Company: AIP
Filing Date: 2025-11-04
Form Type: 10-Q
Source: 0001628280-25-048977
Chunk: 34

Company: Arteris, Inc.
Filing Date: 2025-11-04
Form: 10-Q
Item: Part I, Item 1
Chunk 34
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4 million for the three months ended September 30, 2025 compared to a benefit of $0.1 million for the three months ended September 30, 2024. The increase in our income tax expense was due to changes in current year foreign withholding taxes, impact of losses in jurisdictions which have full valuation allowances and impacts of the One Big Beautiful Bill Act of 2025 (OBBBA). Foreign withholding taxes are generally assessed on gross revenue generated, rather than pre-tax income, in certain countries in which the Company does not file an income tax return.

On July 4, 2025, the U.S. enacted a budget reconciliation package, OBBBA. In accordance with GAAP, we accounted for the tax effects of changes in tax law in the period of enactment which is the third quarter of calendar year 2025, and the impact was not material to our consolidated financial statements.

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Comparison of the Nine Months Ended September 30, 2025 and 2024

Revenue

Nine Months Ended September 30,Change20252024$%(dollars in thousands)Licensing, support and maintenance$46,319 $38,799 $7,520 19 %Variable royalties4,074 2,965 1,109 37 %Other49 471 (422)(90)%Total$50,442 $42,235 $8,207 19 %

Revenue from licensing, support and maintenance increased by $7.5 million for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The increase in revenue from licensing, support and maintenance was primarily due to new license arrangements with existing customers, and the addition of new customers. Growth in our variable royalty revenue was primarily due to an increase in product sales of certain existing customers, and the addition of new customers. Other revenue decreased primarily due to revenue from professional services that was recognized during the nine months ended September 30, 2024, which did not repeat during the nine months ended September 30, 2025.

Cost of revenue

Nine Months Ended September 30,Change20252024$%(dollars in thousands)Cost of revenue$5,034 $4,387 $647 15 %

Cost of revenue increased by $0.6 million, or 15%, to $5.0 million for the nine months ended September 30, 2025 from $4.4