Apple’s chip tech supplier, Arm, breaks revenue records

Apple is working on 5g, oddly enough, so is Arm

Apple’s chip designer, Arm has reported record revenue and a strong outlook for the year ahead – it looks like Cupertino sold a lot of Apple Silicon in the last year or so.

Arm announces record results

Both Arm and Apple’s chip manufacturer, TSMC, have felt the benefit of this.

“Our record results demonstrate that the demand for Arm technology and the strength of the Arm ecosystem has never been greater – our compute platform will power the next set of technology revolutions across cloud computing, automotive and autonomous systems, the IoT, the Metaverse and beyond,” said Rene Haas, CEO Arm.

“As we look ahead to a future built on Arm, our priority is to continue to deliver on our business strategy, enable partners with the solutions they need through further investment in our roadmaps and engineering talent, and together with our ecosystem redefine the future of computing.”

Data points

Here’s the top line figures from Arm.

• 2021 total revenues were up 35% to $2.7Bn with strong growth in both royalty and non-royalty revenue.
• 2021 licensing (non-royalty) revenues were up 61% to $1.13Bn as our expanded product portfolio and new business models such as Arm Flexible Access gave more customers more reasons and more ways to license Arm technology.
• 2021 royalty revenues were up 20% to a record $1.54Bn, helped by continuing strong growth of 5G smartphones, more ADAS and IVI chips going into cars, and price increases in 32-bit microcontrollers.
• Adjusted EBITDA were up 68% year on year to $1Bn, giving an Adjusted EBITDA margin of 37%.
• With more than 225 billion Arm-based chips shipped by our partners, we have the world’s largest computing footprint and a unique understanding of the complete compute spectrum.

The company said 29.2 billion chips using Arm tech were shipped last year, with around 8 billion in Q4. These chips aren’t only used by Apple, of course – you’ll find them in cars, computers from other vendors, and a variety of other places, too.

Et tu, 5G?

You’ll also find them in 5G chips. With this in mind a recent news announcement from Arm may be of interest, particularly in the context that we know Apple is working to develop its own 5G chips for its devices. Might these also be built around Arm? Arm doesn’t – and wouldn’t – say, but does claim it has at least 18 partners across the 5G ecosystem.

Arm says: “TCO savings and energy efficient network infrastructure to operate 5G has risen to the top of the list of considerations for network operators and Arm is rising to the challenge with performance per watt gains and greater throughputs in an economic envelope that has been part of our DNA from the start,” the company said.

And you know what else was part of the company’s DNA from day one? Apple.

Total speculation follows

While I don’t realistically think Apple would ever consider a complete acquisition of Arm, for a lot of different reasons (not least the $40b cost), it isn’t unreasonable to consider the possibility that some combination of companies from across industries reliant on the company’s chips may do so.

Might these include mobile firms?

I don’t know, but I can quite easily speculate on that as one potential direction of travel following the failed Nvidia purchase. After all, I can’t imagine most mobile device makers are especially happy that at present most of the figurative 5G eggs are laid by one solitary hen.

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