Thoughts? Questions? Expressions of guilt for doubting the fabless semiconductor business model?
Q1 2016 Financial Summary
• Group revenues in US$ up 14% year-on-year (£ revenues up 22% year-on-year)
• Processor royalty revenues in US$ up 15% year-on-year, outperforming the industry by 18pp1
• Normalised operating expenses were impacted by weaker sterling; at constant exchange rate normalised operating expenses were 2% higher than Q4 2015, and around the top end of the guidance range2
• Normalised PBT and EPS up 14% and 15% year-on-year respectively
Progress on long-term growth drivers in Q1 2016
• Growth in adoption of ARM® processor technology
o 39 processor licences signed by a broad range of companies, including leading semiconductor vendors and OEMs
o Target applications included mobile computing, automotive, networking infrastructure and servers
• Strong demand for ARM’s most advanced technology
o 8 licences signed for ARM Cortex-A technology for high-performance and highly efficient application processors
o 2 Mali™ multimedia processor licences signed, including licences for advanced graphics and display processors
o ARM extended long-term agreements with two leading foundries to cover a wider range of physical IP technologies from 55nm to 14nm
• Growth in shipments of chips based on ARM technology
o 4.1 billion ARM-based chips shipped, up 10% year-on-year
o ARMv8-A, octacore and Mali penetration increased in smartphones, driving a higher royalty per mobile device
o Continuing growth in chips for networking infrastructure, up 10% year-on-year
o ARM-based microcontrollers and smartcards up 20% year-on-year
o 50% of physical IP royalty generated from leading-edge nodes from 28nm to 14nm as ARM technology is increasingly used in semiconductor companies’ most advanced chips
Outlook
At the start of 2016, ARM has seen its current technology gaining share in target end-markets, and strong demand for our next generation of products from a wide range of companies. The licensing pipeline for the rest of the year is robust, with leading companies looking to license ARM technology for their next generation products. We expect that ARMv8-A technology will continue to penetrate in mobile and enterprise markets, and the higher royalty rate earned on these products will underpin future royalty revenues.
ARM Holdings Plc (ARMH) Simon Segars on Q1 2 16 Results - Earnings Call Transcript | Seeking Alpha
Q1 2016 Financial Summary
• Group revenues in US$ up 14% year-on-year (£ revenues up 22% year-on-year)
• Processor royalty revenues in US$ up 15% year-on-year, outperforming the industry by 18pp1
• Normalised operating expenses were impacted by weaker sterling; at constant exchange rate normalised operating expenses were 2% higher than Q4 2015, and around the top end of the guidance range2
• Normalised PBT and EPS up 14% and 15% year-on-year respectively
Progress on long-term growth drivers in Q1 2016
• Growth in adoption of ARM® processor technology
o 39 processor licences signed by a broad range of companies, including leading semiconductor vendors and OEMs
o Target applications included mobile computing, automotive, networking infrastructure and servers
• Strong demand for ARM’s most advanced technology
o 8 licences signed for ARM Cortex-A technology for high-performance and highly efficient application processors
o 2 Mali™ multimedia processor licences signed, including licences for advanced graphics and display processors
o ARM extended long-term agreements with two leading foundries to cover a wider range of physical IP technologies from 55nm to 14nm
• Growth in shipments of chips based on ARM technology
o 4.1 billion ARM-based chips shipped, up 10% year-on-year
o ARMv8-A, octacore and Mali penetration increased in smartphones, driving a higher royalty per mobile device
o Continuing growth in chips for networking infrastructure, up 10% year-on-year
o ARM-based microcontrollers and smartcards up 20% year-on-year
o 50% of physical IP royalty generated from leading-edge nodes from 28nm to 14nm as ARM technology is increasingly used in semiconductor companies’ most advanced chips
Outlook
At the start of 2016, ARM has seen its current technology gaining share in target end-markets, and strong demand for our next generation of products from a wide range of companies. The licensing pipeline for the rest of the year is robust, with leading companies looking to license ARM technology for their next generation products. We expect that ARMv8-A technology will continue to penetrate in mobile and enterprise markets, and the higher royalty rate earned on these products will underpin future royalty revenues.
ARM Holdings Plc (ARMH) Simon Segars on Q1 2 16 Results - Earnings Call Transcript | Seeking Alpha
