CEVA (CEVA) Q2 2025 earnings summary

Executive summary

• Achieved strong licensing execution with 13 agreements, including five first-time and four OEM customers, reflecting robust IP portfolio demand.

• Entered broad adoption phase for edge AI NPUs, securing four strategic customer agreements across audio, embedded, and cloud applications.

• Surpassed 20 billion cumulative device shipments, highlighting foundational technology leadership.

• Shipped 488 million units in Q2 2025, up 16% sequentially and 6% year-over-year.

• Saw healthy sequential rebound in royalty business, though year-over-year decline due to low-end smartphone softness.

Financial highlights

• Q2 2025 revenue was $25.7 million, down 10% year-over-year; licensing revenue was $15.0 million (59% of total), down 13% year-over-year.

• Royalty revenue was $10.7 million (41% of total), up 16% sequentially but down 5% year-over-year.

• GAAP gross margin was 86%; non-GAAP gross margin was 87%, both down from prior year.

• GAAP operating loss was $4.5 million; non-GAAP operating income was $0.8 million (3% margin).

• GAAP net loss was $3.7 million ($0.15 per share); non-GAAP net income was $1.8 million ($0.07 per share).

Outlook and guidance

• Licensing pipeline, especially for edge AI, remains healthy entering Q3 and H2 2025.

• Royalty revenue expected to grow sequentially in H2, with strong Q4 momentum anticipated.

• Q3 revenue expected between $26M–$30M, with gross margin to improve by 1% sequentially.

• Double-digit percentage increase in non-GAAP net income and EPS for 2025 over 2024 reiterated.

• Revenue guidance for 2025 lowered to low-single digits growth due to macroeconomic uncertainty.