Key Stats for Arm Holdings Stock
- Current Price: $205.97
- Target Price (Mid): ~$1,405
- Street Target: ~$291
- Potential Total Return: ~582%
- Annualized IRR: ~54% / year
What Happened?
Arm Holdings (ARM) fell 9.97% to $205.97 on October 30, ahead of its own November 4 report, after Intel (INTC) guided fourth-quarter revenue to $15 billion to $16 billion and lost 28.58%. Chip stocks fell together: Qualcomm (QCOM), which reports the same evening as Arm, dropped 11.12%. Options were pricing a move of about 10.5% for Arm’s report as of October 30, according to Unusual Whales, so the stock has already taken a report-sized hit on Intel’s news, with its own numbers still to come.
The Street Has Priced Arm’s Guide, and Its Beats Have Narrowed
TIKR consensus calls for about $1.38 billion of revenue and $0.48 of adjusted EPS for the September quarter, essentially matching Arm’s guidance of $1.38 billion and $0.47. Arm has beaten revenue estimates in each of its last four reports, but by only 1.24% to 1.70% in the last three.
The June-quarter EPS beat was partly a spending story. CFO Jason Child said the $0.45 result was “driven by both higher revenue and slightly lower OpEx than expected,” with operating expenses about $27 million under guidance on timing. He guided September-quarter operating expenses to about $780 million, up from $733 million, told analysts to think about “banking that savings,” and expects spending to grow by a mid-single-digit percentage each quarter.
Licensing Is Guided Up 30% for September. ACV Grew 13% in June
Child guided licensing revenue up about 30% and royalties up in the low teens. Licensing swings with the timing of large deals, so Arm tracks annualized contract value (ACV) as the underlying trend, and Child said “ACV grew 13% year-on-year” in the June quarter, above Arm’s long-term expectation for license revenue growth. Licensing also leans on SoftBank, Arm’s majority owner, which contributed $193 million of licensing and design services that quarter. Child expects about $200 million a quarter for the rest of the year.
Royalties are the slower line as higher memory prices hurt phone sales, though Child said he “would not expect there to be weakness across the overall business,” pointing to faster licensing growth and cloud AI royalties. Arm’s detailed update on AGI CPU revenue and margins is due with its third-quarter results, not this one. As of November 2, no ruling had been reported from the Delaware judge on whether an October 13 jury breach finding lets Qualcomm, 9% of Arm’s fiscal 2026 revenue, stop paying royalties for up to five years.
TIKR tracks 43 analysts on Arm Holdings. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Arm Holdings, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Arm Holdings’ Analyst Ratings
TIKR Advanced Model Analysis
- Current Price: $205.97
- Target Price (Mid): ~$1,405
- Potential Total Return: ~582%
- Annualized IRR: ~54% / year
The TIKR model’s mid case puts Arm at around $1,405 by March 31, 2031, about 582% above the October 30 close, or around 54% a year. That path depends on the AGI CPU becoming a large business. Child said Arm will report chip sales “as a third line” once they reach at least 10% of revenue, which he expects in fiscal 2028, the first disclosure that can test the model directly. Upside comes if Arm secures supply beyond its first $1 billion of chip demand. A Qualcomm royalty suspension, or a royalty slowdown spreading beyond phones, would shrink the base the model compounds from.
Conclusion
On November 4, read licensing revenue against ACV. Reported licensing can hit the guided 30% on the timing of large deals, so ACV growth holding near June’s 13% would be the cleaner sign of demand. Revenue below the $1.38 billion midpoint, the level the Street already expects, would make the October 30 drop look less like Intel’s problem and more like Arm’s own.
So what is Arm Holdings stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
