2014

CEVA, Inc. Announces Third Quarter 2013 Financial Results Four first-time CEVA licensees signed in quarter - further illustrating company's expansion into new growth markets, including smart meters, satellite communications, automotive and connectivity

MOUNTAIN VIEW, Calif., Oct. 30, 2013 /PRNewswire/ -- CEVA, Inc. (NASDAQ: CEVA), the leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for the mobile, digital home and networking markets, today announced its financial results for the third quarter ended September 30, 2013.

(Logo: http://photos.prnewswire.com/prnh/20120808/SF53702LOGO)

Total revenue for the third quarter of 2013 was $10.0 million, a decrease of 17% compared to $12.0 million for the third quarter of 2012. Licensing and related revenue for the third quarter of 2013 was approximately $4.0 million, a decrease of 20% compared to $5.0 million reported for the third quarter of 2012. Royalty revenue for the third quarter of 2013 was approximately $6 million, a decrease of 14% compared to $7.0 million reported for the third quarter of 2012.

Gideon Wertheizer, Chief Executive Officer, stated: "We continue to successfully expand our customer and market reach, adding four first-time licensees to our comprehensive customer base. In total, we have signed more than twenty DSP license agreements in the past two years with customers who are targeting new markets and applications, including communication, audio, digital photography and embedded vision. Despite the revenue shortfall for the third quarter, these agreements are indicative of the continued successful execution of our long-term growth strategy to diversify beyond our traditional cellular markets and customer base, which will serve to expand our market presence and future royalty base."

U.S. GAAP net loss for the third quarter of 2013 was $0.3 million, compared to net income of $2.6 million reported for the same period in 2012. U.S. GAAP diluted loss per share for the third quarter of 2013 was $0.01, compared to earnings per share of $0.11 for the third quarter of 2012.

Non-GAAP net income and diluted earnings per share for the third quarter of 2013 were $1.3 million and $0.06, respectively, representing a decrease of 66% and 63%, respectively, over the $3.8 million and $0.16 reported for the third quarter of 2012. Non-GAAP net income and diluted earnings per share for the third quarter of 2013 and 2012 excluded equity-based compensation expense, net of taxes, of $1.6 million and $1.2 million, respectively.

During the third quarter of 2013, the Company concluded five new license agreements. Four of the agreements were for CEVA DSP cores, platforms and software and one for CEVA Bluetooth technology. Target applications for customer deployment are LTE base stations, satellite communications, smart meters, automotive and connectivity. Geographically, two of the license agreements were in Europe and three were in Asia.

Yaniv Arieli, Chief Financial Officer, stated, "We remain confident in our licensing prospects going forward and continue to focus on maintaining a strong, debt free balance sheet with cash, marketable securities and bank deposits totaling approximately $154 million at the end of the third quarter. Our share repurchase program continued during the quarter with buyback of 138,000 shares at an average price of $16.90 per share for a total consideration of approximately $2.3 million. Year-to-date, we have repurchased 443,000 shares of common stock at an average price of $16.20 per share for a total consideration of approximately $7.2 million."

CEVA Conference Call
On October 30, 2013, CEVA management will conduct a conference call at 8:30 a.m. Eastern Time to discuss the company's operating performance for the quarter.

The conference call will be available via the following dial in numbers:

  • U.S. Participants: Dial 1-877-870-4263 (Access Code: CEVA)
  • International Participants: Dial +1-412-317-0790 (Access Code: CEVA)

The conference call will also be available live via the Internet at the following link: http://www.videonewswire.com/event.asp?id=96235. Please go to the web site at least fifteen minutes prior to the call to register, download and install any necessary audio software.

For those who cannot access the live broadcast, a replay will be available by dialing +1-877-344-7529 or +1-412-317-0088 (access code: 10034620) from one hour after the end of the call until 9:00 a.m. (Eastern Time) on November 7, 2013. The replay will also be available at CEVA's web site www.ceva-dsp.com.

About CEVA, Inc.
CEVA is the world's leading licensor of silicon intellectual property (SIP) DSP cores and platform solutions for the mobile, portable and consumer electronics markets. CEVA's IP portfolio includes comprehensive technologies for cellular baseband (2G / 3G / 4G), multimedia (vision, imaging and HD audio), voice processing, Bluetooth, Serial Attached SCSI (SAS) and Serial ATA (SATA). In 2012, CEVA's IP was shipped in over 1.1 billion devices, powering smartphones from many of the world's leading OEMs, including HTC, Huawei, LG, Nokia, Motorola, Samsung, Sony, TCL and ZTE. Today, more than 40% of handsets shipped worldwide are powered by a CEVA DSP core. For more information, visit www.ceva-dsp.com. Follow CEVA on twitter at www.twitter.com/cevadsp.

Forward Looking Statement
This press release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that if they materialize or prove incorrect, could cause the results of CEVA to differ materially from those expressed or implied by such forward-looking statements and assumptions.  Forward-looking statements include Mr. Wertheizer's statements about CEVA's continued successful execution of its long-term growth strategy to diversify beyond the company's traditional cellular markets and customer base, as well as Mr. Arieli's statement about CEVA's licensing prospects going forward. The risks, uncertainties and assumptions include: the ability of the CEVA DSP cores and other technologies to continue to be strong growth drivers for us; our success in penetrating new markets and maintaining our market position in existing markets; the ability of products incorporating our technologies to achieve market acceptance, the effect of intense industry competition and consolidation, global chip market trends, the possibility that markets for our technologies may not develop as expected or that products incorporating our technologies do not achieve market acceptance; our ability to timely and successfully develop and introduce new technologies; and general market conditions and other risks relating to our business, including, but not limited to, those that are described from time to time in our SEC filings.  CEVA assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. 

 

CEVA, INC. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS – U.S. GAAP

U.S. dollars in thousands, except per share data



Quarter ended
September 30,

Nine months ended

September 30,



2013

2012

2013

2012


Unaudited

Unaudited

Unaudited

Unaudited

Revenues:





Licensing and related revenues

$   3,945

$   4,960

$   15,108

$   16,963

Royalties

6,060

7,046

19,826

23,747






Total revenues

10,005

12,006

34,934

40,710






Cost of revenues

1,131

1,046

3,799

2,927






Gross profit

8,874

10,960

31,135

37,783






Operating expenses:





Research and development, net

5,619

4,637

16,279

15,548

Sales and marketing

2,376

2,235

7,271

6,628

General and administrative

2,006

1,940

5,588

5,658






Total operating expenses

10,001

8,812

29,138

27,834






Operating income (loss)

(1,127)

2,148

1,997

9,949

Financial income, net

617

731

2,053

2,653






Income (loss) before taxes on income

(510)

2,879

4,050

12,602

Income tax expense (benefit)

(187)

285

493

1,672






Net income (loss)

(323)

2,594

3,557

10,930






Basic net income (loss) per share

($0.01)

$0.12

$0.16

$0.48

Diluted net income (loss) per share

($0.01)

$0.11

$0.16

$0.46

Weighted-average number of Common Stock used in computation of net income (loss) per share (in thousands):





Basic

22,072

22,526

22,118

22,965

Diluted

22,072

23,019

22,601

23,565







 

Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures

(U.S. Dollars in thousands, except per share amounts)



Quarter ended

September 30,

Nine months ended

September 30,



2013

2012

2013

2012


Unaudited

Unaudited

Unaudited

Unaudited

GAAP net income (loss)

(323)

2,594

3,557

10,930

Equity-based compensation expense included in cost of revenue

73

73

223

177

Equity-based compensation expense included in research and development expenses

634

468

1,489

1,327

Equity-based compensation expense included in sales and marketing expenses

393

284

1,021

723

Equity-based compensation expense included in general and administrative expenses

660

541

1,691

1,461

Income tax benefit

(159)

(206)

(411)

(550)

Non-GAAP net income

1,278

3,754

7,570

14,068
















GAAP weighted-average number of Common Stock used in computation of diluted net income (loss) per share (in thousands)

22,072

23,019

22,601

23,565






Weighted-average number of shares related to outstanding options

569

3

18

5

Non-GAAP weighted-average number of Common Stock used in computation of diluted net income per share (in thousands)

22,641

23,022

22,619

23,570











GAAP diluted net income (loss) per share

($0.01)

$0.11

$0.16

$0.46

Equity-based compensation expense, net of taxes

$0.07

$0.05

$0.17

$0.14

Non-GAAP diluted net income per share

$0.06

$0.16

$0.33

$0.60

 

CEVA, INC. AND ITS SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. Dollars in thousands)



September 30,

2013

December 31,

2012 (*)



Unaudited


ASSETS



Current assets:



Cash and cash equivalents

$        11,607

$        18,422

Marketable securities and short term bank deposits

113,970

116,572

Trade receivables, net

9,144

6,232

Deferred tax assets

2,810

2,065

Prepaid expenses and other current assets

2,438

2,361

Total current assets

139,969

145,652

Long-term assets:



Long term bank deposits

28,370

23,050

Severance pay fund

6,940

6,130

Deferred tax assets

1,182

1,178

Property and equipment, net

1,723

1,392

Goodwill

36,498

36,498

Investment in other companies

3,367

2,433

Total assets

$        218,049

$        216,333




LIABILITIES AND STOCKHOLDERS' EQUITY



Current liabilities:



Trade payables

$           674

$           1,176

Deferred revenues

513

865

Accrued expenses and other payables

2,570

3,462

Accrued payroll and related benefits

6,631

6,978

Income taxes payable, net

1,863

1,626

Total current liabilities

12,251

14,107




Accrued severance pay

7,034

6,158




Total liabilities

19,285

20,265




Stockholders' equity:



Common stock:

22

22

Additional paid in-capital

202,919

198,495

Accumulated other comprehensive income (loss)

(121)

360

Treasury stock

(28,596)

(25,694)

Retained earnings

24,540

22,885

Total stockholders' equity

198,764

196,068

Total liabilities and stockholders' equity

$    218,049

$    216,333


(*) Derived from audited financial statements

 

SOURCE CEVA, Inc.



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