CHIP DESIGNER ARM's share prices dipped on Wednesday despite posting positive revenues for its latest quarter.
ARM reported that its second quarter revenues were up 22 percent year on year after a 31 percent rise in processor royalty sales and a three percent climb in licensing revenue. Pre-tax profit was also strong, up 32 percent year on year, while earnings per share climbed 34 percent.
However, early trading saw a 3.8 percent decline in ARM's share price, because one of ARM's biggest and most well-known customers, Apple, posted its quarterly earnings at the same time, admitting that it had missed expectations on iPhone sales.
Apple announced revenue of $48bn for the fiscal third quarter during its earnings call on Tuesday, up 32.5 percent on the $37.4bn in the year-ago quarter.
This saw the firm rake in $10.7bn in profit for the three-month period, compared with $7.7bn this time last year.
However, Apple announced iPhone sales of 47 million for the fiscal third quarter, falling slightly short of analyst expectations of 48.8 million, despite being up 35 percent on the previous quarter.
Apple might have rained on ARM's parade, but the chip designer is staying positive, saying that the firm is going into the second half of 2015 "with a robust pipeline of opportunities for licensing" and will meet market expectations for full-year revenue of £947m.
ARM licenses its technology to chip makers and receives a royalty on every chip sold. Apple accounted for 20 to 25 percent of its processor royalties last year, analysts estimated, but ARM's head of investor relations, Ian Thornton, isn't worried about it.
"I don't see anything in Apple's results to change our overall view of our second half when I look at the market more generally," he told Reuters.
Industry data showed "a little weaker than normal seasonality" in April and May, he added, but "not to the extent that would worry us. Combining those gives us multiple routes to the full-year consensus." µ
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