Analyzing ARM Holdings: KPIs, Competitive Position, and Business Model

This report provides a comprehensive analysis of ARM Holdings, focusing on its Key Performance Indicators (KPIs) in comparison to its major competitors, Intel and Imagination Technologies. It examines various financial metrics such as revenue, gross profit, R&D expenses, net income, ROCE, ROA, ROE, operating margin, and current ratio, interpreting the trends and performance of each company. The report also assesses ARM Holdings' competitive positioning using the 4Cs framework (Company, Competition, Resources, and Customers) and outlines its business model using the Business Model Canvas, highlighting key partners, activities, resources, value propositions, customer relationships, channels, customer segments, cost structure, and revenue streams. The analysis identifies strengths, weaknesses, opportunities, and threats, providing a holistic view of ARM Holdings' strategic landscape. Desklib offers a wealth of similar solved assignments and past papers to aid students in their studies.

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Part -1
you did not use the Harvard method in terms of referencing – write down within the text where you got the information from –
see the both examples google and Samsung------write with the each KPI and throughout the assignment I need the referencing-
I cannot pass without it. Also I am surpsired that you did not put any numbers and labeled any graphs and tables- check your
reference again. Number all the graphs and lebell them with name and number. – see google example to do referencing of all
images/graphs and tables and within the text also.
1) Key Performance indicators of ARM Holdings and two of its largest competitors, Intel and Imagination Technologies
KPI ARM HOLDINGS Intel I
m
a
g
i
n
a
t
i
o
n
T
e
c
h
n
o
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l
o
g
i
e
s
Write the $ or pound sign and m for
million sign
201
1
(+/-
%)
(+/-%) 2013 (+/-
%)
201
4
(+/-
%)
201
5
2011 (+/-
%)
2012 2011 (+/-
%)
201
2
(+/-
%)
2013
Revenue (GPB Mil) 492 17
%
24% 715 11% 795 22
%
968 5399
9
-
1%
5334
1
98 30
%
127 19
%
151
Cost of revenue (GPB Mil) 28 14
%
22% 39 -3% 38 3% 39 2024
2
0% 2019
0
21 0% 21 0% 21
Gross profit (GPB Mil) 464 17
%
24% 675 12% 757 23
%
929 3375
7
-
2%
3315
1
77 38
%
106 24
%
131
Gross profit margin % 94.4 0% 0% 94.5 1% 95.2 1% 95.9 62.5 -
1%
62.1 78.8 6% 83.5 3% 86.3
Research and development
(GPB Mil)
165 1% 22% 203 10% 224 24
%
278 8350 22
%
1014
8
45 33
%
60 40
%
84
Total operating expenses
(GPB Mil)
315 7% 55% 522 -
14%
448 17
%
523 1628
0
14
%
1851
3
60 37
%
82 45
%
119
Net income (GPB Mil) 113 42
%
-35% 105 143
%
255 33
%
340 1294
2
-
15
%
1100
5
19 5% 20 -
70
%
6
Basic 0.25 40
%
-37% 0.22 150
%
0.55 31
%
0.72 2.46 -
11
%
2.2 0.08 0% 0.08 -
75
%
0.02
EBITDA 170 41
%
-20% 191 84% 352 30
%
457 2388
6
-
6%
2248
5
20 70
%
34 -
38
%
21
ROCE % 11.5 23 -41% 8.3 116 17.9 13 20.3 24.6 - 18.6 17.62 - 12.2 - 2.74
2

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2 % % 4 % 3 2 24
%
6 30
%
9 78
%
ROA % 9.45 23
%
-42% 6.75 118
%
14.7 17
%
17.1
7
19.2
7
-
27
%
14.1
6
15.08 -
30
%
10.5
7
-
78
%
2.28
ROE % 11.5
2
23
%
-41% 8.33 116
%
17.9
9
14
%
20.4
3
27.1
5
-
17
%
22.6
6
18.2 -
30
%
12.7
7
-
73
%
3.4
Current Ratio (%) 2.26 26
%
-2% 2.78 21% 3.35 8% 3.61 2.15 13
%
2.43 4.7 -
11
%
4.2 -
63
%
1.55
Total Asset (GPB Mil) 130
0
13
%
12% 1638 12% 183
7
15
%
212
0
7111
9
19
%
8435
1
175 22
%
213 59
%
339
Operating Margin (GPB Mil) 30.3 19
%
-40% 21.5
%
81% 38.9 8% 41.9 32.4 -
15
%
27.4 16.58 34
%
22.2
5
-
67
%
7.45
Start the years from 2015 to 2011 .
Add more KPI’s especially 1 Global market share and 2- profitability and general – See the attached Google pdf example.
Graphs & Interpretation:
 Constant increase in revenue for ARM Holdings from 2011 to 2015 indicates that company’s products
and services possess great demand in the target market. However, it shows the positive hike of 5% from 17%
to 22% in past five years. While on the other hand, Intel revenue has decreased significantly in 2011, 2012
and 2013 with the respect of -1%. Similar to this, KPI indicates poor condition of Imagination technologies as
its sales volume has declined considerably in past 3 years from 30% to 19%.
 In addition to this, cost R&D department for ARM Holdings and Imagination Technologies are showing
increasing figures whereas, for Intel it is showing decreasing results. This indicates Intel due to decreasing
revenue is unable to invest in the same [3]. While the other two companies have are constantly investing huge
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in R&D department as their financial status are relatively stable.
 Negative net income for all three companies in past years indicates that they are not able to satisfy the
needs and wants of customers due to which they are unable to attract large number of audience for buying
services [48].
 ARM Holdings shown unstable return on equity till 2013 as thereafter firm is able to provide better
return on the equity capital for its stakeholders. On the other hand, Intel and Imagination Technologies has
been showing declining results which indeed created negative image within the minds of investors for the
future investments [31].
 Despite of decreasing ROCE, ARM Holdings plc has been able to maintain positive results whereas both
its competitors are unable to generate positive outcomes which clearly indicates that they are unable to
generate return on the employed capital [2].
 Liquidity position of ARM Holdings plc is showing significant outcomes which signify that firm has
adequate amount of currents assets to overcome its short term financial obligations. Contradicting to this,
current ratio of its art rival is showing negative outcomes in past year indicates their incapability in meeting
short term financial needs or commitments [41].
 Rationale behind decreasing net income in all three firms is because of incapability in generating profit
from the operations. It is because of the fact, operating margin ratio of the all three firms showcase declining
results [38].
 Significant decrease in earnings per share for all three firms indicates the incapability of providing
expected dividends to the shareholders.
Interpretations
As per the above graph showing return on equity of all the companies it depicts the true position of the three
companies in terms of the rate of return on equity. The growth of Intel shows declining position from 2011 to
2013 from high to low. The graph of imagination technology is inclining downward from moderate to
negative. This graph also depicts the growth rate of ARM from moderate to high position among all
companies.
Under the graphs – now add the individual interpretation of each kpi used above – see Samsung Microsoft word
example attached
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2 Positioning of ARM Holdings: 4C’s as component of ARM’s Eco-system
Company
Strength
 Strong brand name enhances the ability to charge high for its products and services.
 Asset leverage assist the course of ARM Holdings to make the best possible use of operational
assets for expanding business and improving market share.
 High customer loyalty [3].
 Superior technology leads to satisfy diverse expectations of customers.
 Uniqueness of products distinguish ARM from its competitors and allow company to charge
higher prices [47].
Weakness
 Weak R&D slow down the growth of ARM Holdings.
 Weak online presence restrict firm to lose the opportunity of generating high revenues [5].
 High debt burden enhances the risks of business as one bad decision may lead to situation of
bankruptcy [50].
Threats
 Availability of substitute product is one of the major threat for the firm.
 Recession or bad economy may affect adversely on the number of customers [6].
 Increasing international competition can negatively affect the course of ARM Holdings [52].
Resources
 Acquisition of Sansa Security, provider of hardware security IP in 2015.
 Acquisition of Wicentric and Sunrise Micro Devices for Bluetooth smart stack and radio
intellectual property (IP) in the same year [56].
 ARM renewed its $5 million research partnership with University of Michigan in 2011 to focus
on ultra-low energy and sustainable computing.
 More than 50 billion chips have been produced by ARM Holdings plc in 2014 [7].
Competition  Intel invest $1.5 million in loTchuip R&D in Ireland. [14]
 Imagination made a loss of £63.2 million pre-tax in 2016, which is down from 2.2 million profit
of the previous year. Further, company’s revenue has dropped by 23% to £120 million. [13]
 Acquisition of companies like Vuzix, Lantiq, Altera, Recon, Saffron technology in 2015 has
enhanced the level of business for Intel. [17] Recently, Intel has acquire German and Italian firms
i.e. Ascending Technologies and Yogitech to enhance its UAVs and loT security. [15] [16]
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Customers  B2C: ARM processors are used in all modern mobile phones, CPUs which are easily used by
consumers around the globe.
 B2B: ARM processors are used as the main CPU for smartphones which includes the
manufactures like Apple, HTC, Nokia, Sony Ericsson and Samsung.
Collaborators
Alliances ARM and Samsung are extending their strategic alliance through long term licensing agreements.
Acquisitions  Sansa Security [35]
 Wicentric
 Sunrise Micro devices
 Carbon design system [60]
 PolarSSl
Partners  Microsoft: In 2011, Microsoft revealed that Windows 8 operating system will run on ARM
architecture platform [17].
 University of Michigan: $5 million researcher partnership which emphasize on ultra-low energy
and sustainable computing.
Licenses
 ARM Core licensees: There are several companies that possess 64-bit ARMv8-A core licensees
i.e. Samsung, Broadcom, HiSiliconetc [57].
 ARM Architectural licensees: It is 64-bit ARMv8-A architectural license [33].
 Mali licensees: This indicates the licensees of the Mali GPU designs hold by Rockchip and
Allwinner.
Suppliers Deals as an IP firm, ARM Holding does not hold widespread supply chain of raw materials but makes
purchase of varied goods and services from 900 suppliers around the globe.
Here you would need to do big changes- heading should be Positions of Arms compared to intel and imagination see
example of Samsung Microsoft word . Write the components which can give you the comparison of arms with its
rivals.
After writing about positioning you have to write the next Heading which will be 5c’s of ARMS – see google example
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So basically you will keep the no.2 part writing as it and change the name as 5 cs of Arms but will have to write
positioning of Arms against rivals in a separate section.
3. ARM Holding Business model Canvas
Key partners
 Microsoft: In 2011, ARM Holding signed the partnership deal with Microsoft for providing architecture platform to the Windows 8
operating system [58].
 University of Michigan: Is one of the major partner of ARM Holdings wherein, both the firms aim at developing ultra-low energy and
sustainable computing. However, the deal of research partnership was signed at $5 million [32].
Key Activities
 Manufacturing: Primary business is to design ARM processors (CPUs) which are used by leading companies like Apple, Samsung
etc. Further, it manufactures Mali line of graphics processing units (GPU) which are used in laptops in over 50% of android tablets.
ARM’s core designs are used in chips that support many common network related technologies in smartphones i.e. Bluetooth, WiFi, and
broadband [36].
 Research and Development: High investment is made in R&D department of the company to bring constant innovation and updation
within the processors manufactured by the firm. This also aids in satisfying the needs and wants of B2B clients [18]. Normalised
expenses on research and development has increased to £217 million in 2015 to extend the product portfolio. Along with this, another 74
million was invested in acquisitions to accelerate product development and create new revenue streams [34].
 Acquisitions: Acquisition of Sansa Security, provider of hardware security IP in 2015. Further, acquisition of Wicentric and Sunrise
Micro Devices for Bluetooth smart stack and radio intellectual property (IP) in the same year.
Key Resources
 Human resource: ARM Holdings consist of 3300 employees which aims to carry out given tasks and operations in effective and
efficient manner [34].
 Intellectual property: In year 2013, ARM Holdings became the part of consortium of the firms that has acquired the right to patent
portfolio of MIPS technologies. This indeed minimizes the potential risks of future litigation with the patents. In the following year, cited
firm filled 171 patents application across the globe which increased the number of patents owned by ARM to 2500 [51].
 Development tool: The major portfolio of ARM is to manufacture microprocessor designs and graphics processing unit (GPU) designs
which are mainly used in smart phones, tablets, laptops etc. of leading companies like Apple, Samsung, Nokia, HTC and Sony Ericsson
etc [19].
 Brand value: In 2014, brand value of ARM Holdings was recorded at £567 million which clearly indicates the better goodwill of the
company in the market [37].
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 Physical resources: ARM operates in different parts of the world that comprises of Europe, United States and Asia Pacific with 35
well established offices in the countries of these continents [54].
Value proposition  ARM create value for partners by employing engineers to develop advanced processors, IP, tools and software that company license to
its B2B segment for the development of consumer electronics. Licensing helps the course of partners to acquire technology at cost
effective [51].
 By recovering costs from licensing technology helps in generating high revenues and profits which indeed leads to create value of
shareholder by providing them better returns at the end of year [20].
 In context to long term value preposition, company reinvest in R&D as well as hire more skilled and capable engineers to develop new
technology and bring constant innovation within the firm [40].
 ARM creates value by shipping chips to different parts of the world. Along with this, licence and royalty income in which till date
1348 cumulative licences are signed [55].
Customer segment  B2C: ARM processors are used in all modern mobile phones, CPUs which are easily used by consumers around the globe.
 B2B: ARM processors are used as the main CPU for smartphones which includes the manufactures like Apple, HTC, Nokia, Sony
Ericsson and Samsung [21].
Customer Relationship  In this, management aims at developing innovative processors for the companies that have license to create value for money as well as
maintain long term relationship with them [53].
 Herein, managerial level people are encouraged to emphasize on after sale services for several service centers has been established in
different parts of the target market [22].
Distribution Channel  Directly with the clients
 Through factories or licenses
Cost structure
 There are different costs that are associated with the functioning of ARM Holdings plc:
 Manufacturing: Producer of different microprocessor chips and IP is the major costs that cited firm has to incur to satisfy needs and
expectations of clients [39].
 R&D: High investment of £217 million in research and development department to extent the product portfolio of the ARM Holdings
[23].
 Distribution: There are two method through which ARM distributes its quality of products and services i.e. directly to the clients and
through licensing [69].
 Marketing and advertisement: Huge investment is made in the marketing prospects of the business as to overcome the level of
competition as well as create awareness among the target markets of international boundaries [76].
Revenue Streams  Total revenue of £968.3 million has been generated in year 2015 from different portfolios.
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 However, revenue grew by 15% in 2015 as existing customers adopted and deployed ARM latest technology in their current and
future products [73].
 Along with this, 39 new companies signed the license with ARM technology [70].
 In 2015, 15 billion units of chips containing ARM cores has been sold within the target markets.
Add some more detail in BM canvas image.
4. Acquisition of ARM Holdings Plc
Company Standard Industrial classification Value added to ARM Holding
Sansa Security (2015) Hardware security and software
industry
This added value by enhancing ARM’s IP security and software for advanced system on chip
components [9].
Wicentric (2015) Value for partners by adding Bluetooth smart smack [64].
Sunrise Micro Devices (2015) Intellectual property company The acquisition resulted in development of ARM® Cordio® portfolio in which IP of both companies
were integrated [13].
Carbon design system System validation solution industry This acquisition added value for ARM by improving its operating system as well as software system
verification and interconnect performance analysis has been improved significantly [46].
PolarSSI (2014) FlowLink Driver Software Software library implementing the SSL and TLS protocols [63].
Falanx (2006) Security and intelligence provider This added value by incorporating portfolio of 3D graphics accelerators. Along with this, acquisition
assist in hiring specialists who are proficient in developing silicon on insulator physical [49].
5. TWOS Analysis of ARM Holdings
External opportunities (O) External Threats (T)
 Constantly increasing demand of smartphone
leads to generate better revenue for the
microprocessor portfolio of the company [62].
 Improving outlook for semiconductor market
[24].
 Demand of low electric power consumption in
 High degree of competition especially in
microprocessor portfolio has affected the course of
ARM Holding [65].
 Constantly advancement in technology is major
threat as it could hinder the overall processes of
ARM Holdings [66].
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portable devices is increasing at significant pace
[67].
Internal strength (S) S-O S-T
 Strong brand name enhances the ability to
charge high for its products and services.
 Asset leverage assist the course of ARM
Holdings to make the best possible use of
operational assets for expanding business and
improving market share.
 High customer loyalty
 Superior technology leads to satisfy diverse
expectations of customers.
 Uniqueness of products distinguish ARM from
its competitors and allow company to charge
higher prices.
 Use customer loyalty to increase the sales of
microprocessor portfolio so as to generate higher
profits [25].
 Make optimum utilisation of superior
technology for enhancing the outlook for
semiconductor market [68].
 Develop USP in low electric power
consumption for the portable devises to charge high
than competitors and enhance sales volume [71].
 Make optimum use of brand image to maintain
the sales performance of different portfolio of the
ARM.
 Use of asset leverage in acquiring advanced
technology will help in enhancing the overall
functioning of ARM [72].
Internal Weakness (W) W-O W-T
 Weak R&D slow down the growth of ARM
Holdings.
 Weak online presence restrict firm to lose the
opportunity of generating high revenues.
 High debt burden enhances the risks of
business as one bad decision may lead to situation
of bankruptcy.
 Invest in R&D to acquire advanced
technology for enhancing future contingency [75].

 Create USP of sustainable computing through
making use of online marketing or promotional;
campaign [74].
 Develop revenue streams through meeting the
demand of microprocessor portfolio in varied target
markets [80].
 Set proper budget for enhancing the R&D
department of ARM Holdings [78].
 Legal and compliance to ensure that disputes
regarding patents are addressed before progressing
to lawsuit stage [81].
 Focus on licensees in B2B and B2C segments
[26].
 Increasing debt may create obstacle in
acquiring advanced technology [79].
6: Eco system
Knowledge Testing Standards
Innovations, working with partners and self-selectors. Assist in creating road map for developing, trail and Growth of IP that is by means of exchanging of services,
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Research and development investments.
Advantage from partners IP and sharing of patents by
the means of licensing [27].
Use of new and unique technologies
Increasing efficiency of its employees
Enhancing business operations
market new products [42].
Offers ideal environment for testing and trail of the
innovative technologies.
Creative talent of employees judged by giving
challenges
Secure long lasting relations
products and interaction in the eco-system [45].
Pre-determine standards help company to improve its
services.
Growth of IP
Self-recruitment process
The eco system is very weak – add more key information in this section.
7. ARM Holding’s Leadership- Synthesis of McKinsey 7S Framework, Balance scorecard and Senge’s 5th Discipline
System Considering the increasing opportunities as well as obstacles in foreign market, ARM Holdings abiding the collaborative system in which
management emphasize on developing and maintaining quality of long term relationship with stakeholders and partners [82].
Strategy The purpose of ARM existence is to prepare chip for smart phones, tablets, laptops etc. however, increasing demand of smartphones has
helped the course of ARM to generate higher business volume. Further, company employ strategy of license to develop customers for the
microprocessor [28]. Furthermore, acquisition strategy is paying great returns as ARM is constantly enhancing its operating system and IP
for meeting the expectations of clients or customers.
Skills, learning and growth Management of ARM constantly focus on training and development so as to enhance learning and skills of engineers. Innovation and
creativity is the base for growth of ARM in existing market [84].
Style and staff
 Staff: At present, ARM Holdings plc possess 3300 skilful and capable workers who are highly educated engineers. Herein, better
working environment encourages employees to put their best in delivering the best to clients [83].
 Style: Managerial level people abide democratic leadership style to guide and direct workers. It leads to enhance employee
engagement within the organisation. This leads to maintain coordination between the employees and helps them to execute operations
in correct manner [29].
Structure At present, ARM Holdings possess vertical structure which consists of board of directors, top, middle and lower level of management.
Shared values ARM create value for partners by employing engineers to develop advanced processors, IP, tools and software that company license to its
B2B segment for the development of consumer electronics. Licensing helps the course of partners to acquire technology at cost effective
[30].
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red colour writing notes are the feedback to make the amendments.
Change the heading into Mckinsey’s 7s framework & 5th Discipline.
See google- pdf file and make the exactly the same.
After this section make a new heading as 8: Arms’s Leadership and its styles.
In that section you have to mention the keys events or incidents happened in the last 10 years, how arm cope with the
incidents. How leaders were affected with these incidents and how they will involved in such events. Mention the events that
cause any changes in the organisation and leadership. What are the styles of leadership current and past-both. How KPI s and
Mckinsey’s 7s were affected by those incidents and then changes and then leadership styles also?
8. SWOT Analysis
9.Success factors of ARM holding
Innovative design and products ARM holding is known for developing innovative products. In past years it bring many changes in its product lines. It also
develop new products. This is the reason due to which it is one of the top company in its sector. Forbes put ARM holding in the
list of most innovative company [86]. Mentioned company always remain ahead of its competitors in terms of revenue earning
and product development. Hence, technology development play an important role in growth of an organization.
Management practice Management of ARM holding is sound and innovative in nature. Managers of the firm always try to identify the new ways that
they can adopt for speeding up growth rate of an organization. They time to time evaluate business environment and identify the
changes that can be bring in their products to meet business requirements [90]. This is the reason due tom which firm is ahead of
its competitors.
Capital power Firm is earning sufficient amount of revenue in its business. Thus, it have huge quantity of capital in its business. The available
capital is used to make heavy expenditure on research and development projects [91].This is the reason due to which firm is
known for innovation in its product.
Capability to create new market Firm is capable to create new market for itself. This is because it is known for doing innovation in its product line. Its product is
acceptable around the world by top companies [89]. Hence, when it introduce any new innovative product in the market firms
adopt same. As a result, firm is capable to create new market for itself.
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