Raspberry Pi Holdings PLC (LSE:RPI) shares dropped after the maker of single-board computers reported a year-on-year fall in revenue and profit, but said it was encouraged by "momentum building" and kept its profit guidance unchanged for the full year.
Volumes are expected to be higher in the second half, the FTSE 250 company said, supported by strengthening demand and a "substantial" order backlog that stood at approximately 600k units at the end of June.
After worries were raised by some analysts about supplies of dynamic random-access memory (DRAM), the FTSE 250 group said it has sufficient supply on hand and on order to meet its sales goals for the year, and has "several commercial and technical options to mitigate shortages or further price rises" for next year.
Revenue for the first six months of the year came in at $135.5 million, down 6% versus a year ago, but up 9% sequentially compared to the second half of last year as evidence of the improved momentum.
Moreover, revenues from direct sales of single-board computers and compute modules increased 21% compared to H1 2024 and 27% versus H2, which the company said reflected strengthening demand from existing and new OEM customers.
Adjusted EBITDA fell 7% to $19.4 million, but was up 19% sequentially. Profit before tax plunged 43% to $6.2 million. Gross margin increased to 25% from 24% in H1 2024, and was flat sequentially.
Profitability was said to be in line with the board's expectations, with CEO Eben Upton the group was "on track with profit expectations unchanged, underpinned by strong anticipated sales volumes and unit economics in the second half".
He hailed growing demand from the reseller channel, with OEMs driving an 8% sequential increase in direct unit shipments, as well as the uptake of new products and growing customer order backlog.
"Our growing pipeline of OEM opportunities, disciplined supply chain management and strong product roadmap position the business for future growth."
Cash stood at $34.3 million, down from $40.4 million after paying off extended payables, with further normalisation of creditor days expected through the second half.