Arm posts higher fiscal first-quarter profit and revenue as AI demand grows
Shares reversed from a nearly 8% premarket drop to as much as a 19% gain after the open, despite investor concern over smartphone weakness and guidance that fell short of the market's most bullish hopes.
Arm reported stronger fiscal first-quarter 2027 results, with revenue rising 22% to $1.289 billion and adjusted earnings per share of $0.45, as growth in AI and data center demand continued to support the chip designer's business. Licensing revenue rose to $574 million and royalty revenue climbed to $715 million. The company guided fiscal second-quarter revenue to about $1.38 billion, plus or minus $50 million. After initially falling nearly 8% in premarket trading, Arm shares reversed course after the U.S. open and rose as much as 19%, marking their biggest one-day gain since March 25.
- Royalty revenue: Income Arm earns when customers ship chips using its technology, typically based on each device sold.