CEVA

Image source: The Motley Fool. Monday, Aug. 10, 2026 at 8:30 a.m. ET Chief Executive Officer - Amir Panush Chief Financial Officer - Yaniv Arieli Vice President, Market Intelligence, Investor, and Public Relations - Richard Kingston Operator: Good day, and welcome to the CEVA, Inc. Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please note, today's event is being recorded. I'd now like to turn the conference over to Richard Kingston, Vice President, Market Intelligence, Investor, and Public Relations. Please go ahead, sir. Richard Kingston: Thank you, Rocco. Good morning, everyone, and welcome to CEVA's Second Quarter 2026 Earnings Conference Call. Joining me today are Amir Panush, Chief Executive Officer, and Yaniv Arieli, Chief Financial Officer. Before handing the call over to Amir, I'd like to remind everyone that today's discussion contains forward-looking statements that involve risks and uncertainties, as well as assumptions that if they materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such statements. We will also discuss certain non-GAAP financial measures, which we believe provide investors with additional insight into our core operating performance. Reconciliations between our GAAP and non-GAAP results are included in the earnings release issued this morning and available on the Investor Relations section of our website. With that, I'll turn the call over to Amir. Amir Panush: Thank you, Richard, and good morning, everyone. We delivered another strong quarter with revenue increasing 13% year over year to $29 million, fueled by licensing and related revenue growing 21% to its highest level in 3 years. The quarter also benefited from a sequential recovery in royalty revenue, driven by continuing momentum across wireless connectivity, ramping automotive AI programs, and market share gains in smartphones. During the quarter, we signed 10 licensing agreements, including two with first-time customers and two directly with OEMs. More important than the number of agreements is the quality of those agreements. Increasingly, customers are adopting broader platforms and deeper collaborations that transcends both our near-term licensing business and our long-term royalty opportunity. I would like to focus today on two themes that we believe highlight an important shift in the semiconductor industry and explain why CEVA and our technologies are increasingly well positioned for long-term growth. The first is the continuing migration of intelligence from the cloud to the smart edge. This is a trend we have discussed for several years and one that is increasingly driving demands for our higher performance, connectivity, sensing, and AI technologies. During the quarter, we announced what we believe is one of the most strategically significant AI licensing agreements in CEVA's history. A leading global AI and computing platform company, selected our NeuPro-M NPU IP for its next-generation custom AI silicon. This agreement is significant for several reasons. First, it represents a new category of AI customers for CEVA. Historically, our AI licensing activity has primarily been with semiconductor companies and device OEMs. This customer develops both the hardware platform and the operating system, allowing us to collaborate at a much deeper level by optimizing not only the NPU hardware, but also the AI software stack for its models, applications, and workloads. The expertise we gain through this engagement extends well beyond a single customer program. So optimizing AI hardware and software at the platform level will strengthen both our hardware and software roadmaps and further enhance our AI offering for future customers. More broadly, we believe these agreements reflect an important industry trend where companies with some of the world's large engineering organizations are increasingly choosing to leverage proven AI IP rather than developing every component internally. For these companies, the question is no longer whether they have the engineering capability to build an NPU, but whether doing so represents the best use of their engineering resources. By licensing production-proven IP, they can focus their investments on the hardware, software, and AI experiences that differentiate their platforms while reducing development risk and accelerating time to market. The second trend we are seeing is customers increasingly adopting broader platform solutions rather than individual IP blocks. Two agreements from the quarter illustrate this well. A high-volume U.S. semiconductor company chose to adopt 1 complete chip built on our Wi-Fi 6 and Bluetooth Low Energy IP, originally developed in partnership with another CEVA customer, rather than licensing the underlying IP blocks individually. The decision reflects the same preference for production-proven, complete solutions over developing internally or licensing component IP. Separately, another U.S. customer expanded a relationship that began with a single baseband component by adopting our complete baseband processing subsystem. As semiconductor development becomes increasingly complex, customers are recognizing that leveraging proven subsystem IP can significantly reduce engineering effort and execution risk, all while accelerating time to market, enabling them to concentrate their internal resources that most differentiate their products. These are different customers and different technologies, but they demonstrate the same underlying trend. Companies are increasingly choosing production-proven hardware, software, and system expertise that delivered as a complete platform rather than assembling individual IP blocks themselves. For CEVA, this expands both the scope and value of our engagement. Broader platform adoption increases our content per design, deepens our integration into customer products, creates larger, longer-term customer relationships, and increases the royalty opportunity associated with each customer platform as those products enter production. These successful outcomes also validate the strategy we have been executing over the past several years. We have invested in expanding our diverse portfolio beyond individual IP blocks to more complex hardware and software platforms across connectivity, sensing, and AI. As customers look to accelerate development while reducing execution risk, we believe this positions CEVA to capture a greater share of silicon content in future design. Beyond this strategic engagement, activity remains broad-based across our business. In addition to the AI and platform wins I just discussed, we signed multiple follow-on agreements with existing customers, alongside our new customer engagement, demonstrating our ability to both expand long-term relationships and consistently win new business. Across connectivity, we secured customer engagement spanning the United States, Europe, China, and the broader Asia-Pacific region, reinforcing the global demand for our technology. We also expanded our sensing portfolio with the launch of our Microsoft-certified RealSpace Elevate embedded application software, extending our spatial audio technology into the PC gaming market for the first time. Taken together, these achievements reinforce the strength of our Connect, Sense, and Infer offering to enable physical AI use cases. While AI is creating exciting new opportunities for CEVA, connectivity remains the foundation of physical AI and continues to be the entry point for many of our customers' relationships. Increasingly, this relationship expands over time as customers adopt additional technologies across our portfolio. Now, turning to royalties. We are beginning to see the benefits of the broader customer engagement we have been building over the past several years translate into an increasingly diversified royalty business. Royalty revenues increase both sequentially and year over year, supported by continued trends across our wireless connectivity portfolio, drawing contribution from automotive AI deployment, and share gains in smartphones. Wireless connectivity remains particularly strong with healthy year-over-year growth in both Wi-Fi and Bluetooth shipments, while Cellular IoT shipments reach another quarterly record. In automotive, customer programs continue to ramp, reflecting increasing AI content in next-generation vehicles. Overall, the quarter demonstrates the continued evolution of CEVA's business and the continued market leadership of our IP, expanding the breadth of our licensing engagement, increasing the value of every customer relationship through broader platform adoption, and building a more diversified royalty engine. Together, these trends reinforce our confidence in both our near-term outlook and long-term growth opportunity. With that, I'll turn the call over to Yaniv to review our financial results. Yaniv Arieli: Thank you, Amir. Good morning, everyone. I'll now review our financial results for the second quarter. Revenue for the second quarter increased 13% year over year and 7% sequentially to $29 million, reflecting another exceptionally strong licensing quarter and continued improvement in our royalty business. Trailing 12-month licensing and related revenue increased 13% to around $70 million. The revenue breakdown is as follows. Licensing and related revenue increased 21% year over year to $18.2 million, reflecting 63% of our total revenues and our strongest licensing quarters in three years. Importantly, the strength of the quarter reflects the broader platform engagements Amir described earlier, not only increase licensing and related revenues today, but also expand the future royalty opportunity associated with those customer programs. Royalty revenues was $10.8 million, reflecting 37% of our total revenues, compared with $10.7 million for the prior year, and up 17% sequentially reflecting continued strength across wireless connectivity and automotive AI and share gains in smartphones. Gross margin was 87% on GAAP basis and 88% on non-GAAP basis in line with our guidance. GAAP operating expenses were $27.5 million below the low end of our guidance range. Non-GAAP operating expenses excluding equity-based compensation expenses, amortization of acquired intangibles, and acquisition-related costs were $22.3 million at the low end of our guidance. GAAP operating loss improved to $2.1 million compared to $4.5 million in the second quarter of last year. Non-GAAP operating income increased to $3.1 million compared with $0.8 million in the prior year, while non-GAAP operating margins expanded to 11% up from 3% a year ago. Both measures also improved significantly on a sequential basis, demonstrating continued operating leverage. Net financial income was $1 million compared to $2.1 million in the second quarter of 2025 and below our guidance of $1.7 million, primarily due to foreign exchange effects related to our Israeli shekel-denominated lease obligations. Income tax expenses approximately $1.8 million, slightly above the guidance, reflecting the geographic mix of licensing and royalty revenues recognized during the quarter. GAAP net loss was $2.9 million or $0.10 per diluted share compared with GAAP net loss of $3.7 million or $0.15 per share in the second quarter of 2025. Non-GAAP net income increased 28% year over year to $2.3 million, while non-GAAP diluted earnings per share increased to $0.08 compared to $0.07 in the prior year period. On a sequential basis, both non-GAAP and net income and diluted earnings per share doubled. With respect to other related data, during the quarter, customers shipped 567 million CEVA-powered devices, an increase of 16% compared to the second quarter of 2025. Of those shipments, 61 million units, or 11% of the total, were mobile handset modem shipments, compared with 55 million units in the prior year period, reflecting improving smartphone royalties driven by stronger market share in entry-level smartphones together with continued expansion in the premier tier. Consumer IoT increased to 487 million units compared to 409 million units a year ago. Industrial IoT shipments were 19 million units compared to 24 million units in the prior year. Despite the lower unit volume, industrial royalty revenues increased 7% year over year, reflecting a richer mix of higher value products, including automotive AI and wireless infrastructure. Looking at our connectivity technologies, these shipment metrics continue to demonstrate the breadth and diversification of our royalty base across multiple end markets. Bluetooth shipments decreased 16% year over year to 295 million units. Cellular IoT shipment reached another record of 68 million units, up 3% year over year. Wi-Fi shipments increased 28% year over year to 80 million units. As for the balance sheet items, we ended the quarter with approximately $221 million in cash, cash equivalents, marketable securities, and cash deposits, providing significantly financial flexibility to support continued investments in our technology roadmap while maintaining a disciplined approach to capital allocation including selective strategic M&A opportunities. Days sales outstanding were 70 days. During the quarter we generated $5.8 million of cash from operating activities. Depreciation and amortization expenses were $0.8 million, while capital expenditure totaled $0.6 million. At the end of the quarter we employed 406 people including 327 engineers reflecting our continued investment in innovation while maintaining disciplined expense management. Turning to the outlook. We delivered a strong first half of 2026, supported by strong licensing execution, improving royalty trends, and meaningful expansion in non-GAAP profitability. Just as importantly, the quality of the customer engagement we secured during the first half provides a strong foundation for future growth across both licensing and royalties. Reflecting our first half performance and current visibility, we are raising our full year revenue outlook. We now expect 2026 revenue to increase between 13% and 15% over 2025, compared with our previous expectation of 12% growth that we shared at the end of the first quarter. We continue to expect the second half to be stronger than the first, consistent with our normal seasonal profile while recognizing that memory pricing dynamics and broader supply constraints remain important industry variables. On the expenses, we maintain our previous guidance. Total non-operating cost of revenues and operating expenses are still expected to increase by approximately 8% on an annual basis over 2025. As we continue to invest in our roadmap while carefully managing costs, mitigation of foreign exchange headwinds. As a result, the stronger revenue growth together with disciplined expense management, we now expect non-GAAP operating income to increase approximately 70% year over year, while non-GAAP net income is expected to increase approximately 50%, five-zero, both above our previous expectations. Third quarter guidance. Revenue is expected to be in the range of $30.5 million to $34.5 million. Gross margin is expected to be approximately 87% on GAAP basis and 88% on non-GAAP basis, including approximately $0.2 million equity-based compensation expenses, and $0.1 million of amortization of acquired intangibles. GAAP operating expenses are expected to be between $28.2 million and $29.2 million, including approximately $5.4 million of equity-based compensation expense and $0.1 million for amortization of acquired intangibles and $0.1 million for acquisition-related costs. Non-GAAP operating expenses are expected to be similar to the second quarter level between $22.5 million to $23.5 million. Net financial income is expected to be approximately $2 million. Income tax expense is expected to be approximately $1.9 million. And weighted average diluted share count is expected to be approximately 28.2 million shares on GAAP basis and 30 million shares on non-GAAP basis. Rocco, we are ready to take the questions now. Operator: [Operator Instructions] And today's first question comes from Kevin Cassidy at Rosenblatt Securities. Kevin Cassidy: Congratulations on the strong results. You had mentioned about a large company bringing their wireless design in-house rather than buying someone else. Is that a trend you're seeing longer term? And maybe you could talk about the trend you're seeing for more integration of technologies vertically within your customers. Amir Panush: ] Yes, definitely Kevin. Good morning and thanks. Yes, definitely we see this as a trend. As part of our strategy, as I mentioned also on the previous calls, was to really come with a complete offering of IP, including the radio IP. And what we see is some of the customers are basically looking for a complete turnkey offering that they can so-called integrate into their complete portfolio and taking that very quickly in terms of time to market and proven technology and solution. Definitely, we see some of those OEM and semiconductors companies looking to get the full solution from us. Kevin Cassidy: Okay. What does that mean for CEVA? I mean, a little more stickiness to your IP if you're selling more to one customer or I guess just less OpEx involved. I guess what, is that a, this is a positive trend for CEVA? Amir Panush: Yes, Kevin, thanks for the question. Yes, that's definitely a very positive trend. It actually brings three additional values for us. One, on the agreement itself, the licensing agreement, what we see both the licensing in terms of the deal size as well as the future royalty is meaningfully higher than just selling the component IP. Also on top of that, it's really the stickiness with the customers. That helps the customers to reduce their own engineering effort and relying more on CEVA capabilities, which they drive stronger stickiness moving forward. As well as really it helps significantly in the discussion of the make versus buy. It's harder for large companies to rely on CEVA technology if we provide only partial solution or just part of the component IP. The more we offering the complete solution, it's easier for them and drive more the decision towards buying IP from CEVA rather than doing that internally. So overall, this is a very, very positive trend, and fits very well to our strategy of how we drive our engineering activities and overall innovation in IP. Yaniv Arieli: Kevin, I maybe would add one more thing that in the wireless markets, there are new trends that come every couple of years, every year to two years, and depends on the technology itself, new standards, the new features, so by being able to provide those, we also have recurring revenues of new licensing deals for every one of these enhancements going forward. So it's a very strong stickiness mechanism also because of the nature of those wireless connectivity that get constantly upgraded and updated all the time. And we're able, obviously, to do that. Kevin Cassidy: Congratulations again. Operator: Thank you. And our next question today comes from Suji Desilva at ROTH Capital. Sujeeva De Silva: Congratulations on the progress here. Amir, you talked at length about how you're engaging deeper with the customers, maybe a hardware-software integration, perhaps more sort of product development effort. Is this going to result in more custom IP blocks or more continued standard products and will it affect kind of how we should think about royalty rate for you guys? Is that the right framework to think about these kind of engagements? Amir Panush: ] Yes. So definitely overall within our -- thanks for the question, Suji. Overall within our mix of licensing agreements. We do see more, I would call it, custom solutions offering and demands from the market. And that's again, that goes along very nicely with the trends of how we're investing in our resources and what we should do is a potential in the market. Going back to your point on royalty, it's actually where we see significant potential increase of those royalty as the royalty per unit that we can extract by providing the custom offering and the complete offering is meaningfully higher than a component IP. For example, we talked about a very strategic new AI deal that we've just signed with one of the top large OEMs out there that have both operating system capabilities and hardware and software. That level of integration and customization drives significantly much higher royalty per unit that we will get versus our typical NPU offering. Sujeeva De Silva: And then my other question is on the edge AI market and the trend toward edge AI in the cloud. There's a lot of kind of chip and IP sort of opportunity there from various parts. I'm wondering if there are any particular end applications that are initially good opportunities for you as you see traction in the edge AI market or where we should think about your best near-term efforts opportunities are? Amir Panush: So we definitely see that in the high-end compute edge markets, whether it's, you know, the PC, the mobile, those type of application. We also see it right now entrenched very, very deeply in the automotive for ADAS system. And what we will see more is into robotics, humanoids. This is right now coming also into play. Operator: Thank you. Our next question today comes from Natalia Winkler with UBS. Natalia Winkler: I had two. So one is on the smartphone. You mentioned improving share of the entry smartphone, as well as premium. Could you please speak a bit more what are you seeing there? And maybe what's helpful from standpoint of share gains on the entry-level smartphones for you guys? Amir Panush: So related to the entry point customer or the lower tier customers in the handset mobile market, definitely we've seen very meaningful recovery and the royalty between Q2 and Q1. So this quarter we've seen very nice recovery. And we're also seeing that they are basically gaining market share against their competition. Overall, we see there is a very positive momentum as we go into the second half of the year. And definitely the other large U.S. OEM, the expectation is that we go more with their internal modem that should provide for us also a market gain share as we move into the second half. Yaniv Arieli: I'll add some more color. UNISOC, our Chinese customer in the low-cost smartphone, first is moving gradually more and more to 5G from being the leader volume-wise in 4G and the prior generation. That means also higher ASPs for us. And if you Google or look around you'll see that they have won a few dozens of different design wins. Recently in the last quarter with good brands the local and Chinese brands including Vivo, Xiaomi which in the past, got used the MediaTek to more extensively. So these are nice design wins. As long as this continues, both market share gains for them and volume expansion with the higher 5G share in that market going to UNISOC, that will also benefit the CEVA. And this is an important high volume market for us as well. Natalia Winkler: And then the second question I had was, you know, now that ARC has been acquired by GlobalFoundries, are you guys seeing sort of any additional momentum in your licensing business, maybe the NPU licensing business with that transition? Amir Panush: Yes, definitely we see it as a tailwind for our business moving forward, especially for NPU and NeuPro product line, where the competition will be more favorable for us. Because we really focus on that IP as a complete platform, while over there it will be done differently. So that's a good point, Natalia. We will definitely see there is a tailwind and helping us to compete better in the U.S. and the Western world with our NPUs, We just signed one of those very strategic deals this quarter as part of that momentum. Richard Kingston: Rocco, next question. Hello? Hey, Rocco, are we taking more questions? Sorry, everybody, just hold on one minute. We're trying to get re-established here with the call center. [Technical Difficulty] Yaniv Arieli: Sorry, everyone. We are still trying to work this out. Sort of lost the operator. Richard Kingston: Hi, just in the interest of time here, I'm going to see if any of the other analysts in the queue want to email me their questions and I'll read them out and we can answer that way if that makes sense. So if any of the analysts in the queue want to email me directly now I'll ask the question on the line. Thanks. Okay, I have a couple of questions that have just come in over email. First one is from Joseph Cardoso at JPMorgan. He wants to follow up on the entry-level smartphone momentum and maybe tie that back to the risks we're hearing at the low-end portion of the market given the component cost inflation. How are you thinking about the risks there? And are you starting to see any signs of risk there or generally across the portfolio on that front? Yaniv Arieli: I think we've talked about this in the past, that the low-end smartphones in a sense need much less memory and more high-end devices, which are higher priced these days than the supply to high demand. So we haven't seen, at least in the last couple of quarters, significant issues around that. There's still part of the constraint in the market, but to a less degree than the higher end, the $1,000 phones type. So it's still at play in the industry. No doubt it hurts margins in the supply, but for the time being, if we look sequentially from Q1 to Q2, we've seen a tremendous increase in volume. Part of it is seasonal, and that means that our customer was able to address that supply the demand that they plan to at least. For us, we saw significant increase both in volume and dollars. Amir Panush: Yes, maybe I'll add to that. Yes, overall with the trends that we've seen from Q1 to Q2 with the typical seasonality and our customers actually gaining a new socket, we expect good seasonality expansion in the second half as well. Having said that, definitely the memory shortage has an impact on the wireless handset industry, and it's hard to quantify exactly how that will make an impact in the second half, but overall we expect a continued expansion seasonality of our customers as we go through the second half. Richard Kingston: Great, thanks. Another question here from Josh Buchalter at TD Cowen. And Josh asks, can you provide more context on how NeuPro is being used by new custom silicon engagement? Any details on the functionality, that chip, and timeline to materiality? Amir Panush: Yes, great question. First, let me a little bit explain more really about the engagement and the utilization of our NPU IP. For instance, we go, for example, in this case, into more custom silicon offering. And what we are doing with the customers, they have a very good deep access to our core architecture of our IP. And then together we basically go and define what additional special features capabilities and with that specific neural networks will be run on our silicon and hardware IP in a very, very efficient way. So the holy grail here is, one, to be able to run special networks with special features and capabilities but not but even less importantly to be able to run them in a very high efficient performance, so-called tokens per watt, tokens per second in terms of latency, all those very important metrics for edge devices. What these customers with their ability of accessing the complete software stack, including the operating system across all their product lines helps for both of us together to optimize it even further. So that's a big, big plus both from how you can use our IP, which is very, very deeply configurable, as well as how we can work together on the complete hardware software operating system integration. Now, in terms of timing, this is engagement that started typically within a few quarters. Our customers go to tape-out and then from there, a few quarters between, close to about one and a half years to two years, they go to production. Even though this is a custom offering, we expect it to go in terms of the timeline the same as with any other kind of IP and product that we are offering in the domain. So we don't expect it to be any time longer because we are very quickly we can configure the solutions and optimize it with this customer. That's the very unique approach that we have with our IP and capabilities. And what helps us actually to win that socket with that large customers against so-called doing on their own. Richard Kingston: Thanks, Amir. We have another question here from Gary Mobley at Benchmark, a StoneX company. Gary asks, when we talked about the U.S. customer in the quarter adding a baseband subsystem in addition to the DSP, are we referring to RF in this case or is it something else? Amir Panush: It's a complete basically -- Sorry. Can you repeat the question? Just to make sure which... Richard Kingston: Sure, sorry, the U.S. customer that we said upgraded to the complete baseband subsystem in the quarter, was that, were we relating to RF in this scenario or is it some other sort of a function in the subsystem that they upgraded from just DSP? Amir Panush: Yes, this is related to a WLAN or wireless access subsystem with complete satellite configuration. This is a complete so-called modem technology, but excluding the RF. So it's the all MAC baseband technology, hardware and software, complete offering, complete subsystem. While we are hardening that to the specific product, also it's not what the customer needs. Richard Kingston: Okay. We have a question here from Charles Shi at Needham. He asks about the full year guidance. Full year guidance is now raised 13% to 15%. Can you provide more details on the growth of licensing and royalty relative to the company average growth? Yaniv Arieli: /> Yes, sure. If you look at the first two quarters of last year, the licensing and related revenue run rate was $15-ish, $16 million. When you look at the first half of this year, the first two quarters were $17.8 million and now $18.2 million, so the $18-ish million, so there's no doubt from all what we explained today, the solution aspect of providing not just standalone IP, but a full solution to our customers, whether it includes multiple technology, wireless or other, whether it includes RF, and now it's part of their wireless offering or AI and technologies this enabled us at least in the first part of the half of the year to increase significantly the licensing and related revenue level and we believe that these levels they can continue. This is the at least our plan is part of our internal a forecast. We don't break down licensing and royalties, but guide on a full revenue basis, but do have a strong pipeline for these types of deals and do believe that we are and have achieved the step function with adding AI, which is a significant part of our revenue these days, about 20%. We've seen that last year. We've seen that in the first part of this year. This continues. It doesn't replace anything. We could see that it is an increase to our overall licensing and related revenue. So that's on one hand. On the royalty front, the annual guidance, the higher annual guidance is also part of the normal seasonal shift with the stronger second half. If you look at the last three years every second half of those last three years volume-wise we increased the north of 30% year over year for the full second half so we do believe that seasonality will play in our favor with other aspects of new royalty payers like automotive that started only this year at the beginning of the year. On top of that, the market share gains in smartphones that we mentioned and the combo Bluetooth, Wi-Fi type of solution that are a better solution to our customers and higher ASPs to us. So all this in place puts us in a stronger position. As Richard mentioned, 13% to 15% year-over-year growth and significant improvement in operating margins as we are keeping expenses tight and managing all these R&D investments with growth in the top line. We're looking at about 70% growth in non-GAAP operating margins year over year and about 50% growth in net income year over year and that's part of our guidance. Richard Kingston: Thanks, Yaniv. I have another question here. This is from Martin Yang at Oppenheimer. It's a two part. First part is, do you see more platform companies in your pipeline? How big of an opportunity is that in the broader context of your business? Maybe answer that first and I'll do the second one afterwards. Amir Panush: Yes, overall as I mentioned previously, we definitely see this as a growing trend, both in terms of the market needs, our customer needs, as well as what we can offer with our complete portfolio of IP. I cannot break down specifically what portion of the solution was more component IP, but the important thing is that this really helps us to drive a continuous increase in our licensing and we've seen it through the first half of the year that has been stronger than what we originally expected as well as the actual results. And that helps us to drive also or to guide the second half to be stronger than what we discussed just last quarter. So overall this is a very positive trend. This will help us to drive more licensing but the exact portion of each can fluctuate between quarter to quarter and not something that specifically I can support point to. Richard Kingston: Okay, and the second part from Martin relates to Bluetooth HDT. It asks, does a HDT class design win carry a materially higher royalty per unit than your current Bluetooth designs? And when does the HDT royalties start contributing? Amir Panush: Yes, so first, yes, the HDT, it's much improved technology, both from throughput that it supports as well as the new use cases that can support. So definitely that helps us to drive higher royalty per unit versus the legacy Bluetooth 6.0. Even more so, with this technology, we are also now offering it complete solution with our RF IP supporting HDT. And the combination of the two increase even further the royalty per unit that we can get for those sockets. So overall we received as a positive trend. Volume ramp will start towards the end of this year and the significant ramp of course we go through '27, '28. And the customer action that we have announced is they are basically right now ramping that product in the marketplace. So very soon we'll start seeing royalties of that platform as well. Richard Kingston: Thank you. And I've got a question just we can briefly address it. It's multiple analysts have asked about this, but I'll relate this one to Charles Shi at Needham. Asking about for the second half of the year, are we assuming normal seasonality for mobile handsets in the second half of the year? And at the same time, are we assuming a significant market share gain at a premium tier mobile vendor in the second half of the year. So those two kind of tied in together. Amir Panush: Yes, overall we're assuming the seasonality as we've typically seen for our current so-called mobile customers. With the caveat that of course we need to take into account the memory allocation challenges that the mobile market is going through. And on top of that, definitely we are expecting the gain share with our U.S. customers as they continue to use more of their internal modem. So, both are in play. Richard Kingston: Great, thanks. And then just one last question here. I'll come back to Joseph Cardoso at JPMorgan. He asked about Wi-Fi units. They declined sequentially in the quarter following a few quarters in a row of sequential expansion. Just curious if you could dive into the drivers of the volatility in the quarter and how you're thinking about trajectory for Wi-Fi going. Amir Panush: Yes, actually I wouldn't look at one specific quarter so-called on a sequential level, although year over year we continue to see very significant growth of [Technical Difficulty] any of our technology, including Wi-Fi and wireless connectivity. It's more related to our customer mix and when they ramp their own specific product. So some of those high volume can actually start in Q3 and Q4. I would expect our Wi-Fi shipments to continue to go very nicely year over year through the rest of the year. Richard Kingston: Okay, great. Thanks. Yes, I think that's all we'll take for now. Amir, do you want to go to the CEO closing remarks, please? Amir Panush: Yes, thanks, Richard. In closing, this quarter reinforces our confidence in the direction of the business and the strength of our IP. We are seeing increasing demand for our technologies across AI, connectivity, and sensing, strong adoption of broader hardware and software platforms, and continued diversification of our royalty base. At the same time, our licensing momentum is translating into improving profitability and gives us confidence in raising our outlook for the year. The opportunity ahead of us continues to expand as intelligence moves to the edge, and more companies develop custom silicon to differentiate their products. With our Connect, Sense, and Infer portfolio, we believe CEVA is uniquely positioned to enable that transition. Just as importantly, we are seeing customers engage with us at the broader platform level, increasing both the strategic value of our relationship and our long-term royalty opportunity. The momentum we built in the first half of the year gave us confidence heading into the second half. Richard, back to you. Richard Kingston: Thanks, Amir, and thanks, everybody, for keeping your patience with us there. As a reminder, the prepared remarks for this conference call are accessible through the Investors section of our website. And with regards to upcoming investor events we will be attending, here are some of the conferences. The Rosenblatt 6th Annual Technology Summit Part II, August 17 and 18 being held virtually; The 7th Annual Needham Virtual Semiconductor and Semicap Conference, August 19 and 20 being held virtually; the Stifel 2026 Tech Executive Summit, August 24th and 25th in Deer Valley, Utah; Jefferies Semiconductor, IT Hardware & Communications Technology Conference, August 25th and 26th in Chicago; and Benchmark-StoneX's Company, TMT Conference, September 10th in New York, New York. Further information on these events and all events we will be participating in can be found on the investors section of our website. Thank you and goodbye. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Ceva. The Motley Fool has a disclosure policy. CEVA (CEVA) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Ceva (CEVA) came out with quarterly earnings of $0.08 per share, beating the Zacks Consensus Estimate of $0.07 per share. This compares to earnings of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +14.29%. A quarter ago, it was expected that this chip designer would post earnings of $0.02 per share when it actually produced earnings of $0.04, delivering a surprise of +100%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Ceva, which belongs to the Zacks Internet - Software industry, posted revenues of $29.03 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.08%. This compares to year-ago revenues of $25.68 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Ceva shares have added about 79.7% since the beginning of the year versus the S&P 500's gain of 13.3%. While Ceva has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Ceva was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.16 on $31.6 million in revenues for the coming quarter and $0.53 on $122.56 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Software is currently in the top 42% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Salesforce (CRM), is yet to report results for the quarter ended July 2026. The results are expected to be released on August 26. This customer-management software developer is expected to post quarterly earnings of $3.27 per share in its upcoming report, which represents a year-over-year change of +12.4%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Salesforce's revenues are expected to be $11.3 billion, up 10.4% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ceva, Inc. (CEVA) : Free Stock Analysis Report Salesforce, Inc. (CRM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Company posts highest licensing and related revenues in three years on strong AI and connectivity demand ROCKVILLE, Md., Aug. 10, 2026 /PRNewswire/ -- Ceva, Inc. (NASDAQ: CEVA), the leading licensor of silicon and software IP for the Smart Edge, today announced its financial results for the second quarter ended June 30, 2026. Second Quarter Highlights: * Total revenues of $29.0 million, up 13%. Licensing and related revenues of $18.2 million, up 21% and the highest in three years. Ten IP licensing agreements, including two with first-time customers and two directly with OEMs. Royalty revenues of $10.8 million, up 1% year over year and 17% sequentially, supported by strong wireless connectivity shipments, continued ramp of automotive AI programs and improving smartphone royalties. Non-GAAP operating income of $3.1 million and non-GAAP operating margin of 11%, compared with $0.8 million and 3%. *Unless otherwise stated, all comparisons are to the second quarter 2025. Amir Panush, Chief Executive Officer of Ceva, commented, "We delivered another strong quarter, with revenue increasing 13% year over year, fueled by licensing and related revenue growing 21% to its highest level in three years. These results reflect the growing strategic importance of proven silicon and software IP as customers accelerate increasingly complex AI and connectivity technologies that enable Physical AI. Our agreement signed in the quarter with a leading global AI and computing platform company represents an important expansion of our AI customer base. By combining hardware IP, software and system-level expertise, Ceva can deepen its role in customer designs, increase its content opportunity and support larger, longer-term relationships." Business and Market Highlights Licensing momentum during the quarter was led by the selection of Ceva's NeuPro-M NPU IP for next-generation custom AI silicon by a leading global AI and computing platform company. The engagement expands Ceva's AI licensing business into a new category of platform customer that controls both the hardware and operating-system environment. Ceva also saw increased adoption of its diverse portfolio of broader connectivity solutions. A high-volume U.S. semiconductor company added to its portfolio a third-party chip based on Ceva's Wi-Fi 6 and Bluetooth Low Energy IP that was originally developed with another Ceva customer. Separately, an existing U.S. customer expanded its license from an individual baseband component IP to Ceva's complete baseband processing subsystem. Overall, Ceva signed ten licensing agreements during the quarter, including two with first-time customers and two directly with OEMs. Additional connectivity agreements were signed with customers across the U.S., Europe, China and the broader Asia-Pacific. Ceva also launched RealSpace Elevate, extending its Microsoft-certified spatial audio technology into the PC gaming market. Other Second Quarter financial data: * GAAP gross margin was 87%, as compared to GAAP gross margin of 86% GAAP operating loss was $2.1 million, as compared to a GAAP operating loss of $4.5 million GAAP net loss was $2.9 million, as compared to a GAAP net loss of $3.7 million GAAP diluted loss per share was $0.10, as compared to GAAP diluted loss per share of $0.15 Non-GAAP gross margin was 88%, as compared to non-GAAP gross margin of 87% Non-GAAP operating income was $3.1 million, as compared to non-GAAP operating income of $0.8 million Non-GAAP net income and non-GAAP diluted earnings per share were $2.3 million and $0.08, respectively, compared with non-GAAP net income and non-GAAP diluted earnings per share of $1.8 million and $0.07, respectively *Unless otherwise stated, all comparisons are to the second quarter 2025. Yaniv Arieli, Chief Financial Officer of Ceva, added, "Licensing and related revenues reached $18.2 million in the quarter, while trailing-twelve-month licensing and related revenues increased 13% to $69.6 million, demonstrating sustained momentum in the business. Combined with improving royalty trends and disciplined expense management, this drove non-GAAP operating margin to 11%, up from 3% a year ago, demonstrating the operating leverage inherent in our business model." Ceva Conference Call On August 10, 2026, Ceva management will conduct a conference call at 8:30 a.m. Eastern Time to discuss the operating performance for the quarter. The conference call will be available via the following dial in numbers: U.S. Participants: Dial 1-844-435-0316 (Access Code: Ceva) International Participants: Dial +1-412-317-6365 (Access Code: Ceva) The conference call will also be available live via webcast at the following link: https://app.webinar.net/P3eXEg0zQLb. Please go to the website at least fifteen minutes prior to the call to register. For those who cannot access the live broadcast, a replay will be available by dialing +1 855-669-9658 or +1 412-317-0088 (access code: 9794488) from one hour after the end of the call until 9:00 a.m. (Eastern Time) on August 17, 2026. The replay will also be available at Ceva's web site at www.ceva-ip.com. Forward-Looking Statements This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that if they materialize or prove incorrect, could cause the results of Ceva to differ materially from those expressed or implied by such forward-looking statements and assumptions. Forward-looking statements include statements about Ceva's positioning for future growth and to serve as a foundational technology provider for intelligent, connected devices, licensing agreement wins, future industry demand, our market position for the future and future growth in the demand of our products, our forecast of financial measures for the following quarter and 2026, our long term targets and underlying assumptions, our future investments, expectations about future market, the success of our strategies and agreements, visibility into future revenue streams, and Ceva's focus on expense management and profitability improvement. The risks, uncertainties and assumptions that could cause differing Ceva results include: the effect of intense industry competition; the ability of Ceva's technologies and products incorporating Ceva's technologies to achieve market acceptance; Ceva's ability to meet changing needs of end-users and evolving market demands; the lengthy sales cycle for IP and related solutions; Ceva's ability to diversify royalty streams and license revenues; geopolitical risks and instability, including the impact of tariffs and other trade measures and potential disruptions related to ongoing conflicts in the Middle East; and general market conditions and other risks relating to Ceva's business and industry, including, but not limited to, those that are described from time to time in our SEC filings. Ceva assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. About Ceva, Inc. Ceva powers the Smart Edge, bridging the digital and physical worlds to bring AI-driven products to life. Our Ceva AI fabric portfolio of silicon and software IP enables devices to Connect, Sense, and Infer – the essential capabilities for the intelligent edge. From 5G, cellular IoT, Bluetooth, Wi-Fi, and UWB connectivity to scalable Edge AI NPUs, AI DSPs, sensor fusion processors and embedded software, Ceva provides the foundational IP for devices that connect, understand their environment, and act in real time. With more than 21 billion devices shipped and trusted by 400+ customers worldwide, Ceva is the backbone of today's most advanced smart edge products - from AI-infused wearables and IoT devices to autonomous vehicles and 5G infrastructure. Our differentiated solutions deliver seamless integration into existing design flows, total flexibility to combine solutions based on design needs and ultra‑low‑power performance in minimal silicon footprint, helping customers accelerate development, reduce risk, and bring innovative products to market faster. As technology evolves toward Physical AI, Ceva's IP portfolio lays the foundation for systems that are always connected, contextually aware, and capable of intelligent, real-time decision-making. Visit us at www.ceva-ip.com and follow us on LinkedIn, X, YouTube, Facebook, and Instagram. For more information, contact: (*) Derived from audited financial statements. The Company believes that the presentation of non-GAAP measures in the press release is useful to investors in analyzing the results for the quarters ended June 30, 2026, and 2025 because the exclusion of the applicable expenses may provide a meaningful analysis of the Company's core operating results and comparison of quarterly results. Further, the Company believes it is useful for investors to understand how the expenses associated with the application of FASB ASC No. 718 are reflected in its statements of income. The reconciliation of financial measures should be reviewed in addition to and in conjunction with results presented in accordance with GAAP and are intended to provide additional insight into the Company's operations that, when viewed with its GAAP results and the accompanying reconciliation, offer a more complete understanding of factors and trends affecting the Company's business. The reconciliation of financial measures should not be viewed as a substitute for the Company's reported GAAP results. A reconciliation of non-GAAP guidance to the corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future, although it is important to note that these factors could be material to the Company's results computed in accordance with GAAP. View original content to download multimedia:https://www.prnewswire.com/news-releases/ceva-inc-announces-second-quarter-2026-financial-results-302846590.html

This article first appeared on GuruFocus. Revenue: $29 million, up 13% year over year and 7% sequentially. Licensing and Related Revenue: $18.2 million, up 21% year over year, representing 63% of total revenue and the strongest licensing quarter in three years. Royalty Revenue: $10.8 million, up 17% sequentially and roughly flat year over year, representing 37% of total revenue. Gross Margin: 87% on a GAAP basis and 88% on a non-GAAP basis. GAAP Operating Loss: Improved to $2.1 million from $4.5 million in the prior year. Non-GAAP Operating Income: $3.1 million, up from $0.8 million in the prior year, with non-GAAP operating margins expanding to 11%. GAAP Net Loss: $2.9 million, or $0.10 per diluted share, compared with a loss of $3.7 million, or $0.15 per share, in the prior year. Non-GAAP Net Income: $2.3 million, up 28% year over year, with non-GAAP diluted EPS of $0.08. Devices Shipped: 567 million CEVA-powered devices, up 16% year over year. Mobile Handset Modem Shipments: 61 million units, up from 55 million units in the prior year. Consumer IoT Shipments: 487 million units, up from 409 million units a year ago. Industrial IoT Shipments: 19 million units, down from 24 million units, though industrial royalty revenues increased 7% year over year. Bluetooth Shipments: 295 million units, down 16% year over year. Cellular IoT Shipments: 68 million units, a quarterly record, up 3% year over year. Wi-Fi Shipments: 80 million units, up 28% year over year. Cash and Investments: Approximately $221 million in cash, cash equivalents, marketable securities, and cash deposits. Cash Flow from Operations: $5.8 million generated during the quarter. Full-Year 2026 Revenue Outlook: Raised to an increase of 13% to 15% over 2025. Warning! GuruFocus has detected 2 Warning Signs with CEVA. Is CEVA fairly valued? Test your thesis with our free DCF calculator. Release Date: August 10, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. CEVA Inc (NASDAQ:CEVA) delivered a strong second quarter with revenue increasing 13% year-over-year to $29 million, fueled by licensing revenue growing 21% to its highest level in three years. The company signed a strategically significant AI licensing agreement with a leading global AI and computing platform company for its NeuPro-M NPU IP, representing a new category of AI customers and enabling deeper collaboration. CEVA Inc (NASDAQ:CEVA) is seeing a positive trend of customers adopting broader platform solutions, which increases content per design, deepens integration, and expands the long-term royalty opportunity. Royalty revenue showed a sequential recovery, driven by strong wireless connectivity growth, ramping automotive AI programs, and market share gains in smartphones, with Wi-Fi shipments up 28% year-over-year. The company raised its full-year 2026 revenue outlook to 13%-15% growth and expects non-GAAP operating income to increase approximately 70% year-over-year, reflecting strong operating leverage. CEVA Inc (NASDAQ:CEVA) signed 10 licensing agreements in the quarter, including two with first-time customers and two directly with OEMs, demonstrating broad-based demand across the US, Europe, China, and Asia-Pacific. CEVA Inc (NASDAQ:CEVA) experienced a sequential decline in Wi-Fi shipments in the second quarter, following several quarters of expansion, due to customer mix and product ramp timing. Bluetooth shipments decreased 16% year-over-year to 295 million units, indicating weakness in that specific connectivity segment. Industrial IoT shipments declined to 19 million units from 24 million units a year ago, although royalty revenues increased due to a richer product mix. The company faces potential headwinds from memory pricing dynamics and broader supply constraints, which could impact the mobile handset industry and second-half performance. Net financial income was below guidance at $1 million, primarily due to foreign exchange effects related to Israeli shekel-denominated lease obligations. The full-year guidance assumes normal seasonality and market share gains, but the company acknowledges uncertainty around the impact of the memory shortage on the wireless handset industry. Q: Can you provide more context on how NeuPro is being used by the new custom silicon engagement with the leading global AI and computing platform company? Any details on the functionality of that chip and timeline to materiality? A: Amir Panush, CEO: This engagement involves a deep collaboration where the customer has access to our core NPU architecture. Together, we define special features and capabilities to run their specific neural networks with very high efficiency, focusing on metrics like tokens per watt and latency. The customer's ability to access the complete software stack, including the operating system, allows for further optimization. In terms of timing, this is a standard engagement that typically goes to tape-out within a few quarters, with production expected in about 1.5 to 2 years. We don't expect the custom nature of the deal to extend the timeline because our IP is deeply configurable, which was a key factor in winning this socket against the customer's internal development option. Q: You mentioned improving share in entry-level smartphones as well as premium. Could you please speak a bit more about what you are seeing there and what's driving the share gains? A: Amir Panush, CEO & Yaniv Arieli, CFO: We saw a very meaningful recovery in royalties from Q1 to Q2, driven by our customer UNISOC gaining market share against its competition. Yaniv added that UNISOC is gradually moving more to 5G from being the volume leader in 4G, which means higher ASPs for CEVA. They have also won several new design wins with major brands like Vivo and Xiaomi, which previously used MediaTek more extensively. We expect this positive momentum to continue into the second half of the year, also supported by a large US OEM ramping its internal modem, which should provide additional market share gains for CEVA. Q: You talked at length about engaging deeper with customers, perhaps with hardware-software integration. Is this going to result in more custom IP blocks or more standard products, and will it affect how we should think about royalty rates? A: Amir Panush, CEO: We are seeing more demand for custom solutions, which aligns with our investment strategy. The key point is that the royalty per unit we can extract from custom and complete platform offerings is meaningfully higher than for component IP. For example, the strategic AI deal we signed with a large OEM that has both hardware and software capabilities will drive significantly higher royalty per unit versus our typical NPU offering due to the level of integration and customization. Q: You mentioned a large company bringing their wireless design in-house rather than buying from someone else. Is that a trend you're seeing longer term, and what does it mean for CEVA? A: Amir Panush, CEO & Yaniv Arieli, CFO: We see this as a positive trend where customers are looking for a complete offering, including radio IP, to integrate quickly into their portfolios. This brings three additional values: the licensing agreement and future royalties are meaningfully higher than for component IP alone; it creates stronger stickiness as customers rely more on CEVA capabilities; and it strengthens the make-versus-buy decision in our favor. Yaniv added that the constant upgrades in wireless connectivity standards create recurring licensing revenue and a strong stickiness mechanism. Q: Now that AHRQ has been acquired by Global Founders, are you seeing any additional momentum in your licensing business, maybe the NPU licensing business with that transition? A: Amir Panush, CEO: Yes, we definitely see this as a tailwind for our business, especially for our NeuPro NPU product line. The competitive landscape will be more favorable for us because we focus on providing a complete platform, while the acquired entity will be handled differently. This helps us compete better in the US and Western world with our NPUs, and we believe it contributed to signing one of those very strategic deals this quarter. Q: The full year guidance is now raised to 13% to 15%. Can you provide more details on the growth of licensing and royalty relative to the company average growth? A: Yaniv Arieli, CFO: We don't break down licensing and royalties on a full revenue basis, but we have achieved a step function in licensing revenue, adding AI which is now about 20% of our revenue. On the royalty front, the higher annual guidance is supported by normal seasonal shifts, with the second half typically being stronger. We also have new royalty payers like automotive that started ramping this year, market share gains in smartphones, and higher ASPs from combo Bluetooth/Wi-Fi solutions. This puts us in a stronger position for 13% to 15% year-over-year growth with significant improvement in operating margins. Q: Regarding the entry-level smartphone momentum, how are you thinking about the risks from component cost inflation, particularly memory pricing? A: Yaniv Arieli, CFO & Amir Panush, CEO: Low-end smartphones need much less memory than high-end devices, so we haven't seen significant issues in the last couple of quarters. While memory constraints still exist in the industry, our customer was able to address supply and demand sequentially from Q1 to Q2, with a tremendous increase in volume. We expect good seasonal expansion in the second half, though the memory shortage's exact impact is hard to quantify. Q: When we talk to the US customer in the quarter adding a baseband subsystem in addition to the DSP, are we referring to RF in this case or is it something else? A: Amir Panush, CEO: This is related to a complete wireless access subsystem with a full modem baseband technology, hardware and software, but excluding the RF. It's a complete offering that we harden to the specific process and customer needs. Q: Does a Bluetooth HDT class design win carry a materially higher royalty per unit than your current Bluetooth designs, and when does the HDT royalties start contributing? A: Amir Panush, CEO: Yes, HDT is a much-improved technology with higher throughput and new use cases, which helps drive higher royalty per unit versus legacy Bluetooth. We are also offering it as a complete solution with our RF IP, which increases the royalty per unit even further. Volume ramp will start towards the end of this year, with significant ramp through 2027 and 2028. The customer we announced is currently ramping the product in the marketplace. Q: Wi-Fi units declined sequentially in the quarter following a few quarters of sequential expansion. Could you dive into the drivers of the volatility and how you're thinking about the trajectory going forward? < For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in Ceva, Inc.? Here are five stocks we like better. Strong second-quarter performance: CEVA reported revenue of $29 million, up 13% year over year, driven by a 21% increase in licensing revenue and a 17% sequential recovery in royalties. Non-GAAP operating margin expanded to 11% from 3% a year earlier. Broader technology adoption supported licensing momentum: The company signed 10 agreements, including deals for its NeuPro-M AI processor, Wi-Fi 6 and Bluetooth IP, and a complete wireless baseband subsystem. Management said broader platform agreements could increase deal sizes, future royalties and customer integration. CEVA raised its 2026 outlook: The company now expects full-year revenue growth of 13% to 15%, up from its prior 12% forecast, with non-GAAP operating income projected to rise about 70% and net income about 50% year over year. 5 Computer Vision Stocks with a Clear Path to Growth Ceva (NASDAQ:CEVA) reported second-quarter revenue of $29 million, up 13% from a year earlier and 7% sequentially, as licensing activity reached its strongest level in three years and royalty revenue recovered from the prior quarter. Chief Executive Officer Amir Panush said licensing and related revenue rose 21% year over year to $18.2 million, representing 63% of total revenue. Royalty revenue totaled $10.8 million, up from $10.7 million a year earlier and 17% sequentially. → MarketBeat Week in Review – 08/03 - 08/07 “We delivered another strong quarter,” Panush said, citing momentum in wireless connectivity, automotive artificial intelligence programs and smartphone market-share gains. CEVA signed 10 licensing agreements during the quarter, including two with first-time customers and two directly with original equipment manufacturers. Panush said the company is increasingly seeing customers adopt broader platforms and deeper technology collaborations instead of individual intellectual-property blocks. → Quantum Earnings Week: Winners and Losers Are Finally Emerging Among the quarter’s agreements, a global AI and computing platform company selected CEVA’s NeuPro-M neural processing unit IP for next-generation custom AI silicon. Panush called the arrangement one of the company’s most strategically significant AI licensing agreements, saying the customer develops both hardware and an operating system, enabling CEVA to work on AI hardware and software-stack optimization. CEVA also cited two U.S. customer agreements as examples of wider platform adoption. One high-volume semiconductor company selected a complete chip based on CEVA’s Wi-Fi 6 and Bluetooth Low Energy IP, rather than licensing the underlying IP blocks separately. Another U.S. customer expanded from a single baseband component to CEVA’s complete baseband processing subsystem. → Take-Two’s Q1 Results Leave GTA 6 Bulls Stuck in the Fog of War During the question-and-answer session, Panush said the baseband subsystem relates to a wireless-access subsystem supporting satellite constellations and includes MAC and baseband hardware and software, but excludes RF technology. Panush said more complete and customized offerings can increase licensing deal sizes and future royalties, while also making CEVA’s technology more embedded in customer products. CFO Yaniv Arieli added that wireless technologies are regularly updated with new standards and features, which can generate recurring licensing opportunities. Customers shipped 567 million CEVA-powered devices during the quarter, a 16% increase from the second quarter of 2025. Mobile handset modem shipments rose to 61 million units from 55 million units a year earlier, while consumer IoT shipments increased to 487 million from 409 million. Industrial IoT shipments declined to 19 million from 24 million, though industrial royalty revenue increased 7% due to a mix of higher-value products, including automotive AI and wireless infrastructure. Bluetooth shipments declined 16% year over year to 295 million units. Cellular IoT shipments reached a quarterly record of 68 million units, up 3%. Wi-Fi shipments increased 28% to 80 million units. Management said smartphone royalties benefited from stronger share in entry-level devices and continuing expansion in premium-tier devices. Arieli said Chinese customer UNISOC is shifting more of its handset business toward 5G, which carries higher average selling prices for CEVA, and has secured recent design wins with brands including Vivo and Xiaomi. Management acknowledged memory pricing and supply constraints as industry risks, particularly for handsets. Arieli said lower-cost smartphones generally require less memory than higher-end devices, and CEVA had not seen significant problems over the previous two quarters. Panush said the company expects normal seasonal expansion from its mobile customers during the second half, while recognizing the difficulty of quantifying the effects of memory shortages. Panush also said the company expects Bluetooth High Data Throughput technology to carry higher royalty rates than legacy Bluetooth offerings, particularly when combined with CEVA RF IP. He said volume ramps are expected to begin toward the end of 2026, with more significant ramping through 2027 and 2028. GAAP gross margin was 87%, while non-GAAP gross margin was 88%, in line with guidance. GAAP operating loss narrowed to $2.1 million from $4.5 million a year earlier. Non-GAAP operating income increased to $3.1 million from $800,000, and non-GAAP operating margin expanded to 11% from 3%. GAAP net loss was $2.9 million, or 10 cents per diluted share, compared with a loss of $3.7 million, or 15 cents per share, in the prior-year period. Non-GAAP net income rose 28% to $2.3 million, while non-GAAP diluted earnings per share increased to 8 cents from 7 cents. CEVA ended the quarter with approximately $221 million in cash equivalents, marketable securities and cash deposits. It generated $5.8 million in operating cash flow and employed 406 people, including 327 engineers, at quarter-end. The company raised its full-year 2026 revenue outlook, now expecting growth of 13% to 15% over 2025, compared with its previous forecast for 12% growth. CEVA continues to expect the second half to be stronger than the first half. It maintained its expectation that total non-GAAP cost of revenues and operating expenses will rise about 8% for the year. Based on the higher revenue outlook and expense discipline, CEVA now expects non-GAAP operating income to increase about 70% year over year and non-GAAP net income to rise about 50%. For the third quarter, CEVA forecast revenue of $30.5 million to $34.5 million, GAAP gross margin of about 87%, and non-GAAP gross margin of about 88%. The company expects non-GAAP operating expenses of $22.5 million to $23.5 million. Ceva, Inc (NASDAQ: CEVA) is a leading licensor of signal processing IP cores and platforms that enable intelligent, connected devices. The company designs a broad portfolio of digital signal processing (DSP) and AI processors, software development toolkits and reference frameworks for applications ranging from 5G wireless communications and Bluetooth connectivity to audio, computer vision, sensor fusion and edge AI. Its solutions target a variety of end markets including smartphones, automotive, IoT devices, smart home, industrial automation and wearable electronics. Founded in 1999 as a spin-off from DSP Group, Ceva has built its reputation on delivering modular, power-efficient IP that can be customized to meet stringent performance, area and power requirements. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Ceva Q2 Earnings Call Highlights" was originally published by MarketBeat. 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Ceva, Inc. (NASDAQ:CEVA) shares fell 3.32% in pre-market trading on Monday despite the semiconductor intellectual property company reporting second-quarter earnings and revenue above Wall Street expectations. Adjusted earnings reached $0.08 per share, slightly ahead of the analyst consensus estimate of $0.07. Revenue came in at $29.0 million, exceeding expectations of $28.14 million and increasing 13% compared with the same period last year. Ceva’s quarterly growth was led by a strong performance from its licensing business. Licensing and related revenue increased 21% year-on-year to $18.2 million, representing the company’s highest quarterly level in three years. Royalty revenue was more stable, rising 1% from the prior-year period to $10.8 million. On a sequential basis, however, royalty revenue increased 17%. Trailing 12-month licensing and related revenue reached $69.6 million, an increase of 13%, providing further evidence of strengthening momentum across Ceva’s intellectual property portfolio. The company secured ten intellectual property licensing agreements during the second quarter, including two contracts with new customers. Two of the agreements were also signed directly with original equipment manufacturers, expanding Ceva’s relationships further into the end markets using its technology. One of the quarter’s notable contract wins involved a leading global artificial intelligence and computing platform company selecting Ceva’s NeuPro-M neural processing unit intellectual property for use in next-generation custom AI silicon. “We delivered another strong quarter, with revenue increasing 13% year over year, fueled by licensing and related revenue growing 21% to its highest level in three years,” said Amir Panush, Chief Executive Officer of Ceva. Ceva also delivered a significant improvement in adjusted operating profitability during the quarter. Adjusted operating income increased to $3.1 million, representing an operating margin of 11%. That compared with adjusted operating income of $0.8 million and a margin of just 3% in the second quarter of 2025. Adjusted net income rose to $2.3 million from $1.8 million in the corresponding period last year. On a GAAP basis, Ceva remained loss-making, although its deficit narrowed. The company reported a net loss of $2.9 million, equivalent to $0.10 per share, compared with a loss of $3.7 million, or $0.15 per share, a year earlier. GAAP gross margin also improved to 87% from 86%. Ceva ended the second quarter with approximately $220.7 million in cash, cash equivalents, marketable securities and short-term deposits, leaving the company with substantial liquidity to support continued investment in its technology portfolio. Despite the earnings and revenue beat, accelerating licensing growth and improved adjusted margins, Ceva (NASDAQ:CEVA) shares moved lower before Monday’s opening bell. The decline suggests investors were looking beyond the headline quarterly beat, even as the company reported its strongest licensing revenue in three years and continued to expand its exposure to next-generation artificial intelligence semiconductor applications. Ceva stock price

Astera Labs, Inc. (ALAB) came out with quarterly earnings of $0.8 per share, beating the Zacks Consensus Estimate of $0.69 per share. This compares to earnings of $0.44 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +15.94%. A quarter ago, it was expected that this company would post earnings of $0.54 per share when it actually produced earnings of $0.61, delivering a surprise of +12.96%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Astera Labs, Inc., which belongs to the Zacks Internet - Software industry, posted revenues of $392.4 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 8.93%. This compares to year-ago revenues of $191.93 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Astera Labs, Inc. shares have added about 93% since the beginning of the year versus the S&P 500's gain of 11%. While Astera Labs, Inc. has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Astera Labs, Inc. was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.77 on $405.29 million in revenues for the coming quarter and $2.97 on $1.53 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Software is currently in the bottom 40% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Ceva (CEVA), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 10. This chip designer is expected to post quarterly earnings of $0.07 per share in its upcoming report, which represents no change from the year-ago quarter. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Ceva's revenues are expected to be $28.17 million, up 9.7% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Astera Labs, Inc. (ALAB) : Free Stock Analysis Report Ceva, Inc. (CEVA) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

ROCKVILLE, Md., July 8, 2026 /PRNewswire/ -- Ceva, Inc. (NASDAQ: CEVA), the leading licensor of silicon and software IP for the Smart Edge, will announce results for the second quarter 2026 on August 10, 2026 before the NASDAQ market opens. Following the release, Ceva management will conduct a conference call at 8:30 a.m. Eastern Time to discuss the operating performance for the quarter. The conference call will be available via the following dial in numbers: U.S. Participants: Dial 1-844-435-0316 (Access Code: Ceva) International Participants: Dial +1-412-317-6365 (Access Code: Ceva) The conference call will also be available live via webcast at the following link: https://app.webinar.net/P3eXEg0zQLb. https://app.webinar.net/ePpLk12BRaDhttps://app.webinar.net/GvAklQElMmjPlease go to the web site at least fifteen minutes prior to the call to register. For those who cannot access the live broadcast, a replay will be available by dialing +1 855-669-9658 or +1 412-317-0088 (access code: 9794488) from one hour after the end of the call until 9:00 a.m. (Eastern Time) on August 17, 2026. The replay will also be available at Ceva's web site at www.ceva-ip.com. About Ceva, Inc. Ceva powers the Smart Edge, bridging the digital and physical worlds to bring AI-driven products to life. Our Ceva AI fabric portfolio of silicon and software IP enables devices to Connect, Sense, and Infer – the essential capabilities for the intelligent edge. From 5G, cellular IoT, Bluetooth, Wi-Fi, and UWB connectivity to scalable Edge AI NPUs, AI DSPs, sensor fusion processors and embedded software, Ceva provides the foundational IP for devices that connect, understand their environment, and act in real time. With more than 21 billion devices shipped and trusted by 400+ customers worldwide, Ceva is the backbone of today's most advanced smart edge products - from AI-infused wearables and IoT devices to autonomous vehicles and 5G infrastructure. Our differentiated solutions deliver seamless integration into existing design flows, total flexibility to combine solutions based on design needs and ultra–low–power performance in minimal silicon footprint, helping customers accelerate development, reduce risk, and bring innovative products to market faster. As technology evolves toward Physical AI, Ceva's IP portfolio lays the foundation for systems that are always connected, contextually aware, and capable of intelligent, real-time decision-making. Visit us at www.ceva-ip.com and follow us on LinkedIn, X, YouTube, Facebook, and Instagram. Logo: https://mma.prnewswire.com/media/74483/ceva__inc__logo.jpg View original content:https://www.prnewswire.com/news-releases/ceva-inc-schedules-second-quarter-2026-earnings-release-and-conference-call-302820370.html

Image source: The Motley Fool. Monday, May 11, 2026, at 8:30 a.m. ET Chief Executive Officer — Amir Panush Chief Financial Officer — Yaniv Arieli Vice President, Market Intelligence and Investor Relations — Richard Kingston Need a quote from a Motley Fool analyst? Email [email protected] Amir Panush: Thank you, Richard, and good morning, everyone. We are pleased to report a strong start to 2026, building on our momentum from 2025. We exceeded our expectations on both revenues and non-GAAP EPS, including licensing and related revenues of $17.8 million, our strongest licensing quarter in 3 years, reflecting the strength of our pipeline, customer momentum and future earnings power. This performance reflects strong execution and alignment with key market trends, including the convergence of Edge AI and wireless connectivity, rising system complexity and growing demand for integrated solutions that accelerate time to market. As the industry faces increasing constraints in scaling centralized AI compute, the reality of shifting towards running inference at the edge and leveraging local resources is becoming more critical. Against this backdrop, intelligent connected device shipments are expected to exceed 40 billion units annually by 2030, reinforcing the value of our Connect, Sense and infer strategy. In the quarter, we signed several multi-technology engagements and 3 strategically important deals that demonstrate our strategy is translating into results. Starting with connectivity. In early 2025, we introduced our Ceva-Waves Links200 platform to deliver fully integrated system-level wireless solutions across RF, basebands and software, helping customers accelerate time to market. This quarter, we secured a major licensing win for a complete Bluetooth High Data Throughput or HDT solution, a foundational capability for the upcoming Bluetooth 7 standard. We licensed this full solution, including modem software and RF to a leading U.S.-based semiconductor company. Bluetooth 7 is expected to enable higher throughput and more advanced use cases, including multichannel audio, wireless video, XR and gaming peripherals and AI-enabled edge devices. Our HDT solution is a key building block enabling this next generation of high-performance wireless and AI-enabled edge devices. This builds on our prior Bluetooth engagement with the same customer, which is now approaching high-volume production and further expands our footprint through a more integrated RF modem and software platform engagement. This also reflects a broader shift in the industry from internally developed connectivity to licensing proven platforms. We believe that moving to a full stack solution increases value per design for CEVA through higher licensing fees and greater royalty content while also deepening integration and enabling multi-generation engagements. For the quarter, we expect it to deliver faster time to market and lower development risk, allowing them to focus on their core differentiation while leveraging our proven IP, ultimately driving a stronger return on investment for both parties. Turning now to 5G and satellite communications. During the quarter, our PentaG-NTN 5G advanced modem platform, extending our cellular portfolio into satellite communications. Non-terrestrial networks or NTN, an emerging market expected to scale to billions of devices over the coming decade as satellite connectivity becomes an integral part of global communications infrastructure, complementing and in some cases, extending beyond traditional terrestrial 5G networks. This is being driven by a wide range of use cases, including remote and undeserved area coverage, asset tracking and industrial IoT, where ubiquitous always-on connectivity is critical. It is also increasingly important for enabling more resilient and independent communications infrastructure. Customer response has been highly encouraging with clear momentum building across our pipeline. Building on this, we expanded an existing customer relationship with a satellite OEM from DSP cores to a more integrated baseband processing solution. As with our Bluetooth HDT engagement, this reflects a deepening relationship with an existing customer and an expansion in the scope and value of our IP within their platform. In ultra-wideband, during the first quarter, we introduced our next-generation UWB platform and secured a new customer win with a major U.S.-based MCU provider, augmenting its internal UWB capabilities. With our IPM combining its system expertise with our proven connectivity solution to accelerate development and reduce risk. This engagement also builds on a broader relationship with the customer who has licensed multiple CEVA technologies over the past 2 years. We are seeing a transition in UWB towards higher-value industrial, automotive and enterprise applications, driven by demand for precise, secure location awareness in use cases such as access, asset tracking and indoor navigation. As the market expands, customers are increasingly choosing to license proven IP to accelerate time to market and reduce development risk. Across these wins, a clear pattern is emerging. The Bluetooth NTN and UWB engagements we highlighted this quarter are all within existing customers who have expanded their use of CEVA IP over the past 2 years. More broadly, customers are increasingly adopting more integrated system-level solution from CEVA, expanding our value per design while strengthening long-term royalty and margin potential. In sensing, we continue to see growing traction for our spatial audio solutions as demand for immersive audio experience expands. During the quarter, Lenovo launched its latest ThinkPad headset powered by our RealSpace spatial audio with head tracking, building on recent wins with consumer brands like Nothing and boAt. Finally, in AI, we continue to execute on our strategy to enable efficient, scalable inference at the edge with AI representing more than 20% of our licensing and related revenues and the signing of 2 new licensing agreements in the quarter. We are seeing a structural shift towards hybrid AI, where inference is increasingly moving to the device while more complex processing remains in the cloud or across connected systems. This right AI model, right place, right time approach enables real-time on-device decision-making while maintaining the flexibility to scale compute as needed. As a result, demand for highly efficient ultra-low power solutions is growing across wearables, automotive, industrial and smart home applications. And IP and AI content per device is increasing as more products require local connect, sense and inferred capabilities. We believe the rise of hybrid and agent-based AI will further accelerate the shift towards distributed intelligence at the edge, where devices need to locally sense, infer, communicate, coordinate and act in real time while selectively leveraging cloud AI resources. This trend is expected to drive growing demand for efficient [ AGI ] processing alongside advanced wireless connectivity across increasingly complex connected systems. This is now translating into production. Renesas R-Car V4H platform, which integrates our AI DSP and accelerator is now in production in the 2026 Toyota RAV4, one of the highest volume passengers vehicle globally, marking our first mass volume automotive AI deployment. We believe this represents the beginning of a meaningful long-term royalty stream with growing AI content per device. We also announced a collaboration with NXP during the quarter, integrating our AI DSP and accelerator into their S32E2 and S32Z2 software-defined vehicle processors, further validating our position in automotive AI. In addition, our NeuPro-Nano NPU won a leading artificial intelligence award at Embedded World 2026, further emphasizing our leadership position. Our AI licensing pipeline remains strong with multiple evaluation and investment negotiations underway across a broad range of end markets. Stepping back, overall, we signed 14 licensing agreements in the quarter, including 2 with OEMs. In addition to the deals I highlighted earlier, we secured a Wi-Fi 7 design targeting consumer IoT, a Wi-Fi 6 Bluetooth combo engagement with a leading Edge AI SoC platform company and multiple additional Bluetooth and Wi-Fi wins across our connectivity portfolio. Turning now to royalties. We continue to see encouraging momentum across our diversified Smart Edge market with growth in IoT, industrial and AI-driven applications. While total royalties were flat year-over-year, non-mobile royalties grew 8%, reflecting strength across our Smart Edge markets, partially offset by softness in smartphone. Wi-Fi shipments reached an all-time high in the quarter, driven by record Wi-Fi 6 volumes, highlighting the continuing expansion of this market as customers ramp deployments across a broad range of devices. More broadly, Wi-Fi and Bluetooth continue to be durable multiyear growth drivers, as customers scale current generation technologies such as Wi-Fi 6 and Bluetooth 6, they are also developing next-generation platforms, including Wi-Fi 7 and Bluetooth 7. These overlapping cycles are expected to support sustained unit growth, increased IP content per design and long-term margin expansion. We expect the continued shift towards combo chips to further reinforce our strategy as customers integrated multiple CEVA technologies into a single design, increasing value per device and driving stronger overall economics. AI-driven royalties also continue to grow, highlighted by our automotive AI deployment at Toyota and a ramping AI SoC for surveillance, representing early signs of the long-term contribution we expect from Edge AI across multiple end markets. Against these tailwinds, first quarter royalties were impacted by typical seasonal softness in mobile, combined with near-term effects from memory availability constraints and channel inventory in the lower-tier segments. We view these mobile dynamics as largely timing related and expect improvements as the year progresses, supported by inventory normalization and typical seasonality, along with what we anticipate will be stronger high-end smartphone royalties in the second half. Overall, this quarter reinforces our ability to execute on our strategy and increase value per design as we move towards more integrated, higher-value engagements. I will now turn the call over to Yaniv for the financials. Yaniv Arieli: I'll now review the financial results for the first quarter, which reflect the strong licensing performance and continued execution Amir just outlined. Revenues for the first quarter increased 11% year-over-year to $27 million. The revenue breakdown is as follows: licensing and related revenue increased 18% year-over-year to $17.8 million, reflecting 66% of our total revenues. Royalty revenues were $9.2 million, in line with last year, reflecting 34% of total revenues. Gross margins were 86% on GAAP basis and 87% on a non-GAAP basis. Our total GAAP operating expenses for the first quarter were $28.4 million, just over the mid-range of our guidance. Total non-GAAP operating expenses for the first quarter, excluding equity-based compensation expenses, amortization of intangibles and deal costs were $23 million, just over the midrange of our guidance. GAAP operating loss for the first quarter was $5.1 million as compared to GAAP operating loss of $4.4 million in the same quarter last year. Non-GAAP operating margins and income were 2% of revenues and $0.5 million. Net income was $1.9 million compared to $2.1 million for the first quarter of 2025. Taxes were approximately $1.3 million. GAAP net loss for the first quarter was $4.5 million and diluted loss per share was $0.16 as compared to net loss of $3.3 million and diluted loss per share of $0.14 for the first quarter of '25. Non-GAAP net income and non-GAAP diluted earnings per share for the first quarter of '26 were $1.1 million and $0.04, respectively, as compared to non-GAAP net income of $1.4 million and non-GAAP diluted earnings per share of $0.06 for the first quarter of '25. With respect to other related data, we shipped 458 million units of CEVA power devices, up 9% for the first quarter of 2025. Of the 458 million reported, 46 million units or 10% were for mobile handset modems, down from 49 million units in the first quarter last year. 394 million units were consumer IoT devices, up from 337 million units for the first quarter last year. 18 million units were for industrial IoT products, down from 34 million units in the first quarter last year. However, associated industrial IoT royalty revenues were up 19% year-over-year, reflecting a better mix of higher ASP product shipments, including 5G wireless infrastructure and automotive AI. Bluetooth shipments were 206 million units in the quarter, down from 233 million units in the first quarter of last year. Cellular IoT shipments were 66 million units, up 38% year-over-year, and Wi-Fi shipments were a record 91 million units, up 158% year-over-year. As for the balance sheet items. Our cash equivalent balances, marketable securities and bank deposits were approximately $216 million, providing strong financial flexibility. We remain focused on disciplined capital allocation, including continued investments in our road map and a selective approach for strategic M&A opportunities that can accelerate our growth. Our DSOs for the first quarter of '26 was 59 days. During the first quarter, we used $4.9 million of cash in operating activities. Ongoing depreciation and amortization was $0.9 million and purchase of fixed assets was $2.3 million, including approximately $1 million related to leasehold improvements. At the end of the first quarter, our headcount was 430 people, of whom 348 were engineers. Now for the guidance. As Amir highlighted, we delivered a strong start for the year, supported by continued enhancements to our IP portfolio, solid licensing execution and growing fundamental for future royalty expansion. From a financial perspective, we continue to view 2026 as a year of growth across multiple dimensions. Reflecting our first quarter performance, we're upgrading our annual outlook towards the higher end of our previously communicated range. For the full year, we now expect total revenue growth to be at the top end of our 8% to 12% range over 2025, with a typical seasonality profile of lower growth in the first half and stronger growth in the second half, subject to memory pricing dynamics and supply conditions. On the expense side, we maintain focus on cost discipline and operating leverage while continuing to manage foreign exchange headwinds with the strengthening of the euro and the Israeli shekel against the U.S. dollars. Overall expenses, cost of revenues and OpEx combined are expected to increase approximately 8% over 2025. As we continue to invest to support growth, we expect a portion of the incremental revenue to be translated to the bottom line, driving continued improvement in non-GAAP operating income, net income and EPS. Based on our performance to date and current business momentum, we now expect non-GAAP operating margins and non-GAAP net income to increase by 40% to 50% year-over-year, which is above our prior expectations. Guidelines for the second quarter of 2026. Revenues are expected to be in the range of $26 million to $30 million, reflecting continued growth both sequentially and year-over-year. Gross margin is expected to be 87% on a GAAP basis and 88% on non-GAAP basis, excluding an aggregate $0.2 million of equity-based compensation expenses and $0.1 million of amortization of acquired intangibles. GAAP OpEx for the second quarter of '26 is expected to be similar to the first quarter and in the range of $27.7 million to $28.7 million. Of our anticipated total OpEx for the second quarter, $5.3 million is expected to be attributed to equity-based compensation expenses, $0.1 million of amortization of acquired intangibles and $0.1 million of costs associated with business acquisitions. Non-GAAP OpEx is also expected to be similar to the first quarter and in the range of $22.2 million to $23.2 million. Net interest income is expected to be approximately $1.7 million. Taxes for the second quarter is expected to be approximately $1.5 million, and the share count for the second quarter of '26 is expected to be approximately 28 million shares for GAAP and 29.7 million shares for non-GAAP. Betsy, we could now take questions, please. Operator: [Operator Instructions] The first question today comes from Ruben Roy with Stifel. Ruben Roy: Congrats on the nice start to the year. I guess to start, Amir, on the Bluetooth HDT win, I'm not sure if you guys had RF wins previous, but it seems to me like that would be a nice step-up in your value per design strategy that you've been talking about. So can you maybe just talk a little bit more about what you're doing for the RF? And also, I guess, as part of that, is that sort of an architecture that you can replicate across other areas of the business, eventually, WiFi, ultra-wideband, et cetera? And anything you talk about in terms of the royalty rate relative to your traditional Bluetooth licenses? Amir Panush: Yes. Roy, first, thanks a lot for the congratulation. Yes, definitely, this is a very important win for us. As you pointed out, this is a win that of a full system solution, all the way so-called from the antenna up to the full stack and the software, including our own internal developed RF, which is an investment that we've put in the last year or 2 to really build those systems up. The key value here is really that our customers, they can get the full solution. They don't need to do more of the pretesting validation of those things, and we provide them that as a full solution, then time to market and ability to be successful in the market is much higher. And even more so with this customer and overall other customers, what we see, that really helps them to drive more and more so-called the next versus buy decision and move away from so-called internal development to a complete solution based on our technology. So we are very happy with that win with the RF, and we expect more of those wins to come through the year and then, of course, in the next few years. The other piece that you pointed out, this is definitely a technology that we are planning to expand beyond the Bluetooth HDT. We have multiple other wireless technology with digital IP and the same strategy we are going to basically deploy and apply in the marketplace, more and more integrated solution, complete system around our leadership in wireless connectivity. So we are super, super excited about this momentum and that what can build for the future. Last piece that you point on the royalty. As I mentioned in the previous calls, at the end of the royalty comes back to what value it brings to our customers. And in this case, because it's not just the whole different components of the system, it's the fact that it's fully integrated, our customers definitely appreciate it, and we see meaningfully higher royalty than so-called 1 plus 1 is more than 2, and that helps -- will help us to drive much more royalty growth in the future with overall very strong flywheel across our wireless connectivity technology. Ruben Roy: That's great. I guess if I could ask a quick follow-up just on sort of the way the year is playing out. You continue to expect a stronger second half, and I think you gave us a lot of sort of data points and kind of visibility into how you're thinking about that. But you do have some factors coming into play. You mentioned memory pricing and overall sort of macro sort of dynamics going on. So either Amir or Yaniv, can you maybe just give us a little bit of detail on what you're hearing from customers relative to some of those impacts that we might see as we kind of go through the year? I think memory pricing has started to impact some of the end markets. We're hearing from PC guys, et cetera, talk about potential impacts there. So any additional detail on how you're thinking about the second half versus the first half? And what you're hearing from customers would be great. That's all I have. Amir Panush: Yes, definitely. One thing first, I would say, just if we look at this quarter, as we started the year, I'm extremely encouraged by the fact that even though so-called mobile hasn't been that strong, considering the challenge with memory allocation and so-called the inventory utilization, we still deliver really great results driven by, one, very good execution across the licensing and solution-based offering. And second, we see a very good momentum overall in the broader IoT. And going back to what you asked about the memory that if we look at the IoT, it's a market that is less impacted by that. We have a great access across a very diversified set of customers, use cases and products and technologies. So I think overall, we can do so-called better than others in terms of potential impact from memory allocation. And specifically on mobile, with the inventory drawdown that happened this quarter and maybe to some degree through the first half, it probably will put us in a good spot as we go to the second half, which on top of that, of course, what we expect is increased market share in the premium tier. So I think overall, we are well positioned going through so-called that challenges overall in the marketplace. And it goes back to how we execute basically driving our licensing and ensuring that our customers are happy with the ramp-up of our technology. Yaniv Arieli: Ruben, maybe I will add. Historically, if you look at the volumes of shipments of our royalties, our customer shipments in the second half of every given year in the last 3 years, you'll see about a 40% increase. So -- and then every year, there is some issues, whether it's pricing or inventory in our memory. So with that said, the trend was mainly around 40% sequential growth second half versus first half, and we are building that in also in our pro [ specs ] for 2026. Operator: The next question comes from Suji Desilva with ROTH Capital. Sujeeva De Silva: Congratulations on the progress here. Amir, maybe you can talk about your -- as you came in, you talked about sense, connect and infer. And maybe today, you could give us an update on that in terms of the example of traction at the same customer to 2 of those or 3 of those versus just 1, that would be helpful to understand. Amir Panush: Definitely, Suji. I think several names that we mentioned in the past, including these times, we see them basically licensing multiple technologies from us. It can be multiple technologies across connect, but also we have more and more across multiple technologies of connect and infer and in some cases, the whole fee connect, sense and infer. So this is -- we see that progression going very well, and we expect more as we keep driving those technology into the marketplace. But definitely, what drives the baseline flywheel or success with our customers is very high appreciation of our wireless connectivity portfolio. And on top of that, our investment and expansion in the AI or infer overall portfolio. The other thing, as we pointed out, Lenovo with the headset this quarter, we announced that basically, they've been using or start ramping with our wheel space or 3D spatial audio technologies. And they are also a wireless connectivity basically customer through the semi guys that are delivering those solutions to them. Sujeeva De Silva: Okay. I appreciate that, Amir. Great. And then in the connectivity specifically, Bluetooth is already well penetrated. Can you update us on where Wi-Fi is in the attach curve going up in terms of attach? And then will UWB follow a similar path? Or is that more of a niche technology? Amir Panush: Yes. So on the Wi-Fi, Yaniv can point more into the specific numbers, but we're extremely encouraged with the ramp that we've seen first through all 2025 and now continuing and even more in Q1 '26. We reached all record high volume this quarter, and we expect that to continue with a very nice ramp moving so-called from the more legacy Wi-Fi to Wi-Fi 6. And then within a year or 2, we'll start seeing the transition into Wi-Fi 7 plus lots of the combos of the Wi-Fi and Bluetooth. So overall, from a pattern and penetration in the marketplace, we expect, as we mentioned on other calls, right, that Wi-Fi shipments will reach very high volume above the $0.5 billion and more as we keep progressing and then basically augment very nicely our penetration with Bluetooth plus the combos. In terms of UWB, this is, I would call it, overall a newer technology. There are a lot of very good indication in the marketplace from the use cases and with that, the potential demand for the technology. We've seen more penetration right now in smartphone from there into different type of edge devices for location base for access and control. So we are very encouraged with that. Now we just got a major license deals with a U.S. customer, and there will be more to follow. But overall, from a volume penetration, I said, we are highly penetrated with Bluetooth. We are getting to the same level with Wi-Fi and the next to follow will be UWB. Yaniv Arieli: On that I would add to that, Suji, is that we talked about Amir mentioned the combo chips. If you look at the Bluetooth Wi-Fi combo chip year-over-year, the volume has doubled. We haven't opened that number up yet. We'll do it in due time. But some of the reason also that we mentioned that the Bluetooth is going down because we are counting those combo chips is combo and not Bluetooth necessarily. So there is no issue in the market. It's just our count and ASPs for those combo chips are higher than the individual Wi-Fi or Bluetooth solutions in the past. Sujeeva De Silva: And you've been counting those in WiFi units, is what you saying? Yaniv Arieli: The combo -- Bluetooth and WiFi units, yes, doubled year-over-year for Q1. Operator: The next question comes from Samik Chatterjee with JPMorgan. Unknown Analyst: Congrats on the strong results here. Maybe just another follow-up on Wi-Fi. The $91 million number that you had there, it's pretty strong considering a seasonal sort of you typically see a seasonal downtick into 1Q. Can you just outline if there was anything in terms of new customer volume, et cetera, ramping into 1Q that drove that seasonality? And from this sort of 1Q base, should we expect to see a similar pickup into the second half that you've historically seen from first half to second half perspective in Wi-Fi? And I have a follow-up. Amir Panush: Yes, Samik, this is a great question. And actually, the ramp of the volume in Q1 of our Wi-Fi shipments is not related to the seasonality, as you pointed out. It's really the migration of multiple customers adopting our technology. So either migration from Wi-Fi 4 to Wi-Fi 6 or many of them actually new customers that start ramping with the Wi-Fi 6. And I will remind everyone that we talked about more than 30 licenses agreements that we have made in the last 2, 3 years of Wi-Fi technology. And those basically customers are now coming more and more into production. So that momentum, we expect to continue. And actually, we should expect second half to be stronger than the first half, both based on the seasonality plus basically more and more new customers and new program basically ramping in volume for Wi-Fi. So Wi-Fi, we are really still in the ramp-up in terms of market penetration and our customers basically ramping their portfolio and their product line. Unknown Analyst: Got it. Got it. And just maybe... Amir Panush: And it's true -- by the way, both through industrial and consumer. So we are really doing well on both fronts with our Wi-Fi. Unknown Analyst: Just my quick follow-up. Any updates on how you're thinking about capital allocation, particularly in relation to M&A, given that it's a pretty strong year, you'll generate more cash. How are you thinking about sort of the alternatives in front of you, including if you do pursue M&A, what would be the more sort of targeted technology areas that you would look for? Amir Panush: Yes, definitely, this is a key important item within what we're looking to execute on our overall strategy to scale up the company, looking into an M&A options for us. The focus there will be around so-called technologies that complement our success in the smart edge era. We have more focus on IT overall in order to build the scale. So we're talking about connect, sense and infer within those technologies and augmented technologies. I think that's what we are really targeting. And hopefully, we'll be able to talk about it as we progress through the year. Operator: The next question comes from Gary Mobley with Loop Capital. Gary Mobley: Looking specifically at the CEVA wavelengths, the RF subsystem there, I know the highlight that you put in front of us today is more of a system-level license agreement, including the RF. But if I'm not mistaken, that RF subsystem might be unique to a specific manufacturing process node, TSMC 12-nanometer specifically. Can you speak to how you might move forward in broadening that -- I guess, the scope of the RF subsystem across different process nodes and different foundries and how that might affect the overall licensing for wavelengths? Amir Panush: Yes, Gary, great question. So yes, the Links200 that we announced previously was around 12-nanometers TSMC. And overall, what we are executing our strategy is actually to go beyond one process node or one foundry. And also, I think we are well positioned with the access that we have in the market from the number of customers that have licensed our digital IP technology to have a very good sense of where the road map is heading in terms of the process node needs as well as the type of foundries that they are looking to partner with. And yes, we are not going to support all different options out there in permutation. And definitely some customers will build with their own RF. But I'm very confident that we can so-call go and support the majority or the significant portion of where the market is heading in terms of the process need and the foundry. So we'll have so-called multiple options there, but we are not going to cover the whole spectrum. Gary Mobley: And for my follow-up, I want to ask in general about the license pipeline. How does it look compared to maybe a year ago? And if you can give us an update as to what might be recurring in license revenue and what percent still remains onetime in nature? Amir Panush: There are several so-called fundamental trends that we are -- that encourage us, and we feel good with the perspective of our licensing business. One, we see more and more customers, repeating customers coming again going from one generation to the next. The other one is more customers are coming to license multiple technologies either by adding additional technology or just from the start looking for multiple technology. And the last piece is what we are highlighting this quarter is really coming in licensing solutions, which at end brings more value to our customers and help us so-called to have better economics of the deals, including the licensing portion. When we take all those 3 into account, overall, we feel good. We feel confident with where we are in terms of the pipeline, our ability to execute our licensing business. And I think the last few quarters have shown that, including this quarter. So I would say, overall, we look at the year as a good growth year in licensing and the pipeline really supports it well. Operator: The next question comes from Josh Buchalter with TD Cowen. Joshua Buchalter: Congrats on the results. Maybe I want to start big picture. We're seeing sort of a lot of positivity in the CPU space as compute resources are moving increasingly away from or in addition to like being complemented by outside of the AI server rack. I mean could you maybe reflect on where we are on the embedded side in that adoption curve? And specifically, any updates or major momentum on the MPU side from the quarter we could -- you want to highlight? Amir Panush: Yes. Great question, Josh. So first from so-called the momentum of CPU, this is what we have been talking about for the last few quarters about so-called the hybrid AI model and things are more moving into the edge. So this is very encouraging to see that's really happening in the market and also other customers are able to -- other players in the market are able to basically execute to that and show that progress. We need to keep in mind that when we look at our connect, sense and infer IP portfolio, it actually complements extremely well CPU, whether that's CPU based on that architecture or the other risk [indiscernible] architecture. So we are really indifferent to that, and we can support both. So that puts us in a good position. On the NPU specifically, that's where we are building, again, a portfolio of NPUs that goes along any kind of CPU architecture. And I think that's where we're also uniquely positioned, focusing on the NPU technology itself as accelerator to the CPUs that are out there. The more CPU drives more adoption of AI at the edge, the more opportunities we will see with our NPUs. So overall, all those things are encouraging so-called activities and potential tailwinds for us as we progress through the year and next year. Joshua Buchalter: And then maybe I could follow up on the second half outlook. A lot of companies have flagged potential cuts in the second half from the memory headwinds. Have you guys seen anything yet that's impacted your customers? And then I was also hoping you could maybe walk through what are the expectations that you have in your second half outlook for the large North American smartphone customer that has some of your IP on their modem. Yaniv Arieli: Sure. So we built some of our expectations top down with knowing that the market in the second half with the seasonality of the Christmas and the ramp-up for introduction of new products around that time frame is strong. We'll need to see how the market deals with the memory pricing and shortages. But right now, we haven't heard anything specific from our customers other than what we have seen in the mobile space on the low-tier phones that we have seen and other companies have talked about Qualcomm arm in the first quarter of the year with mentioning the recovery going forward. So I don't think we have seen anything yet. I think the market has its way to overcome some of the hurdles when we get to the high season. And we have built all that in, including the North American OEM that doesn't share its internal plans. It doesn't share exactly the timing of introduction of new products, whether they're based on their own modem or not. And we have our own estimates that we have built in this model. The rest will look and get the royalty reports on a quarterly basis. And based on that, be able to report. Again, historically, and the more we have added the combo chips that we talked about today with higher ASPs, the more that we have the automotive AI, NXP and Renaissance helping us this year, which were around last year with royalty contribution, the more 5G networks that started the year very strong and then the OEM opportunities in the U.S., it looks like a stronger and promising second half. And this is the reason we took our guidance to the top range of the previous annual guidance of the 8% to 12%. Operator: The next question comes from Madison De Paola with Rosenblatt Securities. Unknown Analyst: This is Maddie calling on behalf of Kevin Cassidy. I was just wondering which end markets you are expressing the most interest for -- in the NeuPro? Yaniv Arieli: Say that again, Maddie, sorry? Unknown Analyst: Which end markets are expressing the most interest in the NeuPro? Amir Panush: In the NeuPro, yes. It's broad-based, I would say. We see it in automotive. We see it in some industrial application. We see it also in smart home and consumer application. if we look at the 10-plus more deals that we [ sold for ] license last year, it's really across all those 4 markets that I mentioned. So I can't point to one that is much more than the others very significantly. It's nicely distributed and wide base. So we mentioned also last quarter, PC OEM. So we are in the PC market, consumer, again, smartphone surveillance and automotive, industrial. Operator: The last question today comes from Martin Yang with Oppenheimer. Unknown Analyst: First question is on the Bluetooth radio. Is there any plan or intention to extend the IP to other connectivity products, notably Wi-Fi? Amir Panush: Yes, Martin, good question. Yes, definitely. So we started and announced this product first. At the end of the day, we have very strong capabilities across the spectrum of wireless connectivity technology. And the intention and the plan is definitely to expand this to so-call a full solution offering across our wireless connectivity portfolio. So starting with Bluetooth, as you mentioned, the next natural thing will be Wi-Fi and then also UWB and our other technologies. Definitely, that's the plan. And overall, also this quarter, we announced on the satellite side that we're also moving more into complete so-called basement solution, not just so-called offering the components like DSP accelerators, but really the whole basement subsystem. And that resonates very, very nicely with customers, especially customers that wants to make a decision moving from make to buy because they need to rely on more of a so-called ready-to-go solution to help them with time to market and success overall. Unknown Analyst: A follow-up on your answer, you mentioned that satellite communication, is that primarily still in -- on the market deployment regarding smartphone with satellite-based messaging capabilities? Or are you seeing more emerging applications that? Amir Panush: No, we're actually seeing much more potential on the emerging applications as well. So if we look at the different types of OEM out there, they are basically moving to provide more and more as a service and part of the service, they need a complete solution end-to-end. And we are offering the wireless communication both on the terminal side as well as from the satellite side. and then they will build so-called the complete end-to-end offering with the service. And that service is really to be able to have ubiquitous type of connectivity, whether it's for industrial use cases or logistical use cases and so on or even places where there is very little coverage of wireless infrastructure, and they want to provide that augmentation. So those are all about system well beyond just mobile. Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Amir Panush for any closing remarks. Amir Panush: Thank you. In closing, we believe CEVA is well positioned as the industry continues to evolve towards physical AI, where connectivity, sensing and inference converge at the edge. Our expanding portfolio, combined with our strategy to deliver more integrated system-level solutions is enabling us to increase our value per customer and strengthen our long-term royalty model. We remain focused on executing our strategy, deepening customer relationships and driving sustainable growth. Thank you for your continued support. Richard, I will hand over to you to wrap it up. Richard Kingston: Thank you, Amir. As a reminder, the prepared remarks for this conference call are accessible through the Investors section of our website. With regards to upcoming events, we will be participating in the following conferences: Oppenheimer 27th Annual Israeli Conference on May 18 in Tel Aviv; the JPMorgan 2026 Global Technology, Media and Communications Conference, May 20 in Boston, Massachusetts; TD Cowen's 54th Annual Technology, Media and Communications Conference, May 27 in New York; Stifel's Boston Cross Sector One-on-one Conference, June 2 in Boston; the 6th Annual Rosenblatt Technology Summit, the age of AI, June 10, being held virtually; and the 16th Annual ROTH London Conference, June 16 to 18 in London, England. Further information on these events and all events we will be participating in can be found on the Investors section of our website. Thank you, and goodbye. 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See the 10 stocks » *Stock Advisor returns as of May 12, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Ceva. The Motley Fool has a disclosure policy. Ceva (CEVA) Q1 2026 Earnings Transcript was originally published by The Motley Fool