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Arteris, Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 6 August 2026: press release. Guidance figures: 1 raised, 1 lowered, 4 new, 1 kept. The quarter’s numbers.

Key takeaways

  • Revenue rose 46% year over year: Revenue was $24.1 million, up from $16.5 million a year earlier. Trailing-twelve-months variable royalties reached $8.6 million, up 65%. Source
  • ACV plus royalties reached record level: ACV plus royalties exited the quarter at $99.5 million, up 44%. Remaining Performance Obligation was $135 million, up 36%, with the company citing record levels. Source
  • Full-year revenue range raised: Full-year 2026 revenue guidance is $95.0 to $98.0 million, up from the $91.0 to $95.0 million range in the first quarter release. Source
  • Full-year operating loss range widened: Non-GAAP operating loss guidance for full-year 2026 is $7.0 to $10.0 million, against $4.5 to $8.5 million previously. Source
  • Design starts up 21%: Confirmed design starts rose 21% in the trailing twelve months to June 30, 2026, against the prior twelve months. Management described design activity as healthy. Source
  • Cash balance rose sharply: Cash and cash equivalents rose to $93.3 million from $33.9 million at December 31, 2025. Short-term investments were $28.8 million. Source
  • Sinha named CFO from September 8: Saurabh Sinha joins as Chief Financial Officer from Aeva Technologies, where he helped take the company public and managed financial operations and investor relations. Source

“In the second quarter we delivered multiple record-breaking results, including new highs in Annual Contract Value plus royalties exiting the quarter at $99.5 million, up 44% year-over-year, and record revenue, royalties and Remaining Performance Obligation”

K. Charles Janac, President and Chief Executive Officer

Guidance

AreaPeriodFigureAgainst last quarter
ACV plus royalties Sourcethird quarter 2026$99.0 - $103.0 millionNew
ACV plus royalties Sourcefull year 2026$102.0 - $106.0 millionKept
Revenue Sourcethird quarter 2026$24.0 - $25.0 millionNew
Revenue Sourcefull year 2026$95.0 - $98.0 millionRaised from $91.0 - $95.0 million
Non-GAAP operating loss Sourcethird quarter 2026$1.0 - $3.0 millionNew
Non-GAAP operating loss Sourcefull year 2026$7.0 - $10.0 millionLowered from $4.5 - $8.5 million
Free cash flow Sourcethird quarter 2026$5.0 - $9.0 millionNew

What changed from last quarter

  • Guidance raised: Full-year 2026 revenue range raised to $95.0 - $98.0 million from $91.0 - $95.0 million. Source
  • Guidance lowered: Full-year 2026 non-GAAP operating loss range widened to $7.0 - $10.0 million from $4.5 - $8.5 million. Source
  • Guidance kept: Full-year 2026 ACV plus royalties range kept at $102.0 - $106.0 million. Source
  • Guidance withdrawn: The prior release's full-year free cash flow range of $5.0 - $9.0 million does not appear in the updated table; quarterly free cash flow guidance is no longer provided. Source
  • New guidance: Estimated third-quarter 2026 ranges given for ACV plus royalties, revenue, non-GAAP operating loss and free cash flow. Source
  • New: Saurabh Sinha named Chief Financial Officer, starting September 8, 2026. Source
  • Ended: Nicholas B. Hawkins's role as Chief Financial Officer ends with his retirement effective August 31, 2026.
  • New: Arm expanded its partnership with Arteris, licensing hardware security assurance technology. Source

Results and growth drivers

  • Revenue rose 46% year over year: Revenue was $24.1 million, up from $16.5 million a year earlier. Trailing-twelve-months variable royalties reached $8.6 million, up 65%. Source
  • ACV plus royalties reached record level: ACV plus royalties exited the quarter at $99.5 million, up 44%. Remaining Performance Obligation was $135 million, up 36%, with the company citing record levels. Source
  • Operating loss rose year over year: Operating loss was $13.9 million against $8.2 million in the second quarter of 2025. Non-GAAP operating loss was $4.6 million against $3.5 million. Source
  • Net loss and per-share figures: Net loss was $14.1 million, or $0.30 per share, against $9.1 million a year earlier. Non-GAAP net loss was $4.7 million, or $0.10 per share. Source
  • Results against prior second-quarter estimates: Prior estimates for the second quarter were revenue of $23.0 - $24.0 million and non-GAAP operating loss of $2.0 - $3.0 million. Reported revenue was $24.1 million and non-GAAP operating loss was $4.6 million.

Updated 2026 guidance

  • Full-year revenue range raised: Full-year 2026 revenue guidance is $95.0 to $98.0 million, up from the $91.0 to $95.0 million range in the first quarter release. Source
  • Full-year operating loss range widened: Non-GAAP operating loss guidance for full-year 2026 is $7.0 to $10.0 million, against $4.5 to $8.5 million previously. Source
  • Full-year ACV plus royalties unchanged: ACV plus royalties guidance for full-year 2026 stayed at $102.0 to $106.0 million. Source
  • Third-quarter estimates provided: Third-quarter 2026 estimates: ACV plus royalties $99.0 to $103.0 million, revenue $24.0 to $25.0 million, non-GAAP operating loss $1.0 to $3.0 million, free cash flow $5.0 to $9.0 million. Source
  • Quarterly free cash flow guidance discontinued: The company said it will no longer provide quarterly free cash flow guidance. The full-year free cash flow row from the prior release is not in the updated table. Source

“Data center chip and chiplet development remains a key growth driver, with enterprise computing averaging 29% of our Annual Contract Value plus royalties over the past four quarters and AI infrastructure deals among our largest in the quarter.”

K. Charles Janac, President and Chief Executive Officer

Demand and design activity

  • Design starts up 21%: Confirmed design starts rose 21% in the trailing twelve months to June 30, 2026, against the prior twelve months. Management described design activity as healthy. Source
  • Most new designs include AI compute: Management said the majority of new designs now incorporate some form of AI compute. Source
  • Enterprise computing share of ACV: Enterprise computing averaged 29% of ACV plus royalties over the past four quarters. AI infrastructure deals were among the largest in the quarter. Source
  • Deal activity across six end markets: Deal activity was driven by customer engagement in enterprise computing, automotive, aerospace and defense, communications, consumer electronics and industrial markets. Source

Customers and product wins

  • Speedata deployed Arteris: Speedata, which develops an Analytics Processing Unit, deployed Arteris in its Callisto processor for large-volume analytics. Source
  • Li Auto used Arteris in SUV chips: Li Auto deployed its in-house autonomous driving chips in its newest SUV, using Arteris technology. Source
  • SiEngine selected Arteris for cockpit: SiEngine selected Arteris for intelligent cockpit, advanced driver assistance and AI cockpit-drive fusion solutions. Source
  • Arm expanded Arteris partnership: Arm licensed Arteris hardware security assurance technology, which is already used in selected Arm CPUs. Source

“With this momentum, we believe we remain well positioned to support our customers as they innovate across data centers, edge devices, and physical AI systems in the years ahead”

K. Charles Janac, President and Chief Executive Officer

Costs and gross margin

  • Gross margin lower year over year: GAAP gross margin was 85% against 89% a year earlier. Non-GAAP gross margin was 87% against 91%. Source
  • Operating expenses rose across lines: Research and development rose to $16.8 million from $12.2 million, sales and marketing to $9.4 million from $6.3 million, and general and administrative to $6.1 million from $4.5 million. Source
  • Cycuity acquisition costs excluded: Acquisition-related costs were $2.2 million in the quarter. The company excludes them from non-GAAP results and ties them to the Cycuity acquisition. Source
  • Stock-based compensation excluded from non-GAAP: Stock-based compensation was $6.3 million in the quarter. It is excluded from the non-GAAP operating loss. Source

Cash, capital and share count

  • Cash balance rose sharply: Cash and cash equivalents rose to $93.3 million from $33.9 million at December 31, 2025. Short-term investments were $28.8 million. Source
  • At-the-market offering raised $72.5 million: Proceeds from the at-the-market offering, net of commissions and offering costs, were $72.5 million for the six months ended June 30, 2026. Source
  • Shares outstanding increased: Shares outstanding were 49,051,892 at June 30, 2026, against 44,268,816 at December 31, 2025. Source
  • Free cash flow positive in quarter: Free cash flow was $8.6 million for the quarter, against negative $2.8 million a year earlier. Six-month free cash flow was $1.3 million. Source
  • Goodwill and intangibles increased: Goodwill rose to $35.3 million from $4.2 million at December 31, 2025, and intangibles, net, rose to $18.8 million from $2.2 million. Source

Leadership change

  • Sinha named CFO from September 8: Saurabh Sinha joins as Chief Financial Officer from Aeva Technologies, where he helped take the company public and managed financial operations and investor relations. Source
  • Hawkins to retire, then advise: Nicholas B. Hawkins notified the company in May that he will retire effective August 31, 2026, and will continue as an advisor afterward.
  • Retirement tied to family illness: The company said Hawkins's decision to retire is due to an illness in his family and not to any disagreement with the company.

Coming up, as management said on 6 August 2026

  • Sinha starts as CFO: Saurabh Sinha is scheduled to begin as Chief Financial Officer on September 8, 2026. Source
  • Third-quarter 2026 estimates: Management gave estimated third-quarter 2026 ranges for ACV plus royalties, revenue, non-GAAP operating loss and free cash flow. Source

Figures management reported

FigureReported
Backlog SourceRemaining Performance Obligation of $135 million, up 36% year-over-year
Gross margin SourceGAAP 85% (89% a year earlier); non-GAAP 87% (91%)
End-market revenue (enterprise computing) Sourceaveraging 29% of ACV plus royalties over the past four quarters

Earlier plans management reported on

  • Not stated: Management said in the first quarter call that quarterly free cash flow guidance would no longer be provided. The release still shows a third-quarter free cash flow range. Source
  • Not stated: The former CFO said the company was transitioning to Non-GAAP profitability this year. The second-quarter release shows a non-GAAP operating loss for the quarter and full year.

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.