Ceva Q2 2025 Earnings Call Transcript

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Provided by Quartr
August 11, 2025

Key Takeaways

  • Positive Sentiment: CEVA secured 13 license agreements, including four strategic edge AI NPU deals (two NPU Nano, two NPU M), marking its pivot into the broad adoption phase for its AI portfolio.
  • Positive Sentiment: Royalties rebounded sequentially by 16% driven by increased consumer and smartphone shipments, with further growth expected through the holiday season and share gains at a leading US handset OEM.
  • Positive Sentiment: CEVA reached a milestone of over 20 billion CEVA-powered device shipments, joining an elite group of IP companies and underscoring its leadership heading into the smart edge era.
  • Negative Sentiment: Second‐quarter revenue declined 10% year‐over‐year to $25.7 million, with a GAAP operating loss of $4.5 million (versus $0.035 million last year) and compressed margins reflecting ongoing investment costs.
  • Positive Sentiment: Automotive momentum strengthened with licensing deals including support for Qualcomm’s Snapdragon digital chassis V2X solution and a sensor‐fusion DSP for a 4D radar platform, positioning CEVA for meaningful long‐term royalties.
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Earnings Conference Call
Ceva Q2 2025
00:00 / 00:00

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Operator

Good morning, and welcome to the CEVA, Inc. Second Quarter twenty twenty five Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note, today's event is being recorded.

Operator

I'd now like to turn the conference over to Richard Gorsuch, Vice President, Market Intelligence, Investor and Public Relations. Please go ahead.

Richard Kingston
Richard Kingston
VP - Market Intelligence, Investor & Public Relations at CEVA

Thank you, Rocco. Good morning, everyone, and welcome to CEVA's Second Quarter twenty twenty five Earnings Conference Call. Joining me today on the call are Amir Panouche, Chief Executive Officer and Yaniv Arieli, Chief Financial Officer of CEVA. Before handing over to Amir, I would like to remind everyone that today's discussion contains forward looking statements that involve risks and uncertainties as well as assumptions that if they materialize or prove incorrect, could cause the results of CEVA to differ materially from those expressed or implied by such forward looking statements and assumptions. Forward looking statements include statements regarding our strategy and growth opportunities, including with respect to expanding our NPU business into infrastructure and data center markets market positioning trends and dynamics, including with respect to increasing importance of AI and integration of our AI into consumers' products into our customers' products expectations regarding demand for and benefits of our technologies and revenues and our financial goals and guidance regarding future performance.

Richard Kingston
Richard Kingston
VP - Market Intelligence, Investor & Public Relations at CEVA

CEVA assumes no obligation to update any forward looking statements or information which speak as of their respective dates. We will also be discussing certain non GAAP financial measures, which we believe provide a more meaningful analysis of our core operating results and comparison of quarterly results. A reconciliation of non GAAP financial measures is included in the earnings release we issued this morning and in the SEC filings section of our Investor Relations website. With that said, I'd like to turn the call over to Amir, who will review our business performance for the quarter and provide some insights into our ongoing business. Amir?

Amir Panush
Amir Panush
CEO & Director at CEVA

Thank you, Richard, and good morning, everyone. This quarter was marked by strong licensing execution across all our core offering pillars: Connect, Sense and Infer. We secured 13 license agreements, including five first time customers and four OEM customers, highlighting the the breadth and strength of our IP portfolio. We saw a healthy sequential rebound in our royalty business driven by increased shipments from our consumers and smartphones customers. In licensing, this this quarter marked by a pivotal moment for our AI business as we entered the broad adoption phase for our edge AI NPUs.

Amir Panush
Amir Panush
CEO & Director at CEVA

Following extensive evaluations with leading customers, we secured four strategic high impact NPU customer agreements, validating the market's readiness and our innovative market leading NPU portfolio. This includes two Nupo Nano deals related to audio in embedded applications and two Nupo M deals targeting two diverse use cases. AI is increasingly central to the next generation audio experiences. In earbuds and hearing aids, it enables adaptive noise cancellation and personal personalized sound profiles. In smart speakers, it powers far field voice recognition and context aware processing.

Amir Panush
Amir Panush
CEO & Director at CEVA

And in smartwatches, it expands voice commands and helps diagnose diagnosis capabilities. These are just a few of the powerful capabilities that on device AI can enable in the smallest, most power constrained devices, which is why a broad base of our customers are integrating AI into their products. One of the Newport News. Nano agreements was signed with an existing high volume connectivity customer expanding into AI powered audio, reflecting the growing growing trends of customers integrating multiple SiIva IPs into a single chip. This approach boosts product capabilities, enhances deal economics, and increases royalty per device.

Amir Panush
Amir Panush
CEO & Director at CEVA

It also marks the second major connectivity customer to adapt our HIAi NPUs in recent quarters, reinforcing our strategy of deepening relationships through multiple IP agreements. We also signed a new n p a NPU agreements with Ali Corporation, a leader in set top boxes chipsets, to integrate Nupo Nano and UPO M into their next generation video platforms. As AI becomes essential in set top boxes and smart displays, our NPUs offer scalable, energy efficient performance for advanced edge workloads. Another key deal was with a photonic computing company developing a next generation communication acceleration platform for cloud AI inference. Their high throughput, low latency systems require scalable NPUs, and our new PoM paired with our AI software stack was selected for its ability to deliver multi core performance within tight silicon and power constraints.

Amir Panush
Amir Panush
CEO & Director at CEVA

As AI workloads grow more complex, traditional infrastructures faces pressure to improve performance and efficiency. Our new POEM architecture is designed to address these challenges, enabling intelligent workloads, orchestration, adaptive data routing, and low latency inference. We see significant opportunities to expand our NPU business into infrastructure and data centers markets. In automotive, we secured two strategic agreements this quarter. One was a licensing deal with Qualcomm following their acquisition of Autotox, a longtime CEVA customer.

Amir Panush
Amir Panush
CEO & Director at CEVA

Our DSPs are integral to to our Autotox v two x solutions, now part of Qualcomm's Snapdragon digital chassis, supporting global v two x rollouts. With Autotox already in volume production, this collaboration is poised to accelerate global v two x rollouts while reinforcing CEVA leadership in next generation automotive connectivity. The second deal involves our sensor fusion DSP for a US customer developing next generation four d radar platform, which is gaining traction in ADAS and autonomous vehicles. Our automotive momentum continues to build. In q two, a leading semiconductor began production of level two, three SoCs using our vision DSPs and AI accelerators.

Amir Panush
Amir Panush
CEO & Director at CEVA

And another top tier customer is set to begin production on a CEVA powered platform. These wins, along with the new Pro M design win at Next Chip and several others, position us for meaningful long term royalty streams in automotive. Now turning to royalties. We saw good sequential growth across most of our markets, with royalties up 16% sequentially. On a year over year basis, royalty declined by 5%, mainly an attribute attribute to the lackluster smartphone sales at the lower end of the market, where widespread softness has been reported by our peers and which we also experience.

Amir Panush
Amir Panush
CEO & Director at CEVA

With regards to the higher end of the smartphone market, our share is expected to grow at a leading US OEM using our technology in their in house five g modem. Outside of mobile, our consumer IoT customers showed strong sequential and year over year growth in shipments, driven by record high cellular IoT and Wi Fi six shipments. Overall, consumer IoT shipments were up 21 sequentially and 60% year over year. We expect that the sequential growth in royalty will continue throughout the rest of the year as our customers build towards the holiday season and our share growth at our US OEM smartphone customer. Last week, we also announced a major milestone, over 20,000,000,000 CEVA powered devices shipped.

Amir Panush
Amir Panush
CEO & Director at CEVA

This achievement places us among a very small and select group of elite IP companies alongside the likes of ARM Holdings to reach this scale. It reflects our position as a fund fundamental technology leader in the mobile and IoT eras and positions us strongly for the smart edge era now underway. Our broad IP portfolio across Connect, Sense, and Infer is increasingly sought after, as reflected in both our licensing and royalty performance. With AI now contributing meaningfully to licensing revenue, we are well positioned to become the NPUIP of choice across the semiconductor industry. The trust we have built over the past two decades give us a strong platform to scale our AI business and deepen our role as a strategic partner to the world's leading chipmakers.

Amir Panush
Amir Panush
CEO & Director at CEVA

We view the 20,000,000,000 shipments milestone not as a finish line, but as a launchpad for CEVA's next chapter, becoming the trusted IP powerhouse of Smart Edge Era and delivering long term value for our shareholders. I will now hand the call over to Yaniv for the financials.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Thank you, Amir. I'll now start reviewing the results of our operations for the 2025. Revenue for the second quarter was $25,700,000 down 10% compared to $28,400,000 for the same quarter last year. The revenue breakdown is as follows. Licensing and related revenue totaled $15,000,000 representing 59% of our total revenue for the quarter.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

This reflects a 13% year over year decline, primarily due to the catch up in licensing revenue recognized in the 2024 following a slip in the first quarter of last year. Licensing revenue for the 2025 reached $30,100,000 a 5% increase compared to $28,700,000 for the same period in 2024. This growth reflects the strength and stability of our expanded IP portfolio, the growth opportunity in AI licensing, and the solid execution by our global sales organization. Royalty revenue for the quarter was $10,700,000 reflecting 41% of total revenues, 16% sequential increase, but a 5% decrease year over year. 2025 royalty revenue totaled $19,900,000 compared to $21,800,000 in 2024.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

The year over year decrease reflects a slower start in the handset market during the 2025. However, we anticipate sequential growth in the second half of the year with particularly strong momentum in the fourth quarter. Gross margins came in line with guidance, 86% on GAAP and 87% on non GAAP basis, compared to 9091% on GAAP and non GAAP respectively a year ago. Total GAAP operating expenses for the second quarter were $26,600,000 above the high end of our guidance, due mainly to higher employee related benefit provision after a slower first quarter results and associated adjustments. We're also continuing to build on our strategic investments in AI, strengthening our leadership position and fueling future growth.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Total non GAAP operating expenses for the second quarter, excluding equity based compensation expenses, amortization of intangibles and related acquisition costs were $21,600,000 also just above the high end of our guidance for the same reasons I just mentioned. Non GAAP operating margins and income were 3% of revenue and $800,000 Operating margins of 15% and operating income of $4,400,000 were recorded in the second quarter of last year respectively. GAAP operating loss for the second quarter was $4,500,000 as compared to GAAP operating loss of $35,000 for the same period last year. GAAP and non GAAP taxes were $1,100,000 just below our guidance and affected by the geographies of deals signed. GAAP net loss for the second quarter was $3,700,000 and diluted loss per share was $0.15 as compared to a net loss of $300,000 and diluted loss per share of $01 for the same period last year.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Non GAAP net income and diluted income per share for the '25 was 1,800,000.0 and $07 respectively, better than forecasted. In the same period last year, net income was 4,200,000.0 and diluted net income per share was $0.17 With respect to other related data, shipped units by CEVA's licensees during the 2025 were four eighty eight million units, up 16% sequentially and up 6% from the second quarter twenty twenty four reported shipments. Of the four eighty eight million units reported, 55,000,000 units or 11 were for mobile handset modems. Four zero nine million units were for consumer IoT markets, up 16% from three fifty three million units in the '24. 24,000,000 units were for industrial IoT markets, 16% from 28,000,000 units in the second quarter of last year.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Bluetooth shipments were two fifty four million units in the quarter, down 5% from two sixty six million in the '24. Cellular IoT shipments were all time record high at 66,000,000 units, up 66% year over year. WiFi shipments were 62,000,000 units, up 80% from 35,000,000 units a year ago. WiFi six shipments reached a new record high and were up 113% year over year as we continue our WiFi six customer ramp up in the consumer and industrial markets. Overall, good sequential growth in royalties and shipments in many of our customer end markets.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

While softness was evident in the smartphone and some areas of industrial. As for the balance sheet items, as of the June, CEVA's cash, cash equivalent balances, marketable securities and bank deposits were approximately $157,000,000 In the second quarter this year, we were more active on our buyback program and repurchased 300,000 shares for approximately $6,200,000 As of today, around 7 and $2,025,000 shares are still available for repurchase under the repurchase program as expanded in November. Our DSOs for the second quarter were forty two days, lower than the norm and lower than prior quarters. During the second quarter, we generated $1,200,000 of cash from operation activities, ongoing depreciation and amortization was $1,100,000 and the purchase of fixed assets were $700,000 At the end of the second quarter, our headcount was four thirty five people of whom three fifty four are engineers. Now for the guidance.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Our licensing pipeline and potential deal flow, especially around Edge AI prospects, look healthy entering into the third quarter and second half of the year. We have demonstrated strong licensing execution in 2025, notably achieving five sequential quarters with about $15,000,000 or above in licensing revenue. Royalty revenue historically are stronger in the second half of the year due to seasonality, and new product deployment as shipment ramps ahead of the holiday season. We're encouraged by the strength of many of our customers and end market demand, particularly around our Cellular IoT and Wi Fi six product lines. We also anticipate growth in smartphone royalties in the second half of the year, driven by share gains at a U.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

S. OEM smartphone customer using our technology for their in house five gs modem. Such, we're maintaining our overall revenue guidance growth as discussed in the prior earnings call. We continue with our long term investments in AI and other new technologies to enrich our IP portfolio along with continued focus on expenses. We reiterate our belief that we will reach a double digit percentage increase of non GAAP, non net income and fully diluted non GAAP EPS relatively to 2024.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

As for the third quarter, total revenue is expected to be between $26,000,000 to $30,000,000 Gross margin is expected to be 1% higher than the second quarter, approximately 87% on GAAP basis and 88% on non GAAP basis. Excluding an aggregate of $200,000 of equity based compensation expenses and 100,000.0 amortization of acquired intangibles. GAAP OpEx is expected to be at a similar level to the second quarter in a range of 26,000,000 to $27,000,000 Of the anticipated total OpEx for the third quarter, dollars 4,700,000.0 is expected to be attributed to equity based compensation expense, dollars 200,000.0 for amortization of acquired intangibles and 0.1 for expenses related to business acquisitions. Non GAAP OpEx is also expected to be quite similar to the second quarter in the range of 21 to $22,000,000 Net interest income is expected to be approximately $1,300,000 Taxes for the third quarter is expected to be approximately $1,800,000 and the share count for the third quarter is expected to be 25,800,000.0 shares. Rocco, you could now open our Q and A session please.

Operator

Yes, sir. Today's first question comes from Kevin Cassidy, Rosenblatt Securities. Please go ahead.

Kevin Cassidy
MD - Senior Research Analyst at Rosenblatt Securities

Yes. Thanks for taking my question, and congratulations on the great results. You know, as you get an increasing of your, licensing in NPUs, would this suggest, you know, it's a higher valued IC. So would we expect in the future royalty revenues would have higher leverage or, you know, see an acceleration?

Amir Panush
Amir Panush
CEO & Director at CEVA

Hi, good morning, Kevin. Thanks for the question. Yeah, definitely. As we discussed also previously, right now we see great momentum with overall licensing our NPUs. I personally, with the management team, are very encouraged about how we see the prospect of winning those deals.

Amir Panush
Amir Panush
CEO & Director at CEVA

But more looking into the long term, as you pointed out on the royalty side, those deals definitely have better economics. The complexity of the technology and the needs of the technology is higher than our so called average typical royalty that we have today. And with that, we're expecting the royalty to have a meaningful increase, definitely per unit, as those devices will deploy it in the marketplace.

Kevin Cassidy
MD - Senior Research Analyst at Rosenblatt Securities

Okay. Great. And maybe just as the timing for that, I guess, is the time from licensing to royalty longer with this more complex design? And also, because the AI market is moving so fast, would we expect that the tail for the royalty, meaning the product life cycle, is that gonna shorten compared to, your past, especially wireless customers?

Amir Panush
Amir Panush
CEO & Director at CEVA

Yes. So typically, Kevin, what we see is that the time between so called when we license the technology until we start getting royalty reports or the royalty is between eighteen to and twenty four months. And in this case, I would say the evaluation sometimes takes longer, but actually the time for our customer to take it into production is similar. In consumer, it can be even shorter than twenty four months. It can be eighteen months.

Amir Panush
Amir Panush
CEO & Director at CEVA

A little bit more complex systems in infrastructure and so on can be twenty four months or so. Overall, I would say our customers, as you pointed out, AI is is moving quickly, so and customers really need to deploy that as soon as possible from their perspective. So we do expect the royalty to take care the same as typically in consumers to some degree, maybe even slightly faster. In terms of the tail of that, again, depends to where what system it goes to. If it goes to the typical consumer devices, so we should expect that the same cycle.

Amir Panush
Amir Panush
CEO & Director at CEVA

If it goes to more the infrastructure side, then the tail is much longer, whether it's automotive, whether it's wireless infrastructure, whether it's more on on cloud enterprise support and so on.

Kevin Cassidy
MD - Senior Research Analyst at Rosenblatt Securities

I see. So end market is more important. Great. Okay. Thank you.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Thank you, Kevin.

Amir Panush
Amir Panush
CEO & Director at CEVA

Yeah. Thanks a lot, Kevin.

Operator

Thank you. And our next question today comes from Suji Desilva at ROTH Capital. Please go ahead.

Suji Desilva
MD & Senior Research Analyst at Roth Capital Partners, LLC

Hi, Amir. Hi, Yaniv. Congratulations on reaching 20,000,000,000 units. I'd be curious what the number was when Yaniv joined the company. The royalty stream being stronger in the fourth second half, fourth quarter.

Suji Desilva
MD & Senior Research Analyst at Roth Capital Partners, LLC

I I presume, know, your flagship smartphone customers are a key part of that. I'm wondering if that number or that contribution would be going up in '26 as the flagship customer continues to mix in its announced modem or do you have any visibility there?

Amir Panush
Amir Panush
CEO & Director at CEVA

Yeah. I would say first, Suji, we haven't guided anything for '26 yet, so it's not that we are going to comment on the specifics on that. But generally speaking, our expectation that we we see the the success of our technology penetrating as as that as the customer technology keeps wrapping up. Definitely, we're assuming that for the second half of this year. For '26 and beyond, of course, as we get closer, we will be able to share more.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

But, Suji, I would add, even if you exclude that US customer, historically, q four has been the strongest on the high volume, low cost smartphones for many, many years. It's not something new. Q1 is the slowest quarter and a slow start for the year. And then it ramps up with Q4 always being the strongest. So even historically, we have pretty good data to back that up unless something that we don't anticipate will happen for this year.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

That's where the confidence is coming from on the rest Okay. Of

Suji Desilva
MD & Senior Research Analyst at Roth Capital Partners, LLC

That sounds like a good tailwind there. And then on AI, congrats on the progress there. You talked about sort of scaling AI, Amir, hitting kind of a scale point. Is that software tools, ecosystem? Can you give us the elements of what gives you sort of a scaled opportunity in the edge AI?

Suji Desilva
MD & Senior Research Analyst at Roth Capital Partners, LLC

And maybe you can talk specifically about what data center might be for you guys. It's an interesting avenue that you guys might be charting out. Thanks.

Amir Panush
Amir Panush
CEO & Director at CEVA

Yes, definitely. Thanks. So first from a, I would say the applicability of our NPOs and why we are very encouraged with the interests and the momentum that we see in the market from a scalability point of view that you asked. There are two aspects to that. One from the the hardware IP, the silicon IP capabilities, we are really providing a very scalable platform going from hundreds of jobs all the way to hundreds of tops type of product line.

Amir Panush
Amir Panush
CEO & Director at CEVA

And, actually, our customers can tune and fine tune that to their own requirements, and we have with that, a very good fit to what they need. On top of that, from a software perspective, we really give them the complete SDK or software stack to support it, and one that is quite easy to integrate into their own system and to support their own customers. So on on both fronts, the the silicon IP and the software IP that comes on top of that, the scalability that we provide resonates extremely well with our customer base. And that's why this quarter, we really got four deals. Two more, I would say, on the lower end of the spectrum, so called NUPONano, and two on the higher end of the spectrum, the NUPON.

Amir Panush
Amir Panush
CEO & Director at CEVA

Within that, actually, as we pointed out this quarter, we're starting to see interesting fit of our so called edge NPU solution, where everything is about low power, very efficient utilization, high performance, and also small size becoming applicable also for inference on the cloud. This is not really to replace every socket like a GPI and GPUs, but it's where you need to complement with NPUs to run the additional arithmetics and to support the very high bandwidth three d DDR that typically is used in those systems. So it's great to see the applicability happens there that adds for us additional markets to support and to go after. But, of course, the core of our solution is how to make it very optimized for edge, which become also applicable in some cases for the for cloud inference AI as well.

Suji Desilva
MD & Senior Research Analyst at Roth Capital Partners, LLC

Okay. Appreciate the clarification, Amir. Thanks.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Thank you, Suzy.

Operator

And our next question today comes from Chris Riemer of Barclays. Please go ahead.

Chris Reimer
Chris Reimer
Analyst at Barclays Capital

Yes, hi. Thanks for taking my questions and congratulations on the strong results. I was wondering if you could talk a bit about the pipeline. You mentioned last quarter that you had several new products coming to the market. Are they already working?

Chris Reimer
Chris Reimer
Analyst at Barclays Capital

And do you have anything else coming new, looking toward the end of the year?

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Sure. So on AI, I think Amir highlighted that this is a pivotal point in our business. For a long time, we've been talking about AI for the last year. We came out with few products mid last year, the end of last year with new products around AI for the higher end and lower end markets and use cases. So that's something that the traction was record high for us in licensing in the second quarter, but we have seen a deal per quarter over the last three quarters before that.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Obviously So we are trying and we'll try to get that in the market and in different customers and we have multiple evaluations on these technologies as we speak. So that is a very strong add on to our portfolio. On top of the typical connectivity, different Wi Fi, Bluetooth, audio solution and the rest of the portfolio, I think what we're continuing to invest and come up with new features, new technologies all the time. The AI is an interesting add on. And as we've talked about in the past, cellular IoT segment of the market.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Finally, we are seeing the benefits in royalties with a record high volume shipments or Wi Fi six, which is not necessarily new in licensing. We're seeing its great results with a record high also in the second quarter in volume. So it's the same mix of enhancing our portfolio of licensable technologies on one hand. And over time, the royalties kick in and help us from different markets and new customers that are starting to ramp up.

Chris Reimer
Chris Reimer
Analyst at Barclays Capital

Got it. Yes. And just looking at shipments, nice uptick this quarter and you did mention the addition of the customer in The U. S, the smartphone expected shipments to go up. But how should we be looking at some of the other segments?

Chris Reimer
Chris Reimer
Analyst at Barclays Capital

Do you have any color on other segments of the market that may be shipping higher?

Amir Panush
Amir Panush
CEO & Director at CEVA

Yeah. Maybe if I I'll I'll give a good color about each of the end market that we are looking at. So I'll I'll start actually with the the smartphone industrial that have been slower than what we expected in q one, q two, called the first half. These two we expect to have a very strong so called sequential growth in the second half of the year. But overall smartphone, generally speaking, I would say it's it's flattish to a little bit soft overall.

Amir Panush
Amir Panush
CEO & Director at CEVA

But we are gaining market share and with that, we're expecting a very strong sequential growth in in the second half of the year. The rest of the market, the consumer IoT the and the infrastructure and all the other markets that we are supporting actually has been doing very well and we expect additional sequential growth in the second half. That's all also what we see is our WiFi six is keep ramping very, very strongly. So that's a strong tale for us in the second half, as well as the cellular IoT that we pointed out in this earnings as well.

Chris Reimer
Chris Reimer
Analyst at Barclays Capital

Mhmm. Okay. Yeah. Thanks. That's good color. That's it for me.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Thank you, Chris.

Operator

Our next question comes from Martin Yang at Oppenheimer. Please go ahead.

Martin Yang
Senior Analyst at Oppenheimer & Co. Inc.

Thank you for taking my question. I want to ask about Bluetooth. That product has been growing pretty consistently year over year in past few quarters. What contributed to this quarter's decline on a year over year basis? Anything on customer or market dynamics worth pointing out?

Amir Panush
Amir Panush
CEO & Director at CEVA

There wasn't something specific this quarter that I will point to on the Bluetooth 40. I would say, generally speaking, we expect the second half a good sequential growth for our Bluetooth technology as well. There is the shift that is coming right now to adopt more the Bluetooth six point o in in production. Of course, we are launching already Bluetooth seven point o, which will drive significant growth for us in the 2627. So overall, it's it's very healthy for us.

Amir Panush
Amir Panush
CEO & Director at CEVA

It's it can be a little bit the mix of our customers for this quarter, but nothing more than that.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Yeah. In general, Martin, it was about a quarter of a million devices, which is not that bad because annually last year we powered 1,100,000,000 devices. And again, Q1 and Q2 tend to be slower than the second half of the year. So I think that number will pick up in the next two quarters.

Amir Panush
Amir Panush
CEO & Director at CEVA

And on that one also, generally speaking for our top customers, see them, they've been doing well this quarter and we expect good sequential growth in the second half as well.

Martin Yang
Senior Analyst at Oppenheimer & Co. Inc.

Thank you. And in the context of overall annual guidance, do you think overall Bluetooth would will give you year over year growth for the year on units?

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Well, it's hard to guess. This is why we don't give annual guidance on specifically licensing on royalties. There's so many moving parts. There's so many different market. There's so many different use cases from hearing aids to watches and to a lot of IoT devices.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Very difficult to know all that. In general, if you look at the last couple of years, the answer is yes. We've grown Bluetooth year over year, we've grown WiFi significantly year over year. Cellular IoT took a long time, many, many years to pick up, but we have in the last two years, we're seeing tremendous growth in that market. So I think the answer should be yes without having a bottom up type of analysis, but from a top down and the customer use case and the customers that come back and license newer generation of each of these technologies, we are seeing a lot of good momentum there.

Amir Panush
Amir Panush
CEO & Director at CEVA

Just to add on that, if you look at actually at the first half of the year for '24, that was for '25, sorry, that has been a growth over '24. So first half, Bluetooth volume growth is already there and we expect for the full year to keep seeing increase year over year for our Bluetooth shipment.

Yaniv Arieli
Yaniv Arieli
CFO at CEVA

Which is also true for WiFi and cellular IoT. First half of this year was higher than the first half of last year for all of these three different markets and technologies. So good sign from it. Thank you, Adi. Sure.

Martin Yang
Senior Analyst at Oppenheimer & Co. Inc.

Thank you, Amir.

Amir Panush
Amir Panush
CEO & Director at CEVA

Thank you.

Operator

Thank you. This concludes today's question and answer session. I'd like to turn the conference back over to Amir Panos for any closing remarks.

Amir Panush
Amir Panush
CEO & Director at CEVA

Yeah. Thank you. On behalf of the CEVA team, thank you for joining us today. We continue to execute on our strategy to democratize edge AI through our portfolio of technologies that enable connectivity, sensing, and inference. Our strong licensing performance, expanding royalty base, and milestones of over 20,000,000,000 devices shipped underscore the trust our customers place in us as a fund foundational technology provider, We're with AI adoption accelerating across consumer, industrials, and automotive markets and our IP portfolio more relevant than ever, we are well positioned to drive long term growth and shareholder value.

Amir Panush
Amir Panush
CEO & Director at CEVA

We look forward to meeting many of you during the third quarter at investor conferences. Richard, I will hand over to you to wrap it up.

Richard Kingston
Richard Kingston
VP - Market Intelligence, Investor & Public Relations at CEVA

Thank you, Amir. As a reminder, the prepared remarks for this conference call are filed as an exhibit to the current report on Form eight ks and accessible through the Investors section of our website. With regards to upcoming events, we will be participating in the following conferences: the Oppenheimer twenty eighth Annual Technology, Internet and Communications Conference, August 13, being held virtually the Rosenblatt Virtual Tech Summit, August 19, being held virtually sixth Annual Needham Virtual Semiconductor and Semi Cap one on one Conference, August 20 the Jefferies Semiconductor IT Hardware and Communications Technology Conference, August 26 in Chicago the Evercore Semiconductor, IT, Hardware and Networking Conference, August 27 in Chicago TD Securities Technology Growth CAP Summit, September 4 in New York and Jefferies Tech Trek twenty twenty five, September 11 in Tel Aviv, Israel. For information on these events and all events we will be participating in can be found on the Investors section of our website. Thank you, and goodbye.

Operator

Thank you. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, have a wonderful day.

Executives
Analysts
    • Richard Kingston
      VP - Market Intelligence, Investor & Public Relations at CEVA
    • Amir Panush
      CEO & Director at CEVA
    • Kevin Cassidy
      MD - Senior Research Analyst at Rosenblatt Securities
    • Suji Desilva
      MD & Senior Research Analyst at Roth Capital Partners, LLC
    • Chris Reimer
      Analyst at Barclays Capital
    • Martin Yang
      Senior Analyst at Oppenheimer & Co. Inc.
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