Arm Q4 Earnings Beat Estimates, Shares Fall After Hours

Arm Holdings plc reported fourth-quarter financial results that exceeded Wall Street expectations on Wednesday, while revealing more than $2 billion in customer demand for its new AGI CPU designed for data centers. The announcement, made after market close, led to a decline in the company's shares, which fell more than 5 percent in after-hours trading despite a 13 percent gain during the regular session.

For the quarter ended March 31, Arm posted revenue of $1.49 billion, surpassing the $1.47 billion consensus estimate and marking a 20 percent increase from the prior year. Adjusted earnings per share came in at 60 cents, topping the 58 cents forecast. Licensing revenue reached $819 million, up 29 percent and ahead of the $781 million expected, while royalties rose 11 percent to $671 million but missed the $690 million target.

Looking ahead, Arm guided for first-quarter revenue of about $1.26 billion at the midpoint of its range, slightly above the $1.25 billion analyst estimate, with adjusted earnings per share of 40 cents versus the 37 cents consensus.

Chief Executive Rene Haas highlighted surging demand for data center compute amid the rise of agentic AI systems, which perform...