ARM Holdings Posts Higher First-Quarter Profit

By Lisa Fleisher 

LONDON--Computer chip designer ARM Holdings PLC on Wednesday reported a rise in first-quarter profit boosted by demand for its technology for a growing range of products including so-called supercomputers and sensors.

Net income for the first three months of the year rose to GBP62.3 million ($104.7 million) from GBP51.9 million a year earlier. Earnings per share were 4.4 pence, up from 3.7 pence in the prior-year period, the company said. Revenue rose 10% to GBP186.7 million.

The Cambridge, England-based company designs chips found in 95% of all smartphones, which have fueled its revenue in recent years. ARM designs processors and licenses them to chip manufacturers such as Qualcomm Inc. and Nvidia Corp for a licensing fee and royalties on every chip shipped.

As more companies try to bring Internet connectivity to everyday objects, such as cars or bikes or even toothbrushes, demand for chips will grow. But those chips aren't as lucrative for the company as those used in smartphones, said Pierre Ferragu, an analyst with Sanford C. Bernstein Ltd.

Write to Rory Gallivan at [e-mail] and Lisa Fleisher at [e-mail]

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