Arm stock pops 6% as CEO Haas issues $15 billion revenue expectation for new chip

Arm Holdings experienced a notable 6% increase in its stock during after-hours trading on Tuesday, following CEO Rene Haas's announcement of expected annual revenue projections for 2031. Haas revealed that these figures anticipate revenue more than six times higher than what the company achieved in 2025. At an event in San Francisco, Haas introduced Arm's first in-house chip, with Meta confirmed as the initial customer. Prior to this event, CNBC had the opportunity to preview the chip during a visit to Arm's specialized lab in Austin, Texas. Interestingly, Arm's stock had dipped approximately 1.5% earlier on Tuesday, despite the chip's unveiling. The CEO forecasted that the new chip could generate around $15 billion in annual revenue by 2031, contributing to a total revenue of $25 billion and an earnings per share of $9. "We may be under-calling that number," Haas stated, expressing confidence that the demand for the chip might surpass current expectations. This projection represents a significant shift for the chip design company, which reported just over $4 billion in revenue in 2025. As the demand for central processing units (CPUs) rises, particularly due to the evolving needs of agentic AI, Haas anticipates a fourfold increase in CPU demand. The Arm AGI CPU is specifically designed for AI inference, marking a long-awaited strategic shift for the company as it enters direct competition with its own customers. Arm's CFO, Jason Child, highlighted that the new chip is being sold with a gross profit margin of about 50%. He noted, "It expands our market to include customers that were not interested in an IP model, gives our current customers choice, and for Arm it creates a much larger profit opportunity," during the event on Tuesday. With this ambitious strategy, Arm Holdings is poised to redefine its role in the chip industry.