Record revenue, operating margin and operating profit; Strategic agreements signed with key customersSAN JOSE, Calif. --- Oct. 29, 2008
-- CEVA, Inc. [(NASDAQ: CEVA); (LSE: CVA)], a leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for mobile handset, consumer electronics and storage applications, today announced its financial results for the quarter ended September 30, 2008.
Total revenue for the third quarter of 2008 was a record high $10.2 million, an increase of 17% compared to $8.7 million reported for the third quarter of 2007. Licensing revenue for the third quarter of 2008 was $6.0 million, an increase of 12% from $5.3 million reported for the third quarter of 2007. Royalty revenue for the third quarter of 2008 was $3.3 million, an increase of 51% from $2.2 million reported for the third quarter of 2007 and an 8% sequential increase from the second quarter of 2008. Revenue from services was $0.9 million, compared to $1.2 million reported for the third quarter of 2007.
Net income was $1.4 million for the third quarter of 2008, which represents an increase of 26% as compared to the $1.1 million for the same quarter of 2007. Diluted net income per share for the third quarter of 2008 increased 40% to $0.07 per share, compared to diluted net income of $0.05 per share for the third quarter of 2007.
During the third quarter of 2008, the Company concluded six new license agreements, of which five are for CEVA DSP cores, platforms and software. Target applications for customer deployment are 3.5G, LTE modems, femtocells and consumer electronics. Geographically, three of the six deals are in Europe, while two are with U.S.-based companies and one was concluded in the Asia Pacific region.
During the quarter, CEVA continued to execute on its strategy of licensing to global industry leaders, including two agreements for the Company's most advanced DSP cores. The first strategic agreement was signed with a major U.S. semiconductor company who licensed the CEVA-X1641 DSP core to develop an ASIC chip for a multinational OEM targeting the femtocell market. The second strategic agreement was signed with a major Asian OEM manufacturer who will use the CEVA-TeakLite-III DSP core to develop a chip for next-generation LTE applications. These two agreements illustrate the continued expansion of the wireless use model beyond cellular handsets to new applications in home gateways and mobile Internet markets.
Over the last few months, CEVA implemented its previously-announced 1 million share buy-back program, of which 500,000 shares were subject to a 10b5-1 plan that was established during the quarter. During the third quarter of 2008, CEVA repurchased approximately 200,000 shares at an average price of $8.2 per share, totaling approximately $1.6 million. As of today, CEVA repurchased approximately 675,000 shares at an average price of $7.87 per share, totaling approximately $5.3 million. It also fully utilized the shares available for repurchase under its 10b5-1 plan.
Gideon Wertheizer, Chief Executive Officer of CEVA, stated: "These solid third quarter results are a direct result of our focused strategy on growth opportunities in the mobile and consumer markets. Additionally, we are encouraged by our customers' progress in growing their businesses and expanding their markets shares with their customers, such as manufacturers of handsets, personal multimedia devices, portable game consoles and smartphones."
Yaniv Arieli, Chief Financial Officer of CEVA, stated: "During the third quarter, we executed record operating margins and operating income. We also generated positive cash flow of approximately $1.4 million, after taking into account $1.2 million of cash outflow associated with our buyback program. CEVA's cash balances and marketable securities as of September 30, 2008 were $87.9 million, and our DSO level was at 35 days."
"Given the current market environment, we remain vigilant in monitoring and controlling our expenses. Further, our strategy is supported by a strong balance sheet and business fundamentals that provide opportunities for continued stockholder value creation," concluded Arieli.Financial Tables
to download financial tablesCEVA Conference Call
On October 29, 2008, CEVA management will conduct a conference call at 8:30 a.m. Eastern Time / 12:30 p.m. London time, to discuss the operating performance for the quarter.
The conference call will be available via the following dial-in numbers:
-- US Participants: Dial 1-877-493-9121 (Access Code: CEVA)
-- UK/Rest of World: Dial +44-800-032-3836 (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=52145
. 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: 68242364) for US domestic callers and +44-800-917-2646 (passcode: 68242364) for international callers from two hours after the end of the call until 11:59 p.m. (Eastern Time) on November 05, 2008. The replay will also be available at CEVA's web site http://www.ceva-dsp.com/
.About CEVA, Inc.
Headquartered in San Jose, Calif., CEVA is a leading licensor of silicon intellectual property (SIP) platform solutions and DSP cores for mobile, consumer electronics and storage applications. CEVA's IP portfolio includes comprehensive solutions for multimedia, audio, voice over packet (VoP), Bluetooth and Serial ATA (SATA), and a wide range of programmable DSP cores and subsystems with different price/performance metrics serving multiple markets. In 2007, CEVA's IP was shipped in over 225 million devices. For more information, visit http://www.ceva-dsp.com/