Jefferies just slapped a $290 price target on Arm Holdings, up from $210, while maintaining its Buy rating. That is a 38% bump in the target price, and it reflects a growing Wall Street consensus that Arm’s chip designs are becoming the backbone of AI-era data centers.
Analyst Janardan Menon pointed to robust demand for Arm’s AI-centric CPU roadmap as the primary catalyst. The thesis is straightforward: as hyperscalers race to build out AI infrastructure, they are increasingly turning to Arm-based processors, and that shift is poised to send the company’s licensing and royalty revenue meaningfully higher.
The Vera factor and the AGI CPU roadmap
At the center of the bull case is Arm’s next-generation architecture. Jefferies specifically highlighted what it calls the “AGI CPU” as a key growth driver, with strong demand expected in fiscal years 2027 and 2028.
The firm projects approximately 20% growth in royalties and licensing revenue during that period. For a company whose entire business model revolves around collecting fees every time someone uses its chip designs, that kind of acceleration matters.
