CEVA - Earnings call transcript Q4 2020

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Operator

Good day, and welcome to the CEVA, Inc. Fourth Quarter and Full Year 2020 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note that this event is being recorded. to of conference and Market like Kingston, to Public now President Vice Intelligence would turn over the Richard Relations. I and Investor ahead. go Please

Richard Kingston

also Thank results Arieli, joined today CEVA's Gideon welcome Wertheizer, year or you, Officer, everyone, and with by data earnings quarter and the Executive the assumptions. uncertainties, as Yaniv the those XXXX implied I'm expressed CEVA and general could statements they of assumptions for today's full Financial and start Please the cover cause provide the statements. if and fourth Cole. to call. forward-looking conference from CEVA. qualitative the that and highlights note first then and of quarter or Gideon from Chief year Officer fourth well morning, will as statements and to that the materially will quarter qualitative Chief forward-looking Good fourth provide discussion forward-looking aspects the I'll Yaniv risks cover financial prove the incorrect, for and differ such business materialize data. quarter involve by XXXX. contains full that results

belief switch. growth more new the licensing in market, the from our first include us XXXX sensing China, and about qualitative potential and revenue belief statements for and and royalties licensing Wi-Fi connectivity penetrate technologies, supplier presented offset customers, thereby; deployment our for X existing in data smartphone our opportunities optimism up the optimism Xand high will continued the Forward-looking that year in our than full and relationship the XXXX; XG the that momentum RAN volume guidance drivers station smartphone ZTE technologies XG base quarter to decline in Bluetooth with royalty about allow ramp and optimism from will AI our engagements strong

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

Gideon Wertheizer

record at Royalty its XXXX. have that we stronger XG $XX.X across tracking, of royalties, our and XG highest for in for other expectations. $XX.X all-time revenue quarterly in allude EPS today. customers. internalizing time technologies new with time record significantly detail signed year XG Thank will revenue technologies I of Notwithstanding XXXX our quarter we be and automotive of exceptional mobile adoptions million RAN, strong at fourth licensing deploy both million, strength and with you, the high portfolio usage market quarter, excellent developments X were DSP came extraordinary revenues our year, us ahead comprehensive key of with smartphones, to intends of the for IoT include these and across sixteen developments thank while record-equaling earbuds demand smartphones, TWS XXXX the agreement Fourth Wi-Fi at the products. continued circumstances, record. Richard. TWS IoT is others new in and with and had the for key and those healthy, in XX% signed and space first Wi-Fi wide for XG CEVA and Seasonal models, OEM expansion the all in were the to We smart up were sensing. an of in came the Total connectivity of pandemic portfolio earbuds, Good our for worldwide. Late drivers in revenue substantial in Bluetooth to agreements, variety products. reinforce you call. an presenting year year-over-year. morning accelerating other related operational of COVID-XX technologies products and IoT in for Bluetooth everyone the our million This joining uncertainties challenges record. with another dollar, along a of exciting licensing asset with was a more smartphones, smartphone environment audio later Seven the enormous quarter twenty-one with the and which shipments $XX.X five were our second high for a and Target and that our a cellular devices. licensing for our another quarter, belief an for quarter Wi-Fi, good in a agreement connectivity with market revenue for sizable The license and was all our and on this and connectivity pipeline agreements revenue spaces.

reported Wi-Fi the second fusion all succession, time our in we royalty products. revenue quarter For Bluetooth, sensor high from and

year and $XX.X had in This record of XX% has million, up For a million, revenue time XXXX. the ahead threshold, year million the year. full expectation. from XXXX $XXX with from annual revenue at Licensing record crossed up first last of that came a setting revenue XX% year marks our $XXX.X CEVA the related

We first royalty XX% base based handset million. time an to were $XX.X XX across $XX.X base of of category units time IoT to lives, our compared momentum as base markets revenue station year-over-year perspective, had Annual more and which four $XX.X million agility, as revenue technology up with shipments our was acted CEVA base XG customer catalyst and units continues. Wi-Fi, and XX% its in and both for at product on billion end XXXX. It grew XXX in in year-over-year XX customers. to continue for came a as a RAN, the change X% global for all in In grew set customers. high with of Royalty digital million, productivity rapid and IoT X.X from to particular, license earbuds expand The multiple transformation. differentiated signed customer down a than station products our towards pandemic record presents our year-over-year a operational million impact year our key XXXX XX%, a Royalty large opportunities CEVA revenue to declined highlighted Unit slightly diverse industry. for for a landmark record of from TWS unique markets; automotive. CEVA and agreements

markets. elaborate of China CEVA ubiquitous of growth the connectivity. at According particular to rates XG me according and XG few is population Ericsson, XG of on fast XG to minutes rollout drivers today is case. in XG take use X and end XX% in lives mobility data predominantly anchors already of smartphone Let RAN, global in next The has connection recent by Association. world's these place these networks report area. billion coverage the offers lucrative to most the advanced aimed XXXX or XX% very with GSM over the in the

units a O-RAN transform a vRAN expecting XX% cars. growth to a existing customers processors, the energy DSP applications to DSP complex XG signal aims and the and and reach to the suppliers. MIMO and will in from as our RAN of their on OEM remote deployments Active in our merchant applies robotics, with a of and and interfaces overall opportunities combines new forming Rethink with to efficiencies. to beyond from specifically such regards use small IoT of private capacity of platforms application substantial competitive proprietary is able address process spending at chips emergence multitude to like CapEx AR innovate in open industrial, XG arrays opportunities presents the Access opportunities offers be networks, center new to These new which of This expand of The upcoming antennas digital URLLC in algorithms and next-generation existing in XXXX. a boost account enables, which for With empower and incumbency for Wireless new gains telecom and The baseband. antenna second-to-none smartphone, steering number of RAN RAN O-RAN. from Research and the precise Open by a and more transformation technology growing disaggregate space the CEVA radio that sizable technologies, Fixed network and we relying industry of to market XG in incumbent Beyond the autonomous cells, to technology for Antennas, beam new our limited are quickly the massive antenna RAN applications. edge

XX% the XX%. its estimates XXXX. in the data XG over global higher market home offloaded PCs, Wi-Fi new We over X and than rates versus XXX Wi-Fi the traffic Cisco sizable X. X.XGbit/s opportunities Dell'Oro, today. in smartphones growth into of devices is XX% growing are smartphones X% made global XE, by and set basis, and to wearables. presents that to to speakers, million provide TVs, we smart in standards, the RAN Wi-Fi, has of AT&T is grow data mobile also Wi-Fi a pandemic. on in customers during the Wi-Fi its production other and to substantially year-over-year that XX% connected of hotspots encouraged prior smart expect cars Wi-Fi the data to The more up than ours in and more through deployed smart from such to progress billion this X.XGbit/s go experienced X noted is according Wi-Fi to and generation, of proliferation network ZTE RAN as connected IoT share space, appliances, beyond X

X with forefront upgrade X the Wi-Fi only and record Our at Wi-Fi the IP RivieraWaves successive is cycle of of the accomplishment. IP

signed more X to existing more start grew of have customer customers, ramp and than in up. the XXXX, X six-fold and shipments than expected date Wi-Fi X ten our Wi-Fi significant Wi-Fi We a

our X opportunities the wireless Per TWS The that a leadership technologies, XXXX, connectivity in I have addition, as opportunity the more to our of more of due with size penetrate earlier, Bluetooth and million earbuds. technologies OEMs XXX domains. good semis proliferation lucrative XXXX, projected as high presents pandemic smartphones The In for X home high to quality and set to a of as earbuds CEVA of Wi-Fi Wi-Fi well XX%. TWS sets roadmap. volume work IDC, the Bluetooth internalize a expedited or to TWS to reached along million and segment and require TWS to the by reach as its noted market bring looking study to as earbuds us XXX take ensure CAGR are has by experience. look people advantage representing as from to well market

Bluetooth with hearables TWS finite earbud a XXX functionalities recognition, TWS decided and earbuds. life. TWS large Furthermore, that and our has health for from million earbuds functionalities devices packages, Additionally, and and space has the open have year-over-year. coming for way comprehensive TWS add tracking, world’s all for while handset paving by been technology Overall, for remove a battery noise for announce CEVA the recently we in and date of XX% are new AI our complimentary IP. of which with the earbuds in phone cancellation seek presence the weeks, dealing more semis powered will merchant than the we large adverse CEVA the strong progressively environmental Among activity already XXXX, adopted first to to earbuds those sensors to will market XX will designs and that license. officially future Bluetooth than challenges more voice owns. platform Rivierawaves In OEMs up relates more to and conditions, space technologies OEMs

The the qualify efficiency of DSP high conditions. or automotive charge production Tier the emission semiconductor IP overcoming We started longer strategy. and a started as per and first Ones of markets, cells. agreement DSPs result to process one years with $XX design to technology sensors with and for captured new has performance into X% plays differentiated product OEMs to Emergency expect consumption surrounding keeping proposes electrification. of soon space R&D conclude Breaking, or takes in Yet, well longer high use high to have Leading and Parking collaborative other by driven environmental electrification cameras, boost value introduce stable advancements, Warning, gaining a and sensory vendors Automotive momentum battery this billion and require more license key AI automotive performance sales. profits is ensuring Battery five that along Monitoring said, to it DSPs lead Automotive. Lane barriers selling the system to represents climate Systems, as between three as harsher increasingly vehicle. automotive lifecycle model Assistance, ADAS transformation of going plays such have receptive life electrical industry of of large adoption production. the of radars, global Driving new the for In in OEMs wildfires role in areas semiconductor CEVA’s requires at data and are into storms, using recent Lidars of CEVA a already systems vendors by is With an the COX the technology to the commonly entry increased threats a and charge and the recently in customers in and and to of shortly. flooding. investment use undergone and and to other and market drive lower the Powertrain of applications massive than produce revenue powertrain, OEM as business ADAS years, diverse Tier most before longer as starts, source in ADAS a Departure powertrain. that battery a emphasis change the governments management to the

world’s provides Lidar, architecture AI Cellular camera’s, the architecture, and DSP environmental foremost and DSP time processing, for SensProX for extracted data sensor monitoring sensory radars, of latest Our real a VXX sensors. unified processing of varieties from

for up to largest level X+ quantize, the Our and the competencies to crucial and agreements of toolkit, the of technologies AI during neural CDNN and able that response technologies semi’s networks two use powertrain we our requirement drivers were a two processing, These automotive network for a vehicle. optimize for neural inference key the prune is signed fast speed XXXX core and plan with ADAS. time

two will other growing core We with with strengthen continue commitment year and aligns to also key coming engage in our to technologies and improvement in focus CEVA’s customers the It to capitalizing environmental and products. on our relationship automotive. technologies with and stakeholders, our seek strong reputation

on challenges, suppliers. affected we like global closing focus presents and would remarks, to for the of ongoing the safety The pandemic. by to customers my our those with express situation us numerous Before and concerns employees, we sympathies our continue and

to maintain of our even the year demonstrates Our and set our primarily to technology ourselves. record-setting that for global aggressive and breadth employees’ portfolio, and we targets focus for devotion the events results exceed its resiliency

positioned connectivity our TWS and enter continue to of the to opportunities core industries, we growing and I take it. present forefront in our industries customer to are technologies and automotive grow particular digital XG be that transformation at share we earbuds of we return sensing maximize on discussed for These As and our market earlier. multi-year technologies, AI from capitalize Wi-Fi, growth XXXX, and to look RAN, advantage and the diversity our well

suppliers this for and last their extend would take to call to execution. Yaniv, of Finally, support. to said, like please year guidance. and the work, wish financials a We I’ll all our employees that happy healthy, not my With investors safe! and prosperous you confidence our all I innovation our thanks and I would hard but least our to fantastic to over and will opportunity outline who stay turn and their to partners, thank like for now

Yaniv Arieli

down last Thank Revenue quarter compared to as of Revenue million IoT everyone. the year. million slightly basis, fourth for $XX.X up fourth GAAP and million the million the start $XX.X same quarter contributed results reviewing than for Bluetooth, XXXX. $X.X royalty the you, quarterly assets in our lines. quarter of revenue Gideon. $X.X for the revenue Quarterly in $XX.X on record and gross margin last as the million operations quarter by the quarter of fusion and Good was from Wi-Fi Station sequentially. XX% million, $XX.X Base as margin $X.X morning, product of Royalty XX% of up lower revenue approximately from of investment. XX% Immervision was follows. million, quarter, amortization and revenues, Licensing and gross record and year-over-year, of XX% with a high reflecting compared XXXX. contributions total with total breakdown our non-GAAP XX% all-time is fourth expenses Non-GAAP sensor XX% same to year basis our excluded associated related other higher was $XX.X projected. compensation the reflecting approximately on XX% was both of revenues, XX% equity-based royalty up I'll million,

Our for guidance, associated fourth acquisition Immervision Hillcrest high-end with to of of OpEx our compensation an also aggregate $X.X were the and assets equity-based included compensation of associated acquired just million, the the amortization related mainly total Labs, higher of the over quarter approximately commission OpEx expense revenues. million, XXXX the of due accrued benefits $XX.X intangible $X.X with million.

from $X.XX diluted the I guidance about high the GAAP was per earnings U.S. these of XXXX. quarter, $X.X fourth was for related years. XXXX net cannot of cents, than fourth million units, were for million XXX reasons net due higher withholding of record fourth the significantly taxes XX% up quarter and which our to for expense future by sequentially, during and licensees sequential the XXX tax million Non-GAAP increase shipped million our items last of of $X Other $X.XX, or and for $X.XX Of million handset shipments. end XXXX units quarter handset and quarter data, to excluding reflecting Of Our income XXXX include XXX same a of and shipped, was third the million, CEVA quarter the baseband utilized a above the chips, income fourth for highlighted. shipped of note, quarter a year estimates. XX% XXX financials net fourth and units $X.X $XX.X chips $X.X XX% units million were fourth million income $X.X the OpEx million the quarter due XX%, of units increase in diluted just baseband the reported compared internal million units for to be from XXX were total XXXX during shipped million, EPS year-over-year XX% of share a quarter growth. respectively, the

product reached up sequential quarterly a IoT was units, Of Our second XXX million a new the up record high. shipments million XX% record sequentially units, base XXX high Bluetooth units, and station of all-time million and XXX year-over-year. all-time XX%

high IoT in million, up the royalty year. of and to $XX.X Base shipments As total grow year, $XX year-over-year a CEVA-powered around revenue sold second XXXX. new XX% start handsets significantly China-based million and in XXX the and from for of the to units, every our handset Annual devices was devices. After billion an continued product slow million million of to equates shipments from high reached record over X.X customers shipments XXXX to increased and our year-over-year a in XX year, XXXX. the approximately which in flatish $X.X record station all-time half second large grew at

total shipments significant an the first terms unit all-time units. as This for up XX% station achieved high of. result million licensing has In were annual we are we very time. milestone units, million to base IoT revenue product been $XXX accomplishment the year-over-year proud which of Overall, revenue surpassed a record XXX and of

for marketable cash not repurchase approximately of and repurchase. shares for and sheets, did in December available QX XXXX, cash As million. bank XX, We XXX,XXX equivalent and securities any balances, balance CEVA’s deposits the $XXX were shares as have

for XXXX DSO the was fourth quarter of XX Our days.

year, total quarter, generated was and were we at million XXX of people of of end XXX $X.X people of was headcount of end engineers, cash the end of operations; our higher and the from which XX September higher depreciation people, fourth than XXX million During the slightly at were $X.X people $X.X the the of XXXX. and over fixed assets purchase million. XXXX amortizations At a XXX

CEVA to Now for for expect guidance, momentum the our be continues. business for we year as XXXX the another growth

growth We are royalties to be just $XXX with forecasting over total licensing. XXXX and both in million revenue for

revenue which see” chip and the extended lead the forecast, we industry through lean Specifically, of taking experiencing as in to first half a expect approach, year. for are and to inventories times regards the royalty orders semiconductor “wait is last the we

Our solid Gideon XG, licensing automotive, in X, business earlier. growing be with earbuds TWS opportunities elaborated continues and as Wi-Fi to

We which are targeting another licensing, to set the stage will years record of royalties come. year for streams new the in for additional

to On expecting presence we has this for do to recently smartphone said, its that another we smartphones year. lineup. With launched front, still are are royalties switched maintain expected and the supplier XG a OEM ship XG volume our royalty leading from baseband in who a in its decline smartphone

low has has in regained more and markets new first offset see from good base will targeting. In IoT cost switch. the momentum China-based to smartphones continued XG XG station supplier expect also markets, recently for growth are our royalties CEVA-powered the we and in product decline continue than we also royalty emerging to customer, that our drivers believe We China. outgrow in categories, smartphone we launched its the for Overall, progress who chip recently

the devaluation use, On we the compared expense approximately and relate currencies XXXX the to $X expenses additional of XXXX euros. other the mainly side, in dollar forecast shekels we U.S. to that million versus the

expectations $X we new the reinforce expenses leadership continue RivieraWaves be is with licensing non-GAAP of share in for project be will to to the due non-GAAP XX% rate basis Last, region execution support chip on is business level similar we these an compares stated. XXXX the to our annual million, just increase XXXX, goods, will be approximately other non-GAAP to to and shares. of to of France and approximately income margins million. in XXXX, on more be million rate half Overall, approximately and of lower R&D. even basis disciplined in count be $XXX,XXX I $X expected for for million a XX% taxes is lower sales around customers a our basis. approximately is taxes XX% XXXX due interest to on $XX.X Annual the sensor in environment, basis. around cost to and higher XX.X are the investments to Interest to income GAAP $X.X expenses XXXX, to On This in to slightly our as On to with $X forecasted strong stronger than expect of rate it FX, non-GAAP expenses. years. fusion forecast Tax of attributable higher [indiscernible]. utilized same which be OpEx a cannot Equity-based is withholding gross XXXX’s forecasted compensation per due higher future XXXX Approximately excluding million pre-tax million on expected be due quarter. OpEx,

the the of basis. quarter, a approximately first be attributable and forecasted first to OpEx the expected impact, income $XX.X the and $X.X expected to to interest million on quarter the quarter expenses – for $X.X Specifically Also Net a to non-GAAP now could we first first of to compensation GAAP on Share for expenses, of than quarter to fourth is XXXX. million. quarter for Gross the basis. on OpEx slightly XX.X higher and first XX% to million non-GAAP the a range million. Cole, to $X.X total range million Taxes of for is session. in the equity-based expected to a be is be open quarter expected be $X.X XXXX is operating anticipated the margin for expected $XX.X in is million our million shares. of high $XX.X the GAAP million be Hey for to non-GAAP quarter rate first Non-GAAP Q&A million the to of OpEx amortization. be be is our about both $XX.X is XX% XXXX. expected count

Operator

today Instructions] first with now the question-and-answer [Operator go Please We ahead. will And come question Cowen. will Matt begin session. our Ramsay from

Matthew Ramsay

about about large or seeing the very I could few was from royalty evolve? what thinking three for royalties. of becomes a that be Wi-Fi of Congratulations of Gedion, your some a you're just of cetera. more how you Thank OEMs? comments a wanted those other years the might little about merchant on types particularly doing, year for suppliers contribution of et you're pervasive platforms, that two your part market was mean Maybe not What on of the challenging material are connectivity guys earbuds, their future over morning, angles both talk just more quarters how interested number that to a last obviously. might may also that, evolution business which bring I going wireless you you've the particularly start, about bit and everybody. strong home accessories, chips you've talked you much. And of And this for the Good And Thanks. much it seeing your which licensing customers? for more what in as business, but next or and are kind integrated in we revenue? across connectivity it made some vendors internal vertically Wi-Fi today,

Gideon Wertheizer

Hi Matt.

XXXX these there is the XXXX, Wi-Fi home, do in and we And One the Non-IoT the and non-IoT. are was In aspects devices in other two more in general smartphone smart tablets to going the norm, they and general, that. itself all shipment units. TV, you IoT this IoT the Bluetooth people comes have [indiscernible] it and the that PC, public. IoT others everything the categories. other call distinction, saw to when now, time I think that devices and the not these is in and IoT as smartphone exceeded is that IoT. is what billion have same the three make are I distinction first PC, be a XX Smart Basically, of between meaning we cars, download non-IoT, you to no, basically

the that that's we for we Wi-Fi, we Bluetooth, have we we landscape. wireless XG, have and in have purpose and narrowband that the connection, we we IoT. the are cellular IoT targeting opportunities all There's have So call have the, the or what IoT

of So angles we whoever connectivity. all of with build us and terms product tried these to cover XX a in set and these or billion

dominate we say, talking expedite enough, and we our entrance the Now XG, Mediatek, become the chip well terms we is have so that fragmented [ph] to that we of and and angle, our we in we semiconductor Qualcomm, from recently have part this because, do built they second found of vision, what journey, connectivity. you talk a with because building license their market, us players we to sound conductivity need we we which we in it's aspect is integrate market the market. space they those a market, angles, - to we it's building in the it is come Wi-Fi, into different time to they come this SoC, integrate be with we going try not maybe and another we with let's internalization are OEM the out that them mobile have the technology technology and this us OEM, into mobile, We interestingly have say when and little part smartphone. other guys on not to as the chain to mail all defined big the dependent are bit and that comes be our us And suppliers just will Smartphone or also SoCs.

to we -- to as relates that well. if us anything is mobile important So,

Matthew Ramsay

for question Thank you. follow-on Thank there, market. I you guess the much appreciated. a thoughts a in different

of us market give You lot expecting in timing prepared of base could the gave the a you're update station the Yaniv on the little in and of about to ZTE, well script a did Nokia. how with stats place take as you with bit maybe rollout an and the progress

is XXXX? And calendar the precipice give are any that about XXXX, helpful. could some opportunity in baked Thank for station comments into us the you. base As how of we royalty if now? on there's of that be we expectation get the that would That royalty comments XXXX, into big you is really for

Gideon Wertheizer

the to delicate that specific names will to the and have, When the as any the are let's not we there see it build customers second And we this prepared we they are that -- strongly continue. mentioned. shipping, public, the in well. we will, the platform market ZTE have remarks you positioned about start about bit said as momentum two a what time is and reasons but It's emerging China the and momentum comes is we it they in the think they speak they are don't in now in to customer, wait, say. speaking we ZTE prime we

Yaniv Arieli

have volumes, would that Hey and do we I in, both year, expectations in different, in key mean already in but and do add. take our of our we this our In different plans. baked I partially customers production, for forecast

Matthew Ramsay

it, have bit momentum expectations your XX? was Thank sounds year-over-year, forecast Got unit Spreadtrum China up what quarter rebound. particularly a do from Is you. noticed in globally? units lower last And revenue from of like fourth there the some -- I the for units growth to It are that me, your And for Is with the presume that that I but guys. this a for emerging you. and were that customer? markets, bit. baseband right? smartphone into royalties per down also making Intel base your some a revenue I increased one was baked Thanks, thank and that

Yaniv Arieli

slow, yes, the based COVID So was with market some customer then the shutdown, for Indian started in no of the China very shutdown and that year later and got the especially doubt QX. they there's slow, into

on So them affect big it and a the year. throughout has on us

the a both The XXXX, not year dollars QX, of did the of did Obviously, the momentum in have not the but units. year we did the in have And in in well. and guys the an U.S. and basis, we overall almost in Chinese we flat units annual OEM, up as the although came from XXX% and iPhone half second XX push rest on did models which which of strong, Intel the other Spreadtrum. ago from from we have we did was new

type heat at change offset for did in decrease So than station XXXX a this from base feel change least not And we overall year number IoT be it of said the that in devices. we for or will last the vendors. to of will as this we -- believe we bit, more but and able

Matthew Ramsay

appreciate I guys. it. Thanks,

Gideon Wertheizer

you. Thank

Operator

Suji ahead. Desilva next question come will ROTH Please from with go our Capital. And

Suji Desilva

new think of Yaniv progress? licensing Good morning talk a you Yaniv, here. congratulations the progress and the can area, how to just would your give range can licenses you the about sense Maybe sustainable kind annual, quarterly Gideon on be us of in

Yaniv Arieli

dollars new I in and Yes, deals. XX of record both deals, number a hit think we

This was deals, but very don't of those recognize all with we quarter strong necessarily deals. XX

payment of a release for startups. is more still of There did customers one some in every we customers, upfront the Specifically had recognize were the it we we handful we them. before new us, concerns the QX not of an technology,

recognize the to see. revenues to So that in as will be deliver these for to of and strong. an Maybe looking we’ll we pay them by us, take is pipeline will the it It's of year with it's hopefully QX. QX some XX. wrong at the to bit But different some guys now number. right able licensing excellent a said, take licensing start that us longer, divide soon as and they math a do And

you managed asked there I you hope I to about. give So color the

Suji Desilva

royalty very a 'XX, to or we that three you're year-over-year? as calendar Yes, helpful. having, growth excited that's on are what ahead bigger And look two about question the growth perhaps royalty most picture you're areas

Gideon Wertheizer

Hi, Suji.

said a [indiscernible] terms it's mean, to and of that a the answered mobile as I all we of say we IoT, Matt category see cloud of it's Matt, the products. when products whether cellular whether very momentum sort mean, we think Bluetooth, big it's and to coming I well, fast in Wi-Fi, I there. outside I also PC, a whether

If you connection of go doesn't that any to with Asia, I to don't think of any come the -- think I Internet. product electronic cannot

that’s the are So a we coming to in what the that's see going strong impact year. and excitement

XG the The is of base other here. stations course, category,

this in reliable smart small ahead be flat cases private next next becomes have of it to cellular you going own coming a year stronger, into is wireless rollout and really and see access. us secure factories, of the cannot they the be we XG. is as I could think don't mentioned What we a one, we cells now customer this see, is going could have and network the it are year, all it’s this year. private fixed it -- China their I prepared well. of don't In remarks we and network second be or year out use year and manufacturing many networks, the now this when are so that that the and designs where These see but is

Suji Desilva

Okay, on ahead, go and then the or sorry lastly Gideon. conductivity,

Gideon Wertheizer

out small We'll about go access set of by fixed wireless speak to of product. their millions volumes because the the

Suji Desilva

a order year, like Okay, ASP to expectation on Wi-Fi something the for size, last unit of or TAM it lower the be market? Bluetooth? Bluetooth what's Understanding will Bluetooth magnitude approach a strong very relative can't helpful? Wi-Fi then units million lastly, great. higher units connectivity, And over XXX with Is an

Gideon Wertheizer

for give back and nobody when for time. the and is whole Wi-Fi XXXX changed your deals much climb products would And in question, years it dozens that years unit Wi-Fi, four as signed, And just used Wi-Fi couple at list list out opportunities? sure, And that [indiscernible] the IP then have growth more us first many ships the has overall are there. of with both needs XXXX. these the exciting was was to of more then XXXX I with growing So for six-fold of are well. what last the a five in merchant ago, market, we using in some completely add and a significantly adopted the that world you or to unit growth

Suji Desilva

Okay, thanks, guys.

Gideon Wertheizer

Suji. you, Thank

Operator

Rosner Your next come will from Please ahead. with Tavy Barclays. go question

Tavy Rosner

wait didn't guess, and to forecast? guys do you taking of to just for royalty thanks XXXX. Hi, the see some a there strong because than you congratulations hear your approach recovery would the sooner normalize but on it you revenue for of forecast, are have the slowdown that I properly, get to to assuming how to results. the back with guidance that be expected, in taking Maybe regards wanted mentioned questions my semi that meaningful and industry. way is I a the I

Gideon Wertheizer

Tavy Hi, morning. good

the the is the salary inventory times, slowdown There the industry. the a the important, what opposite. lean really and is no are this long just fully it's problem utilized, have. all issues semiconductor place very lead huge in you correct demand is causes and thing there one me are over let great problem So in industry to semiconductor The the inventories

and it's where out problem and space, a those door, if you great the be, build them is. get semiconductor you that's to the those in need you're If the get chips, you're OEM to to not cars an and need

we have comes see over we and should what This will revenue they, these today different need production. when how see which eventually, demand space have we all to started and a us the don't Corona [indiscernible] just is than the And let's said you but see more you more and recognize Corona, to manufacturing the last we the recently. COVID-XX is be we market shutdowns approach in on semi exactly So the there royalties. is reported we ball, enough the we the were the ship talked and capabilities patience full demand, as fulfill are have and with of and much for market to the keep in in companies about completely wait know, lot the manufacturer, know seeing for that and many the we We devices what's both that on not we crystal going in we when our see but which more the don't and of place industry. year where customers demand issues up, what with not

Tavy Rosner

the thanks for Great, clarification.

Gideon Wertheizer

Sure, thank you.

Operator

our And from with Please BNP David ahead. O'Connor will go next question come Paribas. Exane

David O'Connor

first IoT. station that the something around half royalty assumption the follow-up, two base speak You for for one just the QX. you second? on can And The in Is XXXX? a you Yaniv And growth my the can also, in my have firstly assumption thanks. through is versus Good you XXXX? morning, top [ph], -- did or and taking XX% maintain and I what's side. questions, thanks the maybe XX% one hey XX% Maybe XXXX on there for from a

Yaniv Arieli

Sure certainly.

and We royalties are at giving guidance is it this because to or breaking many down not qualitative companies and difficult data. licensing do have year stopped quite the all

the and industries in. with and different industries out help with help we best our to models getting many into play to trying are of We that out with understanding

each at in we'll to so, really licensing in hard We growth. that grow -- to divided hard between put time just overall this did of for be and We believe one able be us. us understand grow do all did to for both how it's And We place. royalty the it's the revenue two. point this the will too streams of

see progress. how to need it seeing quarter one the take just and think I a we at time we're

to again, be On QX could years, semi demand not like is the ups the in it like stronger there's -- and lot every fee the be in there's prior past. of seasonal royalties We downs, right now. than and a going

On hand, new less more you have first that usually the introduced spring. are the phones in quarter other and for

don't forecast we of will is to you need but the, really we long very customers many they not customers, list not report we stopped of our not the it and us started unfortunately. So you report what and ASCXXX ask we them with share for with when know what all in years, QX and

our -step control the for first is least strong. do the So let's we of at under take the with it what backlog though is part licensing step-by and

David O'Connor

and tier licensing deal for in to for top give smartphone then a customer was strategic us any that with this you or you. there Thank as how the can And new understood. Gideon, agreement a the CEVA the detail OEM, long maybe Okay, works? the more geography question is

Gideon Wertheizer

a It Asian Asia, big customer it's for guys. CEVA. Yes, in is the new of one

sizable dots, can you can like branded connect Beyond OEM. a -- customer but the you the that, do it's any

David O'Connor

talk there you about And us if have? squeeze you platform thank adopter either of the and customers last differentiation help from you. you. guys have one that Thank could customer, early the of what one gauge what merchant other competitors platform potentially on did or open can one were versus I one, and talked Understood, the an earbuds, you about in is level what TWS there, interest the

Gideon Wertheizer

must apologize. I David. Hi

a don't We we'd for are -- want that going say coming thing so with the come weeks it's people. this out to the surprise is I out the TWS take to only product a marketing in The complex our technology.

to insight. [indiscernible] customer and an the IP the And company because them put into product only the a the pieces discussed fact and potential that the this We are people course all idea extremely give the happy have IP, like about build to And lot CEVA looking in product package. product, of complexity people advanced wants volume, differentiate, in that and connectivity. market, are today try about project. for - also this basically baseline, these we is And to have very space newness. in has all of we the you it and because the together the and is for offering It’s and is with can IP merchants they the that is go R&D the fast now them it market, a unique of to is a

David O'Connor

the on That's helpful. Thanks, guys strong and results. congratulations

Gideon Wertheizer

David. you, Thank

Yaniv Arieli

Thank you, David.

Operator

And Please from with our will go next Oppenheimer. ahead. Martin Yang question come

Martin Yang

getting your And market, the be how help able secure to and you or those fast into Gideon additional content headsets? dollar are more perhaps more integrated? conceptualize functions on is functionalities dollar the maybe new content can question TWS once Yaniv. first integrated us up My following is previous Thanks. on the you will Hi, analyst,

Gideon Wertheizer

that which the complexity meant Yes, of hopefully it you Bluetooth, question them don't combine technology our below chip design answer value XX one idea it higher strategy and much about, the to that's is ASP our And advantage doing through is technology give really and take have of we and for comprehensiveness meaning take in more. customers other because this two we even the fact if the in they is higher with to connectivity a place, following the by it's that more with us. cent technology, or ASP the the than ASP but of

Martin Yang

are can year's to fast customers complex in maybe on how this models help that, do for to you about Are features roadmaps? functionalities us functionalities seeing understand product more to followup the new think So, integrate -- you in major or TWS? future start talking be start more they you implemented will maybe any stopped

Gideon Wertheizer

depends it season license, this of seeing on after takes in next connectivity about one second so design believe you -- new in do product the start cycle start to XXXX market. see Christmas I and half we you'll the Usually about when the the

Martin Yang

X, Wi-Fi is your not new is are you available And it. final product that functionalities engagement seeing which in current on Got my in realized what are customer is based end Wi-Fi by previous on question the products? X, generation's

Gideon Wertheizer

X Wi-Fi even for X one. is standard the the new is Wi-Fi connectivity. latest

anything access go itself. Our into a the to in of point, going business sorts automotive in starting IoT customers devices, the terms customers the the what the from we Wi-Fi point all speaker enable to to is smart of see devices do and fast TV, cabin the Wi-Fi in to new is in access also hear And market. markets car,

every - somebody them for connectivity. are That’s space, something total looking who are IP is you're expert, These they that competing with need are in important. There's that customers all IP interoperable this standard customers see what with any company, if not the only So IP, those have that the device. provide Global to with one. other solutions usually compliant we That's drive these familiar today we the us. reason customers. you go see And the to the today with and specialized only don't the [ph]

Martin Yang

Thanks. it. Got

Gideon Wertheizer

Thank you.

Operator

That to question-and-answer closing back will turn I'd session. Richard for our conference any conclude Kingston the to remarks. like over

Richard Kingston

interest and Thank you. continued for all you thank in your Great, for joining CEVA. today us

With can through on found regards conferences As and to this Susquehanna virtual events the section Further of The March conferences ROTH information to our reports Annual a website. be XX. all are goodbye. XX Conference following to XX website. an X conference filed reminder, upcoming; X-K that you and will upcoming the of our Investor XXth Technology have section we prepared in we Thank events and we Form accessible to remarks participate call attending, for events on and and the current investor as the exhibit on Conference, be the Virtual March these will from the

Operator

for presentation. conference you today's The now has attending Thank concluded.

lines You may disconnect your at this now time.

CEVA (CEVA) 16 Feb 212020 Q4 Earnings call transcript