Could Armv9 give Arm a boost this year?

Arm (ARM) shares are under pressure despite beating fourth quarter earnings and revenue expectations. The chip design company posted lukewarm full-year revenue guidance as smartphone demand weakens, causing a dip in its shares.

Yahoo Finance hosts Julie Hyman and Josh Lipton break down analyst reactions to the Arm's earnings.

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This post was written by Melanie Riehl

Video transcript

Arm shares under pressure despite beating fourth quarter earnings and revenue expectations.

The chip design company posting kind of lukewarm full year revenue forecast that that does seem to be the issue.

Julie the forecast for that that fiscal year and arm of course, you know, very synonymous with, with smartphones.

We know Co Renne Haas is is kind of pushed them harder to into new markets like data, data center hardware.

Um I know somebody else saying, listen, it it it is though that narrow this on 2025 2025 sales guy just not good investors who had obviously very high expectations rolling into that print.

Yeah, mark low pacs over at ever.

Cora Si who has an outperform rating on the stock.

I I thought he had an interesting perspective on this.

Uh In his note, he said um it's a tough set up.

It was a tough set up coming into this because he said with the stock up more than 40% year to date.

Very much outperforming the S and P 500 year over year revenue is peaking in this first quarter.

The set up into this print was as challenging as any in our coverage universe.

So expectations, you know, the stock had run up, the expectations were relatively high.

He still likes the stock, but he says we could still see some consolidation in the near term in the shares.

I checked it with John then over um John is long time tech analyst.

I I telling his clients here was his take, you know, he he's sticking with his overweight rating in part because he says still opportunities here for outside growth driven by royalty rate expansion from the adoption of RV nine.

And the there he's referring to a new version of the company's technology that carries this higher royalty rate.

Um price target remains 135 for John.