Ceva, Inc. reported third‑quarter 2025 revenue of $28.4 million, up 4 % year‑over‑year from $27.2 million in Q3 2024. The figure surpassed the consensus estimate of $28.04 million, but fell slightly short of higher analyst forecasts of $28.49 million. The revenue lift was driven by a 3 % increase in licensing revenue and a 6 % rise in royalty revenue, with the AI processor licensing segment—accounting for roughly one‑third of licensing income—providing a high‑margin boost.
Licensing revenue reached $16.0 million, up 3 % YoY, while royalty revenue climbed to $12.4 million, up 6 % YoY. The AI licensing growth, highlighted by a multi‑year deal with Microchip for its NeuPro NPU portfolio, underpins the company’s expanding high‑margin portfolio and signals strong demand for edge‑AI IP.
GAAP gross margin improved to 88 % from 85 % in Q3 2024, and non‑GAAP gross margin rose to 89 % from 87 %. The margin expansion reflects a shift toward higher‑ASP Wi‑Fi and AI IP, pricing power in the licensing business, and disciplined cost control that offset the broader cost base of royalty collection.
Operating loss narrowed to $2.1 million from $2.6 million, while net loss widened to $2.5 million from $1.3 million. Non‑GAAP operating income increased to $3.1 million from $2.1 million, and non‑GAAP net income fell to $2.7 million from $3.4 million. The EPS beat—non‑GAAP EPS of $0.11 versus consensus estimates of $0.10–$0.106—was driven by the higher‑margin licensing mix and effective expense management, offsetting the larger net loss.
CEO Amir Panush said the quarter “exceeded expectations on both revenue and non‑GAAP diluted income per share, driven by strong licensing execution and healthy royalty growth.” CFO Yaniv Arieli noted that AI licensing contributed about one‑third of licensing revenue and that royalty revenue grew 16 % sequentially, underscoring disciplined expense management and a focus on profitability.
For Q4 2025, Ceva guided total revenue to $29 million–$33 million and projected GAAP gross margin of approximately 88 % and non‑GAAP gross margin of about 89 %. The guidance signals management’s confidence in sustaining growth momentum and margin stability amid a competitive IP landscape.
Investors responded favorably to the results, citing the EPS beat and the company’s expanding AI licensing portfolio as key drivers of confidence in Ceva’s future prospects.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.