ARM's 4Q Net Profit Rises, Boosted by Demand for Higher-End Smartphones

By Simon Zekaria

LONDON--Computer-chip designer ARM Holdings PLC (ARM.LN) Wednesday posted higher fourth-quarter profit, boosted by demand for higher-end smartphones.

The Cambridge, U.K.-based company said net profit for the three months to Dec. 31 rose to GBP91.7 million ($132.7 million) from GBP72.8 million in the same period a year earlier.

Pretax profit adjusted for exceptional items rose 17% year-on-year to GBP138.7 million, slightly higher than a market consensus forecast of GBP137.3 million.

Revenue, also adjusted, in dollar terms rose 14% to $407.9 million, higher than a forecast of $402.5 million

"2015 was a strong year for the shipment of chips containing advanced ARM technology, and momentum continued through the fourth quarter," said Chief Executive Simon Segars.

For 2016, it expects dollar revenue to be broadly in line with market expectations.

The company designs chip technology found in more than 95% of all smartphones, including Apple Inc.'s (AAPL) iPhone. It earns licensing fees from chip manufacturers such as Qualcomm Inc. (QCOM) and Nvidia Corp. (NVDA) and royalties on every chip shipped.

ARM is recommending a final dividend of 5.63 pence, up 25%.

Shares closed Tuesday at 940 pence, valuing the company at GBP13.2 billion.

Write to Simon Zekaria at [e-mail]

(END) Dow Jones Newswires

February 10, 2016 02:35 ET (07:35 GMT)

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