What's Going On With Arm Stock On Friday? - ARM Holdings (NASDAQ:ARM)

ARM Holdings Plc (NASDAQ:ARM) shares are trading higher after Morgan Stanley analyst Lee Simpson upgraded the stock from Equal-Weight to Overweight and raised its price target from $107 to $190.

The upgrade comes as the broader semiconductor sector has seen a selloff this week following Donald Trump’s verbal attack against contract chipmaker Taiwan Semiconductor Manufacturing Co (NYSE:TSM) and the U.S.’s plans to intensify advanced semiconductor sanctions against China.

AI chip stocks led by Nvidia Corp (NASDAQ:NVDA), Advanced Micro Devices, Inc (NASDAQ:AMD) lost 9% and 18% this week.

At the Computex forum in Taipei, Arm CEO Rene Haas said he expects 100 billion Arm devices worldwide to be AI-ready by the end of 2025.

Arm Holdings plans to showcase its AI chip in 2025 and launch it commercially by fall 2025. Parent company Softbank Group Corp (OTC:SFTBF) (OTC:SFTBY) aims to invest significantly in data centers using its AI chips and renewable energy.

AMD CFO Jean Hu recently suggested a potential entry into next-generation AI PCs.

Analysts remain optimistic about Arm Holdings, citing strong licensing interest and royalty potential as essential growth factors. They also highlight Arm’s opportunities in the AI and data center sectors.

Arm Holdings stock rose by 158% over the past 12 months as AI integrated into smartphones. The ARM (Acorn RISC Machine) architecture powers 99% of the world’s smartphone CPU cores. Apple, Inc (NASDAQ:AAPL) is one of Arm’s major customers.

Arm’s clients choose the company over Intel Corp’s (NASDAQ:INTC) x86 technology primarily for its efficiency and widespread adoption. Arm’s architecture enables chips to consume less power compared to x86, making it ideal for mobile devices and other power-sensitive applications, CNBC reported in 2023.

Key clients like Apple, Amazon.Com Inc (NASDAQ:AMZN), Alphabet Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) Google, Microsoft Corp (NASDAQ:MSFT), Nvidia Corp (NASDAQ:NVDA), and Qualcomm Inc (NASDAQ:QCOM) leverage Arm’s technology to build custom silicon tailored to their specific needs.