ARMNEUTRAL

Gross Margin

93.1%

Higher than 100% of Technology sector peers

Updated 1078h ago

Sector Performance

100th percentile

ARM

93.1%

Sector Median

65.2%

Sector Avg

60.6%

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Deep Analysis

Arm's current gross margin of 93.1% means that for every dollar of revenue, the company retains 93.1 cents after paying the direct costs of producing its products, leaving only 6.9 cents for other expenses.

This figure far exceeds the sector median of 62.2% and places Arm in the 99th percentile among its technology peers, indicating exceptionally high profitability relative to direct costs. However, the metric shows no trend data because both the year-over-year and quarter-over-quarter changes are reported as N/A, so no directional insight is available. The combination of an extremely high gross margin level with no trend information suggests a stable profit base but offers no clue about momentum, limiting the ability to assess near-term improvement or deterioration. This metric supports the overall NEUTRAL verdict because, while the margin strength is a clear positive, the absence of trend data and other factors in the broader analysis prevent a more bullish stance.

Frequently Asked Questions

What does the Gross Margin tell investors about ARM?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does ARM's Gross Margin compare to its sector?

ARM's Gross Margin of 93.1% compares to a Technology sector median of 65.2%, placing it in the 100th percentile.

Who are ARM's closest peers by Gross Margin?

The closest Technology peers by Gross Margin include: LYFT (47.6%), COHU (46.3%), UBER (45.0%), LSPD (44.4%), GRAB (43.4%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.