For the first quarter ending March 31, ARM reported net income of 6.7m pounds ($12m), up from 4.2m pounds ($7.5m). Sales increased to 34.9m pounds ($62.7m) from 31m pounds ($55.5m) in the year-ago quarter.
Approximately 90% of ARM’s revenue is earned in US dollars, and with the further weakening of the currency during the first quarter, this had a negative impact of 2.1m pounds ($3.7m) on ARM’s sales, according to chief executive Warren East. The effective exchange rate in the first quarter was $1.78, against $1.68 in the fourth quarter of 2003.
It is encouraging that our sustained investment in innovation throughout the industry downturn of recent years has continued to drive licensing revenues in the first quarter, said East. License revenue increased during the first quarter to 14m pounds ($25m) from 12.9m pounds ($23.1m) in the fourth quarter 2003.
First-quarter royalty revenue reached a record level of 13.4m pounds ($24m), up from 12.8m pounds ($22.9m) in the fourth quarter and 10.3m pounds ($18.5m) in the first quarter last year.
The Cambridge, UK-based company employs 741 people and supplies the chip for Nintendo’s Game Boy Advance console. However, its main business comes from mobile handsets, and its processors are found in about 80% of all mobile phones.
Looking forward, ARM said it expects royalty revenue to fall in the second quarter (ending June) against the first, owing to the seasonal boost of Christmas sales. However, it said the positive momentum behind royalty revenues would continue in the medium term.
This article is based on material originally published by ComputerWire
