Profits of the British chip designer ARM Holdings rose by 36 percent year-on-year, from £68.1 million to £92.6 million during the third quarter of 2013, as the adoption of its technology in smartphones and other devices fuelled increased license fee and royalty income.
Total revenues increased 27 percent year-on-year, from £144.6 million to £184 million in the three months leading up to 30 September 2013, as licensing revenue rose by almost half to $123.1 million (£75.9m), while royalty revenues were up slightly by 13 percent to $137 million (£84.5m).
ARM does not manufacture any chips, but instead develops processor technology and licneses its designs to other companies. Its designs are particularly valued in the mobile industry due to their low power consumption.
“In the third quarter of 2013 we saw strong demand for our processor technology with a record 48 licenses signed by 24 companies, 11 of whom were licensing ARM technology for the first time,” said ARM CEO Simon Segars. “ARM’s technology was licensed for an extensive range of end-markets including the Internet-of-Things, wired and wireless communications, and mobile computing.
“This quarter ARM also signed four large licensing deals with thought-leading technology companies, which included MediaTek signing a broad license for ARM’s latest ARMv8-A processor technology and next generation Mali graphics.
“With more customers choosing to deploy ARM technology in their products and ARM’s royalty revenues outperforming the overall semiconductor industry, this has been another quarter that underpins ARM’s long-term growth opportunity.”
ARM has indicated it expects growth to continue due to a record order backlog and “robust opportunity pipeline” and has told investors its expects revenues to reach $290 million (£179m) during the fourth quarter of 2013.
“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,” added Segars.
Last month, ARM acquired the PANTA display controller cores from Cadence Design Systems, in order to continue improving its mobile chip offerings.
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