/C O R R E C T I O N -- CEVA, Inc./
In the news release, CEVA, Inc. Reports Second Quarter 2007 Financial
Results, issued earlier today by CEVA, Inc. over PR Newswire, the financial
table with the heading "CEVA, INC. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS - U.S. GAAP," the column headings were transposed for
the "Quarter ended June 30" columns. The corrected table should appear as
below, rather than what was incorrectly transmitted via PR Newswire.
CEVA, Inc. Reports Second Quarter 2007 Financial Results
Strategic Agreements Concluded with Leading Japanese and European Customers;
Pro forma non-GAAP net income triples from Q2-2006, royalty revenue up 33% YoY
SAN JOSE, Calif., July 24 -- CEVA, Inc. (Nasdaq: CEVA; LSE: CVA), a leading
licensor of silicon intellectual property (SIP) platform solutions and DSP cores
for mobile, consumer electronics and storage applications, today announced its
financial results for the quarter ended June 30, 2007.
(Photo: http://www.newscom.com/cgi-bin/prnh/20051010/CEVALOGO)
Total revenue for the second quarter of 2007 was $8.5 million, a slight
increase of 1% compared to $8.4 million reported for the second quarter of
2006 and a sequential increase of 10% from $7.7 million for the first quarter
of 2007. Second quarter of 2007 licensing revenue was $5.5 million, a
decrease of 8% from $6.0 million reported for the second quarter of 2006 and a
sequential increase of 19% from $4.6 million for the first quarter of 2007.
Royalty revenue for the second quarter of 2007 was $1.9 million, an increase
of 33% over $1.4 million for the second quarter of 2006 and slightly lower by
2.0% from the traditionally strong first quarter of 2007 in which royalty
revenue was $2.0 million. Revenue from services for the first and second
quarters of 2007 was $1.1 million, an increase of 11% compared to $1.0 million
reported for the second quarter of 2006.
Net income for the second quarter of 2007 was $0.4 million, compared to a
net loss of $0.2 million for the second quarter of 2006. Net income per share
for the second quarter of 2007 was $0.02 per share, compared to net loss of
$0.01 per share for the second quarter of 2006.
In the second quarter of 2007 and 2006, the Company recognized an
equity-based compensation charge of $0.5 million pursuant to the adoption of
SFAS 123R. Pro forma non-GAAP net income and net income per share for the
second quarter of 2007, excluding the equity-based compensation expense,
increased 308% and 400% to $0.9 million and $0.05, respectively, compared to
the second quarter of 2006. Pro forma non-GAAP net income and net income per
share for the second quarter of 2006, excluding the equity-based compensation
expense and a gain of $0.1 million reported in interest and other income
related to the disposal of an investment, was $0.2 million and $0.01,
respectively.
During the second quarter of 2007, the Company concluded eight new license
agreements. Six agreements were for CEVA DSP cores and platforms, one
agreement was for CEVA SATA technology and one agreement was for CEVA
Bluetooth 2.0+EDR technology. Target applications for customer deployment are
Digital TV, DVD and HD-DVD, ultra low cost phones, 3G phones, smart phones and
portable multimedia players. Geographically, three of the eight deals
concluded were in the U.S., one was in Europe and four were in the Asia
Pacific region.
During the quarter, CEVA concluded another major strategic licensing
agreement for its newest DSP core, the CEVA-TeakLite-III. The new customer is
one of the largest, branded, consumer electronics vendors in Japan that has
adopted the CEVA-TeakLite-III for its next generation of integrated Digital
TVs. This represents another major design win for CEVA in the home
entertainment segment and continues the Company's expansion beyond the mobile
market into a larger market composed of Digital TVs, HD-DVD / Blu-ray DVDs,
IPTV and set-top boxes.
Gideon Wertheizer, Chief Executive Officer of CEVA, stated: "The second
quarter of 2007 was a strong quarter for the main aspects of our business,
including total revenue reached, the backlog and pipeline build up and the
increase in royalty revenue which was 33% higher compared to the equivalent
quarter last year. We are also particularly pleased with the continued success
of our newest generation CEVA-TeakLite-III DSP core in penetrating the home
entertainment market, as well as the strategic decision made by one of the
largest European semiconductor companies to broadly use our technology over
its internally developed DSP solution."
Yaniv Arieli, Chief Financial Officer of CEVA, stated: "Our revenue for
the second quarter of 2007 was closer to the higher end of our guidance
through a combination of strong royalties reported by our customers and good
licensing performance. This revenue performance along with continued focus on
our growth engines enabled us to report significant sequential profits growth.
Non-GAAP pro forma net income and fully diluted EPS for the second quarter of
2007 compared to the first quarter of 2007 grew 100% and 96%, respectively.
We also generated positive cash flow of approximately $0.5 million and as of
June 30, 2007, CEVA's cash balances and marketable securities were $64.9
million."
CEVA Conference Call
On July 24, 2007 CEVA management will conduct a conference call at 8:30
a.m. Eastern Time / 1:30 p.m. London time, to discuss the operating
performance for the quarter.
The conference call will be available via the following dial-in numbers:
-- US Participants: Dial 1-877-493-9121 (Access Code: CEVA)
-- UK/Rest of World: Dial +44-800-032-3836 (Access Code: CEVA)
The conference call will also be available live via the Internet at the
following link:
http://www.videonewswire.com/event.asp?id=40804. Please go to the web site at
least fifteen minutes prior to the call to register, download and install any
necessary audio software.
For those who cannot access the live broadcast, a replay will be available
by dialing 1-877-519-4471 (passcode: 8982532) for US domestic callers and
+44-800-169-3875 (passcode: 8982532) for international callers from two hours
after the end of the call until 11:59 p.m. (Eastern Time) on July 31, 2007.
The replay will also be available at CEVA's web site http://www.ceva-dsp.com.
About CEVA, Inc.
Headquartered in San Jose, Calif., CEVA is a leading licensor of silicon
intellectual property (SIP) platform solutions and DSP cores for mobile,
consumer electronics and storage applications. CEVA's IP portfolio includes
comprehensive solutions for multimedia, audio, voice over packet (VoP),
Bluetooth, Serial Attached SCSI (SAS) and Serial ATA (SATA), and a wide range
of programmable DSP cores and subsystems with different price/performance
metrics serving multiple markets. In 2006, CEVA's IP was shipped in over 190
million devices. For more information, visit http://www.ceva-dsp.com
Forward-Looking Statements
This press release contains forward-looking statements that involve risks
and uncertainties, as well as assumptions that if they materialize or prove
incorrect, could cause CEVA's results to differ materially from those
expressed or implied by such forward-looking statements and assumptions. All
statements other than statements of historical fact are statements that could
be deemed forward-looking statements, including Mr. Wertheizer's statements
about the backlog and pipeline build up in the second quarter of 2007. The
risks, uncertainties and assumptions include: the ability of the CEVA-
TeakLite-III DSP core and VoIP solution to continue to be strong growth
drivers for the Company; the effect of intense competition within our
industry; the effect of the challenging period of growth experienced by the
industries in which we license our technology; the possibility that the market
for our technology may not develop as expected; our ability to timely and
successfully develop and introduce new technologies; our reliance on revenue
derived from a limited number of licensees; our ability to improve our royalty
revenue in 2007 and other risks relating to our business and the pipeline of
companies interested in our technologies, including, but not limited to, those
that are described from time to time in the Company's Securities and Exchange
Commission filings, including its Annual Report on Form 10-K for the fiscal
year ended December 31, 2006. CEVA assumes no obligation to update any
forward-looking statements or information, which speak as of their respective
dates.
CEVA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - U.S. GAAP
U.S. dollars in thousands, except per share data
Quarter ended Six Months ended
June 30, June 30,
2007 2006 2007 2006
Unaudited Unaudited Unaudited Unaudited
Revenues:
Licensing and
royalties $7,452 $7,455 $14,048 $14,615
Other revenues 1,063 957 2,193 1,931
Total revenues 8,515 8,412 16,241 16,546
Cost of revenues 918 1,135 1,925 2,030
Gross profit 7,597 7,277 14,316 14,516
Operating expenses:
Research and
development, net 4,610 4,873 9,310 9,889
Sales and marketing 1,619 1,606 3,174 3,377
General and
administrative 1,373 1,474 2,619 2,958
Amortization of
intangible assets 41 141 83 331
Total operating
expenses 7,643 8,094 15,186 16,555
Operating loss (46) (817) (870) (2,039)
Interest and other
income, net 626 630 1,450 1,171
Income (loss) before
taxes on income 580 (187) 580 (868)
Taxes on income 150 30 150 150
Net income (loss) 430 (217) 430 (1,018)
Basic and diluted
net income (loss)
per share $0.02 $(0.01) $0.02 $(0.05)
Weighted-average
number of Common
Stock used in
computation of net
income (loss) per
share (in thousands):
Basic 19,473 19,142 19,450 19,104
Diluted 19,776 19,142 19,702 19,104
Unaudited Reconciliation of GAAP to Pro Forma Non-GAAP Financial Measures
(U.S. Dollars in thousands, except per share amounts)
Quarter ended Six Months ended
June 30 June 30
2007 2006 2007 2006
Unaudited Unaudited Unaudited Unaudited
GAAP net income
(loss) 430 (217) 430 (1,018)
Equity-based
compensation
expense included
in cost of revenue 18 9 36 24
Equity based
compensation expense
included in research
and development
expenses 216 134 412 353
Equity based
compensation expense
included in sales and
marketing expenses 92 78 174 180
Equity based
compensation expense
included in general
and administrative
expenses 186 284 362 593
Interest and other
income, net (1) 0 (57) 0 (57)
Pro forma non-GAAP
net income 942 231 1,414 75
Pro forma non-GAAP
basic and diluted
net income per share $0.05 $0.01 $0.07 $0.00
Weighted-average number
of common stock used
in computation of pro
forma non-GAAP Net
income per share
(in thousands):
Basic 19,473 19,142 19,450 19,104
Diluted 19,941 19,443 19,862 19,372
(1) Results for the second quarter of 2006 included a gain of $0.1 million
reported in interest and other income related to the disposal of an
investment.
CEVA, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
U.S. Dollars in Thousands
June 30, December 31,
2007 2006
Unaudited Audited
ASSETS
Current assets:
Cash and cash equivalents $43,026 $37,968
Marketable securities and bank deposits 21,880 26,266
Trade receivables, net 9,949 8,421
Deferred tax assets 642 613
Prepaid expenses 765 564
Other current assets 1,858 1,890
Total current assets 78,120 75,722
Long-term investments:
Severance pay fund 2,291 2,338
Deferred tax assets 703 382
Property and equipment, net 1,887 1,706
Investment 4,233 4,233
Goodwill 36,498 36,498
Other intangible assets, net 118 201
Total assets $123,850 $121,080
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade payables $884 $718
Accrued expenses and other payables 10,013 9,462
Taxes payable 119 135
Deferred revenues 626 406
Total current liabilities 11,642 10,721
Accrued severance pay 2,468 2,519
Accrued liabilities 1370 1,697
Total liabilities 15,480 14,937
Stockholders' equity:
Common Stock: 19 19
Additional paid in-capital 144,652 142,826
Other comprehensive loss (29) --
Accumulated deficit (36,272) (36,702)
Total stockholders' equity 108,370 106,143
Total liabilities and stockholders' $123,850 $121,080
SOURCE CEVA, Inc.
-0- 07/24/2007
CONTACT: Yaniv Arieli, CFO, +1-408-514-2941, yaniv.arieli@ceva-dsp.com,
or Richard Kingston, +1-408-514-2976, richard.kingston@ceva-dsp.com, both of
CEVA, Inc.
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Web site: http://www.ceva-dsp.com
(CEVA)