ARM chips with everything
All those ARM licence deals in recent months are beginning to pay off for the Cambridge, UK semiconductor design house. Its £11.3 million revenues to 30 September, 1998 were 68 per cent up on same time last year, and 13 per cent on Q2. Pre-tax profits jumped 75 per cent to £2.5 million.
ARM's nine month revenues were £29.8 million, up 62 per cent, and profits were £6.4 million, up 98 per cent on 1997. Which just goes to show there is a hell of a lot more money to be made in thinking than in doing. Intellectual property gets you nowhere of course, unless you can persuade some poor sucker to actually make things using your patents -- and better still -- paying for the privilege.
ARM's pitch at the quality embed and things you hold in your hand markets is paying big dividends. It now has 31 manufacturing suckers, more properly termed semiconductor licencees, adding two Natsemi and Qualcomm in Q3.
ARM revenues are still on the puny side, but its position at the head of these 31 makers, shows that it packs a punch way beyond its weight. Sensibly, the company is pumping more money into R&D - which is its lifeblood after all. But operating margins -- currently 18 per cent -- are expected to remain under pressure, the company warns. This is a price worth paying. ®