Analysts maintain bullish outlook on ARM after fiscal Q1 earnings beat, citing robust AGI CPU demand despite supply constraints.
ARM shares surged roughly 10% in premarket trading Thursday following fiscal first-quarter results that exceeded expectations. The company’s strong performance was driven by higher average selling prices and initial demand for its AGI CPU business, though supply chain limitations remain a challenge.
Analysts at Jefferies retained a Buy rating and a $320 price target, highlighting confidence in ARM’s revenue outlook. However, concerns persist over slowing royalty growth and capacity constraints, leading to mixed analyst sentiment on long-term prospects.
Supply chain bottlenecks, particularly in wafers and substrates, are restricting ARM’s ability to meet rising demand for AGI CPUs, delaying revenue realization. The company’s guidance and execution will be closely watched amid varying price targets and ratings.