ARM (NASDAQ:ARM) Updates Q2 2027 Earnings Guidance

ARM (NASDAQ:ARM) updated its second quarter 2027 earnings guidance on Wednesday. The company provided earnings per share guidance of 0.430-0.510 for the period, compared to the consensus earnings per share estimate of 0.390. The company issued revenue guidance of $880.0M-$1.9 billion, compared to the consensus revenue estimate of $1.3 billion.

ARM Price Performance

NASDAQ:ARM traded up $14.18 during trading hours on Thursday, reaching $239.06. 9,859,594 shares of the company were exchanged, compared to its average volume of 8,585,420. The firm has a market cap of $255.34 billion, a price-to-earnings ratio of 285.89, a PEG ratio of 7.61 and a beta of 3.76. The stock has a 50 day simple moving average of $331.09 and a 200 day simple moving average of $211.79. ARM has a 52-week low of $100.02 and a 52-week high of $452.70.

ARM (NASDAQ:ARM) last issued its earnings results on Thursday, July 30th. The company reported $0.45 earnings per share for the quarter, topping the consensus estimate of $0.40 by $0.05. The business had revenue of $1.29 billion for the quarter, compared to analyst estimates of $1.26 billion. ARM had a return on equity of 12.43% and a net margin of 18.37%.The business’s quarterly revenue was up 22.4% on a year-over-year basis. During the same period last year, the company posted $0.35 EPS. On average, analysts predict that ARM will post 1.12 EPS for the current fiscal year.

Analysts Set New Price Targets

A number of analysts recently issued reports on ARM shares. Morgan Stanley increased their target price on shares of ARM from $202.00 to $212.00 and gave the stock an “equal weight” rating in a research report on Thursday. Guggenheim restated a “buy” rating and set a $255.00 target price on shares of ARM in a report on Thursday. Deutsche Bank Aktiengesellschaft reaffirmed a “hold” rating on shares of ARM in a research report on Thursday, May 7th. Raymond James Financial reiterated an “outperform” rating on shares of ARM in a report on Thursday, May 7th. Finally, Royal Bank Of Canada cut their price objective on ARM from $475.00 to $340.00 and set an “outperform” rating on the stock in a research report on Thursday. Eighteen equities research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, the company has a consensus rating of “Moderate Buy” and an average price target of $287.83.

Insider Activity

In other ARM news, insider William Abbey sold 6,566 shares of the company’s stock in a transaction dated Monday, June 1st. The shares were sold at an average price of $402.72, for a total value of $2,644,259.52. Following the completion of the transaction, the insider directly owned 20,563 shares of the company’s stock, valued at $8,281,131.36. This represents a 24.20% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, CAO Laura Kathleen Bartels sold 11,306 shares of the firm’s stock in a transaction dated Tuesday, June 2nd. The shares were sold at an average price of $392.70, for a total value of $4,439,866.20. Following the sale, the chief accounting officer owned 12,135 shares of the company’s stock, valued at $4,765,414.50. This represents a 48.23% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders sold 216,049 shares of company stock worth $52,101,605.

ARM News Roundup

Here are the key news stories impacting ARM this week:

• Positive Sentiment: Record results beat expectations. Fiscal Q1 revenue rose 22.4% year over year to $1.29 billion, exceeding estimates of approximately $1.26 billion, while adjusted EPS of $0.45 topped the $0.40 consensus. Arm shares jump after Q1 revenue, profit beat estimates
• Positive Sentiment: AI and data-center demand remain key growth drivers. Arm said data-center royalty revenue doubled, while demand for its AI and AGI-focused CPU roadmap accelerated. Cloud customers are increasingly using Arm-based designs for custom data-center chips. ARM Q1 Earnings Call Highlights AI CPU Demand and Data Center Growth
• Positive Sentiment: Near-term guidance was above Wall Street expectations. Arm projected fiscal Q2 EPS of $0.43–$0.51, versus consensus of $0.39, and forecast quarterly revenue above estimates, signaling confidence in AI-related chip demand. Arm forecasts quarterly revenue above estimates on AI-driven chip demand
• Neutral Sentiment: Analysts remain constructive but reset expectations. Needham reaffirmed a Buy rating with a $255 target, while RBC and TD Cowen retained bullish ratings but lowered their targets to $340 and $350 from $475, respectively. The cuts suggest improved valuation discipline despite substantial implied upside.
• Negative Sentiment: Royalty-growth and end-market risks remain. Fiscal Q2 royalty growth was reportedly guided to about 13%, as smartphone weakness and memory-price pressures weigh on licensing economics. Investors also viewed the outlook as insufficient relative to Arm’s elevated valuation, contributing to volatility after the earnings release. Memory Prices Hit Arm’s Royalties as Stock Falls

Hedge Funds Weigh In On ARM

A number of institutional investors have recently made changes to their positions in the business. Morgan Stanley raised its holdings in ARM by 1.2% in the fourth quarter. Morgan Stanley now owns 3,783,006 shares of the company’s stock valued at $413,521,000 after acquiring an additional 45,314 shares in the last quarter. Invesco Ltd. increased its position in shares of ARM by 36.9% in the 4th quarter. Invesco Ltd. now owns 2,426,850 shares of the company’s stock worth $265,279,000 after purchasing an additional 654,727 shares during the last quarter. Coatue Management LLC lifted its position in shares of ARM by 1.8% during the fourth quarter. Coatue Management LLC now owns 2,300,000 shares of the company’s stock worth $251,413,000 after purchasing an additional 40,174 shares during the last quarter. Wellington Management Group LLP grew its stake in ARM by 41.6% in the fourth quarter. Wellington Management Group LLP now owns 2,149,159 shares of the company’s stock worth $234,925,000 after purchasing an additional 631,576 shares in the last quarter. Finally, Schroder Investment Management Group increased its holdings in ARM by 11.0% in the fourth quarter. Schroder Investment Management Group now owns 1,891,310 shares of the company’s stock valued at $206,739,000 after buying an additional 187,035 shares during the last quarter. 7.53% of the stock is owned by institutional investors and hedge funds.

About ARM

Arm Limited (NASDAQ: ARM) is a global semiconductor IP company best known for designing energy-efficient processor architectures and related technologies that underpin a wide range of computing devices. Founded in 1990 as a joint venture between Acorn Computers, Apple and VLSI Technology and headquartered in Cambridge, England, Arm develops the ARM instruction set architectures and core processor designs that chipmakers license and integrate into custom system-on-chip (SoC) products. The company operates a licensing and royalty business model rather than manufacturing chips itself.

Arm’s product portfolio includes CPU core families (such as Cortex and Neoverse lines), GPU and multimedia IP (Mali), neural processing units (Ethos) and a suite of system and physical IP blocks.