back to article UK chip champ ARM flexes muscle: Shows strong profit and sales

UK processor core design biz ARM today posted double-digit profit and turnover growth for its full-year results 2014, with the company reporting a "record" number of licences signed in its fourth quarter. Profits rose 13 per cent to £411.3m at the Cambridge-based group, on revenue up 16 per cent to £795m for the year ended 31 …

  1. Stuart 22

    Good or Bad?

    "Profits rose 13 per cent to £411.3m ... on revenue up 16 per cent to £795m"

    Impressive results of which they and their shareholders should be proud.

    But that is £795m of a what sized mobile phone industry? One that wouldn't be punting the products they do without ARM. One where us users wouldn't be getting the same power without mass (ie reduced battery requirements).

    Apple can slurp billions for flashy design but the people who provide the grunt and make it possible get a pittance. It says all that needs to be said about the place of engineers in our society.

    1. Anonymous Coward
      Anonymous Coward

      Re: Good or Bad?

      So what do you propose? They should get £50 per chip produced? Does the same go for Qualcom, Samsung, Intel,Ericson,Texas Instruments etc. Your £500 phone now costs £50,000

      At then end of the day, it's only a single component of a much larger package, Yes it's important, but so are most of he other bits that others have had to design and get to work together.

      1. Tom Wood

        Re: Good or Bad?

        It's worth noting that ARM don't make the chips themselves; they design cores and license the designs. The likes of Qualcomm, Samsung and TI include the ARM core as part of their SOC designs and produce the actual chips.

        1. Yet Another Anonymous coward Silver badge

          Re: Good or Bad?

          Which is why Britain's world leading chip company gets less of the price of your iPhone than the person selling the plastic screen protector.

          It's worth remembering when you hear about innovation led industry and the value of licensing.

        2. Alan Denman

          Re: Good or Bad?

          So therefore the only thing Apple makes is a fingerprint reader.

          Yet they simply a company to do even that !

    2. Otto is a bear.

      Re: Good or Bad?

      You also have to wonder, on those kind of sales, what a Qualcomm, Apple or Oracle would charge in device royalties if they chose to "Invest" in ARM.

      I did like the BBC guy this morning who was pushing the ARM spokesman on how much of their profit was down to Apple, and what would happen if Apple went away. Now there's a man who's done his research. Ah, ARM make record profits, ARM gets revenue from Apple, Apple made record profits, therefore ARM's performance is down to Apple's.

      You do have to admire the logic, all bears are otto.

      1. Anonymous Coward
        Headmaster

        Re: Good or Bad?

        Yes, if only they would "Invest" in ARM. It is such a shame Apple didn't think about investing in ARM back in 1990......

      2. Anonymous Coward
        Anonymous Coward

        Re: Good or Bad?

        http://en.wikipedia.org/wiki/ARM_Holdings

        "The company was founded in November 1990 as Advanced RISC Machines Ltd and structured as a joint venture between Acorn Computers, Apple Computer (now Apple Inc.) and VLSI Technology.[22][23][24] The new company intended to further the development of the Acorn RISC Machine processor, which was originally used in the Acorn Archimedes and had been selected by Apple for their Newton project. Its first profitable year was 1993"

        The existence of ARM on mobile at all has a lot to do with Apple using them for their first PDA (the Newton).

        So all those nobheads saying that the iPhone changed nothing, well actually the whole ARM mobile industry leads back to that partnership between Acorn, Apple and VLSI technology.

        1. Yet Another Anonymous coward Silver badge

          Re: Good or Bad?

          The ARM cpu had already been designed and was being sold in PCs several years before that.

          What the Apple deal did was fund the spin off of ARM as separate from Acorn.

    3. Anonymous Coward
      Anonymous Coward

      Re: Good or Bad?

      But they don't provide the grunt: they provide designs which other people then implement in silicon which provides the grunt.

  2. Anonymous Coward
    Anonymous Coward

    How long can this go on for?

    How long until another provider can effectively compete with ARM on the IP for tiny cores? Or have they ammassed enough patents that makes this impossible? Or are the profits so small that the bigger players like Intel can't be bothered to spend the money on anything smaller than an Atom?

    1. Chris Evans

      Re: How long can this go on for?

      Even if someone could come up with better 'low power' cores. They have to compete with / break into a very large ecosystem. Intel despite having significantly better silicon fabrication, spending a ton of money over some years and having its own big ecosystem is barely denting ARM. Also because they are nowhere near as flexible in how they let people use their cores they have one arm tied behind their back.

    2. Yet Another Anonymous coward Silver badge

      Re: How long can this go on for?

      ARM are (or were) in a race for the bottom with themselves. If you were looking at >100,000 chips it might be cheaper to just design your own core. So ARM's royalty has to drop on large volumes (at least at the low end).

      It's a little different at the high end where the cost of support and development of development tools gets important.

    3. John Brown (no body) Silver badge
      Joke

      Re: How long can this go on for?

      "bigger players like Intel can't be bothered to spend the money on anything smaller than an Atom?"

      Ah, but from tiny Atoms do great Molecules grow...errr....or something.

      1. Nick Kew

        Re: How long can this go on for?

        Ah, but from tiny Atoms do great Molecules grow...errr....or something.

        ARM's progenitor was of course Acorn. And in Acorn's pre-ARM history, the Atom was succeeded by the BBC Micro and the Electron.

        I was mildly amused by full-of-sound-and-fury Otellini's Intel using a succession of names (Atom, Oak Trail, ...) with echoes of ARM history in its attempts to eat ARM's dinner. Imitation may be the sincerest form of flattery, but one has to wonder who at Intel had the sense of humour and who was merely clueless.

        1. Vic

          Re: How long can this go on for?

          the Atom was succeeded by the BBC Micro and the Electron.

          The BBC Micro, of course, was the "Acorn Proton" before the BBC came along and signed the contract...

          Vic.

  3. Anonymous Coward
    Anonymous Coward

    > If you were looking at >100,000 chips it might be cheaper to just design your own core.

    It's not just about building a processor core - that's relatively easy and has been done multiple times in the past by a whole variety of companies (ARC, Tensilica, etc).

    The more expensive part to reproduce is the software - providing a production quality tool chain, debugger, other development tools (valgrind, etc), operating system support, optimized codec libraries, etc is _far_ more expensive than actually developing the CPU hardware.

    I suspect one of the big reasons behind the ARM success is that it isn't just about ARM - it is really about ARM plus more or less the entirety of the rest of the silicon tech industry collaborating on a huge amount of the software and supporting infrastructure. That's almost impossible to reproduce outside of ARM and x86 (and to some extent PPC) - they have a 20 year headstart on everyone else ... and it costs a huge amount of $$$ and time to close that software support gap for any new architecture (which is one reason why Itanium never got off the ground - the software infrastructure just didn't exist to support products using the CPU).

  4. Beardy W

    The exception that proves the rule......

    ARM, the model for IP licensing, makes $0.05 per unit ($580M on 12 billion devices) for the core technology driving a >$5 CPU..

  5. Spiff66

    Everybody become a chip designer

    Can't wait for Cameron and clegg or milliband to come out with "arm is a great British success" so therefor every kid should now get into processor design.

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