Arm Holdings plc American Depositary Shares Q4 FY2026 earnings call

• Arm delivered record quarter and year. Revenue up 20% Q4, 23% full year. • Licensing revenue grew 29%, royalty 11%. • ARM AGI CPU launched, purpose-built for agentic AI, with over $2 billion demand. • Customers like SAP, Cloudflare, Google, AWS, Microsoft using ARM-based tech. • R&D investment up 30% year on year. • Non-GAAP operating income $731 million, margin 49%.

Revenue this quarter was 1.49 billion, up 20%, highest quarterly revenue ever. Licensing revenue grew 29% to 819 million. Royalty revenue grew 11% to 671 million. Full year revenue reached 4.92 billion, up 23%. Royalty revenue up 21% to 2.61 billion, licensing revenue 25% to 2.31 billion. Non-GAAP EPS for Q4 was $0.60, full year $1.77. Royalty growth driven by Cloud AI, data center royalty more than doubled. Licensing growth due to strong demand for next-gen architectures. Customer demand for ARM AGI CPU very strong with over $2 billion across fiscal 2027 and 2028.

• Q1 revenue expected $1.26 billion ±50 million, midpoint 20% growth. • Royalty and license revenue expected up ~20% each. • Non-GAAP operating expense ~$760 million, EPS 40¢ ±4¢. • Expect $15 billion AGI CPU revenue and $10 billion IP revenue by FYE 31, translating to over $9 EPS. • Maintain AGI CPU revenue outlook of $1 billion while pursuing supply chain capacity, first revenues expected Q4 fiscal 2026.

Q: Andrew Gardner asked about demand growth for ARM AGI CPU and supply access.

A: Demand is combination of existing customers increasing forecast and new interest. Working to secure supply.

Q: Joe asked about royalty rate growth.

A: Q4 had tough call due to mediatek 1400 ramp, expecting 20% range by Q1, data center demand offsetting mobile weakness.

Q: Vivek Iyer asked about Arm's niche in CPU market.

A: ARM strong in high core count design, efficiency per core. Hyperscalers using ARM, large market opportunity.

Q: Tim Schulte-Melanda asked about CPU TAM and OPEX.

A: ARM AGI CPU has large core count, trend of ARM in accelerators. OPEX for support baked in numbers.

Q: Chris Sanka asked about CPU to GPU ratio.

A: Core count growth in CPUs, ratios changing from core count perspective.

Q: Sebastian Nagy asked about impact on existing IP customers.

A: Explained early communication with partners, support for strategy.

Q: BJ Rakesh asked about data center royalty growth.

A: Royalties from Neoverse doubling year on year, license revenue expected 20% range long term.

Q: Harlan Sir asked about OpEx for chip business.

A: Revenue split for AGI CPU, OpEx includes support, chip business operating profit positive next year.

Q: Lee Simpson asked about CPU to GPU ratio from core perspective.

A: Each agent runs batch job, more cores better, core count growth in CPU chips.