ARM rose more than 4% before the market the day before, but the next day its decline was far worse than the broader market. The same AI narrative, two days and two different valuations.
Micron’s better-than-expected revenue and raised guidance prove that AI hardware spending hasn’t stopped. Semiconductors are collectively buzzing, and ARM rides along.
The following day, both stocks and bond prices fell—common diversification fails. “Higher rates for longer” becomes the new main storyline. At this point, what gets sold isn’t demand; it’s duration.
Meanwhile, the bulls are betting on a different timetable: based on sell-side estimates cited in public discussions, the server CPU spending “money pool” could grow to $211 billion by 2030—from about $35 billion. In dollar terms, ARM could capture nearly half—yet its current unit share is still only in the teens. This is a forecast, not results.
So today, ARM looks more like an asset priced by interest rates than one priced by orders.
One question: if AI capital expenditures really haven’t stopped, why is ARM’s sensitivity to interest rates still higher than its sensitivity to orders?
Micron’s better-than-expected revenue and raised guidance prove that AI hardware spending hasn’t stopped. Semiconductors are collectively buzzing, and ARM rides along.
The following day, both stocks and bond prices fell—common diversification fails. “Higher rates for longer” becomes the new main storyline. At this point, what gets sold isn’t demand; it’s duration.
Meanwhile, the bulls are betting on a different timetable: based on sell-side estimates cited in public discussions, the server CPU spending “money pool” could grow to $211 billion by 2030—from about $35 billion. In dollar terms, ARM could capture nearly half—yet its current unit share is still only in the teens. This is a forecast, not results.
So today, ARM looks more like an asset priced by interest rates than one priced by orders.
One question: if AI capital expenditures really haven’t stopped, why is ARM’s sensitivity to interest rates still higher than its sensitivity to orders?