CEVA Inc

CEVA reported second-quarter 2026 revenue of $29 million, up 13% year over year, and raised its full-year revenue growth guidance to between 13% and 15%. Licensing and related revenue grew 21% to $18.2 million, its highest level in three years, while royalty revenue rose 17% sequentially to $10.8 million. The company signed 10 licensing agreements, including a strategically significant AI deal with a leading global AI and computing platform company for its NeuPro-M NPU IP. Non-GAAP operating income increased to $3.1 million from $0.8 million a year earlier, and non-GAAP diluted earnings per share rose to $0.08 from $0.07. CEVA now expects non-GAAP operating income to increase approximately 70% year over year and non-GAAP net income to increase approximately 50%.

Ceva reported quarterly earnings of $0.08 per share, beating the Zacks Consensus Estimate of $0.07 per share and marking a 14.29% earnings surprise. Revenue came in at $29.03 million, surpassing the consensus estimate by 3.08% and up from $25.68 million a year ago. The company has topped consensus EPS estimates three times in the last four quarters and revenue estimates four times over the same period. Ceva shares have gained about 79.7% year to date, compared with a 13.3% rise in the S&P 500.

Needham initiated coverage of CEVA with a Buy rating and a $55 price target on June 15. The firm views CEVA as an attractive play on the emerging Physical AI sector, which it believes will require a broader set of semiconductors beyond compute and memory. CEVA holds a 68% global market share in wireless connectivity and has strong positions in sensing and DSP/NPU technology. While widespread Physical AI adoption is likely more than two years away, Needham expects significant near-term upside for the stock. CEVA recently raised its full-year guidance to the top end of its 8% to 12% growth range following licensing growth in the first quarter of 2026.

Ceva has introduced RealSpace Elevate for Windows, a Microsoft-certified, licensable Windows Audio Processing Object that enables gaming headset and PC OEMs to deliver customizable spatial audio experiences. The production-ready APO is designed to reduce development cost and complexity while giving OEMs full control over tuning, branding, and user experience. Built on Ceva's proven RealSpace spatial audio technology, the solution provides precise sound localization and natural externalization optimized for gaming, including controls to highlight critical in-game sounds like footsteps and gunshots. The software supports 7.1 multi-channel spatial rendering and integrates seamlessly into Windows PCs. RealSpace Elevate is available now, expanding Ceva's software licensing opportunities in the growing gaming headset and PC audio market.