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Conclusions are published after independent cross-review.

ARMArm Holdings plc
SellConviction 3.0/10PW target $214.75-33.4%Rated Jun 18Full research page

Verdict

Arm has crossed the Rubicon from pure IP tollbooth to hybrid IP-plus-silicon vendor with the 2026-03-24 launch of Arm AGI CPU and a $2B+ booked customer demand pipeline through FY2028 (Meta as lead partner; OpenAI, Cerebras, Verda, SAP, Cloudflare, F5, SK Telecom committed). The thesis is no longer simply about extending Armv9 royalty rate uplift — it is about whether Arm can earn data-center silicon economics worth $15B by FY2031 without alienating the Apple/Qualcomm/NVIDIA/AVGO licensees who collectively underwrite the IP business today. Q4 FY2026 royalty growth decelerated to +11% YoY (vs +27% in Q3) — material on its own, but the market is treating it as a one-quarter timing artifact while pricing in the AGI CPU optionality. We see Arm as a wide-moat business with two valuation regimes layered on top of each other: a steady-state IP toll franchise worth $130-160 standalone, plus a high-variance silicon call option that the market currently values at $60-90 per share.

ScenarioProb.TargetDriver
Bull30%$285.00AGI CPU booked demand expands from $2B to $5B+ across FY27/FY28 (Verda, Cloudflare, F5 ramp + new wins)
Base45%$215.00FY2027 revenue $5.7-6.1B (16-22% YoY growth) — license growth normalizes after FY2026 deal cadence
Bear25%$130.00Q4 FY2026 +11% royalty growth proves structural — full-year FY2027 royalty growth misses 15% (sub-15% = bear signal per prior thesis)

Change history

  • Jun 18View held

    June-12 analyst PT wave (WF $410 / Barclays $360 / BofA $335 / Mizuho $500) on agentic-AI CPU TAM + Oracle/ByteDance AGI CPU customer adds; stock ~$418.88 (6/17 close); no fundamental change [source: ]

  • Jun 5View held

    June-5 ~9% rate-driven selloff to $342.93 after a round-trip through ATH $411.83 on the NVDA Computex Arm-PC catalyst; no fundamental change [source: ]

  • May 29View held

    All-time-high re-rating to $351.68 (+61% since 2026-05-07) on multiple expansion, no new fundamentals

  • May 7View held

    Q4 FY2026 earnings + AGI CPU strategic pivot

  • Mar 12View held

    Deep research initiation — complete pipeline for ARM

Watching

  • Q4 FY2026 Earnings Report (delivered)May 662d ago
  • Q1 FY2027 Earnings Report — first post-AGI-CPU quarter; royalty re-accel testAug 5in 29d
  • Q1 FY2027 earnings — royalty re-acceleration testAug 5in 29d
  • Apple A20 / Mac M6 architecture disclosureSep 15in 70d
  • Arm DevSummit 2026 — annual developer conferenceOct 15in 100d
  • Q2 FY2027 Earnings Report — royalty trajectory confirmationNov 5
in 121d
  • Armv9 royalty share crossing 50%Nov 5in 121d
  • AGI CPU volume shipments + first Meta/Verda deploymentsDec 15in 161d
  • QCOM Snapdragon Data Center first commercial shipmentDec 31in 177d
  • Q3 FY2027 Earnings Report — FY2031 long-term plan re-affirm/raise checkpointFeb 4, 2027in 212d
  • AGI CPU booked demand expansion beyond $5BFeb 4, 2027in 212d
  • Royalty revenue YoY growth misses 15% for two consecutive quarters
  • Apple, Qualcomm, NVIDIA, AVGO, or Samsung publicly threatens architecture-license non-renewal or announces RISC-V flagship
  • AGI CPU booked customer demand stalls at $2-3B (no further customer expansion through FY27)
  • Arm China entity dispute, US export-control restriction, or operational-control loss
  • SoftBank executes another secondary >5% of float (margin loan or strategic monetization)
  • Q1 FY2027 revenue misses $1.26B guide midpoint by >5% OR FY2027 implied royalty growth <15%
  • Qualcomm Snapdragon Data Center commercial shipment on Ventana Veyron V2 (RISC-V)
  • Armv9 royalty share crosses 50% of total royalties
  • AGI CPU booked customer demand expands beyond $5B across FY27/FY28
  • Royalty growth re-accelerates to 25%+ YoY by H2 FY2027
  • Apple A20 or Mac M6 confirms continued Arm v9 architecture (no RISC-V signal)
  • FY2031 long-term plan ($25B revenue / $9+ NG EPS) re-affirmed or raised at Q3 FY2027 earnings
  • Cloud AI royalty 'more than doubled YoY' growth sustains for 4 consecutive quarters
  • Apple iPhone 18 keynote — A20 architecture disclosure
  • Apple Mac M6 launch — silicon architecture disclosure
  • AGI CPU volume shipments begin

    • Latest notes

    • Jun 18Update — Sell reaffirmed at ~$418.88 on June-12 PT wave (WF $410 / Barclays $360 / BofA $335 / Mizuho $500) + Oracle/ByteDance AGI CPU adds; scenarios unchanged
    • Jun 12BofA, Wells Fargo, Mizuho sharply raise ARM PTs on agentic AI CPU demand; Super Micro, Oracle, ByteDance partnerships confirmed
    • Jun 11Arm Holdings +11.3%: BofA $245 to $335 on June 11, 2026 joins early-June PT wave (WF $410 / Barclays $360 June 1; Mizuho $500 June 4) - all citing agentic AI CPU-heavy data center shift
    • Jun 5Update — Sell reaffirmed at $342.93 after round-trip through ATH $411.83; June-5 ~9% drop is rate-driven, not fundamental
    • May 29Update — Conviction Hold→Sell on valuation overshoot ($351.68 ATH, +61% since 5/7); fundamentals unchanged

    Exposure

    1-hop
    Suppliers

    None mapped.

    Customers
    • AMDArm architecture licensing for custom CPU designs
    • NVDABookArm architecture licensing for Grace CPU and Tegra processors
    • QCOMArm architecture licensing for Snapdragon processors
    • AAPL
    • META
    • OPENAI
    • AMZN
    • MSFT

    Options radar

    Concept — illustrative data
    • Jun 30Call$110.00Aug 211,200 ct$540K
    • Jun 30Call$105.00Jul 17800 ct$216K
    • Jun 29Put$95.00Aug 21600 ct$168K
    Unusual volume3.2x 20-day avg call volume
    IV shift30-day IV 41% → 48%

    Positioning skews toward near-term upside