High-flying Raspberry Pi optimistic about 2025
The low-cost computing platform and hugely successful IPO has nothing to fear from developments in AI that sent shockwaves through the tech sector this week. City writer Graeme Evans explains.
29th January 2025 14:20
by Graeme Evans from interactive investor
AI’s advance nearer to the “sweet spot” of Raspberry Pi Holdings (LSE:RPI) was today flagged in the City after the low-cost computing platform hailed the success of its first year on the stock market.
The FTSE 250 company traded above 700p for the first time this week as investors speculated over the implications of DeepSeek’s creation of a powerful AI model at a cheaper price.
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Broker Peel Hunt said: “The recent AI efficiency gains, we believe, position AI within Raspberry Pi’s sweet spot without requiring Raspberry Pi to evolve to match where AI is headed.”
Raspberry Pi made no reference to the AI developments beyond saying today that its medium-term fundamentals remain “extremely positive”.
It expects demand to build gradually throughout the current year, despite a challenging economic backdrop and the tough market conditions facing the wider industrial sector.
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As well as products aimed at its education and enthusiast customers, the company has launched an expanded range of applications using Raspberry Pi’s Compute Module.
The product line is already in use by more than 1,000 industrial customers, with shipments set for a further boost following November’s strategic partnership with an Italian provider of IoT solutions, payment systems and industrial hardware.
Boosted by a greater public profile since its June IPO, the company has reported an increasing number of discussions with industrial-focused original equipment manufacturers.
Peel Hunt said the recent partnership with Italy’s Seco highlighted how Raspberry Pi has evolved its mindset from the company’s origins as a non-profit and engineering-first business.
The maker of high-performance, low-cost general-purpose computing platforms began trading in 2012 and has sold over 60 million units for industrial internet-of-things purposes, as well as to enthusiasts and educators in markets worldwide.
The 7.4 million sold in 2023 led to revenues of $265.8 million (£210.5 million).
The shares were initially priced at 280p in one of the UK’s few IPOs of 2024 before a sharp upturn towards the end of the year took its valuation above £1 billion.
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Founder and chief executive Eben Upton said he was proud of the group’s performance in its first year as a PLC. He said significant milestones included promotion to the FTSE 250 index and the successful launch of key products against a backdrop of challenging end-market demand.
Today’s update showed that elevated inventory levels continued to normalise in the second half of the year, with units per month recovering from summer lows to total seven million for 2024.
More than 20 new products were launched in the year, including AI accessories, the microcontroller-based Pico 2 and a 16GB Pi 5 for memory-hungry use cases.
Together with good cost discipline, the company expects adjusted earnings of not less than $36 million when it reports maiden annual results on 2 April. Shares today fell 26p to 714p as this is at the low end of the City consensus between $35 million and $40.8 million.
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