NEW YORK, May 20, 2026, 16:03 (EDT)
- Arm’s ADRs on Nasdaq jumped 15.1% to finish at $256.73, pushing this year’s sharp climb further.
- Bernstein put out a bull call and chips rallied ahead of Nvidia’s results, driving the move.
- Supply bottlenecks and word of a U.S. antitrust investigation are still the main limits on the trade.
Arm Holdings’ U.S.-traded ADRs jumped Wednesday, with buyers snapping up chip names with ties to artificial intelligence infrastructure.
The ADRs finished the session 15.1% higher at $256.73. A slight gain appeared in after-hours trading as of 16:03 EDT, Investing.com data showed.
Semiconductor stocks rallied ahead of Nvidia’s earnings, with the Philadelphia Semiconductor Index up 3.9% and the Nasdaq Composite up 1.35% in afternoon trading. Carol Schleif, chief market strategist at BMO Private Wealth, said, “Technology is driving the bus again today.” The move comes before Nvidia’s quarterly report, seen as the next signal for AI-linked demand in chip stocks. Reuters
Arm shares got a boost from a Bernstein note. Analyst David Dai began coverage with an outperform and a $300 target. He said CPUs are gaining ground as “agentic AI” systems use less human input. Dai called Arm “standout” in server CPUs thanks to power efficiency. He sees the server CPU market reaching $137 billion by 2030. MarketWatch
Arm reported strong numbers for the quarter. CEO Rene Haas said on the call that Arm’s fiscal fourth-quarter revenue hit a record $1.49 billion, a rise of 20%. For the full year, revenue reached $4.92 billion, up 23%. Haas told investors demand for the new AGI CPU has already exceeded $2 billion for fiscal 2027 and 2028 combined. “Customers want Arm at the center of the AI data center,” he said.
Arm’s AGI CPU marks a sharper shift than a standard product launch. The company has mostly earned money from licensing chip designs and collecting royalties. In March, Haas said Arm’s push for its own data-center chip was “a very pivotal moment.” Meta is the main partner, while Taiwan Semiconductor Manufacturing Co is making the chip using its 3-nanometer process. Reuters
Arm sits in a tricky position here. Nvidia is still the key name in the sector and dominates AI hardware. Arm is trying to grow its data-center CPU business, pushing into a market that Intel’s x86 chips have controlled for years in PCs and servers.
Arm shares jumped after a big rethink post-May 6 earnings. At the time, Reuters said Arm gave a first-quarter revenue outlook just above analyst calls, and CEO Haas said he was “very bullish about this data center demand.” But royalty revenue came in below expectations and investors raised concerns about chipmaking costs and supply. Reuters
But the trade still looks risky. Arm says it has room for the first $1 billion in AGI CPU demand but hasn’t locked down supply for the next billion. Michael Ashley Schulman at Cerity Partners called that a “party spoiler.” In a separate development, Reuters said the U.S. Federal Trade Commission is investigating Arm’s licensing, and Arm is also locked in a contract fight with Qualcomm over the Nuvia buy. Reuters
Investors right now are betting that Arm’s energy-saving chip designs could move from phones into the core of AI data centers. Next up, Nvidia’s results will steer the AI trade, but Arm still needs to prove it can convert extra CPU demand into shipments, sales and profit margin.
