Arm Holdings ( NASDAQ:ARM ) just shot up over 15% this morningand for good reason. CEO Rene Haas hit CNBC with fresh insights on the company's role in President Trump's massive $500 billion AI "Stargate" project. Backed by OpenAI, Oracle ( NYSE:ORCL ), and SoftBank ( SFTBY ), the initiative is set to supercharge AI infrastructure, and Arm's energy-efficient chip designs put it in prime position. Investors also took comfort in SoftBank's unwavering commitment to its stake in Arm, as Masayoshi Son's deep ties to the project could shape policy and future growth. Throw in Trump's tariff-free stancegreat news for global marketsand you've got a recipe for a stock on fire.

Arm isn't just riding the AI hype trainit's driving it. Already commanding 99% of the smartphone chip market, the company is making aggressive moves in data centers, where efficiency is king. The real kicker? Stargate's financial details are still in the works, but the sheer scale of the project has investors betting big. Son's involvement adds another layer of intrigue, as his strategic influence could steer both capital flows and regulatory decisions in Arm's favor. With AI adoption skyrocketing, the market sees Arm as a critical player in this new wave of tech investment.

Now, let's talk reality: Arm isn't cheap. Trading at a price-to-sales ratio of 45, it's a premium play. But when a stock has momentum like this, valuation concerns tend to take a backseatat least for now. If AI infrastructure spending keeps surging, Arm's growth runway could be long. Investors are watching closely for updates on Stargate's financial framework, which could shape the company's next big move. With the right execution, Arm isn't just a winner todayit could be a dominant force in AI's future.

This article first appeared on GuruFocus .