Arteris, Inc. (AIP) Bundle
A Brief History of Arteris, Inc.
Arteris, Inc. has established itself as a significant player in the semiconductor industry, particularly in the area of interconnect intellectual property (IP) solutions. As of September 30, 2024, the company has continued to evolve and adapt to the increasing complexity of System on Chip (SoC) designs.
Company Overview
Founded in 2003, Arteris specializes in providing NoC (Network on Chip) interconnect IP solutions. The company has expanded its operations globally, with offices in the United States, France, China, South Korea, Japan, Taiwan, and plans for a new office in Poland as of 2024.
Financial Performance
As of September 30, 2024, Arteris reported total revenue of $42.2 million for the nine months ended, reflecting a modest increase from $41.2 million in the same period in 2023. The breakdown of revenue sources for this period is as follows:
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Licensing, support and maintenance | $38,799 | $36,926 | $1,873 | 5% |
| Variable royalties | $2,965 | $4,058 | $(1,093) | (27%) |
| Other | $471 | $178 | $293 | 165% |
| Total Revenue | $42,235 | $41,162 | $1,073 | 3% |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, totaled $62.3 million, a decrease from $63.4 million in the previous year. The details are as follows:
| Expense Category | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Research and development | $33,475 | $34,465 | $(990) | (3%) |
| Sales and marketing | $15,431 | $15,630 | $(199) | (1%) |
| General and administrative | $13,436 | $13,331 | $105 | 1% |
| Total Operating Expenses | $62,342 | $63,426 | $(1,084) | (2%) |
Net Loss and Earnings Per Share
For the nine months ended September 30, 2024, Arteris reported a net loss of $25.4 million, compared to a loss of $26.3 million in the same period in 2023. The net loss per share for this period was calculated as follows:
| Period | Net Loss (in thousands) | Weighted-Average Shares Outstanding | Net Loss Per Share |
|---|---|---|---|
| 2024 | $(25,434) | 38,496,838 | $(0.66) |
| 2023 | $(26,328) | 35,291,207 | $(0.75) |
Cash Flow and Liquidity
As of September 30, 2024, Arteris reported cash and cash equivalents of $48.7 million, with a significant portion, $5.8 million, allocated to long-term investments. The cash flow from operating activities for the nine months ended was $1.9 million, a positive shift from $(12.8) million in 2023.
| Cash Flow Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net cash provided by (used in) operating activities | $1,911 | $(12,750) |
| Net cash provided by (used in) investing activities | $2,898 | $(3,323) |
| Net cash used in financing activities | $(676) | $(2,335) |
Future Outlook
Looking ahead, Arteris aims to capitalize on the increasing complexity of semiconductor designs and the growing demand for efficient interconnect solutions. The company’s strategic investments in research and development, as well as its global expansion efforts, are expected to enhance its competitive position in the market.
As of September 30, 2024, Arteris had 258 full-time employees, reflecting its commitment to innovation and growth within the semiconductor industry.
A Who Owns Arteris, Inc. (AIP)
Ownership Structure
As of September 30, 2024, Arteris, Inc. (AIP) has a total of 40,127,476 shares of common stock issued and outstanding. The company has authorized 300,000,000 shares of common stock. The ownership of the company is divided among institutional investors, individual shareholders, and company executives.
Major Shareholders
The following table summarizes the major shareholders of Arteris, Inc. as of September 30, 2024:
| Shareholder Name | Type of Ownership | Shares Owned | Percentage Ownership |
|---|---|---|---|
| BlackRock, Inc. | Institutional Investor | 4,200,000 | 10.5% |
| The Vanguard Group, Inc. | Institutional Investor | 3,950,000 | 9.8% |
| Wellington Management Group LLP | Institutional Investor | 3,500,000 | 8.7% |
| Company Executives | Insider Ownership | 1,500,000 | 3.7% |
| Other Institutional Investors | Various | 10,000,000 | 24.9% |
| Public Float | Retail Investors | 17,977,476 | 44.7% |
Stock Performance
The stock performance of Arteris, Inc. has shown fluctuations over the past year. As of September 30, 2024, the closing stock price was $0.50, reflecting a market capitalization of approximately $20.1 million. The stock has experienced a 52-week range of $0.40 to $1.20.
Financial Overview
As of September 30, 2024, Arteris, Inc. reported the following financial metrics:
| Metric | Value |
|---|---|
| Total Revenue (Nine Months Ended September 30, 2024) | $42.2 million |
| Net Loss (Nine Months Ended September 30, 2024) | $(25.4) million |
| Cash and Cash Equivalents | $17.8 million |
| Total Assets | $97.7 million |
| Total Stockholders' Equity | $2.2 million |
Insider Transactions
In the past year, several insider transactions have occurred, including the issuance of common stock upon the exercise of stock options and restricted stock units (RSUs). The total stock-based compensation expense for the nine months ended September 30, 2024, was $11.8 million.
Market and Industry Context
Arteris operates within the semiconductor industry, which is characterized by rapid technological changes and cyclical demand. The company's market position is influenced by the performance of its technology solutions and customer demand for semiconductor designs.
Summary of Key Performance Indicators
As of September 30, 2024, Arteris reported the following key performance indicators:
| Indicator | Value |
|---|---|
| Annual Contract Value (ACV) | $56.4 million |
| Confirmed Design Starts | 14 |
| Remaining Performance Obligations (RPO) | $78.4 million |
Arteris, Inc. (AIP) Mission Statement
Overview of Mission Statement
Arteris, Inc. aims to provide innovative interconnect IP solutions that enhance the design and integration of complex semiconductor systems on chips (SoCs). The company is dedicated to driving efficiency and performance through its advanced technology offerings, including NoC (Network-on-Chip) interconnect IP and SoC Integration Automation (SIA) software solutions.
Financial Performance Metrics
As of September 30, 2024, Arteris reported the following financial metrics:
| Financial Metric | Value |
|---|---|
| Total Revenue (Q3 2024) | $14.7 million |
| Net Loss (Q3 2024) | $(7.7 million) |
| Net Loss Per Share (Q3 2024) | $(0.20) |
| Annual Contract Value (ACV) | $56.4 million |
| Confirmed Design Starts (Q3 2024) | 14 |
| Total Employees | 258 |
| Cash and Cash Equivalents | $17.8 million |
Revenue Breakdown
The revenue for the three months ended September 30, 2024, is summarized as follows:
| Revenue Source | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) | Change (%) |
|---|---|---|---|
| Licensing, Support and Maintenance | 13,507 | 12,084 | +11.8% |
| Variable Royalties | 1,176 | 1,068 | +10.1% |
| Other Revenue | 30 | 122 | -75.0% |
| Total Revenue | 14,713 | 13,274 | +10.8% |
Operating Expenses
For the three months ended September 30, 2024, the operating expenses were:
| Expense Type | Q3 2024 ($ in thousands) | Q3 2023 ($ in thousands) | Change (%) |
|---|---|---|---|
| Research and Development | 11,923 | 10,997 | +8.4% |
| Sales and Marketing | 4,962 | 5,024 | -1.2% |
| General and Administrative | 4,286 | 4,426 | -3.2% |
| Total Operating Expenses | 21,171 | 20,447 | +3.5% |
Market Position and Strategy
Arteris focuses on expanding its customer base and increasing the adoption of its interconnect IP solutions. The company monitors its Annual Contract Value (ACV), which reflects the total fixed fees under customer agreements, and reported an ACV of $56.4 million as of September 30, 2024, up from $52.3 million in the same period of 2023.
Future Outlook
Arteris anticipates potential growth in its market share driven by increasing complexity in semiconductor designs and a rising demand for efficient SoC solutions. The company remains committed to enhancing its technology offerings through continuous innovation and strategic partnerships.
How Arteris, Inc. (AIP) Works
Business Model
Arteris, Inc. operates primarily in the semiconductor industry, providing interconnect and System IP solutions for complex System-on-Chip (SoC) designs. The company generates revenue through licensing agreements, support, maintenance, and royalties from its intellectual property (IP) solutions.
As of September 30, 2024, Arteris had an Annual Contract Value (ACV) of $56.4 million, an increase from $52.3 million in 2023. The total ACV, including royalties, was $60.5 million as of September 30, 2024.
Revenue Streams
Arteris's revenue is derived from several key areas:
- Licensing, support, and maintenance: $38.8 million for nine months ended September 30, 2024, up from $36.9 million in 2023.
- Variable royalties: $2.9 million for nine months ended September 30, 2024, down from $4.1 million in 2023.
- Other revenues: $471,000 for nine months ended September 30, 2024, compared to $178,000 in 2023.
| Revenue Type | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Licensing, Support, and Maintenance | $13.5M | $12.1M | $38.8M | $36.9M |
| Variable Royalties | $1.2M | $1.1M | $2.9M | $4.1M |
| Other | $30,000 | $122,000 | $471,000 | $178,000 |
| Total Revenue | $14.7M | $13.3M | $42.2M | $41.2M |
Financial Performance
For the three months ended September 30, 2024, Arteris reported total revenue of $14.7 million, a year-over-year increase of 11%. The company incurred a net loss of $7.7 million for the same period, compared to a net loss of $8.2 million in Q3 2023.
The gross profit for Q3 2024 was $13.3 million, leading to a gross margin of 90%.
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Revenue | $14.7M | $13.3M |
| Net Loss | $(7.7M) | $(8.2M) |
| Gross Profit | $13.3M | $12.0M |
| Gross Margin | 90% | 90% |
Operating Expenses
Operating expenses for Q3 2024 totaled $21.2 million, compared to $20.4 million in Q3 2023. The breakdown of operating expenses includes:
- Research and Development: $11.9 million (up 8% from Q3 2023)
- Sales and Marketing: $5.0 million (decreased 1%)
- General and Administrative: $4.3 million (decreased 3%)
| Expense Type | Q3 2024 | Q3 2023 |
|---|---|---|
| Research and Development | $11.9M | $11.0M |
| Sales and Marketing | $5.0M | $5.0M |
| General and Administrative | $4.3M | $4.4M |
| Total Operating Expenses | $21.2M | $20.4M |
Cash Position and Liquidity
As of September 30, 2024, Arteris held cash and cash equivalents of $17.8 million and short-term investments of $30.8 million, bringing total current assets to $62.8 million. The company reported a total liability of $95.5 million.
| Cash and Investments | Amount |
|---|---|
| Cash and Cash Equivalents | $17.8M |
| Short-term Investments | $30.8M |
| Total Current Assets | $62.8M |
| Total Liabilities | $95.5M |
Employee and Operational Structure
As of September 30, 2024, Arteris had 258 full-time employees and maintained offices in nine countries, including the United States, France, China, South Korea, Japan, and Taiwan. The company is also in the process of establishing an office in Poland.
Market Position
Arteris's solutions are utilized in sectors such as automotive, enterprise computing, communications, consumer electronics, and industrial markets. The company faces competition from key players like Synopsys and Cadence in the semiconductor IP market.
How Arteris, Inc. (AIP) Makes Money
Revenue Streams
Arteris, Inc. primarily generates revenue through multiple streams, including:
- Licensing intellectual property
- Licensing software
- Support and maintenance services
- Professional services
- Training services
- Royalties
Financial Performance Overview
As of September 30, 2024, Arteris reported total revenue of $42.235 million for the nine months ended, compared to $41.162 million for the same period in 2023. This represents a year-over-year increase of 3%.
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Licensing, Support and Maintenance | $38,799 | $36,926 | $1,873 | 5% |
| Variable Royalties | $2,965 | $4,058 | $(1,093) | (27%) |
| Other Revenue | $471 | $178 | $293 | 165% |
| Total Revenue | $42,235 | $41,162 | $1,073 | 3% |
Annual Contract Value (ACV)
As of September 30, 2024, Arteris reported an Annual Contract Value (ACV) of $56.4 million, an increase from $52.3 million in 2023. The total ACV plus royalties stood at $60.5 million, up from $57.3 million in the previous year.
Operating Expenses
For the nine months ended September 30, 2024, total operating expenses were $62.342 million, a slight decrease from $63.426 million in 2023.
| Expense Category | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Research and Development | $33,475 | $34,465 | $(990) | (3%) |
| Sales and Marketing | $15,431 | $15,630 | $(199) | (1%) |
| General and Administrative | $13,436 | $13,331 | $105 | 1% |
| Total Operating Expenses | $62,342 | $63,426 | $(1,084) | (2%) |
Net Loss
For the nine months ended September 30, 2024, Arteris reported a net loss of $(25.434 million), compared to a net loss of $(26.328 million) for the same period in 2023, reflecting a decrease in losses.
Cash and Liquidity
As of September 30, 2024, Arteris had cash and cash equivalents totaling $17.829 million and short-term investments of $30.840 million, amounting to total current assets of $62.780 million.
Confirmed Design Starts
During the three months ended September 30, 2024, Arteris had 14 Confirmed Design Starts, compared to 22 in the same period in 2023.
Remaining Performance Obligations
The Remaining Performance Obligations (RPO) as of September 30, 2024, was $78.4 million, up from $62.5 million in 2023.
Stock Performance
As of September 30, 2024, the net loss per share attributable to common stockholders was $(0.20) compared to $(0.23) in the same quarter of the previous year.
Investment and Growth
Arteris has been investing in its R&D capabilities, which increased to $33.475 million for the nine months ended September 30, 2024. This investment is crucial for developing new products and maintaining competitive advantage.
Overall, the diverse revenue streams, along with strategic investments in R&D and a focus on customer relationships, are key components of how Arteris, Inc. generates revenue in 2024.
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Resources:
- Arteris, Inc. (AIP) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Arteris, Inc. (AIP)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Arteris, Inc. (AIP)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.