The AI chip boom just got louder. Here’s the full picture.

NVIDIA posted its strongest quarter ever. ARM Holdings is our BUY. And Malaysia is quietly stepping into this global story for the first time. It’s all connected.

NVIDIA just changed the conversation.

After market hours, NVIDIA removed any doubt about where AI infrastructure spending is heading. Revenue came in at USD 81.6 billion — up 85.2% year-on-year and ahead of Wall Street estimates — driven almost entirely by data centre demand that reached USD 75.2 billion, nearly doubling from a year ago. EPS of USD 1.87 beat the consensus of USD 1.78. This marked the 14th straight quarter of sequential revenue growth.

The story didn’t stop at the headline numbers. NVIDIA approved an USD 80 billion share buyback, raised its quarterly dividend from USD 0.01 to USD 0.25 per share, and guided Q2 revenue to USD 91 billion — well ahead of the USD 86 billion the market expected. Jensen Huang said it directly: “The buildout of AI factories — the largest infrastructure expansion in human history — is accelerating at extraordinary speed.” NVIDIA is now partnering with Anthropic to scale AI capacity, expanding into robotics as the next frontier of physical AI, and positioning its Vera CPU to move beyond GPUs into the broader server market.

But who else benefits from every AI chip that gets built?

Behind almost every chip that isn’t a NVIDIA GPU — the phone in your pocket, the cloud servers running AI models, the chips being designed right here in Malaysia — sits ARM Holdings. ARM doesn’t manufacture chips. It designs the fundamental blueprint that chipmakers license and collects a royalty every time it ships. Apple pays it. Qualcomm pays it. The more AI infrastructure gets built, the more ARM earns. ARM’s own latest quarter reflected exactly this: licensing revenue grew 29%, data centre royalties doubled. Net profit is projected to grow 58.8% over the next three years. Our research team rates it a BUY at a target of USD 240.71, a 7.9% potential upside backed by 33 Bloomberg Buy ratings. While NVDA offers the bigger upside number, ARM is the steadier royalty play — and as we’ll see in a moment, it has a direct new growth engine right here at home.

That new growth engine? It’s Malaysia.

In March 2025, Malaysia signed a USD 250 million, 10-year national partnership with ARM Holdings — ARM’s first-ever country-level deal anywhere in the world. The goal is straightforward: shift Malaysia from assembling chips for multinational companies to designing its own. On 11 May, three Malaysian chip design firms — SkyeChip, Oppstar, and GreatAsic — received formal offer letters granting access to ARM’s design platforms. Every chip they eventually design on ARM architecture pays ARM a royalty. Malaysia’s semiconductor ambition is, quite directly, a new growth engine for ARM’s royalty stream — the same stream that underpins NVIDIA’s blockbuster results.

Both Malaysian stocks have seen significant moves since the deal was announced and are part of the same structural theme.

The picture in full.

NVIDIA’s results last night confirmed that the AI infrastructure buildout is not slowing — it is accelerating. ARM sits at the foundation of that buildout, earning royalties on every chip the ecosystem produces. And Malaysia, for the first time, is entering the design side of this industry rather than just the manufacturing side — adding a direct local dimension to ARM’s global royalty growth story. Our research team’s view: NVDA at +24.1% upside and ARM at +7.9% are the clear beneficiaries.

All buy calls are based on the research team’s judgement. Investing is risky and trading is at your own risk. Educational purposes only — not personalized financial advice. Rakuten Trade Sdn Bhd