NASDAQ$ARM
ARM Holdings PLC · Q3 2025 earnings
Q3 2025 earnings · · After market close · Investor relations
Briefing
Arm Holdings reported strong Q3 FYE25 results with total revenue of $983 million, a 19% YoY increase. Royalty revenue grew by 23% to $580 million, driven by the adoption of Armv9 and increased cloud and IoT demand. Non-GAAP operating margin stood at 45%, and free cash flow declined 21% YoY. The company continues to gain market share in AI, automotive, and cloud computing.
Headline financials
Revenue & EPS history
ARM · Revenue · Quarterly
$983M
Forward guidance
Arm expects continued growth, with Q4 FYE25 revenue projected between $1.175 billion and $1.275 billion. The company anticipates further royalty growth from Armv9 adoption and expanding cloud and AI market opportunities.
Tailwinds
- Strong revenue growth expected, projected at $1.175B - $1.275B for Q4.
- Continued royalty revenue growth from Armv9 adoption.
- Expansion into AI, automotive, and cloud computing markets.
- Increasing adoption of Compute Subsystems (CSS) enhancing royalties.
- Strong cash generation with a robust pipeline of new licensing deals.
Headwinds
- Free cash flow declined 21% YoY.
- RPO declined 3% QoQ, indicating potential slowing future revenue recognition.
- Increased costs related to research and development.
- Potential macroeconomic headwinds affecting semiconductor demand.
- Competitive pressures in cloud and AI chip markets.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 14 quarterly earnings reports · overlaid with Q3 2025
+3.5%
Avg return
Earnings day
+7.2%
Avg return
5 days after
+17.5%
Avg return
30 days after
29%
4 / 14 earnings
Positive
+56.1%
Q3 2024
Best reaction
-21.3%
Q1 2024
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q4 2026 | -9.0% | -12.8% | +44.6% | |
| Q3 2026 | +5.7% | +20.1% | +9.0% | |
| Q2 2026 | -3.2% | -6.5% | -11.8% | |
| FY 2025 | -5.9% | -16.0% | -15.3% | |
| Q3 2025 | -3.3% | -9.0% | -27.5% | |
| Q2 2025 | +7.1% | +0.9% | +0.2% | |
| Q1 2024 | -21.3% | -21.3% | -7.8% | |
| Q1 2025 | -8.6% | -16.9% | -0.1% | |
| Q4 2022 | -3.4% | +1.7% | +31.0% | |
| Q4 2024 | -3.9% | +8.7% | +26.7% | |
| Q3 2023 | +49.6% | +55.8% | +70.7% | |
| Q3 2024 | +56.1% | +104.1% | +80.2% | |
| Q2 2023 | -3.9% | -1.8% | +23.6% | |
| Q2 2024 | -6.7% | -6.5% | +21.6% | |
| Q4 2023 | — | — | — | |
| Q1 2023 | — | — | — |
Discussion
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