CEVA Stock Falls After Q2 Results, Notes Lower Than Expected Margins

CEVA Inc CEVA reported second-quarter FY21 revenue growth of 29% year-on-year to $30.5 million, beating the analyst consensus of $25.4 million.
Segments: Licensing, non-recurring engineering (NRE), and related revenue increased 15% Y/Y to $15.5 million. Royalty revenue expanded 48% Y/Y to $14.9 million.
The Q2 saw seventeen license agreements, including six with first-time customers.
Non-GAAP EPS of $0.22 beat the analyst consensus of $0.11.
Margin: The quarterly gross margin was 88% on a GAAP basis and 89% on a non-GAAP basis, both lower than its expectation, as it integrated Intrinsix’s NRE costs into the cost of revenue.
CEVA held $137 million in cash and equivalents.
Outlook: CEVA raised its FY21 revenue guidance to $119 million - $121 million (prior $116 million - $117 million), versus the consensus of $115.27 million.
For Q3, CEVA expects a gross margin of 81% on GAAP and 82% on a non-GAAP basis.
Price action: CEVA shares traded lower by 5.17% at $48.15 on the last check Monday.

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