CEVA (CEVA) investor relations material

Executive summary

• Q2 2026 revenue grew 13% year-over-year to $29 million, driven by strong AI and connectivity demand, with licensing and related revenues at $18.2 million, the highest in three years.

• Signed 10 licensing agreements, including two with first-time customers and two with OEMs, and secured a major AI deal with a leading global platform company, expanding into new customer categories.

• AI-related licensing represented over 20% of total licensing revenues, reflecting accelerating edge AI adoption.

• Broader platform solutions and subsystem IP adoption are increasing content per design and long-term royalty opportunities.

• Expanded sensing portfolio with Microsoft-certified RealSpace Elevate, entering the PC gaming market.

Financial highlights

• Q2 2026 revenue was $29 million, up 13% year-over-year and 7% sequentially; licensing and related revenue rose 21% to $18.2 million, and royalty revenue was $10.8 million, up 17% sequentially and 1% year-over-year.

• Gross margin was 87% GAAP and 88% non-GAAP; non-GAAP operating income increased to $3.1 million from $0.8 million, and non-GAAP net income rose to $2.3 million from $1.8 million.

• Non-GAAP operating margin improved to 11% from 3% a year ago; non-GAAP EPS was $0.08 versus $0.07 in Q2'25; GAAP net loss was $2.9 million ($0.10/share).

• 567 million devices powered by the company's IP shipped in Q2, up 16% year-over-year, with record shipments in Bluetooth, Wi-Fi, and cellular IoT.

• Cash, cash equivalents, and marketable securities totaled $221 million at quarter-end.

Outlook and guidance

• Full-year 2026 revenue growth outlook raised to 13%-15% over 2025, with H2 expected to be stronger than H1 and continued licensing and royalty momentum.

• Q3 revenue guidance: $30.5M–$34.5M; gross margin ~87% GAAP, ~88% non-GAAP.

• Non-GAAP operating income expected to rise ~70% year-over-year; non-GAAP net income up ~50%.

• Management expects continued growth in licensing and royalty revenues, driven by demand for integrated AI and connectivity solutions.

• Macroeconomic and geopolitical uncertainties, including Middle East instability, may impact future results.