ARM HOLDINGS shares dropped by six per cent yesterday despite the chip maker growing profits by more than a fifth.
The Cambridge-based company, which designs and manufactures chips for mobile phones and internet-connected devices such as Smart TVs and tablets, saw pre-tax profits jump 22 per cent to £61.9m in the first quarter.
Arm grew revenues 14 per cent to £132.5m despite a two per cent decline in operating margins.
The company said it shipped 0.8bn chips into consumer and embedded digital devices, which includes smart meters and portable navigators, at a 15 per cent increase on the same quarter last year.
And 1.1bn chips were shipped to mobile phone and tablets – a slight decrease on last year.
But chief executive Warren East said he was not worried about Arm losing its vast share of the mobile chip market in light of Intel’s imminent entry to the smartphone arena.
East told City A.M.: “Arm has 100 per cent share of processors in the mobile phone market. We can’t really see Intel securing a massive share – from a tech point of view they’re about three years behind Arm.
“In terms of magnitude of the effect I can’t really see it being that significant,” he added.
West said Arm “absolutely” intended to enter Intel’s PC processor territory. “We talk about being the architecture of the digital world,” he said.
Arm signed 22 new processor deals in the quarter, which boosted licensing revenue 20 per cent to £47.6m.
The company said it expects full year results to be in line with expectations. Its shares fell 6.2 per cent to £5.32.