ARM Sees Major Profits from Smartphones, Eyes IoT Next

ARM Sees Major Profits from Smartphones, Eyes IoT NextUK-based microprocessor designer ARM has seen some high first quarter demand for its technology, according to a Wall Street Journal article by Razak Musah Baba and Rory Gallivan. The company credits its success with increasing demand from the smartphone market.

ARM’s main line of business is licensing its microprocessor designs to other companies; Baba and Gallivan report that its technology thus “can be found in the vast majority of the world’s smartphones including those made by Apple”. Given how strong the smartphone market has been, it’s not a huge surprise that the company ended up making a net profit of $126.7 million for the first quarter of 2015 – though that did beat expectations. ARM reports that its revenue from royalties increased by 31 percent in 2015 overall; and in a statement, ARM CEO Simon Segars said, “As the world becomes more digital and more connected, we continue to see an increase in the demand for ARM’s smart and energy-efficient technology, which is driving both our licensing and royalty revenues.”

Indeed, and that’s not just the case in the smartphone market. ARM is apparently also starting to see a lot of interest in its designs from companies involved in the burgeoning Internet of Things as its many component devices wire up to connect online. Last year, the company actually put together a business unit to tackle the IoT specifically, and last week it acquired two companies – Wicentric Inc. and Sunrise Micro Devices Inc. – to increase its presence in the IoT market. At a time when major multinational IT companies as well as national governments are starting to pour money into the IoT, and major conferences are being organized to help spur development in the field, ARM’s pivot into the Internet of Things appears very prudent – though the company certainly isn’t done with smartphones.