Core Viewpoint - Arm Holdings has experienced a revenue boost due to increased demand for artificial intelligence (AI), although its stock has lost about a third of its value over the past year and faces potential risks in the smartphone segment [1] Group 1: AI and Revenue Growth - Arm's data center business is expected to become its largest segment, aiming for a 50% market share among top hyperscalers, driven by the shift towards AI and inference [2] - Fiscal third-quarter revenue increased by 26% year over year to $1.24 billion, with license revenue rising by 25% to $505 million, partly due to an agreement with Softbank contributing $200 million [4] - Royalty revenue grew by 27% year over year to $737 million, driven by the adoption of newer ARM technologies, including Armv9 architecture and Arm CSS [5] Group 2: Smartphone Risks and Future Guidance - Increasing memory supply constraints may lead to a potential 15% reduction in smartphone sales volumes, but even a 20% reduction would only impact smartphone royalties by 2% to 4% [3] - Annualized contract value (ACV) surged by 28% to $1.62 billion, with guidance for fiscal fourth-quarter revenue projected at around $1.47 billion, representing an 18% year-over-year growth [6] - Royalty growth is expected to be in the low teens, while licensing growth is projected in the high teens, with adjusted earnings per share forecasted between $0.54 and $0.62 [6]