Arteris (AIP, Financial) has become part of the Intel Foundry Accelerator Ecosystem Alliance, joining both the IP Alliance and the newly launched Chiplet Alliance. This strategic partnership aims to assist shared clients in developing electronics using Intel Foundry's cutting-edge process technologies. By fostering the chiplet ecosystem, this collaboration is expected to enhance interoperability and progress beyond conventional node scaling. As a result, Arteris and Intel Foundry are providing engineering teams with the tools needed to meet their design objectives, optimizing performance, power efficiency, and spatial considerations in complex System on Chip (SoC) and chiplet designs.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 4 analysts, the average target price for Arteris Inc (AIP, Financial) is $12.50 with a high estimate of $16.00 and a low estimate of $8.00. The average target implies an upside of 92.60% from the current price of $6.49. More detailed estimate data can be found on the Arteris Inc (AIP) Forecast page.
Based on the consensus recommendation from 4 brokerage firms, Arteris Inc's (AIP, Financial) average brokerage recommendation is currently 2.3, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Arteris Inc (AIP, Financial) in one year is $8.56, suggesting a upside of 31.9% from the current price of $6.49. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Arteris Inc (AIP) Summary page.
AIP Key Business Developments
Release Date: February 18, 2025
- Total Revenue: $15.5 million for Q4 2024, up 24% year over year.
- Annual Contract Value (ACV) plus Royalties: $65.1 million, a record high for the company.
- Remaining Performance Obligations (RPO): $88.4 million, a 22% year-over-year increase.
- Non-GAAP Gross Profit: $14.2 million, representing a gross margin of 91% for Q4 2024.
- GAAP Gross Profit: $13.9 million, representing a gross margin of 90% for Q4 2024.
- Non-GAAP Operating Expense: $16.9 million for Q4 2024, flat sequentially and 1% higher year over year.
- GAAP Operating Expense: $21 million for Q4 2024, a 4% year-over-year increase.
- Non-GAAP Operating Loss: $2.8 million for Q4 2024, a $2.7 million improvement from the prior year period.
- GAAP Operating Loss: $7.1 million for Q4 2024, compared to $9.2 million in the prior year period.
- Non-GAAP Net Loss: $3.9 million for Q4 2024, or $0.10 per share.
- GAAP Net Loss: $8.2 million for Q4 2024, or $0.20 per share.
- Cash, Cash Equivalents, and Investments: $52.3 million at the end of Q4 2024.
- Free Cash Flow: Negative $2.7 million for Q4 2024.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Arteris Inc (AIP, Financial) achieved a record annual contract value plus royalties of $65.1 million in Q4 2024, driven by increased demand for semiconductor System IP products.
- The company reported a 24% year-over-year increase in total revenue for Q4 2024, reaching $15.5 million, which was above the midpoint of their guidance range.
- Arteris Inc (AIP) successfully expanded its customer base, adding 14 new customers, including major players like Infineon and GigaDevice, and increased its presence in the microcontroller market.
- The introduction of FlexGen Smart NoC IP is expected to significantly enhance engineering productivity and improve power consumption and overall performance, with early adoption by over 10 companies.
- The company maintained a strong financial position with $52.3 million in cash, cash equivalents, and investments, and no financial debt at the end of Q4 2024.
Negative Points
- Arteris Inc (AIP) reported a non-GAAP net loss of $3.9 million for Q4 2024, with a diluted net loss per share of $0.10.
- The company's free cash flow was negative $2.7 million in Q4 2024, impacted by short-term working capital timing changes.
- GAAP operating loss for Q4 2024 was $7.1 million, although this was an improvement from the prior year period.
- The company faces challenges in maintaining profitability, with a non-GAAP operating loss of $2.8 million in Q4 2024, despite improvements from the previous year.
- Arteris Inc (AIP) noted that the royalties and other income line was slightly lower year over year, partly due to one-time benefits in 2023 not recurring in 2024.
