CEVA (CEVA) Stock Forecast & Price Target

CEVA Inc. demonstrates a positive financial outlook due to its increasing royalty revenue, which amounted to $10.7 million, accounting for 41% of total revenue and showing a sequential increase driven by higher shipments in the U.S. The company is poised for sustained growth, projected to continue into FY26, largely due to the rising contributions from AI processor licensing and the expanding royalty ramps in 5G, Wi-Fi, and cellular IoT markets. Furthermore, management anticipates a double-digit percentage increase in Non-GAAP net income and fully diluted Non-GAAP EPS for FY2025, supported by strong licensing momentum and anticipated royalty acceleration in the second half of the year.

CEVA Inc. reported a Non-GAAP EPS of $0.07 for 2QFY25, a significant decline from $0.15 in the same period last year, indicating challenges in profitability despite being slightly above consensus estimates. The company experienced a 9.6% year-over-year decline in revenue, totaling $25.7 million, with licensing and related revenue decreasing by 13% year-over-year, contributing to concerns about the sustainability of its revenue growth. The mismatch between current performance metrics and prior year figures suggests potential market or operational difficulties, ultimately contributing to a negative outlook for the stock.