CEVA, Inc. Announces Second Quarter 2011 Financial Results
MOUNTAIN VIEW, Calif., July 26, 2011 /PRNewswire/ -- CEVA, Inc. (NASDAQ: CEVA); (LSE: CVA), the leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for the mobile handset, portable and consumer electronics markets, today announced its financial results for the second quarter ended June 30, 2011.
(Logo: http://photos.prnewswire.com/prnh/20051010/CEVALOGO)
Total revenue for the second quarter of 2011 was $14.4 million, an increase of 36% compared to $10.6 million reported for the second quarter of 2010. Second quarter 2011 licensing revenue was $5.2 million, representing an increase of 13% when compared to $4.6 million reported for the same quarter a year ago. Royalty revenue for the second quarter 2011 was $8.3 million, an increase of 60% compared to $5.2 million reported for the second quarter of 2010. Revenue from services for both the second quarters of 2011 and 2010 was $0.9 million.
Gideon Wertheizer, Chief Executive Officer of CEVA, stated, "The second quarter demonstrated strong financial and business achievements. We are particularly pleased with the dynamics of our licensing business, where we concluded strategic CEVA-XC agreements with partners in the LTE handset and smart grid markets. We also experienced higher sequential shipment volumes of CEVA-powered products, resulting from continued expansion in the lucrative 3G smartphone and TD-SCDMA market segments. Overall, we continue to make exceptional progress in both the licensing and market deployment of our technology, reaffirming the key trends that drive growth and profitability for our company."
Of the eight new license agreements concluded during the second quarter of 2011, seven agreements were for CEVA DSP cores, platforms and software, and one agreement was for CEVA SATA/SAS product lines. Target applications for customer deployment are 4G and 3G baseband processors for handsets, infrastructure, smart grid, portable game consoles and SSD drives. Geographically, four of the agreements signed were in the U.S. and four were in Asia.
U.S. GAAP net income for the second quarter of 2011 was $4.1 million, an increase of 94% over $2.1 million reported for the same period in 2010. U.S. GAAP diluted earnings per share for the second quarter of 2011 were $0.17, an increase of 70% compared to $0.10 for the second quarter of 2010.
Non-GAAP net income and diluted earnings per share for the second quarter of 2011 were $5.4 million and $0.22 respectively, representing an increase of 102% and 83%, respectively, over the $2.7 million and $0.12 reported for the second quarter of 2010. Non-GAAP net income and diluted earnings per share for the second quarter of 2011 and 2010 excluded an aggregate equity-based compensation expense, net of taxes, of $1.2 million and $0.5 million, respectively.
Yaniv Arieli, Chief Financial Officer of CEVA, stated, "We continued to demonstrate considerable progress during the second quarter, delivering significant year-over-year growth in every aspect of our business. Total revenue increase was driven by exceptional year-over-year royalty revenue growth and progress in our licensing business. As a result, our operating income and net income approximately doubled compared to the second quarter of 2010. Finally, we continued to strengthen our balance sheet with the addition of approximately $9 million in positive cash flow. At the end of the quarter, our cash balance, marketable securities and bank deposits totaled approximately $153 million."
CEVA Conference Call
On July 26, 2011, CEVA management will conduct a conference call at 8:30 a.m. Eastern Time / 1:30 p.m. London time, to discuss the operating performance for the second quarter ended June 30, 2011.
The conference call will be available via the following dial in numbers:
- US Participants: Dial 1-877-493-9121 (Access Code: CEVA or 81159859)
- UK/Rest of World: Dial +44-800-051-3806 (Access Code: CEVA or 81159859)
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 1-800-642-1687 (passcode: 81159859) for US domestic callers and +44-800-917-2646 (passcode: 81159859) for international callers from two hours after the end of the call until 11:59 p.m. (Eastern Time) on August 02, 2011. The replay will also be available at CEVA's web site 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 handset, portable and consumer electronics markets. CEVA's IP portfolio includes comprehensive technologies for cellular baseband (2G / 3G / 4G), multimedia, HD video and audio, voice over packet (VoP), Bluetooth, Serial Attached SCSI (SAS) and Serial ATA (SATA). In 2010, CEVA's IP was shipped in over 600 million devices, powering handsets from 7 out of the top 8 handset OEMs, including Nokia, Samsung, LG, Motorola, Sony Ericsson and ZTE. Today, more than one in every three handsets shipped worldwide is powered by a CEVA DSP core. For more information, visit ceva-dsp.com. Follow CEVA on twitter at www.twitter.com/cevadsp.
CEVA, INC. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS – U.S. GAAP U.S. dollars in thousands, except per share data
| |||||
Quarter ended | Six months ended | ||||
June 30, | June 30, | ||||
2011 | 2010 | 2011 | 2010 | ||
Unaudited | Unaudited | Unaudited | Unaudited | ||
Revenues: | |||||
Licensing | $ 5,195 | $ 4,593 | $ 10,303 | $ 9,315 | |
Royalties | 8,272 | 5,154 | 17,478 | 10,134 | |
Other revenues | 921 | 862 | 1,659 | 1,761 | |
Total revenues | 14,388 | 10,609 | 29,440 | 21,210 | |
Cost of revenues | 876 | 863 | 1,824 | 1,577 | |
Gross profit | 13,512 | 9,746 | 27,616 | 19,633 | |
Operating expenses: | |||||
Research and development, net | 5,405 | 4,505 | 10,655 | 9,114 | |
Sales and marketing | 2,327 | 1,776 | 4,551 | 3,584 | |
General and administrative | 1,742 | 1,570 | 3,496 | 3,116 | |
Total operating expenses | 9,474 | 7,851 | 18,702 | 15,814 | |
Operating income | 4,038 | 1,895 | 8,914 | 3,819 | |
Interest and other income, net | 717 | 541 | 1,262 | 1,098 | |
Income before taxes on income | 4,755 | 2,436 | 10,176 | 4,917 | |
Taxes on income | 632 | 313 | 11,402 | 735 | |
Net income | 4,123 | 2,123 | 8,774 | 4,182 | |
Basic net income per share | $0.18 | $0.10 | $0.38 | $0.20 | |
Diluted net income per share | $0.17 | $0.10 | $0.37 | $0.19 | |
Weighted-average number of Common Stock used in computation of net income per share (in thousands): | |||||
Basic | 23,107 | 21,061 | 22,900 | 20,859 | |
Diluted | 24,165 | 22,069 | 24,028 | 21,991 | |
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures (U.S. Dollars in thousands, except per share amounts)
| |||||
Quarter ended | Six months ended | ||||
June 30, | June 30, | ||||
2011 | 2010 | 2011 | 2010 | ||
Unaudited | Unaudited | Unaudited | Unaudited | ||
GAAP net income | 4,123 | 2,123 | 8,774 | 4,182 | |
Equity-based compensation expense included in cost of revenue | 61 | 15 | 110 | 33 | |
Equity-based compensation expense included in research and development expenses | 484 | 139 | 862 | 306 | |
Equity-based compensation expense included in sales and marketing expenses | 255 | 96 | 456 | 208 | |
Equity-based compensation expense included in general and administrative expenses | 371 | 290 | 697 | 577 | |
Deferred tax related to equity-based compensation expenses | 85 | - | 1 | - | |
Non-GAAP net income | 5,379 | 2,663 | 10,900 | 5,306 | |
GAAP weighted-average number of Common Stock used in computation of diluted net income per share (in thousands) | 24,165 | 22,069 | 24,028 | 21,991 | |
Weighted-average number of shares related to outstanding options | 15 | 57 | 23 | 75 | |
Weighted-average number of Common Stock used in computation of diluted net income per share excluding equity-based compensation expense (in thousands) | 24,180 | 22,126 | 24,051 | 22,066 | |
GAAP diluted net income per share | $0.17 | $0.10 | $0.37 | $0.19 | |
Equity-based compensation expense | $0.05 | $0.02 | $0.08 | $0.05 | |
Non-GAAP diluted net income per share | $0.22 | $0.12 | $0.45 | $0.24 | |
CEVA, INC. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. Dollars in Thousands
| |||
June 30, | December 31, | ||
2011 | 2010 | ||
Unaudited | Audited | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 14,379 | $ 17,098 | |
Marketable securities and short term bank deposits | 123,112 | 98,681 | |
Trade receivables, net | 3,622 | 5,906 | |
Deferred tax assets | 2,355 | 1,288 | |
Prepaid expenses and other accounts receivables | 5,186 | 4,609 | |
Total current assets | 148,654 | 127,582 | |
Long-term investments: Long term bank deposits | 15,277 | 15,173 | |
Severance pay fund | 5,858 | 5,433 | |
Deferred tax assets | 839 | 574 | |
Property and equipment, net | 1,308 | 1,348 | |
Goodwill | 36,498 | 36,498 | |
Total assets | $ 208,434 | $ 186,608 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Trade payables | $ 850 | $ 616 | |
Deferred revenues | 3,646 | 616 | |
Accrued expenses and other payables | 9,535 | 10,521 | |
Deferred tax liabilities | 597 | 901 | |
Total current liabilities | 14,628 | 12,654 | |
Accrued severance pay | 5,902 | 5,486 | |
Total liabilities | 20,530 | 18,140 | |
Stockholders' equity: | |||
Common Stock | 23 | 23 | |
Additional paid in-capital | 187,378 | 176,838 | |
Accumulated other comprehensive income | 439 | 317 | |
Accumulated income (deficit) | 64 | (8,710) | |
Total stockholders' equity | 187,904 | 168,468 | |
Total liabilities and stockholders' equity | $ 208,434 | $ 186,608 | |
SOURCE CEVA, Inc.
