Israeli wireless connectivity and smart sensing technologies company Ceva Inc. (Nasdaq:CEVA) released its financial results for the first quarter yesterday. The company reported a net loss for the quarter of $1.2 million, which compares with a net loss of $2.3 million for the same period in 2019. The GAAP-based diluted loss per share for the first quarter of 2020 was $0.05, which compares with $0.10 for the same period in 2019.
On a non-GAAP basis, net profit and diluted earnings per share for the first quarter of 2020 increased to $2.6 million and $0.11, respectively, from $0.3 million and $0.01 in the first quarter of 2019.
Total revenue for the first quarter of 2020 was $23.6 million, representing a 39% increase compared with $17.0 million reported for the first quarter of 2019. First quarter 2020 licensing and related revenue was $14.5 million, an increase of 32% over the same quarter a year ago. Royalty revenue for the first quarter of 2020 was $9.1 million, a year-over-year increase of 53%..
Thirteen license agreements were completed during the quarter, of which three were for smart sensing products and ten were for connectivity products. Three of the agreements were with first time customers. Ceva says that its customers' target markets include 5G for base station RAN, 5G fixed wireless access and 5G backhaul, Wi-Fi 6 for IoT devices, true wireless stereo earbuds, vision and AI for drones, and voice assistants for a range of smart home and IoT devices. Geographically, four of the deals signed were in China, four were in Europe, three were in the US and two were in the APAC region, including Japan.
Ceva CEO Gideon Wertheizer said, "We are extremely proud of our performance during the first quarter, despite the wide scale lockdowns and disruptions our customers are facing as a result of COVID-19. Our licensing activities continue to expand, and we are experiencing strong interest in particular for our 5G, Wi-Fi 6 and sensing technologies. Our royalty revenue performance demonstrates the strength of an increasingly diversified customer base, with IoT products and the introduction of a new low cost flagship smartphone offsetting the impact of supply chain disruptions in China during the first quarter.
"We continue to execute on our strategy and drive new product developments as we believe that these investments present further growth opportunities as the industry recovers from the pandemic."
As for its guidance, in the light of the uncertainty over the effects of the Covid-19 pandemic, Ceva has decided to refrain from providing guidance on royalty revenue, but it retains it $51 million annual guidance for licensing revenue. In the conference call fowling the results release, Ceva CFO Yaniv Arieli said, "Although we continue to work diligently towards our goals of meeting annual revenue guidance given on the last earnings call, the spread of COVID-19 around the world and the extent of the disruption it poses in the supply chain and on the consumer demand cannot be fully assessed at this point. Given this uncertainty, as a matter of prudency, we have decided to withdraw our annual royalty revenue guidance at this stage.
"On the other hand, our licensing and related revenue business remains robust, and we are maintaining our annual forecast of growth of $2 million to $4 million over 2019 record annual results."
Ceva's share price closed down 0.89% at $33.33 in New York yesterday.
Published by Globes, Israel business news - en.globes.co.il - on May 12, 2020
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