Arm Holdings (ARM): AI Infrastructure and CPU Demand Drive Upbeat Outlook

Arm Holdings (ARM): AI Infrastructure and CPU Demand Drive Upbeat Outlook

Thu, September 10, 2026 at 3:03 PM GMT+3 3 min read

• ARM +1.03%

American Century Investments, an investment management company, released its second-quarter 2026 investor letter for the "American Century Investments Focused Dynamic Growth Fund". The letter can be downloaded here. U.S. stocks advanced sharply with double-digit quarterly gains largely due to robust earnings, resilient economic data, and momentum in AI-related stocks. However, there was a slight pullback in June as momentum waned and investors anticipated potential interest rate hikes by the Federal Reserve. Growth and AI stocks outperformed value stocks, while large-cap companies generally surpassed small- and mid-cap stocks. Underperformance was noted in healthcare and communication services, while industrials, particularly in aerospace and defense, contributed positively to performance. The fund's investor class returned 16.38%, slightly below the Russell 1000 Growth Index's 16.74%. The investment approach focuses on bottom-up financial analysis to identify large-cap companies with long-term earnings growth potential, while aiming to mitigate non-financial risks. Please review the Fund's top five holdings to gain insights into its key selections for 2026.

In its second-quarter 2026 investor letter, American Century Investments Focused Dynamic Growth Fund highlighted Arm Holdings plc (NASDAQ:ARM). Arm Holdings plc (NASDAQ:ARM), a UK-based technology company that develops and licenses central processing unit designs and related technologies for semiconductor companies and original equipment manufacturers, contributed to the Fund's performance this quarter. On September 09, 2026, Arm Holdings plc (NASDAQ:ARM) closed at $264.23 per share. Over the past month, Arm Holdings plc (NASDAQ:ARM) declined 5.17%, and its shares gained 70.80% over the past 52 weeks. Arm Holdings plc (NASDAQ:ARM) has a market capitalization of $282.2 billion.

American Century Investments Focused Dynamic Growth Fund stated the following regarding Arm Holdings plc (NASDAQ:ARM) in its Q2 2026 investor letter:

"Arm Holdings plc (NASDAQ:ARM). The semiconductor design firm contributed as shares rose as stronger artificial intelligence (AI)-driven data center and CPU demand supported an upbeat revenue outlook. Investor confidence improved as ARM's energy-efficient chip designs gained traction in AI infrastructure, server and CPU applications."

Arm Holdings plc (NASDAQ:ARM) is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 52 hedge fund portfolios held Arm Holdings plc (NASDAQ:ARM) at the end of the second quarter which was 46 in the previous quarter. While we acknowledge the potential of Arm Holdings plc (NASDAQ:ARM) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we highlighted Sands Capital Global Growth Fund's addition of Arm Holdings plc (NASDAQ:ARM) to its portfolio during the quarter, as it is positioned to benefit from rising central processing unit (CPU) demand driven by agentic AI. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.

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This article is originally published at Insider Monkey.