# Arm earnings: revenue up 27% to $1.44B, royalties miss estimates

> Licensing revenue rose 50% to $773 million, while royalties of $670 million fell short of the $720.8 million analysts expected.

URL: https://claudegpt.si/news/arm-earnings-q2-fiscal-2027-revenue  
Published: 2026-11-04T22:50:58.386Z  
Author: ClaudeGPT Si Newsroom  
Section: AI News  
Topics: Arm, Earnings, Tech stocks, AI data centers, Semiconductors  
Publisher: ClaudeGPT Si

## Key takeaways

- Arm reported September-quarter revenue of $1.44 billion on November 4, up 27%, with licensing up 50% to $773 million.
- Royalty revenue was $670 million, up 8% and below the $720.8 million analysts expected, per Reuters.
- Arm says data center royalties doubled and it expects up to $2 billion from its Arm AGI CPU across fiscal 2027 and 2028.

Arm earnings for the September quarter, reported on November 4, showed revenue up 27% to $1.44 billion, its highest second quarter ever, according to [Arm's results post](https://newsroom.arm.com/news/arm-q2-fye27-results). Licensing revenue jumped 50% to $773 million, but royalty revenue of $670 million came in below the $720.8 million analysts expected, Reuters reported via [Techmeme](https://www.techmeme.com/261104/p51#a261104p51).

Arm designs the chip architecture that phone, PC and data center processors are built on. It earns royalties when partners ship chips, and license fees up front. Royalties lagging estimates while licensing surges is the main thing to read in this report.

## The quarter in numbers

For the quarter ended September 30, 2026:

| Measure | Q2 fiscal 2027 | Change from a year ago |
| --- | --- | --- |
| Total revenue | $1.44B | up 27% |
| Licensing and other | $773M | up 50% |
| Royalty | $670M | up 8%, per Reuters |
| GAAP operating income | $201M | |
| Non-GAAP operating income | $638M | |

Reuters put analysts' revenue estimate at $1.38 billion, so total revenue beat. Arm calls licensing a leading indicator of future royalty growth. It was the fifth straight quarter of revenue growth above 20%.

## The data center and AI numbers

Arm says partners shipped more than 10 billion Arm-based chips in the quarter, 1.5 billion more than a year ago. Data center royalties doubled year over year, and Arm-based share at the top hyperscalers rose from 15% in calendar 2024 to over 50% in 2025. Arm expects that share to pass 60% by the end of 2026.

The company also said it expects up to $2 billion in revenue from its Arm AGI CPU across fiscal 2027 and 2028, with purchase orders running through calendar 2027 and first commercial deliveries on track for the fourth quarter of fiscal 2027. These are Arm's own figures.

Outside the data center, Arm says Arm-based PCs reached about 20% of global PC shipments, and royalty revenue from physical AI, meaning robots and similar machines, grew 50%.

## The stock

Per Yahoo Finance, Arm shares fell 5.3% in the regular session on November 4, to $191.80 as of 21:04 UTC, before the results came out. The results post did not include earnings per share or guidance for the next quarter. Those are on Arm's [investor relations site](https://investors.arm.com/financials/quarterly-annual-results).

## Sources

- [Arm Q2 FY2027 results](https://newsroom.arm.com/news/arm-q2-fye27-results), Arm
- [Arm reports Q2 revenue up 27% YoY to $1.44B](https://www.techmeme.com/261104/p51#a261104p51), Techmeme (Reuters)
- [Arm Holdings (ARM)](https://finance.yahoo.com/quote/ARM), Yahoo Finance