Warren East, the executive who has seen UK semiconductor juggernaut ARM Holdings through some of its most explosive growth, fuelled by deals with companies like Apple for its iPhone and iPad devices, is stepping down from his job and retiring, the company said today. He is being replaced by insider Simon Segars, who is currently president of ARM. East had been with the company since 1994. The change is due to take effect on July 1.
One of ARM’s most important deals over the years has been supplying technology to Apple for its wireless devices, although that deal appears to be changing as Apple opts for its own chip designs (which are still compatible with ARM).
Despite this, ARM is seen as the biggest threat to Intel in the larger market for chips, with its designs used by the likes of Qualcomm, AMD and TSMC. It had already overtaken Intel in mobile devices but some believe that it could also start to make headway in other hardware like refrigerators, cars and more as the trend for connected devices continues. This already makes up one quarter of ARM’s business and is poised to grow.
East started out with ARM in 1994, having joined from Texas Instruments. He’s an engineer by training but had come on board to build up the company’s consulting business, eventually getting appointed CEO in 2001. Like East, Segars is also an engineer by training and has been with ARM since 1991. He has held a number of senior positions, but was only appointed president in January of this year, a sign perhaps of ARM preparing for the succession earlier on.
East’s early comments — which may get further elaborated when he and Segars hold a conference call later today — seem to point to the company needing a change of tack as it moves into those newer devices to complement the work it does in mobile, and perhaps to eventually overtake it. It’s a sign also of how in many ways the wireless industry is evolving to a place where just about anything can be considered “hardware” and is therefore open game to companies like ARM and competitors like Intel.
“We take a very long-term view about our business, and we believe that now is the right time to bring in new leadership, to execute on the next phase of growth and to plan even further into the future,” East said in a statement. “I have worked with Simon in the senior leadership team for many years and we share a global perspective and belief in the ARM approach to partnership and collaboration.”
Under East, ARM had seen operating profits grow six-fold to £263 million ($397 million) for fiscal year 2012 on revenues of $913 million. The really astounding thing is the number of chips based on ARM designs that have shipped annually in 2001 compared to 2012: up to 8.7 billion in 2012 from only 420 million in 2001, with customers growing to 322 from 77 in that time.
ARM HOLDINGS PLC ANNOUNCES CEO SUCCESSION
Cambridge, UK, 19 MARCH 2013 – ARM Holdings plc [(LSE: ARM); (NASDAQ: ARMH)], the world’s leading semiconductor intellectual property (IP) supplier, announces today that Chief Executive Officer Warren East has decided to retire from the company, effective 1 July 2013, after nearly twelve years as CEO and nineteen outstanding years at the company. Simon Segars, currently President of ARM, will become the company’s new CEO.
Warren East joined ARM in 1994 to establish the company’s consulting business and later became VP of business operations. Within three years he was appointed to the Board as Chief Operating Officer. Warren became ARM’s CEO in October 2001 and under his leadership ARM has become the foremost designer of semiconductor IP in the world, providing processor technology for nearly all mobile phones and many other consumer and industrial electronic devices in use today.
Simon Segars, 45, joined the Board in January 2005, is President of ARM, and has operational responsibility for the company’s IP divisions. Simon has been with ARM since 1991 and has held several executive roles including EVP Engineering, when he worked on many of the early ARM processors, as well as EVP Worldwide Sales and EVP Business Development. He has international leadership experience having held senior positions for ARM in both the UK and the USA.
Warren East said, “It has been a privilege to lead ARM during such a momentous and exciting time for our industry and I am proud of what the ARM team of employees and partners has achieved together while I have been CEO; ARM is a great company with a strong market position and a unique culture. We take a very long-term view about our business, and we believe that now is the right time to bring in new leadership, to execute on the next phase of growth and to plan even further into the future. I have worked with Simon in the senior leadership team for many years and we share a global perspective and belief in the ARM approach to partnership and collaboration; he is an excellent choice to lead ARM.
John Buchanan, Chairman of ARM Holdings plc, said, “Warren has transformed ARM during his time as CEO. In 2001 ARM had one processor product line found mainly in mobile phones. Now ARM provides the broadest portfolio of technologies in the industry, used by more than 300 semiconductor customers in nearly 9 billion chips last year. During Warren’s tenure the company has received royalties for over 40 billion ARM-based chips. As CEO he has created a strong platform for growth and consistently created value for shareholders even in a challenging external environment. On behalf of the Board, and the wider ARM team, deep thanks are due to Warren for his passion, service and leadership.”
“The Board is delighted to have someone of Simon Segars’ experience and calibre within ARM to appoint to the role of CEO. Following an extensive review of candidates worldwide, Simon’s proven technology expertise and management skills across a range of senior executive roles make him an excellent CEO candidate and highly qualified to take the company forward. The Board looks forward to continuing to work with Simon to build on the strong momentum that has been created over the past years”.
Simon Segars said, “I am honoured to have been appointed to succeed Warren, who has achieved so much in his time leading the business. Above all, Warren’s vision of the ARM business model and commitment to the ARM partnership has been inspirational and has created a tremendous platform for future growth. I am keen to lead the Company into the next phase of growth, working even more closely with John, the Board, our employees and our customers as well as continuing to develop the ARM partnership.”
There are no disclosures to be made under paragraph 9.6.13 (1) to 9.6.13 (6) of the Listing Rules.