The good revenue line in the financial statements of Ceva Inc. (Nasdaq:CEVA); LSE:CVA), released today, came as no surprise, as the company raised its guidance a month ago. In its profit line, though, the company managed to beat the consensus analysts' estimate handily. Looking forward, the guidance for the fourth quarter is similar to the analysts' estimates.
Ceva provides semiconductor design technology, mainly for the mobile market, and has a market cap on Nasdaq of $480 million.
In the third quarter, Ceva had revenue of $16.2 million, representing growth of 15.2% in comparison with the corresponding quarter of 2014, and 21.5% in comparison with the previous quarter. In comparison with the corresponding quarter, royalty revenue shot up 42.2%, while licensing revenue fell 1.5%. For the first nine months of 2015, Ceva's revenue totaled $43.4 million, 17.4% than in the corresponding period of 2014.
On a GAAP basis, net profit was $3.3 million in the third quarter, and $4 million in the first nine months. On a non-GAAP basis, excluding employee compensation and expenses connected with an acquisition carried out in 2014, net profit was $4.7 million in the third quarter, double the profit in the corresponding quarter.
Third quarter earnings per share were $0.22, whereas the analysts had expected just $0.16.
Non-GAAP net profit for the first nine months totaled $7.6 million, 34.3% more than in the corresponding period of 2014. At the end of the third quarter, Ceva had $129 million cash. It spent $2.8 million on a share buyback program at an average of $17.7 per share, which is about 24% less than the current share price.
For the fourth quarter, Ceva sees revenue of $15-16 million, representing growth of 12% in comparison with the corresponding quarter, and earnings per share of $0.16-0.18 ($3.4-3.9 million total earnings), which compares with $0.08 in the corresponding quarter.
For the year as a whole, according to the company's guidance, revenue growth will be 16%, to $59 million, with earnings per share totaling $0.53.
Ceva CEO Gideon Wertheizer said, "Our outstanding third quarter financial performance delivered record high revenues for the company. This milestone achievement is a direct consequence of our LTE market share gain strategy and the continued expansion of our licensee base into new and lucrative markets. Ceva has evolved into a diversified company with strong competencies to leverage the major opportunities existing in an increasingly smart and connected world."
Published by Globes [online], Israel business news - www.globes-online.com - on November 2, 2015
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