Reuters Arm surged more than 30 on Wednesday after the British tech company forecast quarterly sales and profit above Wall Street expectations as customers aim to design new chips for artificial intelligence work, generating higher royalties.

The surge in Arm39;s stock lifted its market capitalization by about 26 billion. Now trading at 102.11, Arm has doubled from the 51 price set in its September initial public offering.

The company, uniquely, supplies a library of blueprints to chipmaking rivals. Its majority owner SoftBank Group bet in 2016 that Arm could use its dominant position in smartphones, where it sits at the heart of both Apple and Android devices.

The solid Arm earnings and, even more importantly, their robust forecasts are good signs for both the company and the tech industry overall, said Bob O39;Donnell, president and chief analyst at TECHnalysis Research.

Arm executives said on Wednesday the expansion strategy was starting to pay off, with customers flocking to Armbased central processors to complement Nvidia39;s chips for AI work in data centers, and working on new laptops and smartphones that can handle chatbots and other AI features.

The midpoints of Arm39;s fourthquarter sales and adjusted profit forecasts range of 875 million and 30 cents per share, respectively, beat estimates of 780.3 million and 21 cents per share, according to LSEG data.

It raised its guidance by roughly 100 million because markets such as automotive and AI are going to…