ARM Posts Higher Profit In Q3 On 27% Higher Revenue

(RTTNews) - Chipmaker ARM Holdings Plc (ARMH, ARM.L) Tuesday reported a higher third-quarter profit, helped by 27 percent growth in revenues, as more customers chose ARM technology in their products, and it saw royalty revenues outperforming the overall semiconductor industry.

Looking ahead, Simon Segars, chief executive officer of the company stated, "As the products we use every day become more connected, and as new categories of smart devices are introduced, there are increasing opportunities for ARM's high-performance, low-power technology, which drive both license and long-term royalty revenues."

During the period, the company saw strong demand for its processor technology, with 48 licenses signed by 24 companies, 11 of them licensing ARM technology for the first time. It also signed four large licensing deals with thought-leading technology companies.

For the three-month period, profit before tax climbed to 68.3 million pounds from 55.3 million pounds in the previous year. The results are on an IFRS basis.

After adjusting for certain items, normalized pre-tax profit grew 36 percent year-on-year to 92.6 million pounds.

On a per share basis, earnings were 3.44 pence or 16.72 cents per ADS, higher than 2.96 pence, or 14.35 cents per ADS reported a year ago.

Normalized earnings earnings increased to 5.11 pence per share, or 24.84 cents per ADS, from the previous-year's of 3.71 pence, or 17.96 cents per ADS.

Quarterly revenues climbed 27 percent to 184.0 million pounds from 144.6 million pounds in the preceding year. In Dollar terms, revenues were $286.7 million, a 26 percent increase from the prior year.

Total Processor Division, or PD revenues increased 31 percent, with 54 percent growth in PD Licensing, and 16 percent rise in PD Royalties.

Assuming the macroeconomic situation does not deteriorate significantly in the rest of the quarter, the company expects fourth-quarter group dollar revenues to be in-line with current market view of around $290 million.

In London, ARM shares are currently trading at 979.2 pence, down 59.8 pence or 5.76 percent, on a volume of 787,004 shares.