Arm Holdings plc (ARM) AI Stock Analysis

Arm Holdings plc, headquartered in Cambridge, United Kingdom, specializes in the design, development, and licensing of central processing unit (CPU) products and associated technologies essential for semiconductor companies and original equipment manufacturers (OEMs) worldwide. Established in 1990, the company's portfolio includes microprocessors, systems intellectual property (IPs), graphics processing units (GPUs), physical IP, and various systems IPs. Arm Holdings plc also provides software, tools, and related services critical for product development across markets including automotive, computing infrastructure, consumer technologies, and the Internet of Things (IoT). A subsidiary of Kronos II LLC, its operations span the United States, China, Taiwan, South Korea, and other international markets.

ARM increased its annual revenue from $2.70B in FY2022 to $4.92B in FY2026, delivering a five-year revenue CAGR of 19.4% from FY2021 to FY2026. Annual revenue growth accelerated from 20.7% in FY2024 to 23.9% in FY2025 and 22.8% in FY2026. Gross margin stood at 92.5% in FY2026, while operating margin was 18.5%, down from 20.6% in FY2025. Annual net income reached $904.0M in FY2026, up from $792.0M in FY2025 and $306.0M in FY2024. For the latest quarter ended June 30, 2026, quarterly revenue growth was 22.4% year-over-year, and quarterly earnings growth reached 108.3% year-over-year. Research and development expenses grew to $2.78B in FY2026.

As of June 30, 2026, ARM held $3.89B in cash and short-term investments against total debt of $485.0M, resulting in a net cash position of $3.40B. The company maintained a current ratio of 5.25 and a debt-to-equity ratio of 0.06. Shareholders' equity was $8.63B out of $11.20B in total assets. In FY2026, operating cash flow reached $1.52B, supporting capital expenditures of $545.0M and free cash flow of $979.0M. Additionally, ARM recorded a share count change of -24.0% over five years.

ARM trades at a trailing price-to-earnings ratio of 234.8x and a forward price-to-earnings ratio of 151.5x, well above the median of its Nasdaq-100 Technology peers of 42.1x trailing and 25.1x forward. Its price-to-sales ratio of 47.2x and enterprise value to EBITDA ratio of 304.3x also trade at premiums to the median of its Nasdaq-100 Technology peers of 11.9x and 30.6x, respectively. The stock posted a 1-year return of 33.1%, outperforming the SPY return of 16.8%, and a year-to-date return of 108.4% with a beta of 3.79.

Wall Street coverage includes 21 Strong Buy, 8 Buy, 12 Hold, 1 Sell, and 1 Strong Sell ratings. The mean price target is $290.70, representing upside of 27.6% above the last close of $227.80. For the fiscal year ending March 31, 2027, consensus estimates project revenue of $6.06B and EPS of $2.23. For the following fiscal year, 40 analysts expect revenue of $8.25B and EPS of $3.06. ARM beat EPS estimates in 3 of the last 4 quarters, and its next earnings date is November 4, 2026.

This page is an AI-written research summary of Arm Holdings plc (ARM). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

Related: ARM income statement, ARM balance sheet, ARM key metrics, ARM analyst forecast, ARM chart. See the ARM stock overview for the latest quote and news.