Ceva (CEVA) Stock; Plunges 17% as AI Royalties Lag Despite Strong Q2

TLDRs;

• CEVA stock plunges 17% as investors focus on sluggish royalty growth despite strong quarterly earnings.
• AI licensing revenue jumped 21%, highlighting growing demand for CEVA semiconductor intellectual property.
• Royalty revenue rose only 1.5%, reflecting delays before new AI chip designs reach mass production.
• CEVA raised 2026 guidance, expecting revenue growth of 13% to 15% this year.

CEVA Inc. (NASDAQ: CEVA) stock plunged roughly 17% on August 11 as investors focused on weak royalty growth despite the chip IP company delivering better-than-expected second-quarter results.

Shares fell 15.7% to $32.60 on Monday after CEVA reported a quarterly earnings beat. The sell-off came despite stronger revenue, improved profitability and a raised full-year outlook.

CEVA posted Q2 revenue of $29.03 million, up 13.1% from $25.68 million a year earlier. Adjusted earnings reached $0.08 per share, beating the $0.07 analyst estimate.

AI Licensing Drives Revenue Growth

Licensing and related revenue surged 21.3% year over year to $18.22 million, accounting for about 63% of total quarterly revenue.

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