[Company Announcement & Executive Summary](index=1&type=section&id=1.%20Company%20Announcement%20%26%20Executive%20Summary) This section provides an overview of Ceva, Inc.'s Q2 2025 financial performance, key operational achievements, and strategic highlights, including revenue figures, net loss, and significant business milestones [Announcement and Business Overview](index=1&type=section&id=1.1%20Announcement%20and%20Business%20Overview) Ceva, Inc. announced its second quarter financial results for the period ended June 30, 2025, highlighting its role as a leading silicon and software IP licensor enabling reliable, efficient smart edge devices - Ceva, Inc. (NASDAQ: CEVA) announced its second quarter financial results for the period ended June 30, 2025[1](index=1&type=chunk)[2](index=2&type=chunk) - The company is a leading silicon and software IP licensor, enabling smart edge devices to reliably, efficiently connect, sense, and infer data[2](index=2&type=chunk) [Second Quarter 2025 Financial Highlights](index=1&type=section&id=1.2%20Second%20Quarter%202025%20Financial%20Highlights) Ceva's Q2 2025 total revenue was $25.7 million, down 9.7% year-over-year but up 6% sequentially, with GAAP net loss widening to $3.7 million and non-GAAP net income decreasing by 57.1% | Metric | Q2 2025 (Millions USD) | Q2 2024 (Millions USD) | YoY Change | QoQ Change | | :------------------- | :------------------- | :------------------- | :--------- | :--------- | | **Total Revenue** | 25.7 | 28.4 | -9.7% | +6% | | Licensing and Related Revenue | 15.0 | 17.3 | -13.3% | - | | Royalty Revenue | 10.7 | 11.2 | -4.5% | Sequentially Increased | | **GAAP Net Loss** | (3.7) | (0.3) | Widened | - | | **GAAP Diluted Loss Per Share** | (0.15) | (0.01) | Widened | - | | **Non-GAAP Net Income** | 1.8 | 4.2 | -57.1% | - | | **Non-GAAP Diluted Earnings Per Share** | 0.07 | 0.17 | -58.8% | - | [Operational and Strategic Achievements](index=1&type=section&id=1.3%20Operational%20and%20Strategic%20Achievements) Ceva's AI business expanded with four new NPU agreements and 13 IP licensing deals, reaching 20 billion Ceva-powered device shipments and repurchasing 300,000 shares - AI business continued to expand, signing **four new NPU agreements** this quarter, marking a critical moment for customer adoption[4](index=4&type=chunk)[6](index=6&type=chunk) - A total of **13 IP licensing agreements** were concluded this quarter, covering a wide range of markets and applications including edge AI NPU, V2X communication, 4D radar, Bluetooth, and spatial audio[4](index=4&type=chunk) - **Five agreements** were signed with first-time customers, and **four** with OEM customers[4](index=4&type=chunk) - Ceva-powered device shipments surpassed the **20 billion unit milestone**, with **488 million units** shipped this quarter, including record cellular IoT and Wi-Fi 6 shipments[4](index=4&type=chunk)[6](index=6&type=chunk) - **300,000 shares** of Ceva stock were repurchased this quarter, valued at approximately **$6.2 million**[6](index=6&type=chunk)[8](index=8&type=chunk) [GAAP Financial Results](index=1&type=section&id=2.%20GAAP%20Financial%20Results) This section presents Ceva's GAAP financial performance, including interim condensed consolidated statements of loss and key GAAP metrics for Q2 and H1 2025, detailing revenue, gross profit, and net loss [Interim Condensed Consolidated Statements of Loss](index=5&type=section&id=2.1%20Interim%20Condensed%20Consolidated%20Statements%20of%20Loss) In Q2 2025, Ceva's total revenue was $25.7 million, a decrease year-over-year, resulting in a GAAP gross profit of $22.1 million, an operating loss of $4.5 million, a net loss of $3.7 million, and a diluted loss per share of $0.15 Ceva, Inc. Interim Condensed Consolidated Statements of Loss (GAAP) | Metric (Thousands USD) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--------------------------------- | :------- | :------- | :------- | :------- | | **Revenue:** | | | | | | Licensing and Related Revenue | 15,022 | 17,278 | 30,064 | 28,692 | | Royalty | 10,656 | 11,159 | 19,859 | 21,817 | | **Total Revenue** | **25,678** | **28,437** | **49,923** | **50,509** | | Cost of Revenue | 3,549 | 2,933 | 7,036 | 5,436 | | **Gross Profit** | **22,129** | **25,504** | **42,887** | **45,073** | | **Operating Expenses:** | | | | | | Research and Development, net | 18,758 | 18,758 | 36,367 | 36,749 | | Selling and Marketing | 3,322 | 3,095 | 6,771 | 5,911 | | General and Administrative | 4,381 | 3,537 | 8,314 | 7,109 | | Amortization of Intangible Assets | 150 | 149 | 299 | 299 | | **Total Operating Expenses** | **26,611** | **25,539** | **51,751** | **50,068** | | **Operating Loss** | **(4,482)** | **(35)** | **(8,864)** | **(4,995)** | | Net Financial Income | 2,121 | 1,406 | 4,221 | 2,663 | | Revaluation of Tradable Equity Securities | (208) | (58) | (262) | (118) | | **Loss (Income) Before Taxes** | **(2,569)** | **1,313** | **(4,905)** | **(2,450)** | | Income Tax Expense | 1,135 | 1,604 | 2,126 | 3,289 | | **Net Loss** | **(3,704)** | **(291)** | **(7,031)** | **(5,739)** | | **Basic and Diluted Net Loss Per Share** | **(0.15)** | **(0.01)** | **(0.30)** | **(0.24)** | | **Weighted Average Shares (Thousands):** | | | | | | Basic and Diluted | 23,898 | 23,628 | 23,832 | 23,568 | [Key GAAP Financial Metrics](index=1&type=section&id=2.2%20Key%20GAAP%20Financial%20Metrics) In Q2 2025, Ceva's total revenue decreased to $25.7 million from $28.4 million in Q2 2024, with both licensing and royalty revenues declining, GAAP gross margin falling to 86%, and GAAP operating and net losses significantly widening 2025年第二季度关键GAAP财务指标 (同比) | Metric | Q2 2025 (Millions USD) | Q2 2024 (Millions USD) | YoY Change | | :------------------- | :------------------- | :------------------- | :--------- | | **Total Revenue** | 25.7 | 28.4 | -9.7% | | Licensing and Related Revenue | 15.0 | 17.3 | -13.3% | | Royalty Revenue | 10.7 | 11.2 | -4.5% | | **GAAP Gross Margin** | 86% | 90% | -4% | | **GAAP Operating Loss** | (4.5) | (0.04) | Loss Widened | | **GAAP Net Loss** | (3.7) | (0.3) | Loss Widened | | **GAAP Diluted Loss Per Share** | (0.15) | (0.01) | Loss Widened | [Non-GAAP Financial Results](index=2&type=section&id=3.%20Non-GAAP%20Financial%20Results) This section outlines Ceva's non-GAAP financial performance, presenting key non-GAAP metrics for Q2 2025 and detailed reconciliations from GAAP measures, highlighting adjustments for stock-based compensation and other non-cash items [Key Non-GAAP Financial Metrics](index=2&type=section&id=3.1%20Key%20Non-GAAP%20Financial%20Metrics) In Q2 2025, Ceva's non-GAAP gross margin was 87%, non-GAAP operating income was $0.8 million, non-GAAP net income was $1.8 million, and non-GAAP diluted EPS was $0.07, all showing a decline year-over-year 2025年第二季度关键非GAAP财务指标 (同比) | Metric | Q2 2025 (Millions USD) | Q2 2024 (Millions USD) | YoY Change | | :------------------- | :------------------- | :------------------- | :--------- | | **Non-GAAP Gross Margin** | 87% | 91% | -4% | | **Non-GAAP Operating Income** | 0.8 | 4.4 | -81.8% | | **Non-GAAP Net Income** | 1.8 | 4.2 | -57.1% | | **Non-GAAP Diluted Earnings Per Share** | 0.07 | 0.17 | -58.8% | [Reconciliation of GAAP to Non-GAAP Measures](index=6&type=section&id=3.2%20Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) Ceva's non-GAAP metrics exclude stock-based compensation, acquisition-related intangible asset amortization, asset acquisition costs, and tradable equity securities revaluation losses to provide a clearer view of operating performance, significantly impacting net income, operating income, and gross profit Reconciliation of GAAP Net Loss to Non-GAAP Net Income (Thousands USD) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------------------------------- | :------- | :------- | :------- | :------- | | **GAAP Net Loss** | **(3,704)** | **(291)** | **(7,031)** | **(5,739)** | | Stock-based compensation expense (cost of revenue) | 166 | 191 | 325 | 394 | | Stock-based compensation expense (R&D) | 2,673 | 2,438 | 5,139 | 4,445 | | Stock-based compensation expense (selling and marketing) | 598 | 451 | 1,164 | 816 | | Stock-based compensation expense (general and administrative) | 1,465 | 820 | 2,597 | 1,816 | | Amortization of acquired intangible assets | 209 | 278 | 417 | 556 | | Asset acquisition related costs | 144 | 252 | 288 | 532 | | Revaluation loss of tradable equity securities | 208 | 58 | 262 | 118 | | **Non-GAAP Net Income** | **1,759** | **4,197** | **3,161** | **2,938** | Reconciliation of GAAP Operating Loss to Non-GAAP Operating Income (Thousands USD) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------------------------------- | :------- | :------- | :------- | :------- | | **GAAP Operating Loss** | **(4,482)** | **(35)** | **(8,864)** | **(4,995)** | | Stock-based compensation expense (cost of revenue) | 166 | 191 | 325 | 394 | | Stock-based compensation expense (R&D) | 2,673 | 2,438 | 5,139 | 4,445 | | Stock-based compensation expense (selling and marketing) | 598 | 451 | 1,164 | 816 | | Stock-based compensation expense (general and administrative) | 1,465 | 820 | 2,597 | 1,816 | | Amortization of acquired intangible assets | 209 | 278 | 417 | 556 | | Asset acquisition related costs | 144 | 252 | 288 | 532 | | **Non-GAAP Operating Income** | **773** | **4,395** | **1,066** | **3,564** | Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit (Thousands USD) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :------------------------------------------------- | :------- | :------- | :------- | :------- | | **GAAP Gross Profit** | **22,129** | **25,504** | **42,887** | **45,073** | | GAAP Gross Margin | 86% | 90% | 86% | 89% | | Stock-based compensation expense (cost of revenue) | 166 | 191 | 325 | 394 | | Amortization of acquired intangible assets | 59 | 129 | 118 | 257 | | **Non-GAAP Gross Profit** | **22,354** | **25,824** | **43,330** | **45,724** | | Non-GAAP Gross Margin | 87% | 91% | 87% | 91% | - Non-GAAP gross margin, operating income, net income, and diluted EPS calculations exclude stock-based compensation, amortization of acquired intangible assets, asset acquisition costs, and revaluation losses of tradable equity securities[14](index=14&type=chunk)[15](index=15&type=chunk)[16](index=16&type=chunk) [Management Insights](index=1&type=section&id=4.%20Management%20Insights) This section provides management's perspective on Ceva's Q2 2025 performance, with commentary from the CEO on strategic achievements and AI business scaling, and the CFO on financial drivers and capital allocation [CEO's Commentary](index=1&type=section&id=4.1%20CEO's%20Commentary) CEO Amir Panush expressed satisfaction with Q2 results, driven by expanded AI licensing deals, strong execution across connectivity, sensing, and inferring use cases, and sequential royalty revenue growth, anticipating continued AI business scaling and sequential and year-over-year growth in H2 - Satisfied with second-quarter performance, primarily driven by expanded AI licensing deals and strong execution across the three pillar use cases of connectivity, sensing, and inferring[4](index=4&type=chunk) - AI business continues to scale, with **four new NPU agreements** signed this quarter, highlighting the growing demand for industry-leading edge AI technology[4](index=4&type=chunk) - The company has reached the milestone of **20 billion Ceva-powered device shipments**, solidifying its leadership in wireless connectivity IP[4](index=4&type=chunk) - Anticipates the company's business will achieve sequential and year-over-year growth in the second half of the year[4](index=4&type=chunk) [CFO's Commentary](index=2&type=section&id=4.2%20CFO's%20Commentary) CFO Yaniv Arieli noted AI NPU demand supported licensing, with total licensing revenue exceeding $15 million for the fifth consecutive quarter, while royalty revenue saw continued growth in consumer IoT and record cellular IoT and Wi-Fi 6 shipments, affirming focus on expense management, profitability, and active share repurchase - AI NPU demand supported the quarter's licensing business, with total licensing revenue exceeding **$15 million** for the fifth consecutive quarter[8](index=8&type=chunk) - In terms of royalty revenue, consumer IoT shipments continued to grow, with cellular IoT and Wi-Fi 6 shipments reaching **record highs**[8](index=8&type=chunk) - The company will continue to focus on stringent expense management and improving profitability[8](index=8&type=chunk) - Actively executed the share repurchase program this quarter, repurchasing **300,000 shares** valued at approximately **$6.2 million**[8](index=8&type=chunk) [Financial Position](index=8&type=section&id=5.%20Financial%20Position) This section details Ceva's financial position as of June 30, 2025, through its interim condensed consolidated balance sheets, outlining assets, liabilities, and shareholders' equity [Interim Condensed Consolidated Balance Sheets](index=8&type=section&id=5.1%20Interim%20Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Ceva's total assets were $302.8 million, a slight decrease from $308.9 million on December 31, 2024, with cash and cash equivalents increasing but tradable securities and short-term bank deposits decreasing, alongside a slight decline in total liabilities and total shareholders' equity Ceva, Inc. Interim Condensed Consolidated Balance Sheets (Thousands USD) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------- | :-------------- | | **Assets:** | | | | **Current Assets:** | | | | Cash and cash equivalents | 29,082 | 18,498 | | Tradable securities and short-term bank deposits | 128,422 | 145,146 | | Accounts receivable, net | 11,832 | 15,969 | | Unbilled accounts receivable | 24,851 | 21,240 | | Prepaid expenses and other current assets | 14,621 | 15,488 | | **Total Current Assets** | **208,808** | **216,341** | | **Long-Term Assets:** | | | | Severance pay fund | 7,864 | 7,161 | | Deferred tax assets, net | 1,630 | 1,456 | | Property and equipment, net | 6,484 | 6,877 | | Operating lease right-of-use assets | 4,645 | 5,811 | | Investment in tradable equity securities | 50 | 312 | | Goodwill | 58,308 | 58,308 | | Intangible assets, net | 1,460 | 1,877 | | Other long-term assets | 13,593 | 10,805 | | **Total Assets** | **302,842** | **308,948** | | **Liabilities and Shareholders' Equity:** | | | | **Current Liabilities:** | | | | Accounts payable | 1,771 | 1,125 | | Deferred revenue | 3,212 | 3,599 | | Accrued expenses and other payables | 17,749 | 23,207 | | Operating lease liabilities | 1,610 | 2,598 | | **Total Current Liabilities** | **24,342** | **30,529** | | **Long-Term Liabilities:** | | | | Accrued severance pay | 8,155 | 7,365 | | Operating lease liabilities | 2,755 | 2,963 | | Other accrued liabilities | 1,698 | 1,535 | | **Total Liabilities** | **36,950** | **42,392** | | **Shareholders' Equity:** | | | | Ordinary shares | 24 | 24 | | Additional paid-in capital | 267,743 | 259,891 | | Treasury stock | (5,874) | (3,222) | | Accumulated other comprehensive income (loss) | 344 | (1,330) | | Retained earnings | 3,655 | 11,193 | | **Total Shareholders' Equity** | **265,892** | **266,556** | | **Total Liabilities and Shareholders' Equity** | **302,842** | **308,948** | [Corporate Information](index=3&type=section&id=6.%20Corporate%20Information) This section provides essential corporate information about Ceva, Inc., including its business focus on smart edge devices, IP portfolio, global presence, and important forward-looking statements with associated risk factors [About Ceva, Inc.](index=3&type=section&id=6.1%20About%20Ceva,%20Inc.) Ceva, Inc. innovates smart edge devices through wireless communication, sensing, and edge AI technologies, offering a broad IP portfolio including Bluetooth, Wi-Fi, UWB, 5G, scalable edge AI NPU, and sensor fusion solutions to enable a smarter, safer, and more connected world, headquartered in Rockville, Maryland, with global operations and a commitment to corporate citizenship - Ceva is dedicated to bringing innovation to smart edge devices through its wireless communication, sensing, and edge AI technologies[17](index=17&type=chunk) - The company offers the broadest IP portfolio, including wireless connectivity IP (Bluetooth, Wi-Fi, UWB, and 5G platform IP), scalable edge AI NPU IP, and sensor fusion solutions[17](index=17&type=chunk) - Ceva's technology powers over **20 billion smart edge products**, including smartwatches, IoT devices, wearables, autonomous vehicles, and 5G mobile networks[17](index=17&type=chunk) - Headquartered in Rockville, Maryland, the company boasts a global customer base and operational network, committed to being a responsible global corporate citizen[18](index=18&type=chunk)[19](index=19&type=chunk) [Forward-Looking Statements](index=3&type=section&id=6.2%20Forward-Looking%20Statements) This press release contains forward-looking statements involving risks, uncertainties, and assumptions that could cause Ceva's actual results to differ materially from expectations, including industry competition, technology market acceptance, market demand changes, semiconductor industry cyclicality, revenue diversification, the Israel-Gaza conflict, and other SEC-filed risks, with Ceva disclaiming any obligation to update such statements - The press release contains forward-looking statements involving risks, uncertainties, and assumptions that could cause actual results to differ materially from expectations[13](index=13&type=chunk) - Forward-looking statements include the continued scaling of the AI business, Ceva's position as a leader in wireless connectivity IP, and expectations for sequential growth in the second half of the year[13](index=13&type=chunk) - Risk factors include industry competition, technology market acceptance, changes in market demand, semiconductor industry cyclicality, ability to diversify revenue streams, the Israel-Gaza conflict, and other risks described in SEC filings[13](index=13&type=chunk) - Ceva undertakes no obligation to update any forward-looking statements or information[13](index=13&type=chunk) [Investor Relations](index=2&type=section&id=7.%20Investor%20Relations) This section provides details for Ceva's Q2 2025 earnings conference call, including access information and replay options, along with key investor and public relations contact details [Conference Call Details](index=2&type=section&id=7.1%20Conference%20Call%20Details) Ceva management will host a conference call on August 11, 2025, at 8:30 AM ET to discuss quarterly operating results, with dial-in and webcast options available, and a replay service provided - Ceva management will host a conference call on **August 11, 2025, at 8:30 AM ET** to discuss the quarter's operating results[9](index=9&type=chunk) - The conference call can be accessed via designated dial-in numbers (US participants: **1-844-435-0316**, international participants: **+1-412-317-6365**, access code: **Ceva**) or through the webcast link: https://app.webinar.net/QYyg6d46Eeb[10](index=10&type=chunk)[12](index=12&type=chunk) - A replay will be available after the call by dialing **+1-877-344-7529** or **+1-412-317-0088** (access code: **1439858**), accessible until **9:00 AM ET on August 18, 2025**, and also on Ceva's website[11](index=11&type=chunk) [Contact Information](index=4&type=section&id=7.2%20Contact%20Information) Investors and public relations contacts include CFO Yaniv Arieli and VP of Market Intelligence, Investor & Public Relations Richard Kingston - Contacts include Ceva, Inc. CFO **Yaniv Arieli** (+972.9.961.3770, yaniv.arieli@ceva-ip.com) and VP of Market Intelligence, Investor & Public Relations **Richard Kingston** (+1.650.220.1948, richard.kingston@ceva-ip.com)[21](index=21&type=chunk)

Financial Performance - Total revenue reached $25.7 million[2], compared to $28.4 million in Q2'24[2], a decrease of approximately 9.5% - Non-GAAP earnings per share were 7 cents[2], down from 17 cents in Q2'24[2] - GAAP earnings per share were a loss of 15 cents[2], compared to a loss of 1 cent in Q2'24[2] - Licensing and related royalties revenue was $15 million[4] in Q2'25, compared to $17.3 million[4] in Q2'24, a decrease of approximately 13% - Non-GAAP operating income was $1.8 million[4] in Q2'25, compared to $4.4 million[4] in Q2'24, a decrease of approximately 59% - Non-GAAP net income was $0.8 million[4] in Q2'25, compared to $4.2 million[4] in Q2'24, a decrease of approximately 81% Business Highlights - The company signed four new NPU agreements during the quarter[1] - The company returned $6.2 million to shareholders via stock repurchase of 300,000 shares[9] Shipment Data - Total units shipped reached 488 million[8], including 55 million smartphones[8] and 433 million smart edge devices (excluding smartphones)[8] - Smart Edge shipments include 254 million Bluetooth units[8], 62 million Wi-Fi units[8], and 66 million Cellular IoT units[8] Financial Stability - The company has $157 million in cash, cash equivalents, marketable securities, and bank deposits at the end of Q2, and is debt free[9]

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]