Core Viewpoint - Ceva, Inc. reported its Q2 2025 financial results, highlighting a decline in revenue compared to the previous year but showcasing growth in AI licensing and device shipments, particularly in cellular IoT and Wi-Fi 6 technologies [2][3][4]. Financial Performance - Total revenue for Q2 2025 was $25.7 million, down from $28.4 million in Q2 2024, representing a year-over-year decrease of approximately 9.5% [3]. - Licensing and related revenue for Q2 2025 was $15.0 million, compared to $17.3 million in Q2 2024, a decline of about 13.3% [3]. - Royalty revenue for Q2 2025 was $10.7 million, down from $11.2 million in the same quarter of 2024, a decrease of approximately 4.5% [3]. Profitability Metrics - GAAP gross margin for Q2 2025 was 86%, down from 90% in Q2 2024 [5]. - GAAP operating loss for Q2 2025 was $4.5 million, compared to a loss of $0.04 million in Q2 2024 [5]. - Non-GAAP net income for Q2 2025 was $1.8 million, with diluted income per share of $0.07, compared to $4.2 million and $0.17 per share in Q2 2024 [6][14]. Licensing and Agreements - The company concluded 13 licensing agreements in Q2 2025, including 4 AI deals for the NeuPro product line and 2 strategic automotive IP agreements with U.S. companies [2][4]. - The AI business is scaling, with significant customer adoption reflected in the new NPU agreements signed during the quarter [4][7]. Device Shipments and Milestones - Ceva-powered device shipments reached 488 million units in Q2 2025, including record shipments in cellular IoT and Wi-Fi 6 technologies [2][8]. - The company surpassed the milestone of 20 billion Ceva-powered devices shipped, reinforcing its leadership in wireless connectivity IP [4][8]. Share Repurchase Program - During the quarter, Ceva repurchased 300,000 shares of its stock for approximately $6.2 million, indicating a commitment to returning value to shareholders [8][9].

Core Insights - Ceva, Inc. has been recognized as the 1 vendor in Wireless Connectivity IP, achieving a market share of 68% in 2024, significantly outpacing its closest competitor by more than 10 times [1] - The company’s leadership in wireless connectivity IP is attributed to its comprehensive portfolio that includes Bluetooth, Wi-Fi, UWB, 802.15.4, and cellular IoT solutions, which are essential for the development of smart edge devices [1][3] Industry Trends - The convergence of wireless connectivity, on-device AI, and sensor fusion is driving the demand for smart edge devices, particularly in consumer and industrial SoCs and MCUs [2] - Local data processing is becoming crucial for real-time decision-making, reducing latency, preserving privacy, and enhancing energy efficiency in smart edge applications [2] Company Strategy - Ceva aims to build on its leadership by offering a unified IP portfolio that integrates wireless, sensing, and AI capabilities, facilitating innovation in the AIoT landscape [3] - The Ceva-Waves™ family provides a comprehensive wireless connectivity IP portfolio optimized for seamless integration into SoCs and MCUs, supporting both single and multi-standard configurations [3] Product Offerings - The Ceva-Waves platform includes the Ceva-Waves Dragonfly, a fully integrated solution for LTE-M and NB-IoT connectivity, suitable for low-power applications like asset tracking and smart metering [3] - Ceva has expanded its offerings to include RF IP, launching its first Bluetooth 7 RF IP on TSMC 12nm, alongside support for IEEE 802.15.4, reinforcing its commitment to delivering complete wireless solutions [3] Company Overview - Ceva is dedicated to innovation in the smart edge, providing a broad portfolio of wireless communications, sensing, and Edge AI technologies that power over 19 billion smart edge products globally [4] - The company focuses on delivering high-performance, low-power silicon and software IP solutions to create a smarter, safer, and more interconnected world [4]

Core Viewpoint - Ceva, Inc. will announce its second quarter 2025 results on August 11, 2025, before the NASDAQ market opens, followed by a conference call to discuss the operating performance for the quarter [1] Company Overview - Ceva, Inc. is a leading licensor of silicon and software IP that enables Smart Edge devices to connect, sense, and infer data more reliably and efficiently [1] - The company offers a broad portfolio of IP, including wireless connectivity IPs (Bluetooth, Wi-Fi, UWB, and 5G platform IP), scalable Edge AI NPU IPs, and sensor fusion solutions [4] - Ceva powers over 19 billion smart edge products, including AI-infused smartwatches, IoT devices, wearables, autonomous vehicles, and 5G mobile networks [4] Conference Call Details - The conference call will take place at 8:30 a.m. Eastern Time on August 11, 2025, and will be accessible via dial-in numbers and a live webcast [2][8] - A replay of the conference call will be available from one hour after the end of the call until 9:00 a.m. Eastern Time on August 18, 2025 [3] Corporate Responsibility - Ceva emphasizes sustainability and environmental consciousness, focusing on environmental preservation, recycling, employee welfare, and privacy [6]

Core Insights - Ceva and Nothing have announced a collaboration to integrate Ceva's RealSpace® Spatial Audio Software into Nothing's upcoming audio products, including the Nothing Headphone (1) [1][2][4] - This partnership aims to enhance the listening experience by providing cinematic 3D sound with dynamic head tracking, aligning with Nothing's design-first approach [4][5][6] Company Overview - Nothing, founded in London in 2020, focuses on creating innovative consumer technology that emphasizes design and user experience, having sold over 10 million devices and generated over $1 billion in lifetime revenue [7] - Ceva, Inc. specializes in silicon and software IP for smart edge applications, powering over 19 billion smart edge products globally, including advanced wireless communications and Edge AI technologies [9][10] Product Details - The Nothing Headphone (1) represents Nothing's first entry into the over-ear audio device market, aiming to deliver an immersive audio experience [1][2][4] - Ceva's RealSpace technology is designed for low power consumption and efficient integration into wireless audio devices, enhancing the overall audio experience [5][6] Strategic Goals - The collaboration is part of Nothing's mission to redefine user engagement with audio across music, movies, and games, leveraging Ceva's spatial audio technology [4][6] - Both companies aim to push the boundaries of audio technology, creating a more emotional and immersive listening experience for users [5][6]

CEVA (CEVA) FY Conference Summary Company Overview - CEVA is an IP licensing company, similar to ARM, focusing on technology licensing and earning royalties for each unit sold [3][4] - The company enables three primary use cases: Connect, Sense, and Infer, with a strong emphasis on wireless connectivity, DSP capabilities, and AI accelerators [3][4][6] Core Offerings - CEVA's technology supports a wide range of wireless connectivity including Wi-Fi, Bluetooth, cellular, IoT, and 5G [3][4] - The company has enabled over 20 billion devices, with an annual shipment of approximately 2 billion devices [4] - CEVA's Smart Edge technology integrates connectivity, sensing, and inference capabilities into edge devices [6][7] Market Segmentation and Growth Outlook - CEVA targets six end markets: PC, mobile, automotive, wireless infrastructure, consumer IoT, and industrial IoT [13] - The mobile segment is expected to see significant growth, with a new large U.S. mobile OEM adopting CEVA's technology for their 5G modem [14] - CEVA is currently shipping over 1 billion Bluetooth devices annually, with growth anticipated in Wi-Fi and cellular IoT [15] - The company holds approximately 15% market share in mobile, with expectations to exceed 20% [16] Competitive Landscape - CEVA faces competition primarily from the "make versus buy" decision of customers, with limited direct competition in wireless communication IP [19][20] - The company aims to become the de facto standard for wireless communication, similar to ARM's position in the CPU market [20] Growth Drivers - Short-term growth drivers include increased licensing for next-generation Bluetooth and Wi-Fi technologies [23] - Long-term growth is expected from the transition to smart devices with AI inference capabilities, moving from cloud-based to hybrid models [24] - CEVA anticipates growth in the automotive sector as their Vision AI DSP technologies ramp up in production [27][28] Software Portfolio and Integration - CEVA provides a complete software stack alongside its silicon IP, enhancing interoperability and user experience [31][32] - Investments in embedded software applications for sensor fusion and contextual awareness are aimed at differentiating CEVA's offerings [32] Geographic Strategy and Tariff Impact - CEVA benefits from localization trends, as it does not ship final products and thus is less impacted by tariffs [39][42] - The company serves both Western and Eastern markets successfully, with an increasing demand for IP [40] Financial Performance and Margins - CEVA maintains gross margins above 85%, with a focus on high-margin IP business [44][45] - The company is committed to organic and inorganic growth, with potential M&A opportunities to expand its IP portfolio [48][50] Conclusion - CEVA is positioned for significant growth in the coming years, driven by its strong market presence in mobile and wireless technologies, innovative software solutions, and strategic geographic positioning. The company aims to maintain high gross margins while expanding its IP offerings to meet the evolving needs of its customers [49][51]

Group 1 - The company operates on a principle that emphasizes simplicity and common sense as drivers of success [1] - The hedge fund is built with a clear purpose, disciplined focus, and aims for consistent alpha generation [1] - The investment approach is fully quantitative, relying on a model that provides stock recommendations without human interference [1] Group 2 - The motto "invest first, investigate later" reflects the company's strategy of purchasing based on model suggestions before conducting further research [1] - The company discourages human influence in stock selection to ensure decisions are data-driven and free from individual bias [1]

Revenue Performance - Total revenues for Q1 2025 were $24.2 million, representing a 10% increase compared to Q1 2024[95]. - The five largest customers accounted for 56% of total revenues in Q1 2025, up from 45% in Q1 2024[96]. - Licensing and related revenues increased, while royalty revenues decreased, impacting overall revenue growth[95]. - Licensing and related revenues increased by 32% to $15.0 million in Q1 2025, accounting for 62% of total revenues, up from 52% in Q1 2024[98][102]. - Royalty revenues decreased by 14% to $9.2 million in Q1 2025, representing 38% of total revenues, down from 48% in Q1 2024[103][105]. Market Outlook - The addressable market for Bluetooth, Wi-Fi, UWB, and cellular IoT is expected to exceed 16.5 billion devices annually by 2029[89]. - The company anticipates a low-single digits revenue growth for 2025, down from a high-single digits range due to macroeconomic conditions[93]. - The company expects continued growth in connectivity products, particularly in Bluetooth, Wi-Fi, and cellular IoT business lines[92]. Product Development and Innovation - In Q1 2025, the company signed eleven IP licensing deals, including significant agreements for Wi-Fi 7 and NeuPro-M Edge AI NPU[87]. - The PentaG2 platform and DSPs for 5G mobile broadband are positioned as comprehensive solutions for various connected devices[89]. - The NeuPro-M AI NPUs are designed to enable generative and classic AI across a wide range of devices, with a projected shipment of over 6 billion Edge AI hardware units annually by 2030[89]. - The MotionEngine software has shipped in over 400 million devices, indicating strong market traction[90]. - Eleven IP licensing agreements were concluded in Q1 2025, including deals for Edge AI NPU and Wi-Fi 7 connectivity[101]. Financial Performance - The company reported sales of 420 million chipsets incorporating its technologies in Q1 2025, a 13% increase from Q1 2024[104]. - Gross margin for Q1 2025 was 86%, down from 89% in Q1 2024, primarily due to higher cost of revenues[108]. - Total operating expenses rose to $25.1 million in Q1 2025, compared to $24.5 million in Q1 2024, driven by higher salaries and professional services costs[109]. - Research and development expenses decreased to $17.6 million in Q1 2025, representing 73% of total revenues, down from 82% in Q1 2024[110]. - Financial income, net increased to $2.10 million in Q1 2025, up from $1.26 million in Q1 2024, with a foreign exchange gain of $0.60 million[117][119]. Cash and Investments - The company had approximately $158.3 million in cash, cash equivalents, bank deposits, and marketable securities as of March 31, 2025, down from $163.6 million at the end of 2024[131]. - Total cash, cash equivalents, bank deposits, and marketable securities amounted to $158.3 million, with $134.3 million held by foreign subsidiaries[132]. - Cash used in operating activities for Q1 2025 was $7.4 million, consisting of a net loss of $3.3 million and adjustments for non-cash items of $4.4 million[135]. - Net cash provided by investing activities for Q1 2025 was $6.2 million, compared to $5.1 million for the same period in 2024[138]. - Net cash provided by financing activities for Q1 2025 was $1.4 million, an increase from $0.3 million in Q1 2024[139]. - Unrealized losses associated with investments were approximately $0.8 million as of March 31, 2025, due to changes in the interest rate environment[148]. - Interest income and net gains and losses from marketable securities were $1.50 million for Q1 2025, reflecting higher yields compared to $1.45 million in Q1 2024[149]. - Cash flows from operating activities are primarily affected by payroll-related costs and obligations under property leases and design tool licenses[137]. - The company believes its cash and cash equivalents, short-term bank deposits, and marketable securities will provide sufficient capital for at least the next 12 months[142]. - The company occasionally evaluates potential acquisitions, which may require substantial capital resources and additional financing[143]. - A foreign exchange gain of $600,000 was recorded for Q1 2025, compared to a loss of $193,000 for the same period in 2024[145]. Workforce and R&D - The number of research and development personnel decreased to 325 as of March 31, 2025, from 331 a year earlier[111].

Financial Data and Key Metrics Changes - Total revenue for the quarter was $24.2 million, an increase of 10% year over year from $22.2 million [15] - Licensing revenue increased by 32% to $15 million, representing 62% of total revenues, compared to $11.4 million in the same quarter last year [15] - Royalty revenue decreased by 14% to $9.2 million, accounting for 38% of total revenue, down from $10.7 million in the same quarter last year [16] - GAAP net loss for the first quarter was $3.3 million, with a diluted loss per share of $0.14, compared to a net loss of $5.4 million and a diluted loss per share of $0.23 in the same quarter last year [18] Business Line Data and Key Metrics Changes - Licensing revenue was $15 million, with 11 deals concluded in the quarter, including strategic agreements in connectivity, sensing, and edge AI [6][15] - WiFi royalty revenue grew by 183% year over year, driven by a shift towards WiFi 6, which commands a higher average selling price (ASP) compared to previous generations [12][20] - Shipments of Bluetooth units were 233 million, up 15% from 202 million in the first quarter of the previous year [19] Market Data and Key Metrics Changes - Shipments by CEVA licensees during the first quarter totaled 420 million units, up 13% from the first quarter of the previous year [19] - Consumer IoT market shipments increased by 19% year over year, while industrial IoT shipments rose by 26% [19] - The company anticipates sequential growth in royalties due to the seasonality and expansion of CEVA-powered 5G smartphone modems [21] Company Strategy and Development Direction - The company aims to continue innovating for customers, deepen technology leadership, and build a strong future royalty stream while managing expenses [13] - CEVA is focused on expanding its market share in wireless communication IP and diversifying its royalty customer base [3][21] - The company is adopting a more cautious outlook for the rest of the year, lowering 2025 revenue guidance from a high single-digit range to a low single-digit range for growth over 2024 annual revenues [22] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is no direct impact from tariffs, the indirect impact on consumer demand has increased uncertainty [22] - The company remains optimistic about the long-term potential of its royalty business despite a decline in overall revenue [11] - Management expressed confidence in navigating short-term volatility while focusing on being the IP partner of choice for smart edge devices [13] Other Important Information - The company reported a GAAP operating loss of $4.4 million, down from a loss of $5 million in the same quarter a year ago [17] - Total gross operating expenses for the first quarter were at the low end of guidance at $25.1 million [16] - The company has a cash balance of approximately $158 million as of the end of the first quarter [20] Q&A Session Summary Question: Can you say whether the ADAS win was with a tier one supplier? - Management confirmed that the design win was with a tier one supplier that has secured OEM customers, and it will be part of their next-generation platform [26][27] Question: Is there a similar increase in ASPs with WiFi 7 as seen with WiFi 6? - Management indicated that there is expected to be a significant uplift in ASPs as customers transition from WiFi 6 to WiFi 7, similar to the previous transition [28][30] Question: What competitive environment surrounded the ADAS win? - Management explained that the market is migrating to more advanced models using vision transformers, which require power-efficient solutions with low latency, areas where their technology excels [36] Question: Was the softness in the low-end smartphone market related to tariffs? - Management clarified that the softness was due to supply chain issues and not directly related to tariffs, and they expect a ramp-up in the second quarter [42][44] Question: Is there any impact on the licensing environment due to macro uncertainties? - Management stated that while there is cautious sentiment among customers, they have not seen a decrease in their licensing pipeline [76] Question: Are WiFi royalty units ramping up similarly to Bluetooth? - Management expressed optimism about the ramp-up of WiFi royalty units, noting that many customers are successfully integrating WiFi 6 technology into production [78]

Financial Data and Key Metrics Changes - Total revenue for the quarter was $24.2 million, up 10% year over year from $22.2 million [13] - Licensing revenue increased 32% to $15 million, representing 62% of total revenues compared to $11.4 million in the same quarter last year [14] - Royalty revenue decreased 14% to $9.2 million, reflecting 38% of total revenue, down from $10.7 million for the same quarter last year [15] - GAAP net loss for the first quarter was $3.3 million, with a diluted loss per share of $0.14, compared to a net loss of $5.4 million and diluted loss per share of $0.23 for the same quarter last year [17] Business Line Data and Key Metrics Changes - Royalty revenue was impacted by lower shipments of low-cost smartphone chips and a slower product ramp-up from an industrial customer [4][10] - WiFi royalty revenue grew 183% year over year, driven by a 12% increase in unit shipments, particularly in the consumer and industrial IoT markets [11][19] - Shipments of CEVA licensees during the first quarter were 420 million units, up 13% from the previous year, with notable increases in consumer IoT (up 19%) and industrial IoT (up 26%) [18] Market Data and Key Metrics Changes - The company noted strong demand in the Edge AI portfolio and continued expansion in wireless communication IP, despite a cautious outlook due to macroeconomic factors [20][21] - The overall performance and safety of ADAS systems are advancing rapidly, with significant advancements in AI technologies such as vision transformers [9] Company Strategy and Development Direction - The company aims to continue innovating for customers, deepen technology leadership, and build a strong future royalty stream while managing expenses [12] - The strategy focuses on accumulated and sustained value creation over time, with a long-term view on IP licensing success [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating short-term volatility while focusing on being the IP partner of choice for smart edge devices [12] - A cautious outlook for the rest of the year was adopted, lowering 2025 revenue guidance from a high single-digit range to a low single-digit range for growth over 2024 annual revenues [21][65] Other Important Information - The company is engaged in multiple discussions related to AI influencing using its Newport NPU family, including several automotive players for next-generation platforms [9] - The company expects sequential growth in royalties due to seasonality and expansion of CEVA-powered 5G smartphone modems in the second quarter and beyond [23] Q&A Session Summary Question: Can you say whether the ADAS win was with a tier one supplier or if it has secured a program at an automotive OEM? - Management confirmed it was a design win with a tier one supplier that has secured OEM customers, and it will be part of their next-generation platform [26][27] Question: Is there a similar increase in ASPs with WiFi 7 as there was with WiFi 6? - Management indicated that the transition from WiFi 4 to WiFi 6 saw a significant uplift in ASP, and they expect a similar trend with WiFi 7 as customers migrate to volume production [28][31] Question: What competitive environment surrounded the ADAS win? - Management noted that the market is migrating to more advanced models using vision transformers, requiring power-efficient solutions with low latency, which their technology excels at [36] Question: Was the softness in the low-end smartphone market related to tariffs or customer product transitions? - Management clarified that the slower start was due to supply chain activities and does not expect direct impacts from tariffs, anticipating a ramp-up in customer shipments [42][44] Question: Are there any impacts on the licensing environment due to macro and tariff uncertainty? - Management stated that while there is cautious sentiment among customers, they have not seen a decrease in their licensing pipeline and continue to close strategic deals [76][77] Question: Are WiFi royalty units ramping and tracking to follow the success of Bluetooth? - Management expressed optimism about the ramp-up of WiFi technology, with many customers integrating and ramping production, indicating a strong alignment with Bluetooth success [78]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $24.2 million, representing a 10% increase year over year from $22.2 million in Q1 2024 [13] - Licensing revenue increased by 32% to $15 million, accounting for 62% of total revenues, compared to $11.4 million in Q1 2024 [13] - Royalty revenue decreased by 14% to $9.2 million, reflecting 38% of total revenue, down from $10.7 million in the same quarter last year [14] - GAAP net loss for Q1 2025 was $3.3 million, with a diluted loss per share of $0.14, compared to a net loss of $5.4 million and a diluted loss per share of $0.23 in Q1 2024 [17] Business Line Data and Key Metrics Changes - Royalty revenue from WiFi increased by 183% year over year, driven by a 12% increase in unit shipments, particularly in the consumer and industrial IoT markets [10][19] - Shipments of Bluetooth units were 233 million, up 15% from 202 million in Q1 2024 [18] - Cellular IoT shipments increased by 31% year over year to 48 million units [18] Market Data and Key Metrics Changes - Shipments in the consumer IoT market rose by 19% to 337 million units, while industrial IoT shipments increased by 26% to 30 million units [18] - The overall market for low-cost smartphones experienced a slowdown, impacting royalty revenue expectations [19] Company Strategy and Development Direction - The company aims to continue innovating for customers, deepen technology leadership, and build a strong future royalty stream while managing expenses [12] - The focus remains on expanding market share in wireless communication IP and diversifying the royalty customer base [2][12] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautious outlook for the remainder of the year, lowering 2025 revenue guidance from a high single-digit range to a low single-digit range for growth over 2024 [21] - The company anticipates sequential growth in royalties due to seasonality and the expansion of CEVA-powered 5G smartphone modems [20] Other Important Information - The company reported a cash balance of approximately $158 million as of March 2025 [19] - Total gross operating expenses for Q1 were at the low end of guidance at $25.1 million [14] Q&A Session Summary Question: Can you clarify the significance of the AI NPU ADAS win? - The design win is with a tier one supplier that has secured OEM customers, indicating potential for multiple platforms [26] Question: Is there an increase in ASPs with WiFi 7? - The transition from WiFi 6 to WiFi 7 is expected to bring a significant uplift in ASPs, similar to the previous transition [28] Question: What is the competitive environment around the ADAS win? - The competitive landscape includes a shift towards advanced models using vision transformers, with CEVA's technology excelling in power efficiency and low latency [34][35] Question: What caused the softness in the low-end smartphone market? - The slowdown was attributed to supply chain issues and is expected to recover as customers ramp up production [41][42] Question: How is the licensing pipeline looking? - The licensing pipeline remains strong, with no significant postponements in deals despite macroeconomic concerns [46][76] Question: Are there any impacts from tariffs on licensing? - There is no direct impact from tariffs, but customers are exhibiting cautious behavior due to uncertainty in the market [75][76] Question: How are WiFi royalty units tracking? - WiFi royalty units are ramping up successfully, with many customers integrating technology into production [78]