LONDON: ARM Holdings, the British chip designer favoured by Apple, beat expectations for first-quarter profit thanks to demand for the iPhone 6, and said its royalties would grow as its latest technology is used in more smartphones.
Shares in the Cambridge-based company rose to an all-time high of £12.33 (RM66.80) after it posted a 24% rise in first-quarter pretax profit to £120.5mil (RM653.19mil).
That beat analysts' expectations of £115mil (RM623.08mil), according to a company-provided consensus.
The shares were up 4.6% at £12.04 (RM65.23) at 0717 GMT.
"In the second half of 2015 we expect to benefit from the increasing deployment of ARMv8-A technology, our latest generation of processors, in the newest smartphones and tablets," chief financial officer Tim Score said.
"These chips typically have a slightly higher royalty rate than the previous generation."
Royalty revenue, collected a quarter in arrears from a record 3.8 billion chips shipped, rose 26% on an underlying basis, ARM said.
Analysts at Citi said they expected full-year consensus expectations for ARM's revenue would edge up to reflect the encouraging performance in royalties.
ARM's processor licensing revenue dipped 2%, missing market forecasts, but Score said he expected licensing revenue to rise 5%-10% in the longer term.
Industry-wide revenues had slipped after a busy fourth quarter, in line with normal seasonal trends, which would be reflected in its second quarter, Score said.
But overall second-quarter revenue would be in line with market expectations, which stand at US$354.6mil (RM1.29bil). – Reuters
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