Arm stock up 6% on $15b new chip revenue forecast

Arm Holdings shares rose about 6% in after-hours trading after CEO Rene Haas said the chip designer expects annual revenue of US$25 billion and earnings per share of US$9 by 2031, up from just over US$4 billion in revenue in 2025.

At an event in San Francisco, Arm unveiled its first in-house CPU for data centers, with Meta as the first customer, as it expands beyond its long-running licensing and royalty model.

Haas said the new chip, branded Arm AGI CPU and aimed at AI inference, could contribute about US$15 billion in annual revenue by 2031.

CFO Jason Child said Arm is selling the chip at roughly a 50% gross profit, while the company did not disclose pricing.

🔗 Source: CNBC

🧠 Food for thought

Implications, context, and why it matters.

Arm is joining a party it already helped start

Arm plans to sell its own data center chips as big tech firms build Arm-based processors for their own server fleets, a shift Arm’s designs helped enable 1.
Cloud providers have built in-house Arm chips for years to cut costs and rely less on vendors like Nvidia 2.
Google recently announced its custom Arm-based processor Axion, while Microsoft runs its Maia 200 AI chip in its data centers 2 1.
Selling its own silicon takes Arm beyond licensing its core architecture and into shipping chips, which could let it capture more value from the custom-chip push built on Arm technology 3.

Arm’s new strategy creates complex rivalries

Direct chip sales put Arm up against some of its largest customers, including companies that already build custom silicon from Arm designs 3 1.
The strategy also raises the stakes in data centers, especially for AI inference workloads, as Arm-based CPUs press the x86 architecture’s long-held lead in servers 3.
Arm would move past a licensing and royalty model into building and selling physical hardware, with a stated $60 billion market opportunity and added risk as partners may become competitors 3.