On August 7, 2024, CEVA Inc (CEVA, Financial) released its 8-K filing detailing the financial results for the second quarter ended June 30, 2024. CEVA Inc, a leading licensor of signal-processing intellectual property, partners with semiconductor companies and original equipment manufacturers (OEMs) globally to produce devices for various end markets, including wireless, consumer, automotive, and Internet of Things (IoT) sectors.
Performance Overview
CEVA Inc reported total revenue of $28.4 million for Q2 2024, a 24% increase compared to $22.9 million in Q2 2023. Licensing and related revenue rose by 28% to $17.3 million, while royalty revenue increased by 19% to $11.2 million. These figures surpassed analyst estimates of $24.48 million in revenue and an estimated earnings per share (EPS) of -$0.13.
Amir Panush, Chief Executive Officer of CEVA, commented: “We are pleased to report strong execution and results for the second quarter that exceeded our estimates, with licensing revenue and royalty revenue growing 28% and 19%, respectively, year-over-year. In licensing, customer demand for our IP portfolio is being driven by the growing adoption of AI across every industry and every device.”
Financial Achievements and Challenges
CEVA Inc's GAAP gross margin for Q2 2024 was 90%, up from 85% in Q2 2023. The company reported a GAAP operating loss of $0.04 million, a significant improvement from the $5.3 million loss in the same period last year. The GAAP net loss was $0.3 million, compared to a $4.9 million loss in Q2 2023. GAAP diluted loss per share was $0.01, compared to $0.21 in the previous year.
On a non-GAAP basis, CEVA Inc reported a gross margin of 91%, up from 86% in Q2 2023. Non-GAAP operating income was $4.4 million, compared to a non-GAAP operating loss of $1.1 million in Q2 2023. Non-GAAP net income and diluted income per share were $4.2 million and $0.17, respectively, compared to a non-GAAP net loss and diluted loss per share of $0.5 million and $0.02, respectively, in Q2 2023.
Yaniv Arieli, Chief Financial Officer of CEVA, stated: “Our excellent second quarter performance generated top line growth of 24% year-over-year and coupled with disciplined expense control, enabled us to expand our adjusted operating margin to 15%.”
Key Metrics and Financial Statements
CEVA Inc's balance sheet remains robust, with cash and cash equivalents, marketable securities, and bank deposits totaling approximately $158 million at the end of Q2 2024. The company repurchased approximately 100,000 shares for about $2 million under its stock repurchase program during the quarter.
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $28.4 million | $22.9 million |
| Licensing Revenue | $17.3 million | $13.6 million |
| Royalty Revenue | $11.2 million | $9.4 million |
| GAAP Gross Margin | 90% | 85% |
| Non-GAAP Gross Margin | 91% | 86% |
| GAAP Net Loss | -$0.3 million | -$4.9 million |
| Non-GAAP Net Income | $4.2 million | -$0.5 million |
| GAAP Diluted Loss Per Share | -$0.01 | -$0.21 |
| Non-GAAP Diluted Income Per Share | $0.17 | -$0.02 |
Analysis and Outlook
CEVA Inc's strong performance in Q2 2024 highlights the growing demand for its IP portfolio, driven by the widespread adoption of AI across various industries. The company's ability to secure strategic deals and expand its market share in IoT and the smartphone market underscores its competitive edge in the semiconductor industry.
Despite the positive results, CEVA Inc faces challenges such as intense industry competition and the cyclical nature of the semiconductor market. However, the company's robust financial position and strategic initiatives position it well for future growth.
For more detailed information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from CEVA Inc for further details.
