ARM's (ARMH +2%) chip royalty rate will rise to 1.5% next year from 1.3% last year, and could...

|About: ARM Holdings, plc (ARMH)|By:, SA News Editor

ARM's (ARMH +2%) chip royalty rate will rise to 1.5% next year from 1.3% last year, and could approach 2% by 2020, says Canaccord's Matthew Ramsay in an upbeat note that's helping the CPU core giant make new all-time highs. Higher Cortex CPU core and Mali GPU core shipments are lifting ARM's chip royalties, as is the adoption of quad and (in Samsung's case) octa-core mobile processors. Ramsay adds ARM, which saw chip shipments rise 35% Y/Y in Q1, could have a 50% CPU share by 2020, up from a current 32% - if that happens, microcontrollers and other embedded chips will play a big role. Shares trade at a lofty 53x 2013E EPS.