Arm Holdings Stock Drops As Tech Sector Faces Major Downturn

Key Points:

• Arm Holdings stock dropped 4.17% intraday to $134.615 on December 11, 2025
• The decline was part of a broader semiconductor sector correction affecting multiple chip companies
• NVIDIA’s earnings report and macroeconomic concerns contributed to the selloff
• Analysts maintain a consensus price target of $168.52, suggesting 25% upside from current levels
• Arm’s high price-to-earnings ratio continues to fuel debates about its stock valuation

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Arm Holdings experienced a sharp decline on December 11, 2025, with shares falling 4.17% during intraday trading. The stock closed at $134.615 as investors sold off semiconductor stocks across the market.

Arm Holdings plc American Depositary Shares, ARM

The drop came as part of a broader correction in the chip sector that affected multiple companies. Arm Holdings, which designs processor technology used in smartphones and other devices, saw selling pressure similar to its peers in the semiconductor industry.

What Triggered the Selloff

NVIDIA’s recent earnings report played a role in sparking the semiconductor sector decline. The report raised concerns among investors about growth expectations for chip companies in the coming quarters.

Macroeconomic factors also contributed to the selling pressure across technology stocks. Rising interest rates and inflation worries have made investors more cautious about high-growth tech companies.

Leveraged exchange-traded funds (ETFs) that focus on semiconductor stocks amplified the decline. These investment vehicles use borrowed money to increase exposure, which can magnify both gains and losses during volatile trading periods.

Arm Holdings carries a high price-to-earnings ratio compared to many other chip companies. This valuation metric has become a point of debate among analysts and investors who question whether the stock price reflects realistic growth expectations.

Analyst Price Targets Remain Above Current Levels

Despite the recent drop, Wall Street analysts maintain a consensus price target of $168.52 for Arm Holdings stock. This target represents potential upside of more than 25% from the current trading price of $134.615.

The company has no upcoming dividend payments scheduled, as Arm Holdings does not currently pay a dividend to shareholders. No earnings reports are scheduled for the immediate future.

Options traders have shown interest in bearish positions on Arm Holdings stock. The ARM20251219P125 put option has attracted attention from investors looking to profit from or protect against further downside movement.

The current stock price represents a pullback from recent highs for the company. Arm Holdings went public in September 2023 in one of the largest initial public offerings of that year.

The company’s technology is licensed to hundreds of companies worldwide for use in various electronic devices. Its chip designs power the majority of smartphones and are increasingly used in data centers and automotive applications.

The semiconductor industry has faced challenges in recent months as demand fluctuates across different market segments. Some areas like artificial intelligence chips have shown strong growth, while consumer electronics demand has softened.

Arm Holdings stock remains down from its 52-week high but above its initial public offering price. Trading volume on December 11 was higher than the stock’s average daily volume as investors reacted to the sector-wide selloff.

The current consensus price target of $168.52 is based on estimates from multiple Wall Street analysts who cover the stock.

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