Smartphones and tablets boost ARM's sales
By Reuters and Nicole Kobie
Posted on 23 Oct 2012 at 12:20
Smartphones and tablets helped ARM beat its quarterly forecasts, posting a 22% jump in profits.
The Cambridge-based chip designer said its third-quarter pretax profit jumped to £68.1 million on revenue 20% higher at £144.6 million.
"ARM is sensitive to some strong growth areas, like smartphones and tablets, and those of course are the parts of the industry that are growing much faster than the average," chief financial officer Tim Score told reporters.
Score said the strong result was largely due to a 25% rise in royalties to $121.1 million, about $6 million ahead of expectations and far outstripping the 4% growth in industry revenues.
Sales of ARM's more expensive Cortex-A designs, which are used by Apple and by Qualcomm for its Snapdragon chips, were particularly strong, Score said.
Cortex-A accounted for 9% of shipments, up from 5% a year ago, but it accounted for 35% of royalties, the company said. The technology helped average royalty rates per chip rise to 4.9 cents from 4.4 cents.
Licensing demand for Cortex technology was also strong, with seven Cortex-A licenses out of a total 29 signed in the quarter, helping total licensing revenue rise 15%, the company said.
"ARM's Cortex-A class technology is increasingly being used beyond mobile and mobile computing applications, and this quarter we saw Cortex-A licenses for gaming, digital TVs, home entertainment systems, servers and GPS navigation systems," the company added.
ARM, which reports royalty revenues a quarter in arrears, said indications from its chip-making customers pointed to a moderate sequential increase in royalty revenue in the final quarter, reflecting caution about holiday period sales.
Score said the semiconductor industry expected to see a low-single-digit percentage uplift quarter-on-quarter for the holiday period, rather than about the 10% growth usually seen.
- Flickr redesign: is it enough to tempt photographers back?
- Hands on with the new Google Maps
- Nokia Lumia 925 review: first look
- Why I won't subscribe to Creative Cloud
- GoPro camera strapped to a remote-control helicopter: the ultimate boy's toy
- Acer Iconia A1 review: first look
- Acer Aspire P3 review: first look
- Acer Aspire R7 review: first look
- How we produce the PC Pro podcast
- Google Now draining iPhone battery
- The ICO's shame-faced u-turn on cookies
- Start8 and ModernMix: making Windows 8 work on a desktop
- How to boost your mobile reception
- How to fix Facebook: Social Fixer
- Taking the stress out of WordPress updates
- Where to download free web fonts
- Turn your tablet into a Sky+ remote control
- How to measure the success of a new IT system
- Three years on: the state of the tablet market
- Windows 8: what works and what doesn't