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ARM beats Q3 earnings targets on strong chip royalties, launches IoT education kit in China

ARM CEO Simon Segars said the company's 17 percent compound annual growth in royalties was bolstered by strong adoption of its recently introduced ARMv8-A based chips.

ARM Holdings easily surpassed earnings expectations Wednesday, reporting a 27 percent rise in third-quarter profit.

The British chipmaker, which supplies low-power chips to tech firms worldwide including Apple and Samsung, posted overall revenue of £243.1 million (US $375.5 million) with earnings of £7.61 pence per share (US 35 cents) (statement).

Analysts were expecting $371 million and 35 cents per share.

Net cash came in at £86.6 million, while processor licensing revenue grew 5 percent year-over-year.

ARM CEO Simon Segars said the company's 17 percent compound annual growth in royalties was bolstered by strong adoption of its recently introduced ARMv8-A based chips.

"These new chips are now shipping in a wide range of devices including smartphones, enterprise equipment such as base stations and servers, and consumer electronics such as digital TVs," Segars said in a statement. "ARM technology is being deployed in an increasingly diverse range of products and markets, from the ubiquitous sensors that will form the Internet of Things, to energy-efficient smartphones, to high-performance servers."

On a similar note, ARM has thrown its support behind China's expanding Internet of Things movement.

The company said Wednesday it will provide a cloud-enabled IoT education kit to universities in the region and teach students how to use the company's mbed IoT device platform. The kit will first land at Peking University's new PKU-ARM-ST-Nordic Smart Device Innovation Lab.

According to Mike Muller, chief technology officer for ARM, the kit allows students to take an IoT-centered approach to learning, and ultimately create industry-ready engineers straight out of university.