Arm Shares Fall 5% as Licensing Revenue Rises 50% to $773 Million

Arm shares lost 5% in premarket trading Thursday, Nov. 5, as investors assessed fiscal second-quarter results and guidance from the British semiconductor company. Arm generated $773 million in licensing revenue, 50% more than a year earlier.

Market analysts called the quarter solid, while one judged that it offered limited new details.

Arm expects royalties tied to data-center use to grow at a triple-digit rate over the next few years. Separately, analysts said cloud AI royalties were more than offsetting ongoing weakness in smartphone royalties.

Arm's AGI CPU revenue outlook includes up to $2 billion across fiscal 2027 and 2028, with orders from multiple customers.