British chip designer ARM has benefited from growing interest in the Internet of Things, wearable devices and enterprise networking, and increased sales. In the first quarter of 2014, the company claims to have delivered 2.9 billion chips based on the ARM architecture. This corresponds to a growth of 11 percent compared to the same period of the previous year. The areas of enterprise networking and microcontrollers increased by 150 and 40 percent, respectively.
Compared to the same quarter of the previous year, sales grew by about 10 percent from 170.3 to 186.7 million British pounds. This emerges from the preliminary balance sheet now presented . IFRS pre-tax profit climbed from £ 67.1 million to £ 78 million. The operating margin increased from 38.1 to 40.9 percent.
In 95 percent of all smartphones and 80 percent of all digital cameras ARMs power-saving processor technology is used. It also continues to spread. For example, Microsoft uses an ARM chip in the Windows tablet Surface 2. In addition, the British chip designer also wants to establish itself in the area of enterprise servers and data centers . However, the company suffered a setback in this segment, after which Calexda had to cease operations .
According to ARM, its own customers signed 26 new processor licenses during the past quarter. Six of these apply to Cortex-A CPUs used in smartphones and tablets. Five more are for processors based on the ARMv8-A architecture, such as the Cortex-A53 or Cortex-A57. This brings the total number of licenses for this technology to 43.
Four licenses included ARM's Mali graphics processors and eleven other Cortex-M chips for microcontrollers, intelligent sensors, the Internet of Things (IoT) and wearables. ARM CEO Simon Segar said the Cortex-M chips are "found on most IoT and wearable devices announced so far".
He continued, "We now expect the second generation of wearable and IoT devices: they are very sophisticated in terms of design, have good hardware manufacturing quality, and provide easy-to-use software services. It's still a very fragmented market, but with many of the chips used in these devices being ARM-based, the benefits of our ecosystem are helping developers create new products. "
In the US and Western Europe, the market for smartphones is growing more slowly due to increasing saturation, but the emerging markets promise great growth potential. However, the profit margin is lower there. The demand for energy-saving chips is likely to increase noticeably should the internet of things or wearable devices finally prevail.
In its outlook for the remainder of the year, ARM notes that the semiconductor industry usually declines slightly in the first quarter before growth picks up again. "Recent evidence from the semiconductor industry and our customers suggests that ARM will benefit from an improving market in the second half of the year."
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