Raspberry Pi Shares Fall as Record H1 Results Prompt Profit-Taking

Raspberry Pi Holdings (LON: RPI) shares fell over 9% in Friday trading, reversing most of the prior session's gains as investors took profits following the company's record-setting first-half financial results. The stock had surged more than 11% on Thursday after the British computer maker reported robust growth and raised its full-year guidance.

Stellar Results Trigger Volatility

Raspberry Pi announced a significant increase in performance for the first half of the year, which initially sent its stock to a multi-month high. The company's upgraded forecast for full-year adjusted EBITDA to come in ahead of market consensus was a key driver for the initial rally before the subsequent sell-off.

Key financial highlights from the first-half report include:

• Revenue: Rose 90% to $256.9 million, driven by higher shipment volumes and prices.
• Adjusted EBITDA: More than doubled, rising 108% to $40.3 million.
• Profit Before Tax: Increased 216% to $19.6 million.
• Unit Shipments: Board shipments grew 17% to 4.2 million units.

Operational Performance and Outlook

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The strong revenue growth was supported by a 42% rise in average selling prices, a 46% increase in accessories revenue, and a 164% jump in component sales. While gross profit grew 79% to $59.4 million, the gross margin narrowed slightly to 23% from 25%. However, gross profit per board increased by 53% to $12.2.

The company's balance sheet reflected this growth, with inventory rising by $117 million to $263 million due to strategic purchases of memory components. This contributed to a 46% year-on-year decrease in net cash to $18.4 million. Looking ahead, Raspberry Pi expects second-half unit volumes to exceed first-half levels but cautioned that the "exceptional unit economics" seen in the first half have moderated.

Analyst Commentary

Following the results, analysts at Jefferies raised their full-year forecast for Raspberry Pi, increasing their revenue estimate by 9% to $655 million and their adjusted EBITDA estimate by 16% to $64 million. The firm noted that second-half profitability would likely be lower, as the first half benefited from an estimated $15 million exceptional gain from memory inventory purchased at lower prices in 2025.

Jefferies identified continued strong demand from smart-home devices, defence products, and edge-AI applications as key growth drivers. The increasing use of Raspberry Pi boards in autonomous and unmanned systems is also expected to support higher volumes in the future.