1 Chip Stock Making Bold Plans

Motley Fool Staff, The Motley Fool Sun, May 17, 2026 at 2:59 AM GMT+7 27 min read DASH INTC AMD SBUX NVDA In this episode of Motley Fool Hidden Gems Investing, Motley Fool contributors Tyler Crowe, Matt Frankel, and Jon Quast discuss: ARM Holdings’ and Advanced Micro Devices’ blowout earnings. ARM’s ambitious new goal to build its own chips. The bottlenecks to bringing on new chip capacity. Mailbag: Why do Starbucks and Domino’s have negative shareholder equity? Mailbag: How will the SaaSpocalypse affect Salesforce and Wix? To catch full episodes of all The Motley Fool s free podcasts, check out our podcast center. When you re ready to invest, check out this top 10 list of stocks to buy. Will AI create the world s first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue » Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this. On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $584,450!* Apple: if you invested $1,000 when we doubled down in 2008, you’d have $57,222!* Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $469,293!* Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon. *Stock Advisor returns as of May 11, 2026 This podcast was recorded on May 7, 2026. Tyler Crowe: We ve got earnings galore on Motley Fool Hidden Gems Investing. Welcome to the Motley Fool Hidden Gems Investing. I m your host, Tyler Crowe, and today I m joined by longtime contributors Jon Quast and Matt Frankel. We re going to do a whole bunch of earnings reactions today because it s been a busy week related to earnings, and, of course, we re going to hit our mailbag at the end of the show. First, as we re going to start, we re going to talk about basically semiconductor earnings because it has been one of the big talking points of the week. Arm Holdings and Advanced Micro Devices, AMD, both reported within the past couple of days, and after both earnings, we saw shares explode as they blasted past earnings expectations, 15, 20% moves in the day. We re going to start Arm Holdings today because shares are quickly retreating after the company mentioned on its call after hours that mobile growth was, well, not really growth, and that rising costs were going to impact commodity mobile device sales. Jon, Matt, you two played rock-paper-scissors to cover the two. Jon, you happened to pick Arm Holdings as a result. What did you see in the earnings release and the conference call and was today s reaction to this, hey, maybe mobile growth isn t great? Was that an appropriate response, do you think, to what you saw? Jon Quast: Tyler, I think the market reaction is appropriate, but not for the reason that you mentioned here, and so I just want to frame this. It is important that you mention the mobile aspect of the business because, if we zoom way out, I don t want to take for granted that all of our listeners know what Arm Holdings is. This is a company that really rose in prominence due to mobile devices. Its chips are more energy-efficient than other chips on the market, and that s a really big deal when you re looking at battery life in a mobile device, so it was able to rise. It does not make its own chips. Historically, it licenses these products to the manufacturers of the mobile devices, but if you look at what we have right now in AI, we have a bottleneck. You ve heard about many bottlenecks. The big one is electricity. Power is scarce, and this is driving AI companies to try to find more energy-efficient solutions, and so ARM makes CPUs, and it claims they re two times more efficient than conventional X86 architecture, and that s the kind that Intel makes, for example. Arm is claiming that they can save AI companies 10 billion per gigawatts in capital expenditures in a data center, so that s a really big deal. I think the big news here lately with Arm has been it s not going to just license the technology anymore. It s going to make its own chips. It s going to actually be a chipmaker, and it s a no-brainer. According to the company, it can make 10 times the gross profit per chip than just licensing it. That s a huge thing, and if you look, management says here in the most recent quarter, it already has $2 billion worth of demand over the next two years for its in-house chips. That s a really big adoption curve. That s really good, but what is the hang-up here? The hang-up here is that,

1 Chip Stock Making Bold Plans

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1 Chip Stock Making Bold Plans

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