Arm Holdings in Numbers: Revenue, Royalties, Chips and Ownership

Arm Holdings at a glance: a $4.92 billion licensing business inside most of the world electronics

Arm does not manufacture chips in the way Intel or Samsung do. It designs instruction set architectures and processor cores, licenses them to chip companies such as Apple, Qualcomm, MediaTek, NVIDIA and the large cloud providers, and then collects a royalty on every chip those partners ship. That model explains most of the numbers on this page: almost no cost of sales, a gross margin of 97.5 percent under US GAAP in FY2026, and a heavy research budget that absorbs more than half of revenue. In March 2026 Arm also announced its first production chip, the Arm AGI CPU, which adds a product business on top of licensing from fiscal 2027 onward.

Every figure below comes from Arm filings with the US Securities and Exchange Commission or its investor relations site, labelled with the period it covers. For context on how Arm compares with the chip companies it supplies, see our NVIDIA statistics and facts page.

Arm revenue grew from $2.03 billion in FY2021 to $4.92 billion in FY2026

Arm revenue was broadly flat for two years before its return to the stock market. The F-1 prospectus filed in August 2023 shows $2,027 million in FY2021, $2,703 million in FY2022 and $2,679 million in FY2023. Growth resumed strongly after the listing: revenue rose 21 percent to $3,233 million in FY2024, 24 percent to $4,007 million in FY2025 and 23 percent to $4,920 million in FY2026. Over five years revenue grew by 143 percent, a BusinessStats calculation from the reported totals.

Revenue has more than doubled since FY2021: from $2.03 billion to $4.92 billion, with the steepest climb in the two years after the September 2023 listing.

FY2025 was the first year Arm passed $4 billion, and FY2026 set records for both the full year and the fourth quarter, when revenue reached $1,490 million. Arm credits the growth mainly to higher royalty rates per chip from its newer Armv9 architecture and its Compute Subsystems (CSS), to more Arm chips inside data centres, and to a run of large licensing deals. For how this compares with the largest chip and platform companies, our big tech revenue comparison sets out the annual totals of the biggest technology groups.

FY2023 and FY2024 figures from the Q4 FY2024 shareholder letter; FY2025 and FY2026 figures from the Q4 FY2025 and Q4 FY2026 letters. Growth rates for FY2023 are a BusinessStats calculation against $2,703 million in FY2022. Cells marked not shown are left out because this page only shows figures confirmed in the documents cited.

Royalties brought in $2.61 billion in FY2026, 53 percent of Arm revenue

Arm reports two revenue lines. Royalty revenue is earned when a partner ships a chip that uses Arm technology, usually as a percentage of the chip price or a fixed fee per unit, so it follows chip volumes and the mix of architectures in those chips. License and other revenue is the upfront and recurring fee a company pays to use Arm designs, plus software, support and services. Licensing tends to lead royalties by several years, because a chip licensed today may not ship in volume until much later.

Both streams grew in FY2026: royalties rose 21 percent to $2,613 million and license and other revenue rose 25 percent to $2,307 million.

Royalties grew 8 percent in FY2024, 20 percent in FY2025 and 21 percent in FY2026. License and other revenue grew faster in each of those years, by 43 percent, 29 percent and 25 percent, which is why the royalty share of revenue fell from 62.5 percent in FY2023 to 53.1 percent in FY2026 (BusinessStats calculations). Licensing is still a leading indicator: Arm reported annualized contract value, its measure of recurring license income, of $1,660 million at 31 March 2026, up 22 percent, and $1,732 million at 30 June 2026, up 13 percent.

Royalties are still the larger half: 53.1 percent of FY2026 revenue, against 46.9 percent from license and other revenue.

The smartphone figures show why Arm can grow royalties faster than the handset market. In its Q4 FY2025 letter Arm said analysts estimated smartphone unit shipments grew by less than 2 percent that year, while Arm smartphone royalty revenue grew by around 30 percent, almost all from higher value per chip. Volume trends for the handset market itself are tracked in our quarterly global smartphone shipments data, and brand shares in our smartphone market share by vendor report.

Quarterly revenue reached a record $1,490 million in the March 2026 quarter

Quarterly revenue first passed $1 billion in Q4 FY2025 (January to March 2025) at $1,241 million and has stayed above that level since.

Licensing is lumpy, royalties are steadier: license revenue swung between $330 million and $819 million a quarter, while royalties climbed from $467 million to $715 million.

Source: Arm shareholder letters for each quarter. Growth rates are as reported by Arm; FY2025 quarterly growth rates are left out because the FY2024 quarters they compare against are not shown here.

Two patterns stand out. Royalty revenue was higher than a year earlier in every quarter shown, although it dipped from $737 million in Q3 FY2026 to $671 million in Q4 FY2026, still 11 percent above the same quarter of FY2025. License revenue is far more volatile because it depends on when large contracts are signed; Q4 FY2026 brought a record $819 million, up 29 percent, then Q1 FY2027 fell back to $574 million, which was still 23 percent higher than a year before.

Q1 FY2027: $1,289 million revenue, $715 million in royalties and a $1.38 billion guide for Q2

Arm published its first quarter of fiscal 2027, covering April to June 2026, on 29 July 2026. Revenue of $1,289 million was up 22 percent from $1,053 million and came in above the guidance range Arm gave in May of $1.26 billion, plus or minus $50 million. Royalty revenue rose 22 percent to $715 million and license and other revenue rose 23 percent to $574 million. The second quarter, July to September 2026, is due to be reported on Wednesday 4 November 2026 after the US market close, so it is not yet included here.

The gap between GAAP and non-GAAP operating income comes mainly from share-based compensation, which only GAAP counts. Arm does not give full-year revenue guidance for FY2027 in its Q1 letter. Starting with Q1 FY2027, Arm also stopped reporting remaining performance obligations and the counts of Arm Total Access and Arm Flexible Access licenses each quarter.

A 97.5 percent gross margin, but research spending keeps GAAP operating margin at 18 percent

Because Arm sells designs rather than physical products, its cost of sales was just $121 million in both FY2025 and FY2026, which left a GAAP gross margin of 97.5 percent in FY2026. GAAP operating income was $900 million in FY2026, an 18.3 percent margin, down from 20.7 percent in FY2025 as research and development spending grew faster than revenue. On a non-GAAP basis operating income was $2,115 million, a 43.0 percent margin (BusinessStats calculations from reported values).

Source: Arm Q4 FY2026 shareholder letter (income statement for years ended 31 March). Margins and percentage changes are BusinessStats calculations. Cash and short-term investments stood at $3,601 million on 31 March 2026.

The FY2024 dip in GAAP operating income to $111 million, shown in the annual table above, did not reflect a weaker business: non-GAAP operating income rose that year from $783 million to $1,408 million. The $1,297 million gap between the two measures consists of items excluded from non-GAAP results, mainly share-based compensation. Revenue from related parties, which Arm reports as a separate line, rose from $823 million in FY2025 to $1,499 million in FY2026, or 30.5 percent of total revenue.

Arm spent $2.78 billion on R&D in FY2026 and employed 9,584 people

Research and development is by far the largest cost at Arm. GAAP R&D expense rose from $1,979 million in FY2024 to $2,071 million in FY2025 and $2,776 million in FY2026, equal to 56.4 percent of FY2026 revenue (BusinessStats calculation). Non-GAAP R&D, which excludes share-based compensation, was $1,911 million in FY2026, up 43 percent. For comparison with one of the biggest spenders among Arm licensees, see Apple research and development expenses.

Headcount up 61 percent in three years: from 5,963 to 9,584, and 8,058 of the March 2026 total were engineers.

Headcount has grown every year since the listing. Arm had 5,963 full-time employees at 31 March 2023, 7,096 a year later, 8,330 at 31 March 2025 and 9,584 at 31 March 2026, of whom 8,058, or 84 percent, were engineers. The UK annual report gives an average of 9,024 employees during FY2026, up from 7,676 in FY2025. Arm is headquartered in Cambridge, and the wider British sector is profiled in our report on tech companies in the United Kingdom.

More than 350 billion Arm-based chips have shipped since 1990

Arm counts the chips its partners report in their royalty statements. On that basis, the company said in its FY2026 annual report that customers have shipped more than 350 billion Arm-based chips cumulatively. The figure was more than 250 billion in the August 2023 prospectus, 287.4 billion at 31 March 2024 and more than 310 billion in the FY2025 annual report. Annual shipment counts were last given for FY2023 and FY2024.

Chip counts depend on partner royalty reports and are stated by Arm with "more than" for recent years. BusinessStats does not derive annual counts from these rounded cumulative figures.

Unit shipments fell in FY2024, from 30.6 billion to 28.6 billion, yet royalty revenue still rose 8 percent that year. That gap is the clearest sign that Arm earns more per chip as partners move to Armv9 and more complex designs. In the data centre the measure is cores rather than chips: Arm said its Neoverse cores passed one billion deployed by December 2025 and 1.5 billion by June 2026, with the latest 500 million arriving in nine months.

Above 99 percent of smartphones and about half of top hyperscaler CPU compute

Arm publishes market share estimates in two forms. The IPO prospectus gave detailed shares for each end market at the end of 2020 and 2022, and current shareholder letters and annual reports give headline shares for smartphones and cloud. The FY2026 annual report says Arm CPUs powered more than 99 percent of smartphones sold worldwide in FY2026. In the Q4 FY2026 letter Arm put its share of CPU compute among the top hyperscalers at about 50 percent, after saying a year earlier that it expected close to half of new server chips shipped to those companies to be Arm-based.

Share gains in every segment shown: automotive rose 7.8 points and networking 6.7 points between 2020 and 2022.

The prospectus figures, estimated by Arm for calendar 2022, show Arm with 64.5 percent of IoT and embedded chips, 40.8 percent of automotive chips, 25.5 percent of networking equipment chips and 10.1 percent of cloud compute, plus more than 99 percent of mobile application processors. Across all chips with a processor, Arm put its share at about 48.9 percent. Cloud compute has moved most since then, as Amazon, Google, Microsoft and NVIDIA have all launched Arm-based server processors. The x86 side of that contest is covered in our Intel and AMD x86 market share data, and cloud spending in the big three cloud providers.

These are company estimates built from third-party data, and the newer figures are measured by chip value, so they are not directly comparable with the prospectus. The detailed split above stops at 2022 because that is the latest labelled end-market table Arm has published. Demand for AI servers, which drives the data centre gains, is covered in our data centre statistics.

Five customers generate 57 percent of revenue, and Arm China about 16 percent

Arm licenses its designs to a long list of chip companies, but its revenue base is concentrated. According to the FY2026 Form 20-F, the top five customers together accounted for about 57 percent of revenue in FY2026, compared with 56 percent in FY2025 and 54 percent in FY2024. The UK annual report confirms that this group includes Arm China and SoftBank Group. Arm does not name the others in its filings, and it does not publish revenue by named customer.

Five customers bring in 57 percent of revenue: Arm China alone accounted for about 16 percent in FY2026.

Arm China is a separately run company that holds the right to sell Arm technology in the PRC and pays Arm for it. Its importance has declined. It was the largest single customer of Arm at about 18 percent of revenue in FY2022 and 24 percent in FY2023, then 21 percent in FY2024, 17 percent in FY2025 and 16 percent in FY2026. Total revenue from the PRC, which also includes some sales not made through Arm China, was about 25 percent in FY2023, 22 percent in FY2024, 19 percent in FY2025 and 18 percent in FY2026.

Dependence on Arm China has fallen: its share of revenue peaked at about 24 percent in FY2023 and was about 16 percent in FY2026.

Arm has also changed its license portfolio. At 31 March 2026 there were 56 active Arm Total Access licenses, up from 44 a year earlier, and 329 Arm Flexible Access licenses, up from 314. Total Access is a subscription to a broad catalogue of Arm IP used by large chip designers; Flexible Access lets companies, often start-ups, design with Arm IP first and pay license fees when they commit to manufacturing. Arm also counts more than 22 million software developers in its ecosystem.

SoftBank bought Arm for 1,700 pence a share in 2016 and still owns around 87 percent

SoftBank Group announced its takeover of the then London listed ARM Holdings on 18 July 2016, offering 1,700 pence in cash per share, a premium of about 43 percent to the previous close, for an equity value of about £24.3 billion. A planned sale of Arm to NVIDIA, announced on 13 September 2020, was ended on 8 February 2022 because of what the two companies called significant regulatory challenges, and SoftBank said it would prepare Arm for a public listing instead.

Sources: SoftBank Group press releases of 18 July 2016 and 8 February 2022; Arm IPO pricing release of 13 September 2023; Arm UK annual reports for FYE25 and FYE26.

Arm priced its initial public offering on 13 September 2023 at $51.00 per American depositary share. All 95.5 million ADSs in the base offering were sold by a wholly owned subsidiary of SoftBank Group, so Arm itself raised no money; the base deal was worth about $4.87 billion at the offer price, a BusinessStats calculation, before an option for underwriters to buy up to 7 million more ADSs. Trading began on the Nasdaq Global Select Market the next day under the ticker ARM. Arm had 1,056,513,738 ordinary shares outstanding at 31 March 2025.

SoftBank Group still held an indirect stake of around 87 percent at both 31 March 2025 and 31 March 2026, which makes Arm a controlled company under Nasdaq rules. That leaves only about 13 percent of the shares outside SoftBank Group control. For where Arm sits among the most valuable listed firms, see our ranking of the biggest companies in the world by market value.

The Arm AGI CPU: the first chip Arm sells under its own name

On 24 March 2026 Arm announced the Arm AGI CPU, its first production silicon product, aimed at AI data centres running large numbers of software agents. According to the launch release, the chip has up to 136 Arm Neoverse V3 cores, a thermal design power of 300 watts, and is made by TSMC on a 3 nanometre process. Meta is the lead partner and co-developer, and Cerebras, Cloudflare, F5, OpenAI, Positron, Rebellions, SAP and SK Telecom were named as early customers. Early systems were available at launch, with broader availability planned for the second half of 2026.

These are company targets, not results, and the chip business has not yet produced reported revenue on the scale of licensing. They do mark a change in model: Arm now offers partners three routes, licensing individual IP, adopting a CSS platform, or buying Arm-designed silicon. It also sold its Artisan foundation IP business to Cadence in a deal completed on 26 August 2025, narrowing its focus to compute. The wider AI spending that underpins these plans is tracked in our AI market size report.

Methodology and data notes

All financial figures come from Arm documents: the Forms 20-F for FY2025 and FY2026, the August 2023 Form F-1, the UK annual reports for FYE25 and FYE26 and the quarterly shareholder letters from Q4 FY2024 to Q1 FY2027. Ownership and deal facts come from SoftBank Group and Arm press releases.

This page replaces an earlier version that used rounded or estimated values, including FY2025 revenue of $3.72 billion (Arm reported $4,007 million), a 63 to 37 royalty and licensing split (the reported split was 54 to 46), a SoftBank stake of about 90 percent, more than 6,500 employees, R&D of about $1.5 billion and 280 billion cumulative chips. Analyst estimates of revenue by named customer and of future revenue have been removed because Arm does not publish them. More technology company data is collected in our technology and telecommunications topic overview.

Arm Holdings in eight numbers

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