Arm Projects Up to $2 Billion in AGI CPU Revenue Across Fiscal 2027 and 2028

Arm management projects up to $2 billion in AGI CPU revenue across fiscal 2027 and 2028, shifting the chip’s outlook from customer demand and production capacity to potential sales.

The company expects shipments to begin in fiscal fourth-quarter 2027. Purchase orders from multiple customers extend through calendar 2027, and improved supply visibility has increased management’s confidence in the outlook.

Arm previously cited more than $2 billion in customer demand for the chip across fiscal 2027 and 2028, while secured manufacturing capacity supported a $1 billion opportunity over those years. Those figures described demand and production capacity, not revenue or shipments, as detailed in earlier coverage of the demand figures. Arm’s AGI CPU marks its first move into production silicon products after years of licensing processor technology and collecting royalties on chips that use its intellectual property.

Arm reported fiscal second-quarter revenue of $1.44 billion, up 27% from a year earlier. “Arm delivered a record second quarter,” CEO Rene Haas said. Data-center royalties doubled year over year, and management expects triple-digit growth in that area for the next few years. Licensing revenue exceeded expectations by about $100 million, helped by accelerated long-term commitments.

Management expects gross margins of 30% to 40% for the first-generation AGI CPU, with margins of 50% or more targeted later. It also identified higher memory prices as a pressure on smartphone sales and supply-chain constraints as a possible risk to AGI CPU deliveries. Shipments are expected to start in fiscal fourth-quarter 2027.