Beth Kindig is the CEO and Lead Tech Analyst for the I/O Fund and delivers weekly in-depth tech stock analysis to her free newsletter subscribers. Sign up here to receive free weekly stock tips. I/O Fund has a cumulative 3-year audited return of 47%, beating Ark and the majority of Wall Street funds over four audit periods in 2020, 2021 and 2022.
Arm Holdings is positioned to capitalize on the growing adoption of artificial intelligence technologies, leveraging its established licensing model and extensive ecosystem to drive future growth. Arm's established licensing model offers a recurring and relatively stable income source, and the stock is seeing favorable price action due to the growing tailwinds from its higher-royalty v9 design supporting next-generation AI chips from Nvidia, Microsoft, Amazon and others.
The rapid growth in v9 adoption and its higher royalty rates have already contributed to a significant increase in Arm's royalty revenue. v9 constituted 10% of royalty revenue in the September quarter and accelerated to 15% in the recent quarter.. As adoption continues to rise, the v9 architecture is expected to be awas $203 billion in 2022 and is expected to grow at a compound annual growth rate of 6.8% to $247 billion in CY2025.
License and other revenue grew 18% YoY to $354 million. The company has seen strong growth in license revenue as they are signing long-term and high value agreements with its customers due to demand for Arm’s advanced CPUs to run AI workloads. The trend was strongest in the Sept quarter as license revenue grew by 106%.
we expect to sign multiple new ATA deals in Q4, and demand for our latest technology remains high as customers need access to AI-capable CPUs and related technology such as our Compute Subsystems.” Management increased its revenue guidance for the next quarter by $95 million to a range of $850 million to $900 million, representing YoY growth of 38.2% at the midpoint. This strong upward revision was due to the points discussed earlier, including the rebound in royalty revenue and the higher revenue opportunity from AI. Analysts expect revenue to grow 37.4% YoY to $869.88 million in the next quarter and 27.9% in the June quarter.FY2023 revenue ending March declined by YoY to $2.679 billion.
will depend on a number of factors, including the share price, but is currently expected to be between $150 million to $200 million per quarter.”Adjusted operating margin was 43.8% compared to 39.9% in the same period last year and 47.6% in the Sept quarter.Net margin was 10.6% compared to 25.1% in the same period last year and in the Sept quarter. The adjusted net margin was 39.3% compared to 31.1% in the same period last year and 46.9% in the Sept quarter.
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