#Arm shares are rising on the back of third-quarter profit growth and strong forecasts
Arm Holdings shares rose more than 60% after the company's third-quarter results beat expectations. The company also released a forecast for the fourth quarter, which turned out to be better than expected: revenue is expected to be $850-$900 million against the projected $778 million.
The company is unique in that it supplies the architecture of processors and chips to chip manufacturers. In 2016, its majority owner, SoftBank Group, bet that Arm would be able to exploit its dominant position in the smartphone industry, where it is at the heart of Apple and Android devices.
Arm said the expansion strategy is starting to bear fruit: customers are flocking to Arm-based CPUs in addition to Nvidia chips to run artificial intelligence in data centers, and are also working on new laptops and smartphones that can support chatbots and other artificial intelligence features.
Arm Holdings shares rose more than 60% after the company's third-quarter results beat expectations. The company also released a forecast for the fourth quarter, which turned out to be better than expected: revenue is expected to be $850-$900 million against the projected $778 million.
The company is unique in that it supplies the architecture of processors and chips to chip manufacturers. In 2016, its majority owner, SoftBank Group, bet that Arm would be able to exploit its dominant position in the smartphone industry, where it is at the heart of Apple and Android devices.
Arm said the expansion strategy is starting to bear fruit: customers are flocking to Arm-based CPUs in addition to Nvidia chips to run artificial intelligence in data centers, and are also working on new laptops and smartphones that can support chatbots and other artificial intelligence features.
Arm Holdings #ARM is growing again as investors continue to believe in the potential of AI
The stock is up almost 30% today, continuing last week's gains. Investors are continuing to invest in a British chip development company after it posted a stronger-than-expected outlook.
In fiscal year 2024, Arm now expects to earn between $1.20 and 1.24 per share on an adjusted basis — compared to the previous forecast of $1-1.10 dollars per share and above the estimate of $1.05 per share — as the company benefits from increased demand for artificial intelligence. "We have also seen evidence regarding one of our strategies, which we call computing subsystems," said CEO Rene Haas.
In the next quarter, Arm expects to earn between $0.28 and 0.32 adjusted earnings per share, and sales will range from $850 to 900 million. Analysts expect adjusted earnings of $0.21 per share on revenue of $778.5 million.
The stock is up almost 30% today, continuing last week's gains. Investors are continuing to invest in a British chip development company after it posted a stronger-than-expected outlook.
In fiscal year 2024, Arm now expects to earn between $1.20 and 1.24 per share on an adjusted basis — compared to the previous forecast of $1-1.10 dollars per share and above the estimate of $1.05 per share — as the company benefits from increased demand for artificial intelligence. "We have also seen evidence regarding one of our strategies, which we call computing subsystems," said CEO Rene Haas.
In the next quarter, Arm expects to earn between $0.28 and 0.32 adjusted earnings per share, and sales will range from $850 to 900 million. Analysts expect adjusted earnings of $0.21 per share on revenue of $778.5 million.