ARM Holdings posts 72 per cent surge in profits

British chip designer's results boosted by strong mobile market trends

UK chip designer ARM Holdings has seen a 72 per cent increase in full-year profits, on the back of a boom in smartphone sales this year.

The Cambridge-based firm, which designs chips for devices such as Apple's iPad and iPhone and has recently teamed up with Microsoft in the tablet space, saw profit before tax rise to £167.4m in 2010 from £96.8m in 2009.

Revenues increased to £407m in 2010 from £305m in 2009.

The company has already kicked off 2011 in a similarly encouraging manner, with Microsoft pledging to use ARM's chips to power the next generation of its Windows operating system mobile devices, and graphics processor vendor Nvidia recently signed a licensing deal to use ARM designs as well.

As a consequence, there has been speculation that ARM is a potential takeover target, which has caused the firm's share prices to rise.

However, chief executive Warren East dismissed talk of a possible sale and said he was not concerned by the high valuation on the stock but that the firm would keep working to boost sales.

"We are well positioned to succeed with leading technology, an innovative business model and a thriving ecosystem of partners," he said.