Arm Holdings Plc (NASDAQ:ARM) reported financial results for the first quarter of fiscal 2026 on Wednesday after the bell. Here’s what you need to know from the print.
Q1 Earnings: Arm reported fiscal first-quarter revenue of $1.053 billion, missing analyst estimates of $1.055 billion. The chip designer reported first-quarter adjusted earnings of 35 cents per share, in line with analyst estimates, according to Benzinga Pro.
First-quarter revenue was up 12% year-over-year. Royalty revenue climbed 25% year-over-year to $585 million, driven by the adoption of the Armv9 architecture, the ramp of chips based on Arm CSS and increased usage of Arm-based chips in data centers. The company said license and other revenue declined 1% year-over-year.
Annualized contract value (ACV) was up 28% year-over-year to approximately $1.53 billion. Arm said it generated $332 million of operating cash flow and $150 million of free cash flow in the first quarter.
The company ended the period with $2.91 billion in cash, cash equivalents and short-term investments.
“Arm is powering AI workloads everywhere with unmatched performance and energy efficiency,” said Rene Haas, CEO of Arm Holdings.
“Our Q1 FYE26 results exceeded $1 billion in revenue for the second straight quarter as royalties grew across all target end markets, demonstrating the strength of Arm as the AI platform of choice — from the cloud to the smallest edge devices.”
Outlook: Arm expects second-quarter revenue of $1.01 billion to $1.11 billion versus estimates of $1.056 billion. The company anticipates second-quarter adjusted earnings of 29 cents to 37 cents per share versus estimates of 35 cents per share.
Management will discuss the quarter on an earnings call slated for 5 p.m. ET.
ARM Price Action: Arm shares were down 8.31% in Wednesday’s after-hours session, trading at $149.75 at the time of publication, according to Benzinga Pro.
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