Raspberry Pi (LSE:RPI) will report its first set of interim results on Tuesday, fresh from its IPO in June after being promoted to the FTSE 250 today.
Shares in the Cambridge-based hobbyist microcomputer company were floated at 280p, with a debut valuation of £541 million.
The shares soared as high as 440p, prompting a large short position to be taken out by JP Morgan's asset management division, though the shares have settled near 345p recently, for a valuation of almost £670 million.
As well as posting results for the first six months of 2024, the DIY computing platform maker's chief executive, Eben Upton, and finance chief Richard Boult will host a hybrid analyst and institutional investors later in the morning.
Financials
Since its inception in 2012, the company has sold over 60 million affordable, high-performance single-board computers (SBCs) and compute modules.
That included 7.4 million units in 2023, when the calendar year saw revenues of $265.8 million generated, with a gross profit of $66 million and an operating profit of $37.5 million. Adjusted EBITDA stood at $43.5 million.
Raspberry Pi's revenue grew by 47% and profits soared by 85%, calculated research house Third Bridge, which reckoned that pace was unlikely to continue.
“A more realistic yearly growth rate is around 20%. The strong performance in FY22-23 was driven by pent-up demand and a return to normal operations after pandemic-related supply chain issues,” the Third Bridge analysts said.
There have been more supportive views from other City analysts, with investment bank Jefferies affixing a 'buy' rating to the shares and a 448p target price.
“The company looks well-positioned to outgrow the fast-growing Industrial IoT market, with Edge AI acting as an additional driver,” Jefferies analyst Janardan Menon said in a note, referring to a partnership with machine learning and edge AI specialist Hailo that saw the launch of an Raspberry Pi AI kit launched earlier this year.
“Semiconductor and software expertise are key differentiators, alongside its strong global brand and reputation. Profitability is expected to gradually increase with higher direct-to-OEM sales.”
Raspberry Pi also boasts ESG qualities, the analyst notes, with its products helping improve standards of education and the use of digital technologies worldwide in an affordable way, and that its boards use 85% less power than a typical PC, while having a much smaller carbon footprint during production and shipment.
** Update: Details added **