Arm Holdings plc architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers. The company is involved in the licensing, marketing, research, and development of microprocessors, systems intellectual property (IPs), graphics processing units, physical IP and associated systems IPs, software, tools, and other related services. It also offers arm central processing units, …
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Competitive advantage assessment
Key strengths
Margins Consistently Above PeersGross margin at 97.5% (top 2%) and operating margin at 18.3% (top 25%) indicate strong pricing power.
ROIC Sustainably Above PeersROIC at 73.4th percentile exceeds peers and WACC, demonstrating superior capital allocation.
The dashed ring is the peer median. Defense scores are percentile ranks
against peers, so 50 is roughly the typical company in this group.
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Arm Holdings plc ranks #8 of 66
scored companies in Semiconductors by moat score — the top 12%.
The widest moat in the group is NVE Corporation (NVEC)
at 86/100.
Moat scores for companies ranked near ARM in Semiconductors
Pricing power is the ability to raise prices without losing volume.
Cost Advantage
Score 56
· 15% of the moat score
A cost advantage means delivering the same product for structurally less — better purchasing, denser distribution, a more automated process.
Customer Stickiness
Score 80
· 15% of the moat score
Stickiness is what makes revenue repeat without being re-won every year.
Capital Efficiency
Score 78
· 18% of the moat score
Capital efficiency asks what the company earns on the money tied up in the business.
Resilience
Score 80
· 17% of the moat score
Resilience is the capacity to get through a bad year on its own terms — enough liquidity, enough interest cover, and enough cash generation to avoid a rescue financing or a forced sale.
Scale & Market Position
Score 75
· 15% of the moat score
Scale matters only when it converts into economics.
Arm Holdings plc (ARM) scores 75 out of 100 on the StatsAlpha Moat Map, which rates its competitive advantage as strong. It ranks #8 of 66 scored companies in Semiconductors, the top 12%. The score is a weighted composite of 6 competitive defenses, each measured against industry peers of 65 companies in Semiconductors. Its strongest defense is Customer Stickiness (80/100) and its weakest is Cost Advantage (56/100).
How does Arm Holdings plc compare with other Semiconductors companies?
Arm Holdings plc ranks #8 of 66 scored companies in Semiconductors by moat score. The widest moat in Semiconductors is NVE Corporation (NVEC) at 86/100. The companies ranked closest are Broadcom Inc. (AVGO) at 76 just above it and Monolithic Power Systems, Inc. (MPWR) at 75 just below it.
How is the moat score calculated?
Each company is scored with an industry-specific template — Corporate Default in this case, chosen because the defenses that matter to a bank are not the ones that matter to a software company. Every defense combines several financial signals, and each signal is measured as a percentile against a peer group of 65 companies in Semiconductors. The defenses are then weighted to produce the overall score out of 100.
Why is Arm Holdings plc scored with the Corporate Default template?
Most public companies sell a product or a service at a margin, so the moat question is whether that margin survives contact with competitors. The Corporate template scores the six defenses that show up in a general operating company's financial signature: whether it can hold price, produce more cheaply than rivals, keep its customers, earn a return above its cost of capital, withstand a downturn, and turn size into economics.
Which competitive defenses are measured for Arm Holdings plc?
The Corporate Default template measures 6 defenses, and ARM scores: Pricing Power (79), Cost Advantage (56), Customer Stickiness (80), Capital Efficiency (78), Resilience (80), Scale & Market Position (75). Each is scored independently as a percentile against peers, so a company can be strong on one and weak on another — the overall score reflects how those defenses are weighted for this industry.
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