ARM HoldingsARM -3.15%62 Net Margin % is 21.01% as of Mar. 2026, which is 9% above its 10-year median of 19.35. GuruFocus rates ARM with a GF Score™ of 62/100 and a GF Value™ of $177.63 (Significantly Overvalued). The stock has 1 warning sign investors should review. Among 1,023 Semiconductors companies, ARM Holdings ranks better than 82.99% on this metric.
Net margin is calculated as Net Income divided by its Revenue. ARM Holdings's Net Income for the
three
months ended in Mar. 2026 was $313 Mil. ARM Holdings's Revenue for the
three
months ended in Mar. 2026 was $1,490 Mil. Therefore, ARM Holdings's net margin for the quarter that ended in Mar. 2026 was 21.01%.
The historical rank and industry rank for ARM Holdings's Net Margin % or its related term are showing as below:
ARM'
s Net Margin % Range Over the Past 10 Years
Min: 9.46 Med: 19.35 Max: 20.31
Current: 18.37
ARM's Net Margin % is ranked better than 82.99% of 1023
companies
in the Semiconductors industry
Industry Median: 4.17
vs ARM: 18.37
ARM Holdings (NAS:ARM) Net Margin % Explanation
Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.
But the long term trend of the net margin is a good indicator of the competitiveness and health of the business.
ARM Holdings Net Margin % Related Terms
ARM Holdings Net Margin % Historical Data
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The historical data trend for ARM Holdings's Net Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Semiconductors subindustry, ARM Holdings's Net Margin %, along with its competitors' market caps and Net Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
ARM Holdings Net Margin % vs Semiconductors Industry
For the Semiconductors industry and Technology sector, ARM Holdings's Net Margin % distribution charts can be found below:
* The bar in red indicates where ARM Holdings's Net Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
ARM Holdings (ARM) has a Net Margin % of 21.01% as of Mar. 2026. Net margin is the ratio of total net income to net sales. View historical data on ARM Holdings and its competitors. This is near median its historical median of 19.35. Over the past decade, ARM Holdings' Net Margin % has ranged from 9.46 to 20.31. According to the industry distribution chart, ARM Holdings ranks #174 out of 1023 companies in the Semiconductors industry, placing it in the top 17%.
Is ARM Holdings' Net Margin % too high?
ARM Holdings' current Net Margin % of 21.01% is near median its 10-year median of 19.35. Over the past 10 years, this metric has ranged from a low of 9.46 to a high of 20.31. The Semiconductors industry median Net Margin % is 4.17. ARM Holdings' value of 21.01% is 403.8% above this industry median. Based on the distribution chart, ARM Holdings ranks #174 out of 1023 companies in the Semiconductors industry, which is in the top quartile — a strong position relative to peers. Overall, ARM Holdings has a GF Score™ of 62/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does ARM Holdings' Net Margin % compare to TXN and QCOM?
According to the Semiconductors industry distribution chart, ARM Holdings ranks #174 out of 1023 companies for Net Margin %. This places ARM Holdings in the top 17% of its industry — outperforming the majority of peers. The industry median Net Margin % is 4.17. ARM Holdings' value of 21.01% is 403.8% above this benchmark. Historically, ARM Holdings' own Net Margin % has ranged from 9.46 to 20.31 over the past decade. While the company's 10-year median is 19.35 vs. the industry median of 4.17, ARM Holdings has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Net Margin % for a Semiconductors company?
The median Net Margin % among Semiconductors companies is 4.17, based on 1,023 companies in the industry. Companies in the top quartile (top 25%) have a Net Margin % significantly above this median, while those in the bottom quartile fall well below. However, Net Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. ARM Holdings's current Net Margin % of 21.01% is 403.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Net Margin % mean?
A high Net Margin % can signal that a stock is expensive relative to its fundamentals. Net margin is the ratio of total net income to net sales. View historical data on ARM Holdings and its competitors. For the Semiconductors industry, the median Net Margin % is 4.17 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. ARM Holdings's current Net Margin % is 21.01%, which is near median its own 10-year median of 19.35. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is ARM Holdings stock overvalued right now?
Based on GuruFocus' analysis, ARM Holdings (ARM) is currently considered Significantly Overvalued. The stock's GF Value™ is $177.63, compared to a current price of $347.77 — trading 95.8% above its estimated fair value. The current Net Margin % is 21.01%, which is near median its 10-year median of 19.35 and 403.8% above the Semiconductors industry median of 4.17. ARM Holdings' overall GF Score™ is 62/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Net Margin % calculated?
Net Margin % is calculated from a company's financial statements. For ARM Holdings (ARM), the current Net Margin % is 21.01% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is ARM Holdings (ARM) Overvalued in 2026?
Based on GuruFocus' analysis, ARM Holdings stock appears to be overvalued.
The current stock price of $347.77 is trading 95.8% above its estimated GF Value™ of $177.63.
GuruFocus considers ARM Holdings to be Significantly Overvalued.
Key valuation signals for ARM:
Net Margin %: 21.01% (near median its 10-year median of 19.35)
GF Value™: $177.63 vs. price of $347.77 (95.8% above fair value)
Industry Position: 403.8% above the Semiconductors median (#174 of 1023)
No single metric tells the full story. See the ARM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Arm Holdings is the IP owner and developer of the Arm architecture, which is used in 99% of the world's smartphone CPU cores. It also has high market share in other battery-powered devices like wearables, tablets, and sensors. Arm licenses its architecture for a fee, offering different types of licenses depending on the flexibility the customer needs. Customers like Apple or Qualcomm buy architectural licenses, which allow them to modify the architecture and add or delete instructions to tailor the chips to their specific needs. Other clients directly buy off-the-shelf designs from Arm. Both off-the-shelf and architectural customers pay a royalty fee per chip shipped. In 2026, Arm announced the launch of its own CPU products on top of its existing royalty business.
62GF Score
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