Earnings Call Transcript - CEVA Q3 2023

Operator, Operator

Good day and welcome to the CEVA, Inc. Third Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. Please note today's event is being recorded. I would now like to turn the conference over to Richard Kingston, Vice President, Market Intelligence, Investor and Public Relations. Please go ahead.

Richard Kingston, Vice President, Market Intelligence, Investor and Public Relations

Thank you, Rocco. Good morning everyone and welcome to CEVA's third quarter 2023 earnings conference call. Joining me today on the call are Amir Panush, CEVA CEO; and Yaniv Arieli, CEVA CFO. Before handing over to Amir, I would like to remind everyone that today's discussions contain forward-looking statements that involve risks and uncertainties as well as assumptions that if they materialize or prove incorrect, could cause the results of CEVA to differ materially from those expressed or implied by such forward-looking statements and assumptions. Forward-looking statements include statements regarding the benefits and future financial impacts of the divestment of the Intrinsix business and related refocusing on our core strengths of IP development and licensing, market trends and dynamics, our market position, strategy and growth drivers, including with respect to WiFi 7, demand for and benefits of our technologies, plans with respect to CEVA's share repurchase program, and expectations and financial guidance regarding future performance. CEVA assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. In addition, following the divestment of Intrinsix's business to Cadence, financial results from Intrinsix were transitioned to discontinued operations beginning in the third quarter of 2023, and all prior period financial results have been recast accordingly. We will also be discussing certain non-GAAP financial measures, which we believe provide a more meaningful analysis of our core operating results and comparison of quarterly results. A reconciliation of non-GAAP financial measures is included in the earnings release we issued this morning and in the SEC filings section of our Investor Relations website. With that said, I'd like to turn the call over to Amir, who will review our business performance for the quarter and provide some insight into our ongoing business. Amir?

Amir Panush, CEO

Thank you, Richard. Welcome everyone and thank you for joining us today. Before I begin, I would like to address the situation in Israel following the horrifying attacks that took place a month ago. This has been an extremely difficult and heartbreaking time for all of us, and I would like to thank the many of you who have reached out to us for your support. Our priority at this time has been for the safety and well-being of our employees and their families, and we are doing everything we can to ensure we provide them with the support they need. In the midst of these adversities, our operations in Israel remain largely unaffected and we continue to drive our business and support our customers globally. I want to thank our employees in Israel and our Board for all their efforts during this difficult time. Turning our attention to the business. Since being appointed CEO of CEVA at the beginning of the year, I have emphasized our need to focus our efforts on our key IP pillars, where we have built strong leadership with differentiated offerings that are best suited to drive scale and synergies across our technologies globally. In the quarter, we took an important step in this strategy with our decision to strategically exit the US aerospace and defense design services industry and divest the Intrinsix business. When we acquired the Intrinsix business in 2021, our thesis was that it would help increase our presence in the US aerospace and defense industry and expand our offering to co-create IP SoC designs, leveraging the Intrinsix team. However, what became clear to me after joining is that the A&D industry doesn't offer product volumes that align with the IP royalty business model. And while the Intrinsix team has a legacy in the US aerospace and defense design service capabilities, these were not applicable to our global customer base. The sale of Intrinsix to Cadence closed on October 2nd. For reference, in the first three quarters of 2023, Intrinsix contributed just shy of 10% of overall combined revenues, lower than our internal plans and with lower margins and lack of profitability compared to our core business. We expect the divestment of Intrinsix to be accretive for us from day one and return us to the 9% gross margins moving forward. Moreover, this divestment will allow us to drive stronger focus on our key strengths, namely wireless communications, edge AI, and sensing software IP. Yaniv will elaborate on the financial impact of the divestment in his section shortly. Proceeds from the sale will serve to help us invest in our future growth, reinforce our leadership position as the world's number one supplier of wireless communication IP, and pursue the compelling opportunity we see in edge AI for our DSP and NPU platforms and sensing software IPs. I want to emphasize also that we will continue to offer system design support to customers globally that wish to customize our IPs for their projects as we still see strong demand for chip design expertise from our OEM customers, in particular, but we will not focus on a service-only type business model. Turning to our earnings. We delivered solid results with recovery in our IP licensing business, and our deal pipeline is the strongest it has been this year. In royalties, we are encouraged by the second sequential quarter of royalty growth, shipping 500 million CEVA-powered devices. This robust level of CEVA-powered shipments is very encouraging and an indicator of the strength of our customer base in winning business and taking advantage of the consumer demand recovery during the quarter. Moving on to our licensing and royalty business performance in the quarter. We signed 13 new licensing deals in the third quarter with exceptional demand and contribution from our wireless communications IP portfolio, where our leadership position is unrivaled in the industry. Recently, we reached the important milestone of passing $100 million in licensing revenues for our Bluetooth portfolio since it became a mature product. We added another nine licensing agreements for our Bluetooth 5 this quarter alone. Three of these customers also licensed our WiFi APs to develop wireless combo chips. One of them licensed our new WiFi 7 IP for access points, which carries a substantial ASP uplift over the current generation WiFi 6 IP, both for licensing and royalty. WiFi 7 possesses a significant opportunity for us, with ABI Research forecasting device shipments of WiFi 7 chipsets to grow at a CAGR of 75% from 2023 to 2028 and to more than 1.5 billion units annually. With close to 40 WiFi 6 licenses to date, we are the de facto IP vendor for WiFi in the industry. Each generation of WiFi becomes even more complex for chip designers, and our ability to provide leading-edge WiFi IP within the same timeframe as the ratification of the WiFi standard means that we can enable our customers to get to market rapidly, with lower risk and more cost-effectively. When you add in the fact that we can also provide the latest generation Bluetooth IP that is required in almost every use case today, not to mention our UWB and cellular IoT IPs, our value proposition around wireless communication is exceptional. There are only a handful of companies in the world today that have a leading-edge wireless portfolio as comprehensive as ours, and we are the only IP company amongst the leaders. We are investing to expand our leadership and ensure our customers always receive the best-in-class latest standards IP to integrate connectivity into their chip designs. We expect 2024 WiFi licensing to be driven by WiFi 7 demand, while WiFi 6 royalties will experience meaningful growth in tandem. We will provide more color around our WiFi 6 and WiFi 7 status and opportunities on our upcoming Investor Day scheduled for December 6 in New York City. The other two WiFi combo deals signed in the quarter were for WiFi 6 for Smart Edge devices. One involves a leading platform OEM in the electronic maker community, whose devices are widely used in education and prototyping, who is expanding their offering by integrating WiFi 6 and Bluetooth. The second deal was with a major designer and manufacturer of embedded systems. Other notable deals concluded in the quarter included new agreements for our leading-edge Bluetooth IP with a global OEM leader in hearing care solutions, and we have a leading player for hearables and wearables intelligent chips with a deal for our DSP targeting the high-growth satellite communications market. Now, on the royalties. We reported the second-highest volume of CEVA-powered device shipments for any quarter in the company's history, driven by recovery in consumer demand. As evidenced from the strength of our wireless communications and licensing business in the past few years, wireless chips continue to lead the way in terms of device shipments. Bluetooth chips in the quarter surpassed 300 million units, and cellular IoT shipments reached an all-time high of more than 35 million units. An area of softness in the quarter was wireless infrastructure, where our main customers for 5G RAN reported weaker-than-anticipated 5G network builds. For our sensing and AI technologies, shipments of TVs, PCs, and smart edge devices grew sequentially, including good traction for our audio technologies. To conclude, our business performed solidly in the third quarter, and we are encouraged by the healthy licensing pipeline that we are building for this quarter and beyond. In royalties, the 500 million devices shipped in the quarter powered by our IP reflects the ability of our strong customer base to win business and take advantage of the consumer demand recovery. With the sale of Intrinsix, we have taken an important step, which will allow us to fully focus on our core strengths of IP development and licensing, which is where we see the greatest opportunities for growth and value creation for our investors. In addition, reinforcing shareholder value, the Board of Directors decided to increase our existing share repurchase program by an additional 700,000 shares. Finally, we recently established a corporate strategy function at CEVA and appointed Iri Transhanski as our Chief Strategy Officer. He is a result-driven semiconductor and technology executive, and his experience and knowledge gained from over 20 years in the semiconductor industry will be instrumental in defining our future strategy and help drive long-term growth. I look forward to seeing many of you at our Investor Day in New York on December 6, where we will share our strategy and vision for CEVA and outline the growth drivers and opportunities in the years ahead. Now, let me turn over the call to Yaniv, who will review our third quarter financial results and provide fourth quarter and 2024 guidance.

Yaniv Arieli, CFO

Thank you, Amir, and good day to all. Before I start reviewing the results of our operations for the third quarter of 2023, I want to explain that revenues, cost of goods and operating expenses for the third quarter do not include Intrinsix numbers, reflecting the Intrinsix business and the held for sale discontinued operation unless otherwise noted. Revenue for the third quarter was $24.1 million as compared to $30 million for the same quarter last year. The revenue breakdown is as follows: licensing and related revenue, reflecting 58% of total revenues, was $13.9 million as compared to $18.7 million for the third quarter of 2022, but up 3% sequentially. Royalty revenue, reflecting 42% of total revenues, was at $10.1 million as compared to $11.4 million for the same quarter last year. However, this is the second sequential increase since the first and second quarters of 2023. This supports the recovery we have seen in handsets and general IoT product demand in the third quarter. Quarterly gross margin on a CEVA standalone basis, without the discontinued operation, came in at 90% on a GAAP basis and 92% on a non-GAAP basis due to the lower service-related expenses. Non-GAAP quarterly gross margin excluded equity-based compensation expenses of $0.2 million and the amortization of acquired intangibles of $0.1 million. Total GAAP operating expenses for the third quarter were $24.4 million, lower than our guidance due to the exclusion of the Intrinsix business cost, actions taken by management to reduce costs, and lower employee-related expenses. Our total non-GAAP operating expense for the third quarter, excluding equity-based compensation expenses and amortizations of intangibles, was $20.4 million, also below the lower end of our guidance due to the same reasons I just explained. GAAP operating loss for the third quarter was $2.7 million, up from a GAAP operating loss of $2.4 million in the same quarter a year ago. The GAAP quarterly loss included equity-based compensation and the amortization of acquired intangibles of $0.3 million and $0.1 million of costs associated with new costs. Non-GAAP operating income was $1.6 million compared to operating income of $7.3 million in the same period a year ago. GAAP and non-GAAP tax expenses of $1.1 million were recorded, mainly associated with withholding tax deducted by our customers that could not be utilized and were expensed. GAAP net loss for continuing operations was $2.7 million, and non-GAAP net income was $1.4 million. The net loss for the discontinued operations of Intrinsix was $2.2 million and non-GAAP net loss of $1 million. Overall, the GAAP loss was $5 million and diluted EPS of $0.21 for the third quarter of this year as compared to a net loss of $22.3 million and diluted loss per share of $0.96 for the third quarter of 2022. Our overall non-GAAP net income was $0.4 million and diluted earnings per share was $0.02 for the third quarter of 2023 as compared to a net income of $4.7 million and diluted earnings per share of $0.20 in the third quarter of last year. With respect to other related data, shipped units by CEVA licensees during the third quarter of 2023 were 500 million units, our second-highest quarter shipments on record, up 35% sequentially compared to the second quarter of 2023, where we reported 370 million units and up 40% year-over-year from 357 million units. Of the 500 million units reported, 79 million units or 16% were for handset baseband, similar shipment volume to the second quarter. Our base station and IoT product shipments were 421 million units, up 45% sequentially from $291 million for the second quarter of this year and up 51% year-over-year from 279 million units a year ago. Bluetooth shipments were 313 million units for the quarter as compared to 210 million units for the second quarter of last year as many of our customers experienced strong sales resulting from consumer demand recovery for devices such as TWS earbuds, smartwatches and across consumer IoT in general. WiFi shipments were 24 million units as compared to 29 million units in the second quarter, and we are encouraged to see the number of WiFi 6 customers continue to ramp up their production targeting IoT and smart home with the transition to the WiFi 6 standard imminent. Cellular IoT shipments reached a record 35 million units in the quarter as compared to 21 million units in the second quarter. This increase reflects that the market is maturing and the technology is making its way to more end products and consumer and industrial use cases. Other shipments under the base station IoT umbrella totaled 49 million units in the quarter. This includes our sensor fusion, computer vision, AI, audio 5G brand and DSPs for non-cellular communications, such as V2X or vehicle-to-everything, smart meters, satellites, and drones. As for balance sheet items, at the end of the third quarter, our cash equivalent balances, marketable securities, and cash deposits were approximately $132 million. In the third quarter, we continued our buyback program by repurchasing approximately 135 million shares for approximately $3 million. Yesterday, our Board of Directors authorized a new increase of 700,000 shares to the existing repurchase program. As of today, around 844,000 shares are available for repurchase, giving effect to this expansion. We believe in our future business prospects and plan to leverage the program to increase shareholders' value. Our Days Sales Outstanding (DSOs) for the third quarter were 31 days, below our norm and better than the second quarter, which was 47 days. During the third quarter, we used $1.3 million cash from operating activities, ongoing depreciation, and amortization was $1.1 million and purchase of fixed assets were zero. At the end of the third quarter, our headcount was 476 people, including Intrinsix employees, of whom 391 were engineers compared to 497 people at the end of the second quarter. Now, turning to our outlook. CEVA, post divesting its Intrinsix's AMD service business, will be able to present GAAP and non-GAAP accretive financials for 2023 compared to its previous consolidated financials, excluding ongoing losses from its discontinued operation. Our gross margin will increase and return to the 90% range; cost of revenue and OpEx will also decrease respectively. Overall, we are actively implementing measures to reduce overall headcount and expenses while closely monitoring them in parallel to investing and enhancing marketing and licensing of our technologies. Our licensing and related revenue business has shown improvement in the third quarter, and we see a promising pipeline ahead of us for wireless connectivity and sensing AI technologies. In royalties, we anticipate consumer products and low-cost smartphones to maintain demand ahead of the upcoming holiday season, and we will continue to monitor the 5G base station RAN market for any improvements. All in all, we expect fourth quarter overall revenue to be in the $23.3 million to $25.3 million range. Looking ahead into next year 2024 and considering the investment in the Intrinsix service business, we would use the basis of the fourth quarter guidance for modeling 2024 with potential revenue growth as the year progresses. Gross margins are forecasted to be in the 90% range, and overall non-GAAP OpEx and cost of goods together, meaning all annual expenses combined, are forecasted at this stage to be flat with 2023. Combining these, we expect operating leverage to improve over 2023 and we'll provide more detailed guidance for 2024 at our next earnings call. Specifically for the fourth quarter, gross margin is expected to be approximately 90% on a GAAP basis and 92% on a non-GAAP basis, excluding an aggregate of $0.2 million of equity-based compensation expenses and $0.1 million of amortization of acquired intangibles. OpEx for the fourth quarter is expected to be slightly higher compared to the third quarter due to G&A, professional costs, and employee-related benefits, estimated to be in the range of $24.2 million to $25.2 million, including an expected net expense of $4.2 million for equity-based compensation expenses and $0.3 million for amortization of acquired intangibles. Our non-GAAP OpEx is also expected to be slightly higher than the third quarter for the reasons I just explained and in the range of $20.1 million to $20.1 million. I want to emphasize that overall expenses for CEVA post the divestment of Intrinsix are forecasted to continue and remain at lower levels as we closely examine cost management measures. Net income is expected to be approximately $1.1 million, with interest income. Taxes for the fourth quarter are expected to be approximately $1.4 million, derived mainly from withholding tax on new deals signed and reported royalties for the quarter. The share count for the fourth quarter is expected to be at 25.1 million shares. Rocco, you could now open the Q&A session, please.

Operator, Operator

Yes, sir. Today's first question comes from Kevin Cassidy at Rosenblatt Securities. Please go ahead.

Kevin Cassidy, Analyst

Yes, thanks for taking my question and congratulations on a good quarter in a tough market. What we're hearing through this earnings period, is a lot of slowing in demand from the IoT market, but here you are saying that you're shipping the second highest units in company history. Can you explain why you're outperforming these markets?

Amir Panush, CEO

Yes, definitely. I would say several things related to that. One is that overall, we have made significant progress with our licensing of Bluetooth and WiFi and other wireless connectivity technologies. We have a larger and larger customer base that continues to ramp their volume. So, that provides us with the tailwind to keep increasing the volume. Additionally, we believe that our customer base, generally speaking, is performing better than the rest of the market. They are positioned more competitively and are able to gain market share. So, that's an overall explanation for this quarter, I would say, including the restocking that has occurred.

Kevin Cassidy, Analyst

Okay, great. And maybe as a follow-up, just on your licensing business. Can you say how much the US sanctions could be hurting your licensing deals in China?

Amir Panush, CEO

So, for now, they haven't affected us for two main reasons. One is the end markets we target: the consumer market, mainly automotive, industrial, and medical, and less in supercomputers, with no business with the fab industry or building fabs. Therefore, most of the sanctions are targeting those markets. If you look at some of the other players in the EDA and IP space that are similar to ours, they are seeing more or less the same conditions at this time. For the meantime, China is still an important market for us, and we haven't seen any specific restrictions for the markets and technologies that we play in.

Yaniv Arieli, CFO

To add on that, we have established a strong incumbency with our technology and previous licensing agreements with a broad customer base in the consumer markets in China. We see those customers coming back after a very good support and competitive technology, asking for either an upgrade of this type of technology to the next level or for additional technology that we previously haven't provided them. For example, some of our Bluetooth customers are now asking for WiFi, and we see some of them asking for UWB capabilities and other technologies that we can offer.

Kevin Cassidy, Analyst

Okay, great. Thank you.

Amir Panush, CEO

Thank you, Kevin.

Operator, Operator

And our next question today comes from Chris Reimer with Barclays. Please go ahead.

Chris Reimer, Analyst

Hi. Thanks for taking my question. You mentioned the gross margin benefit from the sale of Intrinsix and a bit of reduction in costs relatively speaking. Can you give a little color on what other benefits you might be seeing in terms of changing the business in terms of sales and marketing, and in terms of headcount that might change also because of the discontinued business?

Yaniv Arieli, CFO

Yes, of course. It's a completely different business model with a distinct customer base. Amir talked in the prepared remarks about the reasons we chose to enter that market, both the US market and the size of the customers in that space. The lead times to close deals in the A&D sector are a very long process. Getting new technologies or new projects agreed upon and funded through Washington takes a considerable amount of time. This contrasts significantly with the lead time needed to license Bluetooth or WiFi. Therefore, the design cycle is shorter than the design itself. The end market we are in is high volume compared to A&D, which is a lucrative but lower-volume service business. From all dimensions, including lead-time, customer base, and potential royalty magnitudes from our existing customers and new ones, we've clearly noticed significant benefits.

Amir Panush, CEO

I would say overall, the IP business model is much more advantageous. With our focus on innovation and development, we can leverage our R&D investments across a larger number of customers that can ship in high volumes, providing us better gross margins.

Chris Reimer, Analyst

Got it. Thanks. Just in relation to the combo deals that you mentioned earlier, are you pitching these as already available together, or is it more customer-driven demand where they request combinations? I'm trying to gauge potential for larger sales regarding combo deals. Can you provide any insight on that?

Amir Panush, CEO

Sure, it's actually both. This quarter, we have seen three business deals like that. We observe customer demand for different combinations, especially for WiFi-Bluetooth combos. Simultaneously, we are actively developing these technologies internally, so they are available for customers looking for fast time to market.

Yaniv Arieli, CFO

To add to that, we would like to remind you that the billion devices we shipped last year mainly consisted of about 100 million WiFi units. One of the potentials in royalties is to catch up because WiFi came later to the consumer market. Many of these devices, including automotive ones, require both WiFi and Bluetooth, presenting a substantial revenue opportunity for us with combo chips as well as standalone WiFi solutions that can promise higher ASPs.

Amir Panush, CEO

It's definitely aided both our licensing efforts and our future growth, particularly with Bluetooth customers requesting combos with WiFi and vice versa.

Chris Reimer, Analyst

Okay, great. Thanks. That's all from my side.

Amir Panush, CEO

Thank you, Chris.

Operator, Operator

Next question comes from David O'Connor with BNP Paribas. Please go ahead.

David O'Connor, Analyst

Yes, good morning. Thanks for taking my question. One or two on my side. Firstly, Amir, you talked about revenue growth this year progressing into 2024. Can you provide a sense of what those drivers are specifically from kind of end markets as you look into 2024? That's my first question.

Amir Panush, CEO

Yes, definitely, David. First, we have established a very strong leadership in wireless communications overall. As mentioned previously, many of our customers who have adopted our Bluetooth technology or WiFi are now asking for our other technologies. We see promising increases in UWB activities as well as urban IoT applications. Additionally, we anticipate significant opportunities arising from the proliferation of 5G, particularly outside of handsets and micro-based stations in 2024. Moreover, we recently announced new edge AI products that are entering the market, and we are engaging with multiple customers for early qualification. This will be a growth engine for us as we go into next year. I will provide more details during the upcoming Investor Day.

David O'Connor, Analyst

Thanks for that. As a follow-on just on the WiFi side of things. Clearly, Bluetooth has been massively successful. Can you help me understand what needs to happen for WiFi to reach that hockey stick growth, where we are really talking significant upward shipments? Is that revenue growth you're referring to next year, or is that further out?

Yaniv Arieli, CFO

Yes. We have started meaningful penetration with our WiFi solutions with the WiFi 4 generation, but the most impactful penetration came with the transition to WiFi 6, where we really established our de facto leadership as an IP provider. We anticipate the royalty growth to pick up significantly in 2024, and that momentum will likely continue further into 2025 and 2026. While I cannot pinpoint an exact moment for the hockey stick growth, we are confident in significant ramp-up next year, especially as we currently have more than 40 licensing agreements across various consumer and market segments.

Operator, Operator

David, I'm sorry, this is the operator. You're breaking up badly, sir.

David O'Connor, Analyst

Can you hear me now?

Operator, Operator

A little bit better. Yes, sir, please proceed.

David O'Connor, Analyst

Just one quick one on the M&A side. Given the Intrinsix divestment, has there been any change in strategy on your M&A initiatives?

Amir Panush, CEO

Yes, David, we will discuss this in more depth on the Analyst Day. However, generally speaking, my focus with the team is strongly on the IP business model and how we are going to leverage that. We've established a well-oiled machine for driving success in licensing and royalties, and we believe there are great assets out there related to that business model that we can pursue to create synergy and long-term success for our company moving forward. This remains an important priority for me and the team.

David O'Connor, Analyst

Thank you.

Operator, Operator

Thank you. Our next question today comes from Suji Desilva with ROTH Capital. Please go ahead.

Suji Desilva, Analyst

Hi Amir, Yaniv. I echo my thoughts and hope you and your families are staying safe. Can you talk about the licensing activity in China, the update there and whether there is a recovery or pause or whether it's tracking as it has in the past?

Amir Panush, CEO

Yes, I would say that if you compare to last year or during the hype of COVID, it's definitely slower, and we've discussed that last quarter and to some extent over the past few months. Currently, however, from our perspective, things have stabilized. The demand is stabilizing. We have a strong incumbent customer base, and we see strong demand from them to advance to the next generation and add more technologies. While the momentum has slowed compared to last year, it has stabilized and we are seeing opportunities for growth as we progress into 2024.

Suji Desilva, Analyst

Very helpful. I apologize if you already discussed this earlier, but regarding the wireless infrastructure opportunity, are there any tailwinds expected in calendar 2024? I understand that the market is a bit softer now, but can it potentially recoup in calendar 2024?

Amir Panush, CEO

Regarding the market itself, yes. We have been closely monitoring this for years. We have two of the biggest players in that industry. That market is driven by the demand of various operators, which can vary by town, city, or country. While there were strong investments in 5G deployment in previous years due to significant demand for higher bandwidth and lower latency, recently, operators have realized a lack of new killer applications driving 5G networks. This shift has caused a slowdown in demand that we experienced particularly in Q3. That said, we hope the situation will improve going into Q4 as deployments of 5G technologies across different use cases continue. The market isn't seasonal but cyclical and tends to vary by operator.

Yaniv Arieli, CFO

Yes, it's notable that we've seen demand almost completely recede year-over-year when comparing Q3 this year to last year’s Q3, which was particularly strong. There's still activity anticipated for the coming quarters. We believe there are still opportunities for growth from our existing customer base in the wireless infrastructure space into next year.

Suji Desilva, Analyst

Thanks, everybody.

Amir Panush, CEO

Thank you.

Operator, Operator

Thank you. Ladies and gentlemen, this concludes our question-and-answer session. I'd like to turn the conference back over to Richard Kingston for closing remarks.

Richard Kingston, Vice President, Market Intelligence, Investor and Public Relations

Thank you, Rocco, and thank you everyone for joining us today and for your continued interest in CEVA. As a reminder, the prepared remarks for this conference call are filed as an exhibit to the current report on Form 8-K and are accessible through the Investors section of our website. Regarding upcoming events, we will be participating in the following conferences: the Wells Fargo's Seventh Annual TMT event taking place November 29th in Rancho Palo Verde, California; CEVA is hosting its Investor Day on December 6th in New York, and all investors are welcome to attend in person or via webcast; and finally, we will be attending the Oppenheimer 4th Annual 5G Summit taking place virtually on December 11th. Further information on these events can be found in the Investors section of our website. Thank you and goodbye.

Operator, Operator

Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day.