intact even as it pivots to AGI silicon — the real question is whether customer concentration risk materializes as a veto. My thesis: the stock re-rates higher if Q2 2026 earnings confirm AGI CPU design wins with at least one Tier-1 customer, but stays range-bound if licensing growth merely flatlines. The catalyst is Arm's next earnings call in late July — any guidance that quantifies AGI revenue or customer commitments breaks the valuation logjam. The risk is a major customer announcement of proprietary silicon, which would crater licensing royalties. At P/E 139.7, the market is pricing perfection; even modest AGI traction justifies 142 by Q3. Current price 113.34 implies 25% upside on execution.
G Gemini 3M Target $105.00 6M Target $95.00 Reasoning My thesis is that Arm is currently overvalued and will face a reality check as the market realizes the transition into hardware is capital-intensive and dilutive to their pure-play margins. I expect the next quarterly earnings report to act as a catalyst, as investors react to increased R&D spending weighing on net profits. A major risk is a shift in customer strategy, where a key partner like Nvidia accelerates their own proprietary chip development, directly cannibalizing Arm's licensing revenue. With a price-to-sales ratio of 26.29, investors are paying over twenty-six dollars for every dollar of sales, a valuation that assumes perfect execution in a highly competitive market.
C Chatgpt 3M Target $120.00 6M Target $135.00 Reasoning I think Arm's path hinges on a true AGI silicon ramp that meaningfully monetizes licensing while preserving its IP moat. Catalyst: a stronger-than-expected 2026Q2 earnings print showing solid AGI CPU adoption and licensing growth. Risk: execution delay in AGI uptake or a meaningful customer-concentration shock that dents royalties. Current price around 113.34 anchors expectations and limits upside if the AI uplift falters. The stock trades at a P/E around 139.7, a sky-high multiple that reflects multi-year profit expectations baked in. That high multiple means any hiccup in AI monetization could trigger sharp valuation compression.

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