The growth in demand for fourth generation wireless communications capabilities has been the main feature of Ceva Inc.'s (Nasdaq:CEVA); LSE:CVA) reporting in the past few quarters. In the second quarter of this year too, the new generation wireless communications technology led the growth in revenue and in new agreements signed by the company.
Ceva, which licenses silicon intellectual property (SIP) platform solutions and DSP cores for the mobile handsets, portable and consumer electronics markets, encountered demand in the second quarter for its intellectual property in applications it hardly knew before, such as cellular base stations, and not just for the end-user installations for which it generally provides its solutions.
The jump in demand for the costlier fourth generation products contributed to 16% growth in revenue in comparison with the corresponding quarter last year to $10.6 million, which is at the higher end of the company's guidance and the analysts' consensus estimate. Continuing the trend of the previous quarter the company posted higher revenue from royalties, which accounted for 49% of sales, while sales of licenses accounted for 43%.
This found expression in the bottom line Net profit was $2.1 million, or $0.10 per share. Excluding one-time expenses, the company posted record profit of $2.7 million, or $0.12 per share, above analysts' estimates.
Ceva CEO Gideon Wertheizer said, "Our worldwide market share in the handset cellular baseband space increased to a record 29%, and additional high-profile CEVA-powered product introductions by first-tier handset vendors will further increase our market share going forward."
Ceva has raised its revenue guidance for the third quarter to $10.3-11.3 million, and for the year as a whole to $41.7-44.7 million. The annual guidance represents growth of 8-16%. Earnings guidance for the year is raised to $0.48-0.52 per share, compared with previous guidance of $0.43-0.49.
Published by Globes [online], Israel business news - www.globes-online.com - on July 28, 2010
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