SAN FRANCISCO -- Intellectual property chip firm
swung to a profit in the first quarter, as revenue from royalty payments hit an all-time high.
The San Jose, Calif., company said Tuesday that sales for the three months ended March 31 increased 30% year over year to $10.1 million, vs. the average analyst expectation of $9.76 million.
Ceva posted net income of $5.5 million, or 27 cents a share, vs. break-even results at this time last year.
Ceva's results included a $10.9 million capital gain from divesting itself of its stake in
, as well as $3.1 million tax expense related to the divestment and a $3.5 million restructuring charge stemming from the termination of a long-term lease in Ireland.
Excluding the various charges, as well as its stock compensation expenses, Ceva said it earned 9 cents a share. The average analyst expectation called for EPS of 6 cents, according to Thomson Financial.
Shares of Ceva were up 6%, or 55 cents, at $9.75 in midday trading Tuesday.
Ceva licenses technology for DSPs, or digital signal processors, that chipmakers like
incorporate in their chips. Many of these chipmakers are benefiting from a new willingness by handset makers like
to use more than one supplier of chips for their products.
Ceva CEO Gideon Wertheizer said the company's record royalty revenue of $3.7 million, up 91% year over year, reflect the company's growing market share in the cell phone market.
"Our strong presence across all the key handset segments, comprising of ultra low-cost, mid-range and high-end 3.5G phones, continues to grow as many of the leading handset manufacturers transitioning to multi-source strategies favor Ceva's DSP technology," Wertheizer said.
During the quarter, Ceva added 10 new licensing agreements, the company said.
Ceva did not immediately provide a financial outlook for the current quarter, although executives were scheduled to hold a conference call with analysts Tuesday.