A British chip-design company whose processor blueprints power most of the world's smartphones, tablets, and other electronics — companies like Apple, Qualcomm, and Samsung license its designs rather than buy chips from it. ARM was born in Cambridge in the 1980s, when engineers at the computer maker Acorn designed their own processor after finding nothing suitable on the market; the chip was named the Acorn RISC Machine. The name later became "Advanced RISC Machines" when the technology was spun off in 1990 with help from Apple, and the original design was reportedly created by two engineers in a single weekend.
20-F · Fiscal year ended Mar 31, 2026 · SEC filing ↗
Arm expanded into production silicon with the Arm AGI CPU, adding a new business dimension alongside 23% revenue growth to $4.9 billion.
Arm became a chipmaker. rose 23% to $4.9 billion and reached $904 million, as from chip shipments grew 21% and the company sold its Artisan foundation IP business for a $131 million pre-tax gain. The move into production silicon with the Arm AGI CPU opens a new growth path but puts the company in direct competition with its own licensees.
Key takeaways
, the primary indicator of end-market chip demand, rose 21% to $2.6 billion, with mobile applications processors contributing 43% of that total.
License and other rose 25% to $2.3 billion, driven by new agreements and renewals for higher-value compute subsystems and AI-focused designs.
from related parties, primarily Arm China, rose 82% to $1.5 billion, with license and other revenue from that entity up 141%.
Research and development expenses rose 34% to $2.8 billion, as the company invested in next-generation products including the Arm AGI CPU and grew headcount.
rose to $900 million from $831 million, while increased to $904 million, aided by a $131 million pre-tax gain on the sale of the Artisan foundation IP business to Cadence.
more than doubled to $1.5 billion, and the company held $2.8 billion in cash and equivalents with $850 million in short-term investments at year-end.
What changed
The Q4 run-up flagged in FY2025 continued: full-year royalty revenue rose 21% to $2.6 billion, and total reached $4.9 billion, up from $4.0 billion the year before.
The Qualcomm and Nuvia litigation flagged in FY2025 remains unresolved and is now cited as a risk that could disrupt a major customer relationship and require significant management attention and legal costs.
The in internal control over financial reporting flagged in FY2025 remains unresolved after three years.
What to watch
Whether the Arm AGI CPU generates material or triggers customer defections, as existing licensees may view Arm as a direct competitor.
The outcome of the Qualcomm and Nuvia litigation, which could disrupt a major customer relationship and impose significant legal costs.
Whether the 34% increase in R&D spending translates into growth that sustains or improves the 18% .
Section summaries
Quantitative and Qualitative Disclosures About Market Risk
Market risk arises from foreign exchange, interest rates, and equity investments, with sensitivity disclosed for each.
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A hypothetical 1% interest rate shift would impact operating results by approximately $25 million for the fiscal year.
A 10% weakening of the U.S. dollar could increase operating expenses by as much as 6%, partially mitigated by .
Translational currency exposure to GBP, EUR, and CNY could affect other non- by $5M, $4M, and $7M respectively on a 10% rate move.
The Ampere investment that produced a $246 million fair-value loss in FY2025 is no longer called out as a material driver of results; other non- in FY2026 included a $131 million gain on the Artisan IP sale instead.
The company reorganized into three AI-focused domains — Edge AI, Physical AI, and Cloud AI — and expanded from IP licensing into production silicon with the Arm AGI CPU, a structural shift from the pure-licensing model described in prior filings.
Progress on remediating the in internal control over financial reporting, now unresolved for three years.
Equity price risk stems from a $387 million portfolio of marketable and non-marketable securities, with privately-held investments carrying higher inherent risk.
The company uses to hedge a portion of its foreign exchange exposure on operating expenses.
Arm's shift into production silicon (e.g., Arm AGI CPU) introduces new competitive, supply-chain, and execution risks alongside traditional IP licensing concentration and geopolitical exposures.
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Developing and selling production silicon like the Arm AGI CPU exposes Arm to new manufacturing, , and supply-chain risks not present in its IP licensing model, including dependence on third-party foundries.
This product shift creates potential competitive conflicts with existing licensing customers, who may view Arm as a direct competitor and reduce or terminate their relationships.
Arm's remains highly concentrated, with its top five customers accounting for 57% of total revenue in FY2026 and the PRC market representing 18%, creating significant customer and geopolitical risk.
Intense competition from established architectures like x86 and open-source RISC-V, including a customer-led RISC-V joint venture, threatens Arm's market share and pricing power.
Arm's reliance on the independently operated Arm China for PRC market access poses operational, financial, and IP protection risks, compounded by ongoing litigation involving Arm China's former CEO.
Pending litigation with Qualcomm and Nuvia, a major customer, creates uncertainty around a key commercial relationship and could require significant management attention and legal costs.
Arm is a global semiconductor IP and silicon leader, expanding from CPU/GPU licensing into production chips with the Arm AGI CPU.
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Arm licenses CPU, GPU, NPU, system IP, and compute subsystems (CSS) and, as of March 2026, has expanded into production silicon with the Arm AGI CPU.
The company reorganized into three AI-focused domains: Edge AI (smartphones, IoT), Physical AI (automotive, robotics), and Cloud AI (data center, networking).
Arm's business model generates license fees for IP access and per-unit royalties on substantially all chips shipped, with mobile applications processors contributing 43% of total in FY2026.
Arm holds over 99% market share in mobile applications processors and has cumulatively shipped more than 350 billion Arm-based chips, supported by over 22 million developers.
The company faces competition from x86 and RISC-V architectures, and some customers are developing in-house architectures or may compete directly as Arm enters silicon production.
Arm China operates as the exclusive IP distributor in the PRC under an IPLA running through 2048, accounting for 16% of total in FY2026.
Total revenue rose 23% to $4.9B in FY2026, driven by 25% higher license revenue and 21% higher royalty revenue, while R&D spending surged 34%.
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Total increased 23% to $4,920 million, with license and other revenue up 25% to $2,307 million and royalty revenue up 21% to $2,613 million.
from related parties (primarily Arm China) jumped 82% to $1,499 million, driven by a 141% increase in license and other revenue.
Research and development expenses grew 34% to $2,776 million, primarily due to investments in next-generation products like the Arm AGI CPU and headcount growth.
rose to $900 million (18% of ) from $831 million, while increased to $904 million from $792 million.
Other non- included a $131 million pre-tax gain on the sale of the Artisan foundation IP business to Cadence.
more than doubled to $1,524 million, and the company held $2,751 million in cash and equivalents with $850 million in short-term investments at year-end.