CEVA (CEVA) investor relations material

Executive summary

• Revenue grew 13% year-over-year to $29 million for Q2 2026, driven by a 21% increase in licensing and related revenue, the highest in three years, and strong AI and connectivity demand.

• Signed 10 licensing agreements, including two with first-time customers and two with OEMs, reflecting deeper customer engagement and broader platform adoption.

• Strategic AI licensing agreement with a leading global platform company marks a new customer category and deeper hardware-software collaboration.

• 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 up 13% year-over-year and 7% sequentially to $29 million; licensing and related revenue rose 21% to $18.2 million (63% of total), and royalty revenue was $10.8 million, up 17% sequentially and slightly up 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 a year ago; non-GAAP net income up 28% year-over-year to $2.3 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: $2.9 million ($0.10/share).

• 567 million devices powered by the company's IP shipped in Q2, up 16% year-over-year.

• Cash, equivalents, and marketable securities totaled $221 million at quarter-end; cash from operations was $5.8 million.

Outlook and guidance

• Full-year 2026 revenue growth outlook raised to 13%-15% over 2025, up from prior 12% guidance.

• H2 expected to be stronger than H1, with normal seasonality and continued licensing and royalty momentum; non-GAAP operating income expected to rise ~70% year-over-year, non-GAAP net income up ~50%.

• Q3 2026 revenue guidance: $30.5M–$34.5M; gross margin ~87% GAAP, ~88% non-GAAP.

• Management highlighted sustained licensing momentum, improving royalty trends, and focus on expense management and profitability improvement.

• Forward-looking statements caution about risks from competition, market acceptance, and geopolitical instability.