CAMBRIDGE, England -- ARM Holdings plc, which licenses intellectual property related to microprocessor circuit designs, made a profit of £4.8 million (about US$8.1 million) on sales revenue of £31.7 million (about US$53.0 million) in the third quarter of 2003, ARM said Tuesday (October 21, 2003).
These numbers were almost unchanged from the company's performance in the second quarter of 2003 and down on the third quarter of 2002.
In the second quarter ARM made £4.3 million (about US$7.2 million) on sales of £31.4 million (about US$52.5 million, see July 22 story) and in the third quarter of 2003 the company made net income of £5.9 million on sales revenue of £33.3 million.
The company's royalty revenue increased slightly from the second quarter, from £10.2 million (about US$17.1 million) to £11.0 million (about US$18.4 million), on record quarterly unit shipments of 188 million units. Five new partners commenced shipping in the quarter
"New product introductions are expected to continue to drive further licensing opportunities, however we remain cautious as to when ARM's licensing revenues will benefit from any general semiconductor recovery," said Warren East, ARM's chief executive officer, in a statement.
ARM provided a further warning on licensing revenue in its statement saying that despite increased levels of business activity, "it remains uncertain as to how quickly an improvement in industry conditions will feed through to sustained levels of higher licensing activity for ARM. In the meantime, recent new product introductions are expected to result in incremental licensing opportunities."
The company said 16 licenses for microprocessor cores were signed in the quarter, compared to 11 in the second quarter and the licensing activity included seven new partners. License revenues were £13.1 million (about US$21.9 million), up from £12.7 million (about US$21.2 million) in the previous quarter.
Nonetheless the company said that fourth quarter revenues were expected to be similar to third quarter levels.
The company said that further opportunities would be underpinned by new features such as TrustZone security, Thumb-2 for improved code-density, and Intelligent Energy Manager, applied in ARM11 cores.