Arm shares soar after reporting strong earnings and forecast

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Arm CEO Rene Haas and executives celebrate as Softbank’s Arm, a chip design company, holds an initial public offering at the Nasdaq MarketSite in New York, September 14, 2023.

Brendan McDermid | Reuters

Shares of chip maker Arm climbed more than 60% Thursday morning after the company reported better-than-expected earnings on Wednesday and a strong profit forecast for the quarter.

Most smartphones and many PCs feature Arm chip design technology. The company reported higher-than-expected earnings per share and revenue for the quarter that ended in December.

Earnings per share came in at 29 cents adjusted versus the 25 cents analysts had expected, according to LSEG, formerly Refinitiv. Revenue for the quarter was $824 million, compared to the $761 million expected.

The company also predicted that earnings per share for this quarter would be between 28 cents and 32 cents on sales of between $850 million and $900 million. Analysts are expecting earnings of 21 cents per share on sales of $780 million.

Arm, founded in 1990 and acquired by Softbank in 2016 for $32 billion, went public in September. The company sold shares at $51 per piece in its initial public offering and was trading at just under $100 per share Thursday morning.

Softbank still owns about 930 million shares of the chip designer, or about 90% of its outstanding stock, and had gained about $6.8 billion as of early trading Thursday.

– CNBC’s Kif Leswing added to the report.

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