• Revenue: Increased 21% to $29.2 million for Q4 2024, compared to $24.2 million in Q4 2023.
• Licensing and Related Revenue: Increased 33% to $15.7 million, representing 54% of total revenues.
• Royalty Revenue: Increased 9% to $13.5 million, representing 46% of total revenues.
• GAAP Operating Income: $0.1 million for Q4 2024, up from a loss of $2.8 million in Q4 2023.
• Non-GAAP Operating Margin: 15% of revenues, with operating income of $4.5 million.
• Net Loss: $1.7 million for Q4 2024, compared to a net loss of $8.1 million in Q4 2023.
• Non-GAAP Net Income: $2.7 million, with diluted earnings per share of $0.11.
• Unit Shipments: 623 million units in Q4 2024, up 38% from Q4 2023.
• Wi-Fi Shipments: Record 66 million units, up 110% year over year.
• Bluetooth Shipments: Record high of 343 million units, up 41% year over year.
• Cash and Equivalents: Approximately $164 million as of December 31, 2024.
• Cash from Operating Activities: Generated $8 million in Q4 2024.

• Warning! GuruFocus has detected 3 Warning Sign with CEVA.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• CEVA Inc (NASDAQ:CEVA) reported a 21% year-on-year revenue growth in the fourth quarter, driven by strong licensing and royalty performance.
• The company achieved record high shipments of Wi-Fi and Bluetooth IP, with Wi-Fi shipments growing 110% and Bluetooth shipments up 41% year over year.
• CEVA Inc (NASDAQ:CEVA) signed several key strategic licensing deals, including a long-term agreement with a top-tier global MCU company for their Wi-Fi platform.
• The company reported its strongest royalty quarter of the year, with a record 623 million units shipped, marking the first time surpassing 600 million units in a single quarter.
• CEVA Inc (NASDAQ:CEVA) achieved significant milestones in AI products, signing important licensing agreements for AI DSPs and NeuPro-Nano NPUs, indicating strong market interest and demand for their Edge AI portfolio.

Negative Points

• CEVA Inc (NASDAQ:CEVA) experienced a negative financial income of $0.1 million due to a significant fall in the value of the EUR versus the US dollar, impacting the value of EUR-dominated assets.
• The company reported a net loss of $1.7 million for the fourth quarter, although this was an improvement from the previous year's loss.
• Gross margins are expected to be slightly lower in the first quarter of 2025 due to lower seasonal royalty revenue and allocation of design activities for strategic customers.
• The company anticipates lower growth in the first half of 2025, with higher growth expected in the second half, reflecting typical seasonal trends.
• CEVA Inc (NASDAQ:CEVA) faces uncertainties in the timing and volume of royalty ramp-ups from new customers, which could impact revenue projections.

Q & A Highlights

Q: With AI moving to the edge, is there an opportunity for CEVA's wireless and MPU technologies to be integrated into OEM MCUs? A: Amir Panush, CEO: Yes, there is definitely an opportunity. We are licensing our wireless technology to top-tier MCU customers, and our new nano NPU complements our wireless connectivity and sensing technology. MCU players are adding more AI capabilities, and we help them integrate various technologies, including connectivity.

Q: Can you provide details on the US mobile OEM's in-house 5G modem and when royalty revenues might start? A: Yaniv Arieli, CFO: We cannot provide specific details beyond what was shared. The timing and ramp-up volume will become clearer as we receive more information from our customers, including this one. It's an exciting opportunity for the coming years.

Q: How does the recent AI news about the Deep Seek model in China impact CEVA's edge AI opportunities? A: Amir Panush, CEO: The innovation in AI, both in the US and China, presents a great opportunity for us. Optimized models with smaller footprints and lower power requirements enable LLMs to run locally, accelerating smart edge adoption. We see increased demand for our NPUs and AI models on the edge.

Q: What is the growth outlook for Wi-Fi in 2025, and which markets will drive this growth? A: Amir Panush, CEO: We are transitioning from Wi-Fi 4/5 to Wi-Fi 6, with over 40 customers licensed. 2024 was strong for Wi-Fi shipments and ASPs, and we expect further acceleration in 2025. Wi-Fi 6 is penetrating various IoT markets, enhancing data throughput and spectrum utilization.

Q: How do you view the bifurcation of AI models between large language models and reasoning models at the edge? A: Amir Panush, CEO: We expect a range of AI capabilities at the edge, from simple models to sophisticated LLMs. Our strategy is to offer a complete portfolio of AI accelerators and NPUs to support various requirements, from low-tier MCUs to high-end SoCs.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.