ARM Holdings (LSE:ARM)
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2 Years : From Dec 2011 to Dec 2013
ARM Holdings PLC (ARM.LN) Tuesday posted a strong increase in first-quarter revenue and profit, driven by demand for its microchip designs, and said annual revenue will be in line with market expectations.
ARM produces microchip blueprints found in most mobile phones, including Apple Inc.'s (AAPL) iPhone, as well as tablets, computers, household goods and even cars.
"As many aspects of our lives become digital, we continue to see an increase in the demand for ARM's smarter and lower power technology, which is driving both our licensing and royalty revenues," Chief Executive Warren East said.
Net profit jumped 74% to GBP37.4 million in the three months ended March 31 from GBP21.5 million a year earlier, helped by higher revenue and the signing of 22 processor licenses.
Profit before tax and exceptional items, a key figure tracked by U.K. analysts, rose 22% to GBP61.9 million in the quarter from GBP50.7 million, broadly in-line with market expectations of GBP61.1 million.
Revenue rose 14% to GBP132.5 million from GBP116 million a year earlier. Analysts had forecast a 12% rise in revenue to GBP130 million.
ARM, which generates the bulk of its sales in U.S. dollars, booked a 13% rise in dollar revenue.
Whilst first quarter industry shipments declined sequentially, most analysts expect the industry to recover in the second half, and as a result, ARM expects that group revenue for 2012 will be in line with current market expectations of $860 million.
ARM said earlier this month it would set up a joint venture with two European companies, Gemalto NV (GTO.FR) and Giesecke & Devrient GmbH, to speed up the adoption of a security standard for online transactions on mobile devices and game consoles.
The new joint-venture company will provide software that integrates closely with ARM-based chips, sitting underneath the operating system and closer to the silicon to make the device more secure.
ARM shares closed at 567 pence Monday, valuing the company around GBP7.80 billion. The stock has fallen 4.3% since January on concerns about the technology industry's outlook.
-By Lilly Vitorovich, Dow Jones Newswires; 44-0-207 842 9290; firstname.lastname@example.org