Audio sounds sweet for chipmaker CSR
LONDON, May 1 – British chipmaker CSR posted a 38 per cent rise in first-quarter revenue today, supported by increased demand for silicon used in headphones, speaker systems and cars, and said it had hopes of gaining ground in smartphones.
The Cambridge-based company, whose technology is used in popular headphones made by “Beats by Dr Dre” and Sennheiser, saw underlying operating profit rise to US$2.7 million (RM8.18 million), from breakeven a year ago, on revenue of US$227 million.
“There are lots of people with these trendy headsets,” Chief Executive Joep van Beurden said in an interview today.
“We sell not just the bluetooth link, or the wireless link, between the headset and the iPod, but we provide extremely high fidelity audio quality, echo and noise cancellation etc, all on the same chip.”
Growth in the group’s voice and music, automotive and location platforms are helping offset declines in personal navigation devices and handsets, where CSR has suffered from a weak position in smartphones.
It is trying to make up lost ground with its new wi-fi bluetooth combination chip, which van Beurden said was on track to ramp up next year.
“We have already announced we have a tier one lead customer, and that is unchanged, but beyond there’s broad interest from a whole range of smartphone manufacturers across the world,” he said.
CSR had said in February it expected first-quarter revenue to be between US$205 million and US$225 million. Analysts were expecting, on average, US$217 million.
Shares in the group, which spiked 19 per cent in the last week on bid chatter, were up 2.8 per cent at 237 pence by 0831 GMT, valuing the group at US$765 million.
“It is just rumours and speculation,” van Beurden said in reference to the bid reports. “We are keeping our heads down and are focused on our organic growth areas and on improving our profitability.”
Analyst Ian Robertson at Seymour Pierce said CSR had delivered “an encouraging performance against an uncertain economic backdrop”.
“The mix shift away from mobile phones continues to improve the gross margin – but some more phone revenues would not go amiss,” he said.
CSR said it expected its second-quarter revenue to be in a US$245-US$265 million range, keeping it on track to meet full-year consensus, which is a US$946 million to US$1,049 million range according to Thomson Reuters data. – Reuters