At Extreme Investor Network, we always strive to provide our readers with the most valuable and up-to-date information in the world of finance. Today, we are excited to delve into the potential impact of Apple’s latest iPhone 16 lineup on Arm Holdings (NASDAQ: ARM) and why investors should take notice.
Apple recently unveiled its highly anticipated iPhone 16 lineup at a September event, showcasing the new generation of smartphones that will support generative artificial intelligence (AI). With a projected surge in demand for generative AI smartphones, it’s no surprise that Apple is making a strategic move into this emerging market.
Market research firm IDC forecasts a significant year-over-year increase in shipments of generative AI smartphones, with the market expected to grow at an annual rate of 78% through 2028. Wedbush analyst Dan Ives anticipates a solid upgrade cycle for Apple’s iPhones, with shipments projected to increase in the double digits by 2024.
But while Apple stands to benefit from the success of its latest smartphones, Arm Holdings could be an even bigger beneficiary. Apple’s new smartphones, powered by the A18 chip designed using Arm Holdings’ Armv9 architecture, could lead to higher royalties for Arm.
Armv9 architecture commands higher royalties per chip compared to its predecessor, the Armv8. Arm CEO Rene Haas has indicated that royalties from Armv9 could be double that of Armv8, driving significant revenue growth for the company. The adoption of Armv9 has already been a key driver of Arm’s revenue growth, with total revenue increasing 39% year over year in the first quarter of fiscal 2025.
With leading smartphone processor companies like Qualcomm and MediaTek already using Armv9 architecture, Arm Holdings is well positioned to capitalize on the growing demand for generative AI smartphones. Analysts project an acceleration in Arm’s bottom-line growth, with earnings expected to increase at a healthy pace.
Investors looking to benefit from the rise of AI smartphones and the potential impact of Apple’s latest iPhones should consider Arm Holdings as a solid long-term investment. As the demand for Armv9 architecture grows, Arm Holdings could see a boost in revenue and margins, translating into significant earnings growth.
At Extreme Investor Network, we believe that staying informed about market trends and strategic investments is crucial for successful financial growth. Arm Holdings’ potential to capitalize on the booming demand for generative AI smartphones makes it a compelling investment opportunity for those looking to diversify their portfolio and maximize returns.
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