Ceva (NASDAQ:CEVA) Issues Earnings Results, Misses Expectations By $0.06 EPS

Ceva (NASDAQ:CEVA) issued its earnings results on Monday. The semiconductor company reported $0.13 EPS for the quarter, missing the consensus estimate of $0.19 by ($0.06), FiscalAI reports. Ceva had a negative return on equity of 2.70% and a negative net margin of 9.25%. The company had revenue of $29.06 million during the quarter, compared to the consensus estimate of $32.71 million. During the same quarter in the prior year, the business earned $0.11 EPS. The firm’s revenue for the quarter was up 2.4% compared to the same quarter last year.

Here are the key takeaways from Ceva’s conference call:

• CEVA forecast fourth-quarter revenue of $34 million to $38 million, about 24% sequential growth at the midpoint and potentially its highest quarterly revenue to date; management expects non-GAAP diluted EPS to more than double sequentially.
• AI licensing reached a quarterly record, contributing more than 35% of licensing and related revenue, and six of the quarter’s 10 new agreements were AI-related. CEVA is extending its NeuPro portfolio into AI infrastructure and expects initial NPU royalties around year-end or early 2027, with a broader ramp expected thereafter.
• Royalty revenue rose 3% year over year and 18% sequentially, supported by record shipments of 623 million CEVA-powered devices and growth in mobile and wireless IoT. Management expects a significant smartphone-modem ramp at a major U.S. customer in Q4 and into 2027.
• Licensing revenue came in below expectations after a significant multi-year connectivity agreement shifted from Q3 to Q4, though the company said it signed early in Q4. Management also cited memory-market headwinds and weakness in compute-intensive consumer markets, including smartphones, PCs, and TVs.
• Q3 revenue increased 2% year over year to $29.1 million, while non-GAAP diluted EPS rose 18% to $0.13. Non-GAAP operating income declined to $2.5 million from $3.1 million, and non-GAAP gross margin fell to 86% from 89%.

Ceva Stock Up 9.8%

Shares of CEVA stock traded up $2.39 on Wednesday, reaching $26.84. The company’s stock had a trading volume of 101,895 shares, compared to its average volume of 643,039. Ceva has a 12-month low of $17.02 and a 12-month high of $51.60. The company has a market capitalization of $755.66 million, a P/E ratio of -70.63 and a beta of 1.98. The stock’s 50 day simple moving average is $30.39 and its 200-day simple moving average is $30.61.

More Ceva News

Here’s some of the latest news about CEVA:

• Positive Sentiment: Ceva expects fourth-quarter revenue of $34 million to $38 million, with smartphone modem royalties expected to step up. That outlook points to a potential near-term revenue improvement. Article: Ceva expects Q4 revenue of $34M-$38M as smartphone modem royalties step up
• Neutral Sentiment: Several analysts cut their price targets after the results, though UBS, Stifel, Needham and Oppenheimer maintained Buy or Outperform ratings; JPMorgan kept a Neutral rating. The lower targets reflect more cautious expectations, while the retained positive ratings suggest some see upside. Article: Ceva shares gap down on disappointing earnings
• Negative Sentiment: Recent Seeking Alpha commentary flags slowing growth and a valuation it considers high, while also highlighting risks tied to handset royalties as Ceva navigates the edge-AI transition. Those concerns may limit enthusiasm despite the Q4 revenue forecast. Article: CEVA: Growth Is Slowing, But The Valuation Remains High Article: CEVA: Navigating The Edge AI Transition And Handset Royalty Risks

Wall Street Analysts Forecast Growth

Several equities research analysts have recently weighed in on the company. Wall Street Zen cut Ceva from a “buy” rating to a “hold” rating in a research report on Sunday. Stifel Nicolaus lowered their price target on shares of Ceva from $50.00 to $40.00 and set a “buy” rating on the stock in a report on Tuesday. TD Cowen cut their price objective on shares of Ceva from $45.00 to $35.00 and set a “buy” rating for the company in a research report on Monday, October 19th. Needham & Company LLC reduced their price objective on shares of Ceva from $43.00 to $30.00 and set a “buy” rating for the company in a research note on Monday. Finally, Rosenblatt Securities boosted their price objective on shares of Ceva from $45.00 to $49.00 and gave the company a “buy” rating in a research note on Tuesday, August 11th. One analyst has rated the stock with a Strong Buy rating, nine have assigned a Buy rating, one has issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, Ceva currently has a consensus rating of “Moderate Buy” and a consensus target price of $36.20.

About Ceva

CEVA, Inc. develops and licenses semiconductor intellectual property and software for connected and intelligent devices. Rather than manufacturing chips, the company provides technology that semiconductor companies and other customers can incorporate into their own products. Its portfolio includes digital signal processors and platforms for wireless connectivity, including cellular, Wi-Fi, Bluetooth and ultra-wideband, as well as technologies for audio, imaging, computer vision, sensor processing and edge artificial intelligence.