A share price dip when a chief executive departs is a little like a royal curtsy or a courtroom bob – respectful, perhaps deserved, but sometimes rather knee-jerk. Sure, no investor would begrudge Warren East, who will retire in June as the boss of chip designer Arm Holdings, a bit of esteem.

When he took over the top job in 2001, Arm’s revenues were less than a quarter of last year’s $900m, and operating profits under one-fifth of their current size. With Arm-designed chips found in products from digital cameras to mobiles, the big worry was royalty growth as customers struggled with the difficult economic climate and global chip sales fell 30 per cent.

Since then, Arm has grown substantially, notably over the past three years when it has capitalised on the latest development of mobile devices. Arm shares, which slipped 3 per cent on Tuesday, have all but quintupled since the start of 2010. The timing of Mr East’s departure is slightly surprising: he is only 51. But his explanation – that this is a company that looks five to seven years ahead and to stay through to the 2020s would mean a lengthy 20 years in the top job – has some merit. Paul Otellini, US chipmaker Intel’s boss, has lasted eight.