Arteris (AIP) AI Stock Analysis

• Market Cap: $709.74M
• Dividend Yield: N/A
• Average Volume (3M): 458.46K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.99
• Revenue Growth: 20.45%
• EPS Growth: 12.28%
• Country: US
• Employees: 267
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): -0.05
• Shares Outstanding: 45,467,262
• 10 Day Avg. Volume: 520,058
• 30 Day Avg. Volume: 458,456
• PEG Ratio: 4.06
• Price to Book (P/B): -44.80
• Price to Sales (P/S): 9.29
• P/FCF Ratio: 122.64
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 10.61
• Enterprise Value/Gross Profit: 11.75
• Enterprise Value/Ebitda: -26.64
• 1Y Price Target: $21.67
• Price Target Upside: 27.40% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): -0.17
• Revenue Forecast (FY): $91.01M

• Rating: 47 Neutral
• Price Target: $17.00 ▼(-0.06% Downside)
• Action: Reiterated Date: 02/14/26
• Date: Action: Reiterated 02/14/26

The score is held back most by weak financial performance (persistent large GAAP losses and negative equity) and soft technical momentum (below key moving averages with negative MACD). Offsetting these are a more constructive earnings-call outlook with strong top-line traction, improving operating leverage, and 2026 guidance pointing toward better profitability and positive non-GAAP free cash flow.

Positive Factors

High Gross Margins

Sustained ~92% gross margins reflect a highly scalable licensing and royalty model with minimal incremental product costs. This structural margin advantage supports operating leverage as revenues grow, funds R&D and ecosystem support, and provides durable cash generation potential.

Growing Recurring Revenue & Backlog

Record ACV plus royalties and a larger RPO backlog increase recurring and volume-linked revenue visibility. An expanding royalty base diversifies income by tying fees to chip shipments, creating multi-year revenue leverage that strengthens predictability and supports long-term margin expansion.

Improving Cash Generation & Profitability Path

A turnaround to positive free cash flow in 2025 and guidance for positive non‑GAAP FCF in 2026 indicate improving operational efficiency and disciplined expense control. Durable cash generation reduces reliance on external financing and provides resources for product investment and targeted M&A.

Negative Factors

Persistent GAAP Losses & Negative Equity

Large GAAP losses and a negative equity position weaken balance-sheet resilience and limit financing flexibility. If GAAP losses persist, the company may face constraints on strategic investments or deal-making, increasing risk around sustaining growth and executing multi-year product roadmaps.

Backlog Conversion & Revenue Timing Risk

Material uncertainty in converting RPO to recognized revenue reduces top-line visibility and planning accuracy. Structural timing risk in royalty and contract recognition can produce volatile quarter-to-quarter cash flows, complicating capacity, hiring and investment decisions over the medium term.

Cycuity Integration & Near-term Margin Drag

The Cycuity acquisition broadens TAM but brings lower-margin government-subcontractor work and near-term cash drag. Integration and margin dilution risk could persist until cross-sell synergies scale, pressuring near-term margins and cash if integration execution lags expectations.

Arteris Business Overview & Revenue Model

Company Description

Arteris, Inc. provides semiconductor interconnect intellectual property (IP) and IP deployment solutions in the Americas, the Asia Pacific, Europe, and the Middle East. The company develops, licenses, and supports the on-chip interconnect fabric technology used in System-on-Chip (Soc) designs and Network-on-Chip (NoC) interconnect IP. Its products include FlexNoC, a silicon-proven interconnect IP product; FlexNoC Resilience Package, which provides on-chip data protection; Ncore, a silicon-proven and cache coherent interconnect IP product that provides scalable, configurable, and area efficient characteristics; CodaCache, a last-level cache semiconductor IP product; and Physical interconnect aware NoC optimizer, a software tool that estimates physical layout effects during the architecture and logic development stages of an SoC interconnect design; The company also offers FlexWay for IP subsystem interconnect; FlexPSI for All-digital inter chip link; and FlexNoC Physical for linking physical placement and routing tools. In addition, it provides IP deployment software solutions, including specification, design, documentation, artificial intelligence (AI) package, design data intelligence, and harmony trace. The company serves customers in the automotive, AI/machine learning, 5G and wireless communications, data centers, consumer electronics, and other markets. Arteris, Inc. was founded in 2003 and is headquartered in Campbell, California.

How the Company Makes Money

Arteris generates revenue primarily through the licensing of its technology and software solutions to semiconductor companies. This includes both one-time licensing fees and recurring royalties based on the production volumes of chips utilizing their NoC technology. Additionally, Arteris offers professional services such as design consultancy and technical support, which further contribute to its income. Significant partnerships with major semiconductor manufacturers and ongoing collaborations with industry leaders bolster the company's market position and provide a steady stream of revenue through joint development projects and co-marketing agreements.

Arteris Financial Statement Overview

Summary

Exceptionally high gross margins (~90%+) and improved cash generation in 2025 (operating cash flow $6.7M; free cash flow $5.3M) are positives, but the company remains deeply unprofitable (2025 net loss -$34.7M) and balance-sheet resilience weakened with stockholders’ equity turning negative (-$14.6M).

Income Statement

Revenue has grown steadily over the last several years, reaching $70.6M in 2025 (up ~7% year over year), and gross margins are exceptionally strong (~90%+), indicating a highly scalable product economics profile. However, the company remains deeply unprofitable: operating losses persist each year and net losses were -$34.7M in 2025 (roughly -49% net margin). The trajectory shows improving losses versus 2023–2024, but profitability is still not in sight, which weighs heavily on the score.

Balance Sheet

Debt levels are modest in absolute terms ($4.3M total debt in 2025), which helps limit financial risk from leverage. The major weakness is capital structure: stockholders’ equity turned negative in 2025 (-$14.6M) after being near break-even in 2024 and positive in 2021–2023, which reduces balance-sheet resilience and can constrain financing flexibility. Total assets are sizable ($115.0M), but the negative equity position is a meaningful red flag.

Cash Flow

Cash generation improved materially in 2025, with operating cash flow of $6.7M and free cash flow of $5.3M, a notable turnaround from cash burn in 2022–2024. This suggests improving cash efficiency despite ongoing accounting losses. The key weakness is volatility: free cash flow has swung sharply year to year, and the business still reports large net losses, so sustaining positive cash flow will be important to prove durability.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	70.58M	57.72M	53.67M	50.38M	37.86M
Gross Profit	63.68M	51.76M	48.59M	46.10M	34.13M
EBITDA	-29.76M	-24.83M	-28.52M	-25.33M	-20.27M
Net Income	-34.75M	-33.64M	-36.87M	-27.39M	-23.38M
Balance Sheet
Total Assets	115.03M	106.14M	102.80M	115.52M	120.44M
Cash, Cash Equivalents and Short-Term Investments	54.60M	43.84M	41.17M	68.15M	85.83M
Total Debt	9.08M	5.99M	7.75M	3.62M	3.91M
Total Liabilities	129.66M	107.32M	87.70M	77.98M	67.54M
Stockholders Equity	-14.63M	-1.19M	15.10M	37.53M	52.90M
Cash Flow
Free Cash Flow	5.34M	-1.04M	-17.23M	-7.82M	-1.62M
Operating Cash Flow	6.73M	-720.00K	-15.73M	-6.77M	-814.00K
Investing Cash Flow	12.03M	970.00K	-4.69M	-37.48M	-1.36M
Financing Cash Flow	1.42M	-262.00K	-2.92M	-4.15M	76.25M

Arteris Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17.01
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AIP, the sentiment is Positive. The current price of 17.01 is above the 20-day moving average (MA) of 14.94, above the 50-day MA of 15.80, and above the 200-day MA of 12.03, indicating a bullish trend. The MACD of -0.13 indicates Negative momentum. The RSI at 63.19 is Neutral, neither overbought nor oversold. The STOCH value of 75.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AIP.

Arteris Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVEC	81 Outperform	$334.15M	23.60	23.36%	6.28%	-9.48%	-14.28%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CEVA	52 Neutral	$543.87M	-48.16	-3.53%	―	5.55%	-239.94%
LAES	50 Neutral	$724.81M	-8.40	-45.62%	―	-44.30%	16.42%
VLN	48 Neutral	$156.62M	-5.03	-25.50%	―	7.53%	-15.00%
AIP	47 Neutral	$709.74M	-20.69	―	―	20.45%	12.28%
BZAI	45 Neutral	$136.69M	-0.52	-1331.73%	―	―	-1827.24%

Arteris Corporate Events

Arteris Announces Merger Agreement with Cycuity

On December 10, 2025, Arteris, Inc. entered into a merger agreement to acquire Cycuity, Inc. through a two-step merger process. The acquisition involves a total consideration of up to $45 million, including cash, shares, and potential earnout payments contingent on Cycuity’s performance in 2026. The transaction is subject to customary closing conditions and includes escrow arrangements for indemnification and post-closing adjustments.

The most recent analyst rating on (AIP) stock is a Hold with a $15.00 price target. To see the full list of analyst forecasts on Arteris stock, see the AIP Stock Forecast page.