Profits rocket at ARM

Profits rocket at ARM
Alex Mayhew-Smith ARM Holdings is profiting from growth across all its interests as the company’s profits rocket. The firm saw 1999 first quarter results leap with a 91 per cent growth in pre-tax profits to ?3.2m, compared to the same period last year. “There are a variety of reasons [for the growth]. There are strong licensing demands for the processor, a strong recognition of our brand and increased interest from OEMs,” said Pete Magowan, ARM’s v-p for Europe. The company’s revenues grew 51 per cent to ?13.1m – a five per cent increase on the previous quarter – with continued growth in the wireless segment. Magowan said: “We are expanding into networking and multimedia with games makers such as Sega and Sony.” Last year ARM shipped over 50 million units and growth in 1999 was as expected: “The first quarter headed into further growth, benefiting from the expansion of the mobile phone market.” Licence revenues in the quarter amounted to 64 per cent of revenue, with Fujitsu becoming the most recent licensee of the ARM7TDMI processor. While the number of staff increased by only 15 to 369 over the last year, this year the firm expects to recruit about 80 new employees. The company has already stated it plans to double its workforce in the next three to five years and it will also be investing in a next generation of microprocessors, said Magowan. ARM’s shares rose 15p to 2880 within hours of the news. “We are constantly watching the barometer of our business and it is growing in response to new product designs from Ericsson, Nokia and Psion.”


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