Ceva royalties rebound 18% in third quarter as AI licensing hits record share of sales

Ceva, Inc. reported third-quarter revenue of $29.1 million, up 2% from a year earlier, with royalty income rebounding sharply and AI licensing reaching a record share of its licensing business.

Royalty revenue rose 18% from the second quarter to $12.7 million, and 3% from a year earlier, while licensing and related revenue grew 2% to $16.3 million. Customers shipped 623 million Ceva-powered devices in the quarter, matching the company's all-time quarterly record, including record shipments in cellular IoT and Wi-Fi 6. The company posted a GAAP net loss of $2.3 million, or 8 cents a share, while non-GAAP net income was $3.8 million, or 13 cents a diluted share.

Ceva signed 10 intellectual-property licensing agreements in the quarter, including three with first-time customers, and six of the ten covered AI technologies. One new customer is targeting AI infrastructure, and the company extended its NeuPro line of AI processors into infrastructure applications with NeuPro Ultra. Chief executive Amir Panush pointed to the continued ramp of internally developed modems at a major U.S. customer, describing it as a multi-year smartphone royalty opportunity running through 2027 and beyond. Revenue came in below the $32.7 million analyst estimate cited by Reuters.

The company's release puts total revenue at $29,063,000 against $28,384,000 a year earlier, which works out to the 2% increase it reported, and its tables show royalties of $12,725,000 and licensing revenue of $16,338,000. The same release states that AI licensing accounted for more than 35% of total licensing and related revenue, that 623 million devices shipped, and that 10 agreements were signed with six covering AI. Kalkine's account of the filing matches those figures, and a Reuters brief carried by TradingView confirms the $29.1 million revenue total. The release also records a GAAP net loss of $2.3 million and non-GAAP earnings of 13 cents a share, so the gap between the two profit measures comes from the company's own reconciliation rather than an outside calculation.

Royalties are the recurring engine of Ceva's business, so an 18% sequential rebound matters more than the modest headline growth, and the modem ramp at a large U.S. customer is now the clearest source of future royalty growth. Chief financial officer Yaniv Arieli said a significant multi-year connectivity agreement expected in the third quarter was signed early in the fourth, and that the company expects a strong fourth quarter on both the top and bottom lines. With AI licensing now more than a third of licensing revenue, the quarter also shows how far the company's bet on edge AI has moved from experiment to income.