Arm Reportedly Launches 'Physical AI' Division To Expand In Robotics Market

• Arm executives see robotics as a market with immense potential for growth in the long run.
• The company last year disclosed plans to develop its own chips.

Chip technology firm Arm has reportedly reorganized the company and formed a Physical AI unit to expand its presence in the robotics market.

Arm will now operate three main lines of business: its Cloud and AI, Edge - which includes its mobile devices and PC products - and Physical AI, which also folds in its automotive business, Reuters reported, citing company executives. 

Arm executives see robotics as a market with immense potential for growth in the long run. The head of the newly formed unit, Drew Henry said that physical AI solutions could "fundamentally enhance labor, free up extra time" and may have a considerable impact on gross domestic product as a result, the report added. 

The potential for growth in robotics spurred discussions inside Arm for months about how best to tackle the market. The company formally reorganized recently and created the Physical AI division, the report added. 

Company Updates

The company in its third quarter (Q3) results reported a revenue of $1.23 billion, which was ahead of analysts’ expectation, as per data from Fiscal.ai.

Arm generates revenue from licensing fees for its semiconductor designs and collects a royalty fee over every chip sold that uses its technology. 

The company last year disclosed its plans to develop its own chips. It said it will invest a portion of its profit, in a move to diversify its operations and open more sources of revenue. 

The company is facing pressures from President Trump’s tariffs. Tariff volatility and macroeconomic challenges have been tapering demand for smartphones, which is a stronghold for Arm. 

How Did Stocktwits Users React?

Retail sentiment around ARM trended in ‘bullish’ territory amid ‘high’ message volume.

Shares of Arm have fallen nearly 22% over the past year. 
 

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