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With the demand for better, faster smartphones increasing exponentially by the day, it comes as no real surprise that little British chippie ARM has managed to beat even its own earning expectations and gain market share, pushing from handsets into all kinds of other electronics, from fridges to MP3s.
The firm, which uses every opportunity it gets to remind people of its minuteness compared to behemoths like Intel, saw its revenues skyrocket 54% to £100m ($155.87 million), helped along by a whopping nine million dollar royalty catch-up payment, which the firm says is a one-off.
Financial boffins had been expecting ARM to pull in some £33 million ($51.4 million) in pre-tax profits, but the company strong-armed its way to a resounding £43.5m ($67.8 million) instead.
Courtesy of nasdaq.com
Somehow this failed to wow investors, however, with ARM holdings shares down by 1.8% on Tuesday, likely because the firm refused to raise its full year forecast, preferring to keep things modest.
“It’s possible that the usual seasonal uptick [in royalties] is a of a slightly flatter trajectory, but still showing growth,” said the firm’s CFO Tim Score blaming the global economy.
A company press release noted the firm had sold another 17 processor licenses in the last quarter, 13 of which weren’t even for mobile handsets. Indeed, a recent processor license sale to Microsoft has kicked off all kinds of speculation about the little chips being used in anything from Xboxes to servers.
“Arm continued to gain share in the quarter with shipments of Arm-based chips growing faster than the industry in all target markets,” gushed ARM’s CEO Warren East, doubtless proud his firm had managed to ship 130% more ARM microcontrollers year-on-year and triple its market value to some $7.2 billion.
A rumored bid for acquisition by Apple a couple of months back certainly did the firm’s stock prices no harm either.
If ARM isn’t careful, it might quickly discover that its reputation as little David has transformed itself into one of a much bigger Goliath. Not that that should discourage the firm one little bit. Talk about making money hand over fist.
