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Arm beats expectations ahead of possible FTSE 100 promotion
(GUARDIAN) - Arm, the UK-based chip designer, has beaten market expectations with a surge in sales of smartphones and the launch of the first mobile computers based on its technology.
In a tough economic climate the company reported full year profits of £96.8m, down 4%, and said 2010 figures were expected to be in line with expectations, with the semiconductor market set to show signs of improvement. Smartphone sales grew by 15% in the third quarter whilst overall mobile shipments were flat, the company said. A range of businesses have recently announced smartphones and mobile computers based on Arm’s technology, including Dell, Google, HP and Motorola. However it is not clear if its designs are in the much hyped iPad launched last week by Apple. At Arm’s joint broker Investec, analyst Gareth Evans said:
Today’s results add to the view that Arm will continue to outperform the broader semiconductor market – a view that management have reiterated in the outlook statement. We retain our buy stance and elect to upgrade our discounted cash flow-based price target to 215p.
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