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ARM社が2008年第1四半期の業績速報を発表

29 April 2008

A conference call discussing these results will be audiocast today at 08:30 BST at www.arm.com/ir

ARM Holdings plc社(本社:英国ケンブリッジ、日本法人:横浜市港北区、代表取締役社長:西嶋貴史)は、現地時間の4月29日に、2008年3月31日締め第1四半期の業績(未監査)を発表しました。

 決算ハイライト(明記のない限り、US GAAPベース)

  • 第1四半期のドル売上高は前年同期比4%増の134.3百万ドル
    • プロセッサ部門(PD)の総売上高は91.1百万ドルで、前年同期比11%増
      • プロセッサ部門(PD)のロイヤリティ収入は前年同期比22%増の54.8百万ドル
      • 出荷数は889百万個
    • フィジカルIP部門(PIPD)の総売上高は、前期比7%増の20.9百万ドル
    • フィジカルIP部門(PIPD)のロイヤリティ収入は前年同期比20%増
  • グループとしての受注残高は前期と変わらず記録的な高さ
  • 税引き前利益(PBT)は21.3百万ポンド(US GAAPベースで12.2百万ポンド)、1株当たり利益(EPS)は1.17ペンス(US GAAPベースで0.69ペンス)
  • ネット・キャッシュは第1四半期末で55百万ポンド
    • 第1四半期の自社株買いは13百万ポンド
    • 第1四半期の正規化済みキャッシュ・ジェネレーションは14百万ポンド
  • 2008会計年度の成長率予測は変更なし

最高経営責任者(CEO)のWarren Eastは、第1四半期の業績について、次のように述べています。
「ARMは、2008年の順調なスタートを切りました。第1四半期の業績は、安定した業務運営を実証しています。PIPDの売上高は前期より増加し、Cortex®マイクロプロセッサ・ファミリについては、今期も7件の新規ライセンス契約が締結されるなど、引き続き高い需要が見られます。PD、PIPDの両方で、ロイヤリティ収入が前年同期比20%以上増加していることも、急速に多様化しつつあるコンシューマ・エレクトロニクス製品にARMテクノロジーが採用されていることを裏付けています。」

Q1 2008 – Revenue Analysis


Revenue ($M)*** Revenue (£M)

Q1 2008 Q1 2007 % Change Q1 2008 Q1 2007 % Change
PD            
Licensing 36.3 37.4 -3% 18.3 19.4 -6%
Royalties 54.8 45.0 22% 27.8 23.0 21%
Total PD 91.1 82.4 11% 46.1 42.4 9%
PIPD            
Licensing 11.8 16.9 -30% 5.9 8.7 -32%
Royalties 9.11 8.41 9% 4.71 4.31 9%
Total PIPD 20.9 25.3 -17% 10.6 13.0 -18%
Development Systems 14.2 13.5 5% 7.1 6.9 3%
Services 8.1 8.0 2% 4.1 4.2 -3%
Total Revenue 134.3 129.2 4% 67.9 66.5 2%

1 Includes catch-up royalties in Q1 2008 of $0.8m (£0.4m) and in Q1 2007 of $1.5m (£0.8m). 

Q1 2008 – Financial Summary


£M
Normalised* US GAAP
Q1 2008 Q1 2007 % Change Q1 2008 Q1 2007
Revenue 67.91 66.5 2% 67.9 66.5
Income before income tax 21.3 21.6 -1% 12.2 12.7
Operating margin 30.6% 30.3%
17.2% 16.9%
Earnings per share (pence) 1.17 1.14 3% 0.69 0.70
Net cash generation** 13.7 15.6


Effective fx rate  ($/£) 1.98 1.94


¹ Equivalent to £69.1m at Q1 2007 effective $/£ rate

業界の現状と展望
ARMは、PIPDの売上高が前期より増加し、PD、PIPDの両部門のロイヤリティ収入が増加するなど、2008年の順調なスタートを切りました。

当社は、半導体業界および広いマクロ経済環境の不確定性を考慮し、慎重な姿勢を取っています。この情勢と、ロイヤリティ収入に対して生じうる業界の季節的な影響を考慮すれば、恐らく第2四半期の総ドル売上高は、第1四半期を上回らないでしょう。しかし、2月の成長率予測に従い、取引環境に著しい悪化がないと仮定すると、2008会計年度のドル売上高も、少なくとも2007年に達成した成長率で増加すると期待しています。

CONTACTS:                                                                                                                                     

Fiona Laffan/Pavla Shaw                                           Tim Score/Ian Thornton                                    

Brunswick                                                                   ARM Holdings plc                                                    

+44 (0)207 404 5959                                                +44 (0)1628 427800

* Normalised figures are based on US GAAP, adjusted for acquisition-related, share-based remuneration and restructuring charges. For reconciliation of GAAP measures to normalised non-GAAP measures detailed in this document, see notes 6.1 to 6.21.

** Before dividends and share buybacks, net cash flows from share option exercises and acquisition consideration - see notes 6.12 to 6.15.

*** Dollar revenues are based on the group’s actual dollar invoicing, where applicable, and using the rate of exchange applicable on the date of the transaction for invoicing in currencies other than dollars.  Approximately 95% of invoicing is in dollars.

**** Each American Depositary Share (ADS) represents three shares.

Financial review

(US GAAP unless otherwise stated)

Total revenues
Total dollar revenues in Q1 2008 were $134.3 million, up 4% versus Q1 2007.  Sterling revenues of £67.9 million were up 2% year-on-year after a 2% weakening of the dollar against sterling (ARM’s effective rate of $1.98 in Q1 2008 compared to $1.94 in Q1 2007). At the Q1 2007 effective rate, Q1 2008 sterling revenues would have been £69.1 million.

License revenues
Total dollar license revenues in Q1 2008 fell by 12% to $48.1 million, representing 36% of group revenues, compared to $54.3 million in Q1 2007. License revenues comprised $36.3 million from PD and $11.8 million from PIPD. 

Royalty revenues
Total dollar royalty revenues in Q1 2008 grew by 20% to $63.9 million, representing 47% of group revenues, compared to $53.4 million in Q1 2007. Royalty revenues comprised $54.8 million from PD and $9.1 million from PIPD.  

Against the backdrop of growth in more sophisticated mobile phones, underlying PD royalties grew 12% sequentially and 22% compared to Q1 2007.

Total PIPD royalties grew 9% to $9.1 million including $0.8 million of catch-up royalties. Underlying royalties were up by 20% year-on-year.

Development Systems and Service revenues
Sales of development systems in Q1 2008 were $14.2 million, representing 11% of group revenues, compared to $13.5 million in Q1 2007.   Service revenues in Q1 2008 were $8.1 million, representing 6% of group revenues, compared to $8.0 million in Q1 2007.

Gross margins
Gross margins in Q1 2008, excluding the FAS123(R) charge of £0.3 million (see below), were 88.8% compared to 89.4% in Q4 2007 and 89.5% in Q1 2007. The lower gross margin in Q1 2008 is due primarily to the higher revenue contribution from technology which includes payments to collaborative partners recorded as a cost of sale.                                                                                                      

Operating expenses and operating margin
Total operating expenses in Q1 2008 were £48.4 million (Q1 2007: £48.0 million) including amortisation of intangible assets and other acquisition-related charges of £4.5 million (Q1 2007: £5.1 million),   £3.6 million (Q1 2007: £3.6 million) in relation to the fair value of share-based remuneration and related payroll taxes and restructuring charges of £0.7 million (Q1 2007: nil). Total share-based remuneration and related payroll tax charges of £3.9 million in Q1 2008 were included within cost of revenues (£0.3 million), research and development (£2.6 million), sales and marketing (£0.5 million) and general and administrative (£0.5 million). Normalised income statements for Q1 2008 and Q1 2007 are included in notes 6.20 and 6.21 below which reconcile US GAAP to the normalised non-GAAP measures referred to in this earnings release.

Operating expenses (excluding acquisition-related, share-based remuneration and restructuring charges) in Q1 2008 were £39.5 million compared to £39.3 million in Q1 2007 and £37.2 million in Q4 2007. The sequential increase in operating expenses from Q4 2007 to Q1 2008 is due primarily to salary inflation effective from the beginning of the year, the quarterly phasing profile of certain vacation pay and sabbatical accruals and a negative quarter-on-quarter foreign exchange impact on opex. Cost management remains a key focus with opex in the remaining quarters of 2008 expected to be lower than the Q1 level, subject to the potential negative impact on opex arising from movements in exchange rates.

Normalised research and development expenses were £16.3 million in Q1 2008, representing 24% of revenues, compared to £15.1 million in Q4 2007 and £16.6 million in Q1 2007. Normalised sales and marketing costs in Q1 2008 were £11.0 million, being 16% of revenues, compared to £11.1 million in Q4 2007 and £11.1 million in Q1 2007. Normalised general and administrative expenses in Q1 2008 were £12.2 million, representing 18% of revenues, compared to £11.1 million in Q4 2007 and £11.6 million in Q1 2007.

Normalised operating margin in Q1 2008 was 30.6% (6.1) compared to 31.5% (6.2)   in Q4 2007 and 30.3% (6.3)in Q1 2007. Operating margins in Q1 2008 were slightly ahead of Q1 2007 despite the weakening of the US dollar against sterling. 

Earnings and taxation
Income before income tax in Q1 2008 was £12.2 million compared to £12.7 million in Q1 2007. After adjusting for acquisition-related, share-based remuneration and restructuring charges, normalised income before income tax in Q1 2008 was £21.3 million (6.5)   compared to £21.6 million (6.7) in Q1 2007.   The group’s effective tax rate under US GAAP in Q1 2008 was 27% (Q1 2007: 25%) reflecting the availability of research and development tax credits and a reduction in the benefits arising from the structuring of the Artisan® acquisition.

In Q1 2008, fully diluted earnings per share prepared under US GAAP were 0.7 pence (4.1 cents per ADS****) compared to earnings per share of 0.7 pence (4.1 cents per ADS****) in Q1 2007. Normalised fully diluted earnings per share in Q1 2008 were 1.17 pence (6.16) per share (7.0 cents per ADS****) compared to 1.14 pence (6.18) (6.7 cents per ADS****) in Q1 2007. 

Balance sheet
Intangible assets at 31 March 2008 were £380.4 million, comprising goodwill of £345.2 million and other intangible assets of £35.2 million, compared to £344.7 million and £39.4 million respectively at 31 December 2007.

Total accounts receivable were £72.0 million at 31 March 2008, comprising £53.9 million of trade receivables and £18.1 million of amounts recoverable on contracts, compared to £68.2 million at 31 December 2007, comprising £43.7 million of trade receivables and £24.5 million of amounts recoverable on contracts. Days sales outstanding (DSOs) were 52 at 31 March 2008 compared to 49 at 31 December 2007 and 41 at 31 March 2007. Having been temporarily higher at the end of Q1 2008, DSOs are now back to more typical levels following strong cash receipts in April.  

Cash flow and share buyback programme
Net cash at 31 March 2008 was £55.2 million (6.9) compared to £51.3 million (6.10) at 31 December 2007. Normalised free cash flow in Q1 2008 was £13.7 million (6.12)

During the quarter, £13.0 million of cash was returned to shareholders through the purchase of 15 million shares. It is anticipated that the buyback programme will resume after the announcement of these results. 

Operating review

Backlog
Group order backlog at the end of Q1 2008 remained at the record high level that was achieved in Q4 2007 and was up more than 20% on the level at the end of Q1 2007.

PD licensing
Fifteen processor licenses were signed in Q1 across the entire range of processor technology. Seven Cortex licenses were signed, including one further license for our newest microprocessor, the Cortex-A9 core. Interest in ARM’s 3D Mali™ graphics technology continued to develop, with Broadcom taking a license in the quarter, further demonstrating ARM’s success in selling specialist processor technologies beyond the traditional ARM® microprocessors.

Q1 2008 PD Licensing Analysis – 542 cumulative processor licenses


Multi-use Term Per-use
Cumulative

U D N U D N U D N Total Total
ARM7 1






1 154
ARM9

 1 1
1

1 4 243
ARM11 1







1 65
Cortex-M3
1 2
1



4 18
Cortex-R4   1               1 11
Cortex-A8 1                 1 10
Cortex-A9   1               1 5
Mali      
  1       1 6
Other   1               1 30
                  Total 15 542

U:Upgrade     D:Derivative     N:New

PD royalties
PD unit shipments grew strongly in Q4 2007 (our partners report royalties one quarter in arrears) buoyed by growth in smartphones, audio players and other consumer electronics. Reported processor unit shipments were 889 million, up 7% sequentially and up 23% compared to Q1 2007. The ARM11™ family achieved 80% sequential growth and now represents approximately 3% of all units shipped. Shipments of new Cortex-based devices gathered pace with more than a quarter of a million units being shipped in a quarter for the first time. The ARM7™ and ARM9™ families now represent 57% and 40% of total shipments respectively. Not only does this demonstrate the longevity of ARM technology but it also underscores the material additional value to be derived from the significant license sales of ARM11 and later technology that have already been made.  

The proportion of total units shipped in mobile devices grew to 70%, up from 67% in the previous quarter. The cause of this shift was a significant increase in the proportion of smartphones shipped during the Christmas season which contain more ARM technology per phone than less feature-rich devices. For the quarter, an ARM technology-based mobile phone contained an average of 1.7 ARM microprocessors. As smartphones typically use more sophisticated semiconductor devices with higher average selling prices per chip and as ARM’s royalties are typically based on a percentage of the selling price of the semiconductor chip, the overall average royalty per ARM microprocessor increased from 5.9c in Q4 2007 to 6.2c in Q1 2008.

In Q1 2008, shipments in ARM-based chips in embedded devices continued to grow compared to the previous quarter. Microcontrollers continued to grow, up 55% compared with Q1 2007, and ARM powered smartcards, used in secure identity cards, credit cards and SIM cards grew 25% sequentially to 30m units. The contribution from units shipped in home and enterprise was flat with growth in units shipped in digital TV being offset by falls in digital still cameras.

PIPD licensing
PIPD license revenue increased sequentially to $11.8 million in Q1 from $10.8 million in Q4 2007. Thirteen physical IP licenses were signed in the quarter for products across the technology portfolio, including two further licenses with top ten semiconductor companies. The attractiveness of ARM’s combined processor and physical IP offer was illustrated again in Q1 with additional business being signed which included technology from both divisions.

In February, we described how the PIPD business is transitioning from the technology catch-up phase which has been a key strategic focus since the acquisition of Artisan, to a more business-as-usual state for the development of leading-edge technology. In order to facilitate this transition, a reorganization of the business was undertaken in Q1 which included the creation of dedicated design centres to align better the skill sets of each centre with the challenges of customer centric development of leading-edge technology. This alignment included the elimination of 30 positions from our US operation in the quarter resulting in a restructuring charge of £0.7 million.

Also in Q1, we have strengthened PIPD’s ability to capitalise on the longer-term growth opportunity by investing both in key engineering and commercial management and in the infrastructure to improve internal processes to drive increased productivity and improved product delivery to customers. We have increased the breadth of our product offering through the addition of products available via our web channel and achieved significant milestones in the delivery of advanced technology to tier-1 customers.

Q1 2008 PIPD Licensing Analysis - 363 cumulative physical IP licenses


Process Node (nm) Total
Platform Licenses

Metro 180/130 2
Advantage 65 1
Standard Cell Libraries

Advantage 65/90 3
Metro

180

1

Memory Compilers

Advantage

90

1
Velocity PHYs 90/65 5
Quarter Total
13
Cumulative Total
363

PIPD royalties
PIPD royalties in Q1 2008 were $9.1 million, up 4% from $8.7 million in Q4 2007 and up 9% from $8.4 million in Q1 2007. Underlying royalties for PIPD were $8.3 million up 20% year-on-year. Sequentially, underlying royalties were broadly flat, representing market share gains given the 2.3% decline (source - Gartner Dataquest, January 2008) in foundry utilization rates during the corresponding period.

People
At 31 March 2008, ARM had 1,707 full-time employees, a net reduction of 21 since the year end, following the restructuring activities in PIPD in the first quarter. At the end of Q1, the group had 659 employees based in the UK, 494 in the US, 188 in Continental Europe, 293 in India and 73 in the Asia Pacific region. 

Change to ARM’s NASDAQ ticker
On 14 April 2008, ARM American Depositary Receipts (ADR) started trading on NASDAQ under the new ticker symbol "ARMH". This change makes ARM ADRs compatible with the new NASDAQ platform and better aligns ARM with other leading NASDAQ semiconductor companies such as BRCM, INTC, MRVL and QCOM. The 3:1 ratio between ARM ordinary shares and an American Depositary Share (ADS) remains unchanged.

Legal matters
ARM is currently involved in ongoing litigation proceedings with Technology Properties Limited, Inc. Details are set out in the 2007 Annual Report on Form 20-F filed with the Securities and Exchange Commission on 7 April 2008. Based on independent legal advice, ARM does not expect any significant liability to arise in respect of these proceedings.

ARM had been involved in ongoing litigation proceedings with Nazomi Communications, Inc. The litigation has now been concluded with a ruling granted in ARM's favour.

Download Q1 2008 Earnings Release - Financial Tables (39KB .pdf ) PDF Icon

Note
The results shown for Q1 2008, Q4 2007 and Q1 2007 are unaudited. The results shown for FY 2007 are audited.  The financial information contained in this announcement does not constitute statutory accounts within the meaning of Section 240(3) of the Companies Act 1985. Statutory accounts of the Company in respect of the financial year ended 31 December 2007, upon which the Company’s auditors have given a report which was unqualified and did not contain a statement under Section 237(2) or Section 237(3) of that Act, will soon be delivered to the Registrar of Companies.

The results for ARM for Q1 2008 and previous quarters as shown reflect the accounting policies as stated in Note 1 to the US GAAP financial statements in the Annual Report and Accounts for the fiscal year ended 31 December 2007 and in the Annual Report on Form 20-F for the fiscal year ended 31 December 2007.

This document contains forward-looking statements as defined in section 102 of the Private Securities Litigation Reform Act of 1995.  These statements are subject to risk factors associated with the semiconductor and intellectual property businesses.  When used in this document, the words “anticipates”, “may”, “can”, “believes”, “expects”, “projects”, “intends”, “likely”, similar expressions and any other statements that are not historical facts, in each case as they relate to ARM, its management or its businesses and financial performance and condition are intended to identify those assertions as forward-looking statements.  It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a number of variables, many of which are beyond our control. These variables could cause actual results or trends to differ materially and include, but are not limited to: failure to realize the benefits of our recent acquisitions, unforeseen liabilities arising from our recent acquisitions, price fluctuations, actual demand, the availability of software and operating systems compatible with our intellectual property, the continued demand for products including ARM’s intellectual property, delays in the design process or delays in a customer’s project that uses ARM’s technology, the success of our semiconductor partners, loss of market and industry competition, exchange and currency fluctuations, any future strategic investments or acquisitions, rapid technological change, regulatory developments, ARM’s ability to negotiate, structure, monitor and enforce agreements for the determination and payment of royalties, actual or potential litigation, changes in tax laws, interest rates and access to capital markets, political, economic and financial market conditions in various countries and regions and capital expenditure requirements.

More information about potential factors that could affect ARM’s business and financial results is included in ARM’s Annual Report on Form 20-F for the fiscal year ended 31 December 2007 including (without limitation) under the captions, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which is on file with the Securities and Exchange Commission (the “SEC”) and available at the SEC’s website at www.sec.gov.

ARM社概要
ARMは、ワイヤレス、ネットワーク、デジタル家電、画像、自動車、セキュリティ、そしてストレージ機器といった高度なデジタル製品のコアとなる技術をデザインしています。ARMが提供する総合的な製品・IP(知的財産)には、16/32 ビット組込みRISC マイクロプロセッサ、データエンジン、グラフィック プロセッサ、デジタルライブラリ、組み込みメモリ、ペリフェラル、ソフトウェア、開発ツールならびにアナログ機能や高速インターフェース製品が含まれます。 ARM は、ARMの幅広いパートナーコミュニティと共に、信頼性の高い製品を迅速に市場へ投入するためのトータルシステムソリューションを、大手エレクトロニクス企業に提供しています。ARMについて詳しくは当社Webサイトをご覧ください。(http://www.jp.arm.com/

※ARMはARM社の登録商標です。ARM7、ARM9、ARM11、CortexとMaliは、ARM社の商標です。その他のブランドあるいは製品名は全て、それぞれのホールダーの所有物です。「ARM」とは、ARM Holdings plc(LSE:ARM、NASDAQ:ARMHY)、その事業会社であるARM Limited、各地域の子会社であるARM Inc、ARM KK、ARM Korea Ltd.、ARM Taiwan Ltd、ARM France SAS、ARM Consulting (Shanghai) Co. Ltd., ARM Belgium N.V.、ARM Germany GmbH、Keil Elektronik GmbH、ARM Embedded Technologies Pvt. Ltd.、そして、ARM Norway, ASの全部または一部を意味します。


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