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Arteris
(NASDAQ:AIP)
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Rating:55Neutral
Price Target:
$32.00
▲(5.72% Upside)
Action:Reiterated
Date:08/07/26
The score is held back primarily by ongoing unprofitability and inconsistent free cash flow despite strong gross margins and revenue momentum. Offsetting this, the latest earnings call was meaningfully constructive with raised revenue guidance, record ACV/RPO indicators, and a stated path toward non-GAAP profitability. Technicals are mixed with weaker intermediate momentum, and valuation remains challenged due to losses and no dividend support.
Positive Factors
Exceptional gross margins
Sustained gross margins near the high 80s reflect a licensing/IP business with low incremental cost to serve. This structural margin advantage supports long-term operating leverage as revenue scales and underpins durable cash generation potential once fixed operating expenses are controlled.
Negative Factors
Persistent GAAP losses
Despite strong revenue growth and gross margins, the company remains deeply unprofitable on a GAAP basis with wide negative net margins. Ongoing losses constrain reinvestment, limit retained earnings, and require clear evidence of sustained operating leverage to validate a durable path to profitability.
Read all positive and negative factors
Positive Factors
Negative Factors
Exceptional gross margins
Sustained gross margins near the high 80s reflect a licensing/IP business with low incremental cost to serve. This structural margin advantage supports long-term operating leverage as revenue scales and underpins durable cash generation potential once fixed operating expenses are controlled.
Read all positive factors
Arteris Key Performance Indicators (KPIs)
Any
Annual Contract Value
Measures the total value of recurring contracts over a year, indicating the company's ability to secure long-term revenue streams and customer commitment.
Measures the total value of recurring contracts over a year, indicating the company's ability to secure long-term revenue streams and customer commitment.
Data provided by:
The Fly
The FlyArteris (AIP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.33B
Dividend YieldN/A
Average Volume (3M)935.60K
Price to Earnings (P/E)―
Beta (1Y)1.90
Revenue Growth33.81%
EPS Growth-7.37%
CountryUS
Employees353
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)-0.87
Shares Outstanding49,152,103
10 Day Avg. Volume579,531
30 Day Avg. Volume935,603
Financial Highlights & Ratios
PEG Ratio4.06
Price to Book (P/B)-44.80
Price to Sales (P/S)9.29
P/FCF Ratio122.64
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda>-0.01
Forecast
1Y Price Target
$41.00Price Target Upside35.45% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)-0.1
Revenue Forecast (FY)$94.58M
Arteris Business Overview & Revenue Model
Company Description
Arteris, Inc., together with its subsidiaries, provides semiconductor system intellectual property (IP) solutions in the United States, rest of the Americas, China, Korea, the rest of the Asia Pacific, Europe, and the Middle East. It manages on-ch...
How the Company Makes Money
Arteris makes money primarily by licensing its semiconductor IP and collecting associated fees over the life of customers’ chip programs. Key revenue streams typically include: (1) License revenue: upfront fees paid by customers for the right to u...
Arteris Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 10, 2026
Earnings Call Sentiment Positive
The call emphasized multiple record highs (ACV + royalties, royalties, RPO, revenue), strong top‑line growth (46% revenue YoY) and improving cash strength (positive FCF and $123M cash), alongside clear product and ecosystem momentum (Arm partnership, large FlexGen deals, diversified wins). Near‑term challenges include elevated payroll tax and commission driven OpEx, acquisition‑related charges, some royalty cadence variability, and continued GAAP losses. Management raised revenue guidance and reiterated a path to non‑GAAP profitability, while also disclosing one‑time and timing headwinds that modestly tempered profitability expectations.Positive Updates
Record ACV + Royalties
Exited Q2 2026 with ACV plus royalties of $99.5M, a 44% year‑over‑year increase and a new company record.
Negative Updates
Operating Losses and GAAP Drag
Non‑GAAP operating loss was $4.6M in Q2; GAAP operating loss was $13.9M and GAAP net loss was $14.1M (diluted loss per share $0.30). The company remains unprofitable on a GAAP basis.
Read all updates
Q2-2026 Updates
Positive
Negative
Record ACV + Royalties
Exited Q2 2026 with ACV plus royalties of $99.5M, a 44% year‑over‑year increase and a new company record.
Read all positive updates
Company Guidance
Management guided Q3 2026 to ACV plus royalties of $99M–$103M, revenue of $24M–$25M, and a non‑GAAP operating loss of $3M–$1M (noting this reflects a higher run‑rate of French employer payroll taxes on RSU vesting). For full‑year 2026 they raised revenue guidance to $95M–$98M (up $3.5M from prior guidance, ~37% YoY at the midpoint), expect ACV plus royalties to exit at $102M–$106M, project a non‑GAAP operating loss of $10M–$7M and non‑GAAP free cash flow of +$5M–+$9M (unchanged). They also reported RPO of $135M at quarter end with just over half expected to convert to revenue starting July 1, 2026, and reiterated that Arteris could reach non‑GAAP operating profitability as early as Q4 2026.Arteris Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
52
Neutral
Cash Flow
41
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 84.61M | 70.58M | 57.72M | 53.67M | 50.38M | 37.86M |
| Gross Profit | 73.48M | 63.68M | 51.76M | 48.59M | 46.10M | 34.13M |
| EBITDA | -38.95M | -29.70M | -24.83M | -28.52M | -25.33M | -20.27M |
| Net Income | -39.52M | -34.75M | -33.64M | -36.87M | -27.39M | -23.38M |
Balance Sheet | ||||||
| Total Assets | 224.71M | 115.03M | 106.14M | 102.80M | 115.52M | 120.44M |
| Cash, Cash Equivalents and Short-Term Investments | 122.06M | 54.60M | 43.84M | 41.17M | 68.15M | 85.83M |
| Total Debt | 8.69M | 9.08M | 5.99M | 7.75M | 3.62M | 3.91M |
| Total Liabilities | 157.04M | 129.66M | 107.32M | 87.70M | 77.98M | 67.54M |
| Stockholders Equity | 67.67M | -14.63M | -1.19M | 15.10M | 37.53M | 52.90M |
Cash Flow | ||||||
| Free Cash Flow | 6.77M | 5.34M | -1.04M | -17.23M | -7.82M | -1.62M |
| Operating Cash Flow | 8.51M | 6.73M | -720.00K | -15.73M | -6.77M | -814.00K |
| Investing Cash Flow | -4.98M | 12.03M | 970.00K | -4.69M | -37.48M | -1.36M |
| Financing Cash Flow | 73.60M | 1.42M | -262.00K | -2.92M | -4.15M | 76.25M |
Arteris Risk Analysis
Arteris disclosed 67 risk factors in its most recent earnings report. Arteris reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Arteris Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $572.53M | 31.42 | 30.53% | 3.40% | 24.07% | 23.86% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
55 Neutral | $1.33B | -31.55 | -357.77% | ― | 33.81% | -7.37% | |
55 Neutral | $898.68M | -76.50 | -3.89% | ― | 8.82% | 2.60% | |
48 Neutral | $589.50M | -8.82 | -11.80% | ― | 79.31% | 57.71% | |
46 Neutral | $180.82M | -5.45 | -29.33% | ― | 11.92% | 7.07% | |
45 Neutral | $146.57M | -1.46 | -536.89% | ― | 3908.24% | 60.14% |
* Technology Sector Average
AIP
Arteris
27.45
17.33
171.25%
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Arteris Corporate Events
Business Operations and StrategyExecutive/Board Changes
Arteris Appoints New Chief Financial Officer for Growth
Positive
Aug 6, 2026
On August 6, 2026, Arteris announced that it had appointed Saurabh Sinha as Chief Financial Officer, effective September 8, 2026, succeeding retiring CFO Nick Hawkins after his seven-year tenure. Hawkins, who helped lead Arteris through its IPO an...
Executive/Board ChangesShareholder Meetings
Arteris Shareholders Approve Directors and Auditor at Meeting
Positive
Jun 4, 2026
On June 2, 2026, Arteris, Inc. held its Annual Meeting of Stockholders, where investors voted on the election of three Class II directors and the ratification of the company’s independent auditor. Stockholders elected Antonio J. Viana, Wayne...
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Arteris Announces CFO Retirement Amid Strong Growth Momentum
Positive
May 12, 2026
Arteris, Inc. is a semiconductor technology company specializing in network-on-chip interconnect IP, system-on-chip integration automation software and hardware security assurance solutions. Its products are designed to optimize data movement, pow...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.