ARM Shares Nearly Double Amid AI Surge

Tom Jowitt,
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Shares in ARM Holdings have exploded over the past week, after an optimist forecast almost doubled its share price

Shares in the British chip designer ARM Holdings continue to rally this week, after an optimist forecast, coupled with better than expected third quarter results last week.

ARM’s share price has surged 48 percent since that earnings announcement, rising from $77 to a high of $156 on Monday, before declining back down to $122 as of Tuesday afternoon.

This has pushed ARM’s current market valuation to $125.7 billion, over double what it had been valued at for its public offering on the Nasdaq last September.

ARM’s campus in Cambridge

Share price

In September 2023 Cambridge-based ARM Holdings had secured a $54.5 billion valuation ahead of its return to the stock market.

It sold its shares at $51 apiece in its IPO.

The British chip designer is owned by Japan’s SoftBank Group and its shares had started trading on the Nasdaq in New York, after it opted not to do a dual listing in London and New York, like it had prior to its acquisition by SoftBank in 2016.

SoftBank still owns about 930 million shares of the chip designer, or roughly 90 percent of its outstanding stock, and founder Masayoshi Son is ARM’s chairman.

Strong demand

ARM is major supplier of chip designs for nearly all the smartphones in the world.

It was revealed last September that ARM had entered into a “new long-term agreement with Apple that extends beyond 2040.”

ARM is currently riding the artificial intelligence wave, as more companies require energy efficient processors to run their workloads.

“We are seeing the demand for Arm technology to enable AI everywhere, from the cloud to edge devices in your hand,” ARM noted in its shareholder letter for the quarter. “The most demanding AI applications are already running on ARM today.”