Arteris (AIP) AI Stock Analysis

• Market Cap: $357.65M
• Dividend Yield: N/A
• Average Volume (3M): 259.93K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.14
• Revenue Growth: 14.68%
• EPS Growth: 20.20%
• Country: US
• Employees: 267
• Sector: Technology
• Sector Strength: 82
• Industry: Semiconductors
• EPS (TTM): -0.09
• Shares Outstanding: 41,977,730
• 10 Day Avg. Volume: 273,738
• 30 Day Avg. Volume: 259,933
• PEG Ratio: -0.42
• Price to Book (P/B): 3.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -17.92
• Enterprise Value/Market Cap: 0.30
• Enterprise Value/Revenue: 0.47
• Enterprise Value/Gross Profit: 1.94
• Enterprise Value/Ebitda: -1.02
• 1Y Price Target: $13.33
• Price Target Upside: 56.46% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 57 Neutral
• Price Target: $8.00 ▼(-6.10%Downside)

Arteris's overall stock score is driven by strong revenue growth and positive earnings call sentiment, despite significant challenges in profitability and valuation. The company's technical indicators suggest moderate bullish momentum, while financial leverage remains a risk.

Positive Factors

Customer Growth

Arteris added 14 new customers in 2024, while higher ASP FlexNoc5 and new products like FlexGen demonstrate continued momentum.

Financial Performance

The company reported record annual contract value (ACV) plus royalties, record RPO, and strong FCF generation, an indicator of the strong underlying demand for its network-on-chip IP solutions.

Licensing Win

Securing a licensing win with a leading Japanese automotive OEM for a new autonomous driving SoC was another highlight, bringing the company's total direct Auto OEM engagements to 10.

Revenue

Arteris' revenue of $15.5M came in ahead of the midpoint of management's previously provided range.

Negative Factors

Economic Environment

The uncertain economic environment is impacting demand for Arteris' customers' products, particularly in Automotive and Consumer.

Royalty Line

A lighter-than-anticipated royalty line likely contributed to a mixed quarter performance due to the tepid auto backdrop.

Arteris Business Overview & Revenue Model

Company Description

Arteris (AIP) is a leading provider of interconnect and IP solutions for system-on-chip (SoC) design, primarily serving markets such as automotive, artificial intelligence, machine learning, and consumer electronics. The company's flagship products are its network-on-chip (NoC) interconnect IP and associated software tools, which enable efficient and scalable SoC design, enhancing performance while reducing power consumption and cost.

How the Company Makes Money

Arteris makes money primarily by licensing its intellectual property (IP) solutions to semiconductor and electronic device manufacturers who integrate these solutions into their SoC designs. The company charges upfront licensing fees as well as royalties based on the production volume of chips that incorporate its IP. Additionally, Arteris offers maintenance and support services, which provide recurring revenue streams. Strategic partnerships with major semiconductor companies and technology firms also contribute to Arteris' revenue by expanding its market reach and fostering innovation in its product offerings.

Arteris Financial Statement Overview

Summary

Arteris shows strong revenue growth and a high gross profit margin. However, the company faces profitability issues with negative net and EBIT margins. Its balance sheet reveals financial leverage risks with negative equity, though liabilities are decreasing. Cash flow has improved but remains weak relative to net income.

Income Statement

Arteris has shown consistent revenue growth, with a revenue increase of 13.51% from 2023 to 2024 and an additional 6.21% in TTM. However, profitability remains a challenge with negative net profit margins and EBIT margins. Despite a strong gross profit margin of 89.19% in TTM, the sustained losses highlight ongoing operational challenges.

Balance Sheet

The company's balance sheet reveals significant financial leverage, with negative stockholders' equity in TTM, indicating high reliance on debt financing. This is a potential risk factor, though total liabilities have decreased over the periods. The equity ratio is negative due to liabilities exceeding assets, indicating weak financial stability.

Cash Flow

Arteris has improved its free cash flow position, turning positive in TTM, which is a positive indicator. However, cash flow from operations remains weak relative to net income, reflecting challenges in converting sales into cash. The operating cash flow to net income ratio suggests inefficiencies in cash generation.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
61.31M	57.72M	53.67M	50.38M	37.86M	31.81M
	Gross Profit
54.69M	51.76M	48.59M	46.10M	34.13M	30.32M
	EBIT
-30.17M	-31.60M	-35.14M	-28.86M	-21.77M	-3.78M
	EBITDA
-25.18M	-24.83M	-28.52M	-25.35M	-20.27M	-1.25M
	Net Income Common Stockholders
-32.36M	-33.64M	-36.87M	-27.10M	-23.38M	-3.26M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
16.37M	43.84M	41.17M	68.15M	85.83M	11.74M
	Total Assets
98.32M	106.14M	102.80M	115.52M	120.44M	42.74M
	Total Debt
4.54M	5.99M	7.75M	3.62M	3.91M	4.77M
	Net Debt
-11.83M	-7.69M	-5.94M	-33.80M	-81.91M	-6.97M
	Total Liabilities
103.14M	107.32M	87.70M	77.98M	67.54M	54.74M
	Stockholders Equity
-4.82M	-1.19M	15.10M	37.53M	52.90M	-12.01M
Cash Flow		Free Cash Flow
1.35M	-1.04M	-17.23M	-7.82M	-1.62M	1.51M
	Operating Cash Flow
1.66M	-720.00K	-15.73M	-6.77M	-814.00K	2.16M
	Investing Cash Flow
-11.05M	970.00K	-4.69M	-37.48M	-1.36M	-5.15M
	Financing Cash Flow
-358.00K	-262.00K	-2.92M	-4.15M	76.25M	790.00K

Arteris Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.52
• 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 8.52 is above the 20-day moving average (MA) of 7.72, above the 50-day MA of 7.04, and above the 200-day MA of 8.25, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 65.68 is Neutral, neither overbought nor oversold. The STOCH value of 75.64 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
AEHR	76 Outperform	$363.51M	15.00	21.69%	―	-14.48%	46.79%
NVEC	70 Outperform	$354.95M	23.57	23.57%	5.45%	-13.18%	-12.06%
Sector *	62 Neutral	$11.92B	10.48	-7.50%	2.95%	7.40%	-8.18%
XPER	60 Neutral	$367.78M	―	-4.71%	―	-4.77%	84.82%
AIP	57 Neutral	$357.65M	―	-1369.57%	―	14.68%	20.20%
INDI	54 Neutral	$690.67M	―	-32.43%	―	-7.09%	-53.23%
BZAI	42 Neutral	$256.24M	―	-375.37%	―	―	-10774.57%

Arteris Corporate Events

Arteris Holds Annual Stockholders Meeting, Elects Directors

On June 3, 2025, Arteris, Inc. held its Annual Meeting of Stockholders where two key proposals were voted upon. The stockholders elected two Class I directors, K. Charles Janac and S. Atiq Raza, to serve until the 2028 annual meeting, and ratified Deloitte & Touche, LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025.

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

Arteris Board Member Isabelle Geday Resigns

On March 25, 2025, Isabelle F. Geday announced her resignation from the board of directors of Arteris, Inc., effective March 27, 2025, citing personal reasons unrelated to any disagreements with the company’s operations or policies. In response to her unexpected departure and in appreciation of her service since 2020, the board approved the accelerated vesting of her 19,287 restricted stock units, which were initially set to vest in June 2025 or at the company’s 2025 annual meeting.