Arm (ARM) Q2 2027 Earnings
Quarter includes $46.6 million of fair value losses on equity investments in publicly listed companies and $4.9 million of net expected credit losses relating to Arm China; prior-year quarter EPS included a $131.0 million pre-tax gain on the Artisan foundation IP business divestiture.
How Did ARM Stock React to Q2 2027 Earnings?
Did ARM Beat Earnings? Q2 2027 Results
No. Arm reported Q2 2027 earnings of $0.12 a share on Nov 4, 2026, missing the $0.48 consensus estimate by 74.8%. Revenue was $1.4B against a $1.4B estimate.
Arm Holdings delivered a split verdict in fiscal second-quarter 2027, posting strong revenue growth while falling well short of profit expectations. Revenue climbed 27.1% year over year to $1.44 billion, beating the $1.38 billion consensus by 4.71%, lifted by a 50% surge in license and other revenue to $773 million as high-value deals and backlog contributions rolled in, alongside an 8% gain in royalties driven by richer Armv9 and CSS product mix. GAAP earnings per share, however, came in at $0.12, missing the $0.48 consensus by 74.77%; the GAAP figure includes $46.6 million of fair-value losses on listed equity investments and $4.9 million of net expected credit losses tied to Arm China, while the year-ago quarter had benefited from a $131 million pre-tax gain on the Artisan IP divestiture to Cadence. Looking ahead, Arm expects production of its AGI CPU by end of calendar 2026 and plans to pay $200 million in manufacturing capacity reservation advances in the first half of 2027, underscoring its deepening push into physical silicon, a business management cautioned may carry materially different margin profiles than its traditional IP licensing model.
- License and Other Revenue rose 50% to $773 million on strong demand for Arm IP, timing and size of multiple high-value license agreements and backlog contributions
- Royalty Revenue rose 8% to $670 million on improved mix of higher-royalty products such as Armv9 and Arm CSS and increased deployment of Arm-based chips in data centers
- Royalty growth partially offset by the impact of memory pricing on the smartphone market
- Revenue from external customers rose 43% to $1,019 million; related-party revenue flat at $424 million
- Point-in-time revenue of $470 million vs $242 million a year earlier
- SoftBank Group Consulting Agreement revenue of $208.7 million vs $177.9 million
- U.S. customer revenue of $556 million vs $374 million
- R&D up 24% to $857 million and SG&A up 36% to $343 million on headcount growth and share-based compensation; government incentive benefit of $44 million in R&D vs $30 million
What Is Arm's Outlook?
No financial guidance was provided in the filing. Management's forward-looking commentary covered the following: - Production of the Arm AGI CPU is expected by the end of calendar year 2026. - Silicon products may have materially different margin profiles, revenue recognition and sales cycles than IP licensing. - R&D investment will continue to increase, including in production silicon, CSS, chiplets and complete chip solutions. - Arm expects to pay $200.0 million of capacity reservation advances in the first half of calendar 2027. - Arm committed to $672.0 million of semiconductor product purchases through 2027. - Cash and short-term investments are deemed adequate for liquidity needs for at least the next 12 months. - About 33% of the $2,422.3 million of remaining performance obligations is expected to be recognized over the next 12 months.
ARM YoY Financials
| Metric | Q2 2027 | Q2 2026 | Year over year |
|---|---|---|---|
| Revenue | $1.4B | $1.1B | +27.1% |
| Gross Profit | $1.4B | $1.1B | +26.7% |
| Operating Income | $201.0M | $163.0M | +23.3% |
| Net Income | $130.0M | $238.0M | −45.4% |
ARM Revenue by Segment
ARM Revenue by Geography
When Does Arm Report Next?
Figures from SEC filings and company reports. Not investment advice.