Shares in Raspberry Pi tumbled in London on Tuesday after the low-cost computer maker revealed a sharp drop in half-year profits, leaving investors questioning whether one of the UK’s most high-profile tech IPOs can live up to expectations.
The Cambridge-based firm, which floated in June 2024 in one of the London Stock Exchange’s most celebrated listings in years, said its pre-tax profit fell 43 per cent to $6.2m (£4.6m) in the six months to June.
The results also showed that revenue had slipped nearly six per cent to $135.5m (£100m), while adjusted earnings were down seven per cent to $19.4m (£14.3m).
As a result, shares slid as much as five per cent this morning to 382p, leaving the group 42 per cent lower year-to-date.
The stock remains above its 280p IPO price, but well off the 780p peak it reached in January.
Investors grow restless
Chief executive Eben Upton stressed that the second half had “started well” and insisted full-year profit guidance was unchanged.
“We continued to build momentum in the half, with growing demand from our reseller channel and OEMs driving an eight per cent sequential increase in direct unit shipments and a significant customer order backlog at the end of June”, Upton said.
“Our growing pipeline of OEM opportunities, disciplined supply chain management and strong product roadmap position the business for future growth”.
The company launched seven new products in the first half and highlighted surging demand for its microcontrollers, with semiconductor volumes surpassing board sales for the first time.
But analysts warned that patience may be wearing thin. Russ Mould, investment director at AJ Bell, said: “It feels like quite a lot is riding on Raspberry Pi, which represented the most meaningful tech IPO in the UK in years.”
“There will be widespread disappointment to see its latest results prompt further share price losses. Revenue and profit are meaningfully lower for the period, and the company’s attempt to get the market to focus on sequential improvement is failing miserably,” he added.
Investors remain concerned about the impact of tariffs on components, something Upton has downplayed, as well as higher research and development costs, which rose nearly 40 per cent in the half.
Dan Lane, UK lead analyst at Robinhood, noted the market was still willing to back Raspberry Pi but flagged that expectations were now higher: “Flat volumes and a huge fall in profits don’t paint the greatest picture for one of the UK’s most notable tech hopes. That’s against a tough comparator though, and there’s a lot more to feel positive about”.
“DRAM supply and pricing is a wider concern but Raspberry Pi has enough on hand to hit sales goals. The second half should contribute a lot more meaningfully to profits. Still, valuation is a real issue and sales really need to start justifying the price tag”.
A test for UK tech listings
Founded in 2012 to make computing more accessible, Raspberry Pi has sold tens of millions of its single-board computers worldwide, used everywhere, from classrooms to industrial systems.
Its IPO last year, at a £542m valuation, was seen as a rare coup for London’s market as it battles to attract tech firms that often prefer New York.
But with profits under pressure and the share price sliding, Raspberry Pi is increasingly being viewed as a litmus test for how UK investors treat small and mid-cap tech.
As Mould warned: “The company is still relatively immature, and investors cannot expect profits to rise in a straight line. Nonetheless, any further disappointments and it may find that patience is running thin on the ground”.