Semiconductor firm Arm, previously owned by SoftBank (TYO:9984), reported its first post-IPO earnings today, surpassing sales expectations with a total revenue of $806 million. Despite this positive outcome, the company's shares dipped over 3% due to a lower-than-anticipated revenue forecast for the current quarter.
On Wednesday, Arm reported an adjusted earnings per share (EPS) of $0.36. However, the company's guidance for the current quarter predicts an EPS between $0.21 and $0.28 on sales ranging from $720 million to $800 million, slightly under Wall Street's projections.
The firm's licensing business saw significant growth over the past year, doubling in size and contributing to a 28% annual increase in total revenue. This growth was reflected in licensing sales, which soared by 106% to $388 million. Conversely, royalty revenue declined by 5%, amounting to $418 million.
Over the course of the quarter, more than 7.1 billion Arm-based chips were shipped. These chips are integrated into a variety of devices including smartphones and PCs, underscoring the company's broad market reach.
Despite these robust figures, Arm experienced a net loss of $110 million due to a one-time share-based compensation worth over $500 million triggered by its IPO at Nasdaq in New York on September 14. The company projects this compensation to be between $150 million and $250 million in future quarters.
In 2022, a proposed sale of Arm to Nvidia (NASDAQ:NVDA) was blocked by regulators. Today, major tech companies like Google (NASDAQ:GOOGL) and Meta (NASDAQ:META) utilize Arm's technology in their pursuit of developing AI-capable chips.
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