ARM Holdings PLC · NASDAQ:ARM
ARM — Q4 FYE25 Earnings Presentation
30 slides from ARM's earnings presentation, May 7, 2025
Slide 1: Arm Holdings plc Q4 FYE25 Investor Presentation
Arm Holdings plc Q4 FYE25 Investor Presentation investor.relations@arm.com https://investors.arm.com May 7, 2025 © 2025 Arm 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that reflect Arm Holdings plc’s (“Arm”) plans, beliefs, expectations and current views with respect to, among other things, future events and financial performance. These statements involve known and unknown risks, unce
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to disclosing results determined in accordance with generally accepted accounting principles, or GAAP, Arm utilizes, and this presentation includes, certain non-GAAP financial measures that differ from measures calculated in accordance with GAAP. Arm’s non-GAA
Slide 4: Q4 FYE25: Highlights
Q4 FYE25: Highlights Operating Highlights Innovation Highlights +310bn Arm-based chips shipped $1,241m Cumulative number of Arm-based chips since 1990. Our volume has created a base for the largest Total revenue up 34% YoY ecosystem in the semiconductor industry. AI on Arm is going everywhere $566m
Slide 5: Royalty Growth from Rising Complexity, Volume Expansion
Royalty Growth from Rising Complexity, Volume Expansion More Complexity More Chips More Arm Per Chip • More advanced workloads need • Semiconductor industry revenue is • The concept of AI everywhere is Arm’s latest Armv9 architecture forecasted to grow at a CAGR of increasing demand for Arm’s highly
Slide 6: AI on Arm: Energy Efficiency from the Data Center to the Edge
AI on Arm: Energy Efficiency from the Data Center to the Edge IoT & Mobile Cloud Compute Automotive Embedded Generative AI Optimized Autonomous Smart for AI Driving Home AI for all applications © 2025 Arm 6
Slide 7: Unparalleled Software Ecosystem
Unparalleled Software Ecosystem 22M+ 10M+ Developers on Arm, Developer hours for Arm 1st decade of Armv8 1.5Bn 30M+ Ecosystem hours Developer hours 1st decade of Armv9 © 2025 Arm 7
Slide 8: Q4 FYE25: Record licensing and royalty revenues
Q4 FYE25: Record licensing and royalty revenues • Total revenue: $1,241m up 34% YoY • Royalty revenue: $607m up 18% YoY driven primarily by the continued adoption of the Armv9 architecture, the ramp of chips based on Arm CSS, and increased usage of Arm-based chips in data centers • License and other
Slide 9: Armv9 adoption driving royalty growth
Armv9 adoption driving royalty growth Royalty Revenue by Architecture 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% FYE16 FYE17 FYE18 FYE19 FYE20 FYE21 FYE22 FYE23 FYE24 Q1 FYE25* Q2 FYE25* Q3 FYE25* Q4 FYE25* Armv7 & older Armv8 Armv9 • Armv9 commands a higher royalty per chip than prior architecture
Slide 10: Diversification in multiple long-term growth markets
Diversification in multiple long-term growth markets Royalties by End Market - FYE16 Royalties by End Market - FYE24 IoT / Embedded 20% Other Smartphone AP 40% Automotive 8% Mobile Cloud and networking 10% Consumer electronics 15% Other mobile 7% • Arm is increasing revenue beyond mobile through a b
Slide 11: Royalty: Gaining Share in a Massive Market
Royalty: Gaining Share in a Massive Market Market Share1 Market Value1 FYE22 to FYE24 FYE22 to FYE24 MOBILE APPLICATIONS >99% >99% $30bn $33bn OTHER Client MOBILE 64% 67% $16bn $16bn CONSUMER ELECTRONICS 24% 30% $65bn $50bn CLOUD Auto Infrastructure COMPUTE 9% 15% $16bn $21bn NETWORKING EQUIPMENT 23
Slide 12: Compute Subsystems: A better starting point for chip design
Compute Subsystems: A better starting point for chip design Rising design and manufacturing complexity is lifting cost, time-to-market and risk CSS helps partners solve cost and CSS adopted across Growing ecosystem time-to-market challenges many end markets accelerates deployment • Longer manufactur
Slide 13: Q4 FYE25: From Revenues to Profits
Q4 FYE25: From Revenues to Profits 98% 53% Non-GAAP Non-GAAP Gross Margin Operating $1,241m $1,241m $20m $1,221m $1,221m $566m Margin License Revenue $634m $655m $584m Royalty Revenue $607m Revenue Non-GAAP Non-GAAP Non-GAAP Non-GAAP Non-GAAP Net COS Gross Profit Operating Expenses Operating Income
Slide 14: Near-Term Guidance
Near-Term Guidance Q1 FYE26 Revenue ($m) $1,000m - $1,100m Non-GAAP Operating Expense ($m)1 ~$625m Non-GAAP fully diluted earnings per share ($)1 $0.30 - $0.38 (1) For more information and definitions of the non-GAAP measures see the “Key Financial and Operating Metrics” section of our most recent S
Slide 15: Arm is Building the Future of Computing
Arm is Building the Future of Computing Arm is the world’s most pervasive CPU architecture 310+ Billion Arm-based chips shipped since inception Everything today is a computer – CPUs needed everywhere 30.6 Billion Arm-based chips reported as shipped in FYE25 Ongoing innovation to support of customer
Slide 16: Appendix
Appendix © 2025 Arm 16
Slide 17: Q4 FYE25: Annualized Contract Value
Q4 FYE25: Annualized Contract Value • Annualized contract value, a metric for normalized license and other revenue, increased 15% YoY in Q4 $1,365m $1,253m $1,270m $634m $1,182m $1,193m $1,160m $1,108m $1,080m $1,052m $1,030m $1,048m $1,009m $472m $414m $403m $388m $354m $330m $299m $275m $258m $259
Slide 18: Q4 FYE25: Remaining Performance Obligations (RPO)
Q4 FYE25: Remaining Performance Obligations (RPO) • Remaining performance obligations (RPO), a metric for unearned revenue and amounts to be invoiced and recognized in future periods, was down 4% QoQ $2,433m $2,484m $2,414m $2,385m $2,325m $2,226m $2,168m $634m $1,773m $1,751m $1,758m $1,712m $1,681
Slide 19: Q4 FYE25: Non-Financial Metrics
Q4 FYE25: Non-Financial Metrics Arm Flexible Access Arm Total Access • Arm Total Access (ATA) at 44 extant licenses, up 4 QoQ and 13 YoY 44 314 • Target market for these licenses include smartphones, AI accelerators, automotive applications, data centers and 31 embedded computing 222 203 • ATA licen
Slide 20: Royalty Revenue: Arm is Gaining Share
Royalty Revenue: Arm is Gaining Share Market Share by Chip Value Arm x86 Other $250bln 12% $200bln 13% 15% 14% 9% 39% $150bln 45% 41% 40% 53% $100bln 49% $50bln 42% 44% 46% 38% $0bln FYE21 FYE22 FYE23 FYE24 FYE25 Notes: Based on Arm internal estimates. Other includes legacy and niche architectures s
Slide 21: Royalty Revenue Provides a Platform for Long-Term Growth
Royalty Revenue Provides a Platform for Long-Term Growth • Royalty revenue can continue for many years or decades Royalty revenue from Arm products launched during Fiscal Year Ending $2,000m $1,800m $1,600m Still collecting $1,400m royalties on $1,200m products $1,000m developed in the $800m early 1
Slide 22: Reconciliations: GAAP to Non-GAAP and Adjustments
Reconciliations: GAAP to Non-GAAP and Adjustments Includes retrospective change to Non-GAAP reporting Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions, except per share amounts) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23
Slide 23: Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d
Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions, except per share amounts) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 GAAP to Non-GAAP Reconciliation (
Slide 24: Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d
Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions, except per share amounts) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 GAAP to Non-GAAP Reconciliation (
Slide 25: Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d
Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions, except per share amounts) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 GAAP to Non-GAAP Reconciliation (
Slide 26: Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d
Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions, except per share amounts) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 GAAP to Non-GAAP Reconciliation (
Slide 27: Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d
Reconciliations: GAAP to Non-GAAP and Adjustments…cont’d Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 1 This should be read in conjunction with the Shareholder Letter for the fourth quarter and the fiscal year ended M
Slide 28: Cash Flow Statement
Cash Flow Statement Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 Condensed Cash Flow Statement (Unaudited for the quarterly periods presented) (2) Cash flows pro
Slide 29: Cash Flow Statement
Cash Flow Statement Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 Condensed Cash Flow Statement (Unaudited for the quarterly periods presented) (2) Cash flows pro
Slide 30: Reconciliation: Net cash provided by operating activities to Non-GAAP Free Cash Flow
Reconciliation: Net cash provided by (used for) operating activities to Non-GAAP Free Cash Flow Arm Holdings plc Published on May 7, 2025 Q4 Q1 Q2 Q3 Q4 FY FY FY 31-Mar 30-Jun 30-Sep 31-Dec 31-Mar 31-Mar 31-Mar 31-Mar (in millions) FYE24 FYE25 FYE25 FYE25 FYE25 FYE23 FYE24 FYE25 Free Cash Flow (Unau