Recent developments have brought upheaval for U.K. chip designer ARM Holdings
Beginning with the bad earnings news, full-year revenues dropped 15% to $229 million, while net profits took a 35% nosedive to $35.7 million. But things looked better for the fourth quarter, as revenues increased 5% over the same period in 2002, and adjusted net income edged up 11% to $6.7 million.
Now, on to the dividend flap. On this side of the pond, after years of being seen as old-fashioned, dividends are finally getting some respect. But from a company that lives under the "growth" tag, a dividend can damage its street credibility. That appears to be the assessment of many shareholders, as well as one of our Foolish colleagues in the U.K., who think the dividend announcement means that ARM Holdings has jumped the shark. But are the company's best days really behind it?
Management has given the thumbs up to analyst forecasts of 20% sales growth for 2004, and with 128 partners licensing its technology -- including well-known tech leaders Intel
Seth Jayson can be reached at FoolS@sethj.com.