CEVA (CEVA) investor relations material

Executive summary

• Q1 2026 revenues reached $27.0 million, up 11% year-over-year, with licensing and related revenues at $17.8 million, the highest in three years, driven by strong connectivity and AI portfolio momentum and robust customer engagement.

• Signed 14 licensing agreements, including major wins in Bluetooth HDT, Wi-Fi 7, satellite communications, and ultra-wideband, with multi-technology and system-level solutions, reflecting deepening customer relationships and expanded IP adoption.

• AI represented over 20% of licensing revenues, with new automotive deployments and collaborations, notably with Toyota and NXP, marking the first mass volume automotive AI deployment.

• Wi-Fi shipments reached a record 91 million units, up 158% year-over-year, driven by Wi-Fi 6 adoption and combo chip growth; total CEVA-powered units shipped were 458 million, up 9% year-over-year.

• Non-mobile royalties grew 8% year-over-year, offsetting flat total royalties due to smartphone softness.

Financial highlights

• Total Q1 2026 revenue was $27.0 million, up 11% year-over-year; licensing and related revenue increased 18% to $17.8 million, 66% of total revenues; royalty revenues were $9.2 million, flat year-over-year.

• GAAP gross margin was 86%; non-GAAP gross margin was 87%.

• GAAP operating loss was $5.1 million (vs. $4.4 million prior year); non-GAAP operating income was $0.5 million (2% margin).

• Non-GAAP net income was $1.1 million ($0.04/share), down from $1.4 million ($0.06/share) year-over-year; GAAP net loss was $4.5 million ($0.16/share), compared to $3.3 million ($0.14/share) last year.

• Cash, equivalents, and marketable securities totaled $215.7 million at quarter-end; cash used in operating activities was $4.9 million.

Outlook and guidance

• 2026 annual revenue growth outlook upgraded to the top end of 8%-12%, with stronger growth expected in the second half and continued momentum in licensing and AI portfolios.

• Non-GAAP operating margins and net income expected to increase 40%-50% year-over-year.

• Q2 2026 revenue guidance: $26M-$30M; gross margin 87%-88%; non-GAAP OpEx $22.2M-$23.2M.

• Management expects improvement in royalty revenues as the year progresses, supported by inventory normalization and stronger high-end smartphone demand.

• Measures are being implemented to offset expenses from a weaker U.S. dollar.