ARM vs QCOM: ARM Holdings vs Qualcomm — Which Chip Architecture Stock Wins?: AI Score, Valuation, Performance and Upside
ARM and Qualcomm are deeply interrelated businesses — Qualcomm designs chips on ARM's architecture and pays ARM royalties. ARM is the licensing layer beneath most silicon; Qualcomm is a chip designer that sits on top of ARM's architecture. ARM offers pure royalty model exposure; Qualcomm is a chip design company with licensing income and direct silicon competition.
Use this ARM vs QCOM comparison to choose between the chip architecture licensor and one of its biggest customers turned chip designer. ARM offers a pure royalty rate expansion story; Qualcomm offers a valuation discount with automotive growth optionality and strong near-term on-device AI differentiation.
QCOM holds the edge across 4 of 5 key metrics in this comparison. ARM has delivered stronger 1-year price return (+84.59% vs +5.65%), though QCOM has the better forward P/E setup (16.09x vs 82.36x for ARM). On fundamentals, ARM is growing revenue faster (22.40%), while QCOM maintains the higher operating margin (18.53%) — a classic growth-versus-profitability split. Analyst consensus implies meaningfully more upside for QCOM (+17.61%) than for ARM (+14.39%).
Human Wall Street analysts' price targets, typically implying a ~12-month view — a separate signal from this site's own AI Prediction Signal further down the page, which is a 5-/30-day machine-learning forecast based on price history alone.
- Want exposure to the ubiquitous chip architecture royalty stream as ARMv9 adoption compounds
- Believe data center CPU migration to ARM architecture represents a major long-term royalty expansion
- Are comfortable paying a very high multiple for what may be the most important semiconductor IP platform
- See AI chip licensing as an emerging revenue layer as AI accelerators increasingly use ARM cores
- Want exposure to premium mobile and PC chip design with a high-margin licensing business
- Believe automotive chip revenue will become a significant growth driver over the next 3–5 years
- See on-device AI via Snapdragon as a differentiation point driving premium Android share
- Prefer a more moderate valuation relative to ARM while still participating in mobile and AI chip themes
| Metric | ARM | QCOM |
|---|---|---|
| AI scorei | 42.4 | 49.8 |
| AI ranki | #858 | #470 |
| Latest closei | $242.59 | $168.74 |
| 1M returni | -13.53% | +7.12% |
| 6M returni | +95.46% | +24.36% |
| 1Y returni | +84.59% | +5.65% |
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | ARM | QCOM |
|---|---|---|
| 1Y ago | $18.46K (+84.6%) started 2025-09-03 | $10.56K (+5.6%) started 2025-09-05 |
| 5Y ago | $38.15K (+281.5%) started 2023-09-14 | $13.71K (+37.1%) started 2021-09-07 |
| 10Y ago | $38.15K (+281.5%) started 2023-09-14 | $44.25K (+342.5%) started 2016-09-06 |
Hypothetical — past performance does not guarantee future results.
| Metric | ARM | QCOM |
|---|---|---|
| Market capi | $269.23B | $175.36B |
| Trailing P/Ei | 259.89 | 18.76 |
| Forward P/Ei | 82.36 | 16.09 |
| Price/Salesi | 52.22 | 3.88 |
| EV/Revenuei | 51.56 | 4.07 |
| Analyst targeti | $288.36 | $193.10 |
| Target upsidei | +14.39% | +17.61% |
| Metric | ARM | QCOM |
|---|---|---|
| Revenue growthi | 22.40% | -4.00% |
| Earnings growthi | 108.30% | -23.00% |
| EPS growthi | +108.30% | -23.00% |
| FCF margini | +25.88% | +23.24% |
| Operating margini | 7.60% | 18.53% |
| Profit margini | 20.25% | 21.01% |
| ROIC proxyi | 13.35% | 33.75% |
| Return on equityi | 13.35% | 33.75% |
| Dividend yieldi | 0.00% | 2.23% |
| Betai | 3.89 | 1.66 |
| Debt/equityi | 5.62 | 55.21 |
| Current ratioi | 5.25 | 2.02 |
| Quick ratioi | 5.06 | 1.14 |
Over the past year, ARM and QCOM have moved moderately in the same direction (correlation of 0.46), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | ARM | QCOM |
|---|---|---|---|
| 1Y | Growthi | +84.59% | +5.57% |
| CAGRi | +84.67% | +5.58% | |
| Volatilityi | 76.04% | 52.49% | |
| Sharpe ratioi | 1.12 | 0.28 | |
| Sortino ratioi | 1.88 | 0.42 | |
| Max drawdowni | 48.83% | 41.20% | |
| Current drawdowni | 44.80% | 32.78% | |
| Avg drawdowni | 21.60% | 17.27% | |
| Ulcer Indexi | 26.25% | 21.14% | |
| Max daily dropi | 12.84% | 11.46% | |
| Max wkly dropi | 25.35% | 23.52% | |
| 5Y | Growthi | +281.49% | +26.71% |
| CAGRi | +56.95% | +4.86% | |
| Volatilityi | 76.67% | 42.25% | |
| Sharpe ratioi | 0.90 | 0.22 | |
| Sortino ratioi | 1.50 | 0.31 | |
| Max drawdowni | 53.97% | 44.50% | |
| Current drawdowni | 44.80% | 32.78% | |
| Avg drawdowni | 22.26% | 25.43% | |
| Ulcer Indexi | 25.42% | 27.95% | |
| Max daily dropi | 19.46% | 11.46% | |
| Max wkly dropi | 30.98% | 23.52% | |
| 10Y | Growthi | +281.49% | +239.20% |
| CAGRi | +56.95% | +13.00% | |
| Volatilityi | 76.67% | 39.78% | |
| Sharpe ratioi | 0.90 | 0.39 | |
| Sortino ratioi | 1.50 | 0.58 | |
| Max drawdowni | 53.97% | 44.50% | |
| Current drawdowni | 44.80% | 32.78% | |
| Avg drawdowni | 22.26% | 19.30% | |
| Ulcer Indexi | 25.42% | 22.68% | |
| Max daily dropi | 19.46% | 14.95% | |
| Max wkly dropi | 30.98% | 23.52% |
| Category | ARM | QCOM |
|---|---|---|
| Company | Arm Holdings plc | Qualcomm Incorporated |
| Sector | Technology | Technology |
| Industry | Semiconductors | Semiconductors |
| Core business | Designer and licensor of CPU architecture and instruction sets used in virtually all smartphones, most embedded devices, and a growing share of data center and AI chips. Revenue comes from licensing and per-chip royalties. | Designer of Snapdragon mobile and PC application processors (using ARM architecture), 5G modems, and automotive chips. Also licenses its 5G and CDMA patents via a large, high-margin licensing segment (QTL). |
| Investor focus | Royalty revenue per chip as ARM v9 adoption expands, data center CPU licensing traction (AWS Graviton, Microsoft Cobalt, NVIDIA Grace), AI chip architecture licensing, and royalty rate growth over time. | Snapdragon 8 Elite performance and market share in Android premium devices, automotive design win ramp, on-device AI capabilities, licensing segment renewal risk, and diversification beyond Apple modem dependence. |
- ARM architecture is in virtually every smartphone ever made — near-monopoly in mobile CPU instruction sets
- Transition from ARMv8 to ARMv9 doubles royalty rates, providing structural revenue tailwind
- Data center CPU adoption accelerating with AWS, Microsoft, Google, and NVIDIA all building ARM-based chips
- Snapdragon is the premium Android application processor brand with strong market position in high-end devices
- Automotive chip design wins represent a multi-year revenue ramp as software-defined vehicles proliferate
- QTL licensing segment generates extremely high margins and provides stable baseline earnings
- Extreme valuation — ARM trades at one of the highest revenue multiples in the sector
- Licensing revenue is heavily concentrated in mobile, creating slowdown risk if smartphone markets are weak
- RISC-V open-source architecture is a long-term competitive threat, though currently limited
- Apple modem business at risk as Apple develops its own in-house 5G modem
- Smartphone market cyclicality creates revenue volatility
- Licensing agreements with major Android OEMs periodically come up for renegotiation
Want deeper AI forecasts?
This comparison page is public and free forever. Subscribers can unlock saved watchlists, full AI rankings, detailed forecasts, and interactive analysis tools.
Full valuation workup with AI Score, Monte Carlo forecast, and bull/bear case — free preview, premium data from $3.99.