Normalised figures quoted below for operating margin, profit from operations and EPS are non-GAAP measures. For reconciliations of IFRS GAAP measures to normalised non-GAAP measures, see page 12.
Royalty
Licensing
Other
ARM’s revenue growth is sustained by our customers incorporating ARM technology in more of their product lines.

Profit under IFRS
Normalised profit
Growing revenues and continued financial discipline drive ARM’s profitability.

Regular licences and robust royalties deliver a reliable cash flow.
Operating margin under IFRS
Normalised operating
ARM’s financial discipline balances long-term R&D investment with cost control to improve operating margins over time.
Diluted EPS under IFRS
Normalised Diluted EPS
In 2008, on top of increasing profitability, the strengthening of the dollar vs sterling assisted EPS growth.
Dividend
Share buybacks
Reliable cash generation allows dividend growth.
* Free cash flow is defined as movement on cash, cash equivalents, marketable securities and short-term investments, adding back share buybacks, dividend payments, investment and acquisition consideration, and deducting inflows from share option exercises and proceeds from investment disposals.