CEVA - Earnings call transcript Q1 2020

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Operator

Good day and welcome to the CEVA, Inc.’s First Quarter 2020 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Richard Kingston, Vice President of Market Intelligence and Investor and Public Relations. Please go ahead, sir.

Richard Kingston

good and Rocco you, morning everyone. Thank CEVA’s to first quarter Call. Conference Earnings XXXX Welcome today Chief Gideon Yaniv am by I joined Wertheizer, Financial of Arieli, Officer Executive CEVA. Chief and Officer the data. the and business Gideon and will qualitative highlights cover from general provide first aspects quarter cover full results for then year also XXXX. quarter the the for financial and guidance qualitative data the second will first and Yaniv provide quarter and

as today’s well start results I materially assumptions could risks forward-looking discussion that contains and implied or the note involve incorrect, forward-looking those such with from they will and of if forward-looking assumptions. Please uncertainties as that prove differ materialize statements that statements statements. expressed by CEVA or to the cause

pandemic pillars optimism including to stick and of expense gaining Forward-looking and adverse Research. impact Wi-Fi market achieving our of about and Cisco manage share our the non-GAAP RAN the to ABI statements optimism guidance our in growth, customers second our include the XG, about mitigate data and for ability growth by quarter in such coming objectives; of level certain anticipated XG, XXXX; of market months,

For position IP ability be new speed update incorporating us; any assumes information of CEVA’s difference the the to to customers to of forward-looking demand XG Wi-Fi our competition respective and length markets and on a drivers to of as for global and filings could information, pandemic, smarter, market and our to which products impact ability restrictions more trends. markets; the economy to other our and market on the shelter-in-place CEVA new agreements; execute that refer license and of the existing the Securities and the global in in or generally; baseband with growth include, no acceptance; please intense speak and our the chip COVID-XX associated connected strong the ability effect of Exchange success pandemic, markets; factors IoT maintaining continue with industry the of technologies These for the the extent achieve their devices cause our our extent expansion Commission. results, duration non-handset in obligation COVID-XX the the of consolidation; and market and penetrating dates. of statements the

now With I that to said, will call the hand Gideon. over

Gideon Wertheizer

everyone Good us you, Thank and today. you morning, joining Richard. for thank

loved Firstly, sympathies our with pandemic. ones their heartfelt that those due the the jobs their have around are world to COVID-XX lost or

around world all a We are governments the measures for will sustainable by recovery. lead hopeful taken that the

protect are At proactive health steps CEVA, work-from-home. adjust we operation to taking and all our our employees’ to

structure scalable, a IP is advanced office seamless to migration work-from-home. allowed which Our and from

productivity, Our optimum. activity of ongoing at our and interactions development R&D remains and sales is for support level customer with high

enable instructions country-by-country, monitor to steps to We are government employee’s continue taking to our and our return to careful offices.

with smartphone from China, lock COVID-XX introduction market down weakness than in IoT Against of robust company. year-over-year. in came have this by revenue million XX% assistance licensing XX revenue, vision home of IoT-based new $XX.X for and environment the we AR range devices. the an XG to revenue and and resulting Royalty licensing quarter at in model for $X.X The excellent a new up from in solid signed up three million, deals more XG run, base offset recorded year-over-year. the of Above Target and Three wireless small were for XX for out fixed which of agreements, connectivity access, of for devices, station smart for first-time our XX Chinese product shipments and for was handset wireless back-haul, X drones, ear-buds, seasonal the $XX.X XX% up be We continues backdrop, were Wi-Fi XG include true leading were and XX% year-over-year. with IoT we cells. low-cost technologies million, voice applications customer.

Phase additional Wi-Fi growth increasingly and you back expected Let represent as minutes largest provide work-from-home include to to our These low on into perspective of secular focus sensor, URLLC X, On of the proliferation technologies use enabling in OEM XG few they the two and X. our connected upcoming billions customers services. and aggregation will RAN use cloud agreements the be come new the of extended drive diagnosis robotics, practices next XG chipset vectors network robust of medical; quarter in are low and of me support spaces licensing signed COVID-XX manufacturing, in to the focus for Type services the to the that are enables to the the trends smart services. take communication, their with next that XG X investments future. on key These of Machine treatments power MMTC, MMTC our and are medical XG targeting automotive, remote to latency strategy, generation the and address ultra-reliable customer and XG better and during our Communication, XG the central capital new of RAN AI design. Massive for and development URLLC, with

and and context, ago, few today, offering and XC powerful performance weeks state-of-the-art in DSP operating DSP, a CEVA we this innovation XX, this processing, the unveiled parallel generation is In multi-threading. most unprecedented platform speed, latest our the architecture, advanced available

had recently customer that Mobile. also it encouraged share of billion are engagement China has our $X.X commercial China bigger for to contract most in the China deploy and XG. the XX station recent a has prior by traction in won base ZTE in Mobile, had XX% contract for share XG it Today, We substantially

is with to FCC XXX.XXax. According recent ranging good up new X, Wi-Fi recent mobile the of the latest XXXX. from smart XE reality low to targeting in approval Wi-Fi as X augmentation will standard ABI will than mobile and two $X.X variety Wi-Fi study spectrum speeds nearly band XXXX be Cisco Wi-Fi devices the devices smart signed and from free experiencing at like network traffic to door is billion data for market referred units support to is also also less $XXX compliant of to X.X application gaming, smart as in X boxes, XXXX. forecast, to XX% X during Research, XG mobile virtual to quarter, IoT enable Wi-Fi reach to interest to we to network The According the by by and a worldwide offloaded forecasted compared gigahertz up required latencies locks. are customer million speaker comparable momentum update manufacturing. achieve agreements Wi-Fi In set BTV, smart to Industry for expected additional boost

with from impact the COVID-XX. suffering thoughts our are those of summary, people In

situation activities are is of the dynamic, customers’ our the While interest by still encouraged we persistent product. our design in

our expand are capitalize year. gained momentum focused business We to to last laser we continue on the to

are prudent will normalcy. monitoring the and resume step look supply and and We all face-to-face developments the closely We COVID-XX meeting you some our you and take near impact contained is and again dynamics in and hope roadshow. concerning forward shipment to until we customer demand conferences future safe are at

guidance. hand for With financials that and I over call to the Yaniv said,

Yaniv Arieli

higher million, breakdown results for as is compared first $XX year. start you, XXXX. first Thank million, from morning. of XX% for quarter first quarter revenue $XX.X same as of related million for I’ll follow: quarter quarter for to same XX% reflecting Licensing operations the to quarter our than the of total revenue, approximately million, was Good the by Revenue total $XX.X of million revenue last reviewing was than the $XX reflecting year. Royalty revenue, million the XX% and $X.X higher XX% XX% our Revenue of $X the up XXXX. was Gideon. last

GAAP $X.X gross $X.X gross was of Quarterly margin non-GAAP excluded approximately forecasted. on first and higher GAAP impact million equity-based expense XX% margin acquired of slightly $XX.X compensation amortization quarterly of basis million of and on non-GAAP at the on guidance intangible. better XX% of million. originally quarter expense Non-GAAP our the was we operating than a for end basis, the Total at

difficulties compensation XXXX also of forecasted, associated the OpEx manage. million million included the of for $X.X intangibles for doubtful of and at operating $XX than amortization equity-based higher due approximately end grants expenses compensation the of also Total allowance in higher amortizations to U.S. were liquidity provision OpEx excluding expense million, million, the aggregate associated intangibles, equity-based included debt $X.X the acquired also quarter $X.X PSU February to the of expense of of accounting with an with guidance. customers first one our our

for as compared by share quarter $X.X GAAP the in down a was quarter chips was net XXXX, EPS million a units XXX the of quarter during $X.XX up quarter first the XXXX ago. of from million per first sequential $X.X shipped XXX Of diluted and diluted million U.S. to of first the data, units, million chips, shipped the million XX% year from million XX% related of net $X.XX per XXXX CEVA’s our and units and licensees $X.XX. XXXX, quarter loss non-GAAP of XX-fold loss Other $X.X income the loss and of for for increased share and loss to diluted by X.X-fold the first shipments. decrease of during reflecting XXX XX XX% the or a XXX units handset of first baseband of respectively from units shipped handset units million reported baseband quarter increase were shipped, for sequentially quarter XXXX but fourth XX% were million XX% and

sequentially X% were up and product and year-over-year. IoT station down only XX% units, XXX Our base shipments million

have baseband We station now all IoT our non-handset base and products. chips under of umbrella of categorized the

$XXX March balance marketable the deposits were securities XX, XXXX, equivalent million. and as cash cash, of bank for balances, As sheet, CEVA’s

as XXX,XXX We of the our continued of available approximately repurchase. the And $X.X for shares today, available million. Directors repurchase. shares approved of plan quarter, XXX,XXX plan approximately of February, expansion new by XXX,XXX total for our are repurchasing for buyback this buyback shares In Board

ASC XXXX first adjusted for quarter XXX days. the of were Our DSOs XX

During cash $X.X operations. quarter, generated from million net the first we

our $X.X million, and of purchase a of of amortizations million. end the headcount assets Our which XXX up At depreciation engineers, the fixed people of at were quarter, the total XXX were XXX end from were and first people, XXXX. $X.X was of the

execute we COVID-XX. mentioned during to for the business first quarter excellent the by Now, and continued licensing revenue first and the caused as our quarter guidance; strategy disruption an in by despite well had royalty Gideon,

world we cannot COVID-XX the disruption meeting of fully diligently this of revenue our the be goals and it supply chain earnings spread extent continue demand last the the on call, the the of the and causes around given at to assessed toward on work consumer annual point. Although in guidance

a maintaining we of On our $X to hand, annual this annual million as at related business have other result. uncertainty, this stage. Given guidance remains annual of robust record and decided our to royalty growth over XXXX prudency, are $X of revenue revenue matter we withdraw and forecast licensing our million

levels and expense firmly This research of mitigate non-GAAP to will our support, as in will the affect or any not adverse pandemic to dividends technology coming impact roadmap in believe committed We plans, those are to areas development we months. technology continue also will those investments pay future. monitor closely the customer our the and

the seen to expediting As closing and companies XX% down play from and we such semiconductor IT basis. of create, prior gap Gross on on in the market expected XX% crucial that quarter slow recovery have second can is specifically be role approximately cycle, GAAP technology XXXX. non-GAAP for margin in

equity-based assets investment. Excluding associated the million of Immervision of million of of compensation the aggregate other $X.X expenses amortization $X.X and with

next should lower than the three for OpEx quarter. the XXXX first be of quarters

to $XX.X to million GAAP-based in of million. is The be expected OpEx quarter the second $XX.X range

second the Our expense. expected $X.X for anticipated total be operating to equity-based million, expenses compensation to quarter, attributable is

the $XX shares. expected Net for Share are be million to approximately amortization be thus As million accounting will intangibles. forecasted treatment in to Therefore, acquired originally and in I $X.X to count to of XX.X expected second expenses quarter is is the the for brand million. be second of PSC Taxes both GAAP approximately range to $X.X and are expected income higher million XXXX the management due interest of million $XX to expected to earlier, basis. our to than February non-GAAP our be OpEx attributed $X.XX said non-GAAP quarter be million. is

open Q&A the And could Rocco, session. you now

Operator

Matt Please Cowen. with Thank question you. Today’s comes ahead. [Operator from Ramsay Instructions] first go

Matt Ramsay

versus additional business very have expanding more your continue. Gideon, beyond that next it’s little and well. you could just Maybe baseband, of you more Good but several more earnings with about just portfolio how footprint just good also rolling some of to bit expand the should the your and I calls Thank may here a that did prepared out quarters? Wi-Fi really see XG couple afternoon couple with the noticed OEMs of you of nice you much. the as be over than a XG see in you licensing X initial momentum the momentum in and the licensing couple talked and for the you on years And continue terms the that last comments, product morning. to Thanks. in areas

Gideon Wertheizer

two Yes, two think I things. growth result to highlighting both want and many these offering. do have is two One These if not technologies need engines I’ll get major I competency into that into for one the think of the the significant a the that are you’re this in they It’s market, one to get of suppliers. benefit second it, companies of us. are the landscape technologies is this but the they minute; do

very access station, XG companies the station today. or a are ability and around in and in build capability this to So, the I ASP, can And their base there that specifically, those key is elements that a build radio you base which if touched is few relatedly, on one, one to the not is network use companies, take anymore.

the the the take just about are driving, is generation the you medical, broadband, XG, mobile back Phase we smart but company not offer seeing autonomous into of smartphone, thinking the DSP that XCXX what where that next are at putting which that coronavirus. today the X, to people of people start today We like also only the start manufacturing, can place things remote

is of what to as XG. now of are viable, XG aspect one position we only take called here So, this advantage OpenRAN. proven a is in An the supplier O-RAN, the

and to is the disaggregation that solutions. or or of the which Chinese dependency top-shop, order things independency OEMs states full guys of of, go build on let’s a big in to deconsolidation One in important in to what are is say, one called the supplier come dependency more OpenRAN, provide is

antenna only companies the the company in into in that portion get station. base are and market to side those provide take either enable of we the and So, advantage can the O-RAN or

fixed area the about the of residents side throughout any RAN to barrier entry the that’s that big. to the Wi-Fi the that fact is comes to it which a is – clean when build of company, especially becomes Wi-Fi build XG competitor the have And then the big of and doubled you And XG, or today So, enterprise a Wi-Fi, of general, provide antenna. now comes that in we XE, the which which congestion. year the basically including those wants for

point that its Let’s take require Industry the know, which Wi-Fi robotics, we of web. the handset XE beyond access and at the network or PC will and what reliable all know, access faster of going need fast require they people X.X at to and the more home, kind enterprise into into in this home, us stay

through it technology industrial be the technology part that these the only So, to of anchors of two we a wants are supplier it. or consumer market that of the through of either those in are viable companies this for park

Matt Ramsay

like you really I Got unit obviously the it that But I’m wanted lack and the – first me progress. color there sounds smartphone the the with Yaniv, I good non-handset. on of particularly unit. Thank half for not of if struck it than some that the were visibility more royalty understand were think quarter guidance, mistaken to, it.

guys just all to of that time. in But technologies station. XG really Thank protect as give a color units business of that years you talked some units, stronger So, setting can within maybe about of really for seeing IoT baseband starting it non-smartphone breakdown that some the smartphone like the momentum common breakdown the know you. business the base and and there seems number numbers modeled there? we’ve was of to it had together I about to of non-smartphone in big a we’ll at quite Because franchise – a And business targets you bit would But over we be you’re wait for the than shift the the well, units is kind of decent results seen come like ago the a some some there. least are some what see we of to seems and on any pace any it non-smartphone helpful. color that bigger

Gideon Wertheizer

out was was prior the by It than low in market sure. areas a the with decline series years, that handset seasonal the probably the million. is quarter, stronger going a are you timeframe case of OEM Last quarter We the year a prior September year. the changed years, offset Chinese, normal side, In all-time shows the did that’s This that coming phone units that interesting non-handset side. And came for yet. an of interesting bit. business in in it high of Yes, globe, more unlike of our Chinese even it’s have, handset $XXX the but million. which QX not lower in number well-known the of manufacturing $XXX nice was seasonality that recall, in the were typical you timing $X.X industry the the newer first different from a we We is usually that the the see time a that specifically and usually a beginning cost, Chinese had if record the non-handset. in right. not has million, has in quarter our through different in in And than million the dollar of $X.X

of we year market, it for sensor course is fusion new quarter, didn’t the this have a of had segments ago. some And us, we

very a strong So, for But markets quarter. it among us, for other helpful. even traditional the that was example, was Bluetooth, like

half, needs the to say played very of different in devices, out IoT devices, needing the compared first maybe for new sequential we it and need new name it’s the us specific only were called the markets, overall royalty stronger combination No With first was due IoT a home there that year, for categories base that two not that this traditional the still maybe in any case, should different the traditional coronavirus see business have. people nicely doubt quarter strange X%. This we help that some which that grow is station and of continue at ever wait station decrease we is weakest grow before. still base and consumer new to Although but forecast this the we seasonality quarter segment, just saw this was the low and the of year at least limitation to to those anymore, not the seasonal we half, it’s our This may second than be years last delivery. it had effect. the and

Matt Ramsay

of And million belt to situation. we’ve past tightening? to just things been has in R&D since government coronavirus the have there have quick that one, and different grants I down for you is $XX know kind I – one there it. of moved funding, that Is million last around Any QX. mentioned $XX had organic OpEx, sort just think the Got

the or is anything forward? just unusual OpEx going that So, in should rate a expect Thanks. run we

Yaniv Arieli

Sure.

without from So, we are remarks, prepared R&D. in to we we whatever side the hurting can monitoring trying of that that the and tighten the expense said sort

play let’s grants, that’s year of the around QX million much decrease QX, are first of $X were payments. number. for say and lower a as much in in why was get the we agencies that didn’t the quarter. there big and grants QX closed some next to It couple smaller and will the quarters of the a right government example. than were You’re It’s

for U.S. some an in unusual some corona into and got and us debt difficulties company We that related. liquidity with also of had effect financial doubtful

a the had quarter. So, of $X.X provision bigger million first in we

less shows, also in of if royalty we’re more you ways less the here trying of next could events, taking All travel, with that be. measures any quarters, the offset in what revenues and come will with they trade couple risks up see virtual to in companies, other to

Operator

from comes Walkley question go next Please Mike today our Canaccord with ahead. And Genuity.

Mike Walkley

and Hi, thank strong tough you in environment. results the a congratulations on

in pulling starting on shipments up ReefShark broadband year-end It looks just are to picking to me highlight seems can what one much infrastructure you there’s from uncertainty the on station base infrastructure of contract, ZTE seeing that do world, you need because and XG market side? – expected overall, on maybe takes question so for consumer-driven is the the puts like well market? handset or quite guidance be progress wireless know can more the spending talk the the but I attractive a and with certainly through about while doing royalty and you the maybe you’re just maybe quarter-over-quarter of Just there infrastructure areas so Nokia to and talk

Gideon Wertheizer

Yes. Hi, It’s Gideon. Mike.

coronavirus. that is the customer the You’re the a looks and where of process to they on you you It’s sizable we us has out, infrastructure right. Mobile are X benefiting. $XX investment, being until infrastructure It and will to somehow win billion China This see the our is it contracts months. continue about see the deal, XG an resilient financials the a is point about impact from

are see the will we we in encouraged months. So evolves coming it how and

Mike Walkley

– your can on Great, thanks. that with $X licensing do this just you clients it’s you restrictions your just and is structure a how you you. the interactions? team about work-from-home, travel lot expect virtually restriction to to my great And able work face-to-face this to with given $X on on licensing million to increase of Thank so execute see Can question year. much ensure talk to million side, follow-up

Gideon Wertheizer

Year, show that licensing do demonstration, there works after you way are about customer can China, when was from us, And that you as to for coronavirus on that’s stop like, get New I the can people just remote are and interaction Chinese that the they came immediately comes If to right. effectiveness they productivity peak. with a things example Yes, or agree customer. that’s the ongoing work people this, that different I the people but access, of Q&A, relationship And going smooth are most like than personal other This practice slowdown was didn’t saw even we that is planning not least the we what we That’s and of was that to that already But and it. – fact development easier. see face-to-face. QX And far, together. we presentations. – in in the the – saw of the reason licensing and working the this just what surprise, the wanted it pipeline and it being have give, the to at was valuation, we expedite so logging the late something – a that out had. the

Mike Walkley

I Thank Good all you. this can Great. to the person. And get do we again look together day in year. luck forward

Gideon Wertheizer

Mike. Thanks

Operator

today next ahead. our And with Capital. go question comes DeSilva Suji ROTH from Please

Suji DeSilva

talk Hi, the this execution Gideon. royalty tough in a and about in whether hard at on licensing point? and the certainly, it’s you relatively the or recovery royalty, in stayed any say just licensing linear signs it’s of you’ve seen activity, quarter-to-date? environment in whether linearity to too Hi, Yaniv. activity The can Congratulation in

Gideon Wertheizer

Suji. Hi,

licensing. So the let’s with go

XG other fact of consumer Wi-Fi it’s the we products and BTV is going about Wi-Fi. just are think today, have and the more see and new the say that’s X, cycle because and product people into building access that Wi-Fi in across I X companies a all and than the these – mentioned smart I we devices hotspots licensing, many It’s I more and Wi-Fi world. that so would smart point. be would the

course a hearing IP to have earbuds, build have wants computer people portfolio, have of lot Bluetooth, sound, we vision, aid. we we the have We of

starter. So, over place. portfolio. say they device, people uniqueness need sensor. It’s sensor I a is of are CEVA any microphone form or there they cannot And us. something it’s that connected comes in the it The some the need synergistic a it that sensing, whether our or is all to find need RMU they when connectivity, and of camera sensor one-stop They building

see year. orders with be of countries the release comes will saying what is about done. And But reports go of it’s what then some and ongoing. year. mark gradual really QX we be things end We we the of than on go goes it will other question speaking there But get The QX People that IoT smartphones. base now XG recovery, because buying, royalties, And course, nobody customers. the knows and stay-at-home. – more how will maybe I small be are weaker less us, to is call QX smartphone. get of be the this we will of L-shape, customer, just make and depending anticipated according QX Christmas be the people hard less is primarily or something than V-shape, at to may us as this generally for and think then of stuff station, and we that is recovery Now, from of while virus, that will how that lockdown weaker we out gradual the it the when this season this the of or there. more less more linearity are for around don’t what the expected they as need they or There

Suji DeSilva

and that. one will that licensing are still you. into royalties come mix will wireless activity know. seems you, years next expect And royalty we series to coming two customers infrastructure, Gideon. customers It’s That then Okay. from two Thank very the or color, be XG two? here your or the next or Should there appreciate wins large more you to in of the the or helpful there. that year additional smaller are Thank have be a on helpful in XG

Gideon Wertheizer

that’s Suji. Yes, question, important

heterogeneous XG what is as RAN well. called The other is customers have market architecture. We

So, touched a on and we small remarks. have access. sales, we sales spoke bit it micro and – on have we we the have We fixed wireless prepared

customers that many, there the XG We that play factors. few other RAN but not into have different we market. So, to wants form in go

Suji DeSilva

will are And ASPs which similar just ASPs? Thanks. follow-up the to base significantly quick existing quoted Okay. station then higher ASPs be the you than here, the

Yaniv Arieli

They going much the bigger implementations to are station many physically more higher base chips. with ASP bigger, chips in more and inside. be They are expensive

if base question could the from royalty smaller is the stations of multiple home inside of or the implementation mega-size dozens base discipline bigger based light it’s And the a inside. we and chips side. station type with all get that pole on part what or a dozens have it’s to base check it of way station So, hotspot for here a of

different have production. one think Right customer in we’ll now flavors. I we have So, of lots

year, waiting ago. to the less are this other a We in months. were the of the and at year, the that that ones XX last minute the for next kick-in just And probably then XX later joined mentioned to these than newer beginning Gideon one ones

Suji DeSilva

you, guys. Okay. Thank

Yaniv Arieli

you. Thank

Operator

And our Tavy question Tavy, Please line next ahead. with from is open. Rosner Barclays. today comes go your

Tavy Rosner

on have Most congrats can questions asked. been hear results. Hi, I hi, me? you sorry, of – guess strong my the

Gideon Wertheizer

Yes, go ahead.

Tavy Rosner

you can guys Hi, hear me?

Gideon Wertheizer

Yes, Tavy, ahead. go

Tavy Rosner

sorry. am I Yes,

just looking on you any a scenario Just mentioned a follow-up. that have that’s temporarily to flexibility for where the some costs of if the at your some still flexibility – as then traction you’re second at have revenues, just automotive I’m of you case. wondering the And do your see of decrease we wave would if the seeing quarter, kind a non-R&D Last worst-case I’m and follow-up, COVID the on looking and you cross pressure spend?

Yaniv Arieli

answered that I’ll this. about Tavy. I with question, start because think the and Sure, we talked second

monitoring closely to looking cost are basis. the We

and which are world. the extent, related COVID less like time, Some office less These doing offices obvious the some and virtual of cost savings, of some the events, because to less the are and travel, just to helpful cost. are we differently rest

to more the of early is We and cost and to other be And you QX are – efficient. million $XX could in see creative at gave million as this for that the non-GAAP $XX for the quarter. we guidance looking ways

in don’t account. So, coming royalties some for space. when we we probably into about cars, market, when to And from long at – in market program deal of the we we regard speak into traction, the have baked are a licensing, about XXXX These yet earliest. go that automotive automotive the already they sign start this

new substantial. of not one signed, there that So, is had that customers we here so terms about and we But discussion quarter deals is with the design ongoing. in far,

Tavy Rosner

Great, thanks.

Yaniv Arieli

Thank you.

Operator

Please with Exane Paribas. next And our David today comes from ahead. BNP O’Connor question go

David O’Connor

two for color to sensor kind last or that Yaniv, or one the you. there do in follow-up interaction and in question, maybe terms automotive? on the engagement from fusion, change And the kind from change fusion of In year, there Maybe of around and question. side? in third my you’re you’ve of the taking of forward? any that royalty going the remind some seasonality what my follow-up any COVID-XX, licensing of and for can thanks the the kind base the much expecting past, due on one maybe side, and morning, – QX; on then then station quarter-over-quarter, how there maybe firstly was modeling good try on on we one the so in seen sensor us type Thank a can the Hey, you

Yaniv Arieli

the question question. the got third I David, Okay, and first

because segments didn’t question The hear with XG second XG and you XG question then the see. install in maybe I the back We and we’ll and base breakdown first disruption the that’s was about work specifically there to will They those to station, But people We general. work may go you because in temporary. But didn’t. those repeat and was ask on get I couldn’t it. but IoT don’t royalties.

station, XG for respect. maintain that the we beginning we a that this be growth far, We see any what this thought base in at it’s thought it when don’t what would year same. to comes So the change we

sensor fusion market. terms in is Now, sensor a something the broad that it’s which of is IMU, inertia very measurement fusion, unit,

the customer consumers, the So, there on – customer we have have PC in TV. are there are we

So, and are trend we about highly we are base customer market. it’s and just you is what talk the market the we addressable our don’t looking and expanding that a are seasonality, extending really can’t here fragmented

our segment of one out it’s IoT segment. overall, So

far, in to when far see comes of what it it’s very And we so terms so interest well.

David O’Connor

Thanks question And on for that. automotive. my was

Yaniv Arieli

couldn’t Automotive? What question, I you, hear broken? were was the because you

David O’Connor

Yes, sorry about that.

terms the repeat to any on of automotive the side, you’re automotive Just in on engagement licensing Thank you. change in seeing of QX?

Yaniv Arieli

think in have engagement. Yes, I we don’t change automotive

when before go license for XXXX it’s – the something at question licensing, think the was we until program earliest. for that I there

automotive not is are change royalty change. to have people, design in obvious we prospective cannot there no activity, the not we quarter in here we – way, especially slowdown we customers, it And don’t there market. a what something since a terms is in of there, have impacted So, when and we and that design see comes that from that’s

David O’Connor

guys. Thanks, helpful. That’s it. Got

Yaniv Arieli

Thank you.

Operator

concludes I’d final over Kingston back the And remarks. ladies gentlemen, to and for this conference question-and-answer session. Mr. like the any turn to

Richard Kingston

joining for everybody you interest in CEVA. Thank continued us today for and your

the investors.ceva-dsp.com. we As Investors our through shortly: events, in, regards exhibit the on of May participating website found for on in events, the an Section and of a X-K And upcoming TMT our to goodbye. at can following Form and through reminder, filed the XX. report be be will accessible event running Thank XX prepared we be on remarks the for this as conference information this current With Cowen call and all you events further to Investors the section website. Virtual Conference, from XXXX will participating are

Operator

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CEVA (CEVA) 11 May 202020 Q1 Earnings call transcript