CEVA, Inc. Announces Second Quarter 2020 Financial Results

MOUNTAIN VIEW, Calif. - August 10, 2020 - CEVA, Inc. (NASDAQ: CEVA), the leading licensor of wireless connectivity and smart sensing technologies, today announced its financial results for the second quarter ended June 30, 2020.

Total revenue for the second quarter of 2020 was $23.6 million, a 28% increase compared to $18.4 million reported for the second quarter of 2019. Second quarter 2020 licensing and related revenue was $13.5 million, an increase of 25% when compared to $10.8 million reported for the same quarter a year ago. Royalty revenue for the second quarter of 2020 was $10.1 million, an increase of 33% when compared to $7.6 million reported for the second quarter of 2019.

Eight license agreements were concluded during the quarter, of which three were for smart sensing products and five were for connectivity products. One of the agreements was with a first-time customer. Customers’ target markets include automotive powertrain, wearables, true wireless stereo earbuds and a range of IoT devices. Geographically, seven of the deals signed were in China, and one was in the U.S.

Gideon Wertheizer, CEO of CEVA, stated: “We produced our highest second quarter revenue on record despite the uncertain environment created by the COVID-19 pandemic. We are consistently growing our licensee base and expanding our market reach into new lucrative areas such as automotive powertrain where we concluded a key design win this quarter. Royalty revenues came in ahead of our expectations, driven by revenues from our base station and IoT product line that is up 77% year-over-year to $4.3 million. We continuously monitor developments relating to the spread of the pandemic and U.S. tensions with China, and remain focused on serving our customers and executing on our growth strategy. The dedication and efficiency of our employees, combined with our diverse portfolio of technology, continue to provide us with the foundation to go from strength to strength as a leader in our industry.”

GAAP net loss for the second quarter of 2020 was $1.1 million, as compared to a GAAP net loss of $1.5 million reported for the same period in 2019. GAAP diluted loss per share for the second quarter of 2020 was ($0.05), as compared to a GAAP diluted loss per share of ($0.07) for the same period in 2019.

Non-GAAP net income and diluted earnings per share for the second quarter of 2020 increased 130% and 140% respectively, to $2.9 million and $0.12, respectively, from $1.2 million and $0.05 reported for the second quarter of 2019. Non-GAAP net income and diluted earnings per share for the second quarter of 2020 excluded: (a) equity-based compensation expenses, net of taxes, of $3.3 million, (b) the impact of the amortization of acquired intangibles, net of taxes, of $0.7 million associated with the acquisition of the Hillcrest Labs business and investments in NB-IoT and Immervision technologies. Non-GAAP net income and diluted earnings per share for the second quarter of 2019 excluded: (a) equity-based compensation expenses, net of taxes, of $2.5 million, and (b) the impact of the amortization of acquired intangibles of $0.3 million associated with the acquisition of RivieraWaves and an investment in NB-IoT technologies.

Yaniv Arieli, Chief Financial Officer of CEVA, stated: “Our business continued to show strength in the second quarter, as we managed to exceed all key financial metrics for the quarter and post 28% revenue growth year-over-year. Of note, our Bluetooth and Wi-Fi royalties reached all-time record highs as a result of many new IoT production ramp-ups. With economic uncertainty still persisting, we remain prudent with regards to expenses and maintain a strong balance sheet. Our business generated $12.6 million of cash from operations in the first half of 2020, taking our cash and cash equivalent balances, marketable securities and bank deposits to approximately $157 million at the end of the quarter, with no debt.”