Arm Beats Earnings Expectations, Launches AGI CPU in AI Data-Center Push

Arm Holdings earns most of its revenue by licensing CPU technology and collecting royalties on chips built with its designs. Its power-efficient architecture is increasingly used beyond smartphones as Amazon, Google and Microsoft develop custom processors for cloud and AI infrastructure. That shift, alongside Arm’s move into purpose-built silicon with its AGI CPU, gives the company a larger role in data centers as generative AI drives demand for more computing capacity.

Arm said on July 29, 2026, that revenue for its fiscal first quarter ended June 30 rose 22% to $1.29 billion, while adjusted earnings reached $0.45 a share, beating market estimates. Royalty revenue climbed 22% to $715 million and license and other revenue increased 23% to $574 million. The company projected second-quarter revenue of $1.33 billion to $1.43 billion and adjusted earnings of $0.43 to $0.51 a share, with the midpoints above Wall Street expectations.

Arm’s architecture has long dominated mobile devices and has in recent years expanded into a data-center market controlled by Intel and AMD. Plans to supply Arm’s new AGI CPU in China would give local companies a high-performance, energy-efficient option for AI computing. The move also highlights the importance of chip design and cross-border compliance under U.S. export controls.

The latest report said Arm has sold the AGI CPU to Chinese data centers in compliance with current export rules because the processor is not covered by existing restrictions. However, available information does not disclose the date of the first shipments, customer names, contract value, shipment volumes or performance data. The scale of adoption and its impact on China’s AI computing capacity remain to be confirmed.