Please ensure Javascript is enabled for purposes of website accessibility

Why ARM Holdings Shares Skyrocketed

By Evan Niu, CFA - Apr 23, 2013 at 11:26AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Is this meaningful, or just another movement?

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of British chip designer ARM Holdings (ARMH) have skyrocketed by as much as 11% today after the company reported solid first-quarter earnings.

So what: Revenue in the first quarter totaled $263.9 million, easily topping the Street forecast of $251.1 million. Adjusted earnings per share came in at $0.24, again ahead of the consensus estimate of $0.21. The company said it inked 22 processor licenses in the first quarter across numerous end markets.

Now what: Royalty-bearing chip shipments grew 35% to 2.6 billion units, which was driven largely by mobile and embedded chips. CEO Warren East, who announced last month that he would retire this summer, said that ARM saw record royalty revenue this quarter and there has been strong uptake of its next-generation processors. ARM's guidance for the second quarter calls for revenue to be in-line with the "market expectations."

Interested in more info on ARM Holdings? Add it to your watchlist by clicking here.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

ARM Holdings plc Stock Quote
ARM Holdings plc
ARMH

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
349%
 
S&P 500 Returns
122%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/19/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.