Arm cashes in on gadgets boom

CHIP designer Arm Holdings has turned in another set of forecast-busting quarterly figures as consumer demand shows no sign of slowing for the latest technology for camera mobile phones to in-car computers.

Signalling its confidence in the future, the Cambridge-based semiconductor company said it would start taking on more staff 'in a measured way' in the second half after a small headcount increase between April and June.

Arm, which designs chips for 80% of the world's mobile phones, rang up £36.9m of sales in the second quarter - around £1.5m above analysts' forecasts - to post its third consecutive quarter of growth.

While sales of new-generation mobiles continue to grow, finance director Tim Score said the biggest surge has been in the non-wireless market from iPods to digital cameras and cars using Arm chips. Over 170m of nonwireless products were sold in the first half compared-with 60m two years ago. Royalties from makers increased quarter-on-quarter to £13.9m with record total shipments of 286m units.

Licensing revenue, a key figure for calculating new deals, was up 4% on the first quarter to £14.6m, despite a weaker dollar, in which 90% of Arm sales are made, while 20 new licences were signed. Pre-tax profits rose to £10.4m, from £9.4m in the first quarter and £6.6m a year ago. The half-year dividend is up 17% to 0.24p.