Arm beats second-quarter revenue estimates on AI and data-center demand

Arm Holdings beat Wall Street estimates for second-quarter revenue on Wednesday, driven by higher royalty payments and licensing fees from customers deploying its chip architecture in AI-related computing products.

Unlike chipmakers that manufacture semiconductors, Arm Holdings licenses its processor architecture and earns royalties on chips shipped using its technology, making licensing fees and royalty payments the company’s primary sources of revenue.

Arm said its server-chip architecture accounted for more than 50% of deployments at major cloud providers in 2025 and is expected to exceed 60% by the end of 2026.