Trending Now - Arm's Bold Shift: CEO Unveils Ambitious Chip Sales Strategy
WHO:
Arm Holdings plc (Nasdaq: ARM)
Rene Haas, CEO of Arm
Jason Child, Chief Financial Officer of Arm
Meta Platforms Inc., first major customer for Arm's chip
SoftBank Group Corp., majority owner of Arm
WHAT:
Arm's stock price closed down 1.4% to just under $135 per share before the announcement on March 25th, 2026.
Arm's stock price rose 16% on March 26th, 2026, following the announcement of the AGI CPU.
Arm expects its earnings to reach $9 per share by 2031, with analysts estimating earnings of $1.75 per share for the current fiscal year, excluding some items.
Arm's Chief Financial Officer Jason Child stated that selling its own chips could yield about $500 in gross profit dollars per chip, compared to $100 when using its designs.
Arm announced it will begin making and selling its own chips for AI workloads.
The new chip is called the Arm AGI CPU, designed for AI data center customers.
Arm's stock price surged 13% to $152.50 per share following the announcement.
Arm expects its new AI chip to generate approximately $15 billion in annual revenue by 2031.
Total revenue could reach up to $25 billion annually by 2031, combining new chip revenue and existing blueprint business.
The AGI CPU will have as many as 136 cores and draw 300 watts of electricity.
Arm generated $4 billion in revenue in 2025.
WHERE:
Announcement made at an event in San Francisco.
Chips will be fabricated by Taiwan Semiconductor Manufacturing Co.
WHEN:
Announcement made on March 25th, 2026.
Arm expects to achieve its revenue goals by 2031.
WHY:
The shift to chipmaking is intended to allow Arm to capture a larger share of the revenue generated from high-value data center purchases, which can be significantly higher than smartphone chips.
The shift aims to create a new profitable revenue stream and capitalize on the growing AI market.
Arm's pivot is intended to provide more choices for partners and support agentic AI infrastructure at a global scale.
HOW:
Arm's new business model will allow it to compete directly with its customers, including Amazon, Microsoft, Nvidia, and Google, who previously relied on Arm's designs for their own chip production.
Arm will transition from a chip design and licensing model to manufacturing its own chips.
The company developed the AGI CPU in collaboration with Meta to optimize performance with existing AI infrastructure.
(UPDATED March 26, 2026 03:52 UTC)
Arm's stock price surged 16% on March 26, 2026, following the announcement of its new AGI CPU, bouncing back from a 1.4% drop to just under $135 per share the day before. The company's Chief Financial Officer Jason Child revealed that by shifting to chipmaking, Arm expects to generate about $500 in gross profit per chip, a significant increase compared to the $100 profit when using its designs. This new business model aims to help Arm capture a larger share of the lucrative revenue from high-value data center purchases, directly competing with major players like Amazon, Microsoft, Nvidia, and Google.
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(UPDATED March 26, 2026 00:17 UTC)
Arm Holdings, led by CEO Rene Haas and CFO Jason Child, announced on March 25 that it will start manufacturing and selling its own chips for AI workloads, specifically the new Arm AGI CPU, designed for data center customers. Following this announcement, Arm's stock price jumped 13% to $152.50 per share, with expectations of generating around $15 billion in annual revenue from the new chip by 2031, while total revenue could reach up to $25 billion when combined with its existing business. The AGI CPU, developed in collaboration with Meta Platforms, will feature up to 136 cores and will be fabricated by Taiwan Semiconductor Manufacturing Co., marking a significant shift for Arm as it moves from a design and licensing model to direct chip manufacturing.