 Significant Expansion of SAM and Growth Prospects Despite Short-term Disruptions in Global MarketSAN JOSE, Calif., July 30, 2020 GLOBE NEWSWIRE -- DSP Group, Inc. NASDAQ: DSPG, a leading global provider of voice and wireless chipset solutions for converged communications, announced today its results for the second quarter ended June 30, 2020. Second Quarter Financial Highlights and Comparisons to Second Quarter of 2019: Total revenues of 28.3 million, a 2 decrease: Revenues from IoAT Internet of Audio Things businesses formerly growth initiatives of 18.4 million accounted for 65 of total revenues, an increase of 4. Unified Communications segment revenues of 10.1 million, an increase of 15. SmartVoice segment revenues of 3.9 million, a decrease of 26. SmartHome segment revenues of 4.3 million, an increase of 18. Cordless revenues of 9.9 million, a decrease of 12. GAAP and non-GAAP gross margin of 50.3 and 50.8, respectively, a 60 and 70 basis point increase, respectively. GAAP loss per share of 0.05 and non-GAAP diluted earnings per share of 0.06, compared to GAAP loss per share of 0.02 and non-GAAP diluted earnings per share of 0.07 for the second quarter of 2019. GAAP operating loss of 1.4 million and non-GAAP operating income of 1.0 million, compared to GAAP operating loss of 1.3 million and non-GAAP operating income of 0.9 million, respectively for the second quarter of 2019. GAAP net loss of 1.1 million and non-GAAP net income of 1.6 million, compared to GAAP net loss of 0.5 million and non-GAAP net income of 1.7 million for the second quarter of 2019. Generated 8.0 million of cash from operations, compared to 3.0 million of cash from operations in the second quarter of 2019. Repurchased 29,000 shares of common stock for a total consideration of 0.4 million. Cash, deposits and marketable securities of approximately 137.5 million as of June 30, 2020.Management Comments: Commenting on the results, Ofer Elyakim, CEO of DSP Group, stated: Our second quarter performance reflects prudent execution while navigating through a disrupted business environment brought about by the COVID-19 pandemic. We ended the quarter with revenues of 28.3 million, above the mid-point of our guidance range, driven by solid performance in our IoAT businesses that grew by 4 year over year to a total of 18.4 million and comprised 65 of total revenues. Our performance benefitted from solid results in our SmartHome and Unified Communications segments. Moreover, during the quarter, we announced our entry into the rapidly growing hearables market and strengthened our offerings with the acquisition of SoundChip that we closed on July 1st. By combining our core low-power voice processing and audio codec expertise with SoundChips system-level design expertise and patents around ambient noise cancellation, we have effectively doubled our potential service addressable market SAM.Mr. Elyakim continued: Primarily due to the pandemics impact on the global workforce, we currently expect a decline in revenues in the third quarter, particularly in the Unified Communications market. However, looking forward, the pandemic has changed culture and habits globally in ways that we believe will drive increased demand for our products in an environment that is increasingly reliant on high quality communications and remote collaboration tools. For instance, DSP Groups best-in-class technologies for voice-as-a-user-interface, IoT and unified communications are key enabling technologies for major trends that have arisen from increased sensitivity to health and safety as well as convenience and efficiency for consumers and businesses. We are well positioned for long-term sustainable growth in the SmartVoice, SmartHome and Unified Communications markets and are very excited about the increase in our SAM and growth opportunities with our recent entry into the hearables market.Second Quarter Business Highlights: Expanded our SAM by enabling a wide variety of features to support the growing hearables and VUI-enabled consumer products by leveraging our voice, edge-AI and ANC, thereby driving dynamic growth in a burgeoning market: A leading Korean OEM launched an innovative always-on remote control based on our SmartVoice SoC which enables multiple simultaneous wake-word detection, including Alexa Voice Services AVS support A leading U.S. retail brand launched a new branded tablet product based on our SmartVoice solution Leading Japanese and U.S. brands launched true wireless stereo TWS headset products based on our best-in-class Smart ANC Codec solution Grew and diversified our SmartHome ecosystem with leading IoT vendors that recognize ULEs unmatched characteristics for wireless indoor connectivity. These characteristics include superior range, interference-free spectrum and native support for two-way voice: A leading European service provider selected our DECTULE technology for its new smart home gateway product Deutsche Telecom and Orange each launched a new smart speaker that leverages our DECTULE solution to offer reliable, high-performance, two-way voice support Orange expanded its smart home devices ecosystem and launched a flood sensor Solidified our leadership position in the Unified Communications market as demonstrated by the following business wins: A tier 1 OEM launched a premium conference phone with high-quality audio for smart meetings and sharing based on our DVF platform. A tier 1 European networking OEM launched a new family of SIP desktop IP phones that provides enterprise grade communication experience based on our DVF97 and DVF99 SoCs. Grandstreams GRP series of Carrier-Grade IP Phones based on our DVF solution was awarded the 2020 TMC Labs INTERNET TELEPHONY Innovation AwardSecond Quarter GAAP Results:Revenues for the second quarter of 2020 were 28.3 million, a decrease of 2 from revenues of 29 million for the second quarter of 2019. Net loss and loss per share for the second quarter of 2020 were 1.1 million and 0.05, respectively. Net loss and loss per share for the second quarter of 2019 were 0.5 million and 0.02, respectively.Second Quarter Non-GAAP Results:Non-GAAP net income and diluted earnings per share for the second quarter of 2020 were 1.6 million and 0.06, respectively, as compared to non-GAAP net income and diluted earnings per share of 1.7 million and 0.07, respectively, for the second quarter of 2019. Non-GAAP net income and diluted earnings per share for the second quarter of 2020 excluded the impact of amortization of acquired intangible assets in the amount of 0.1 million associated with previous acquisitions, equity-based compensation expenses of 2.3 million, non-cash expenses from exchange rate differences resulting from the new lease accounting standard ASC 842 in the amount of 0.3 million, and expenses resulted from changes in deferred taxes in the amount of 0.1 million related to intangible assets acquired in previous acquisitions and equity-based compensation expenses. Non-GAAP net income and diluted earnings per share for the second quarter of 2019 excluded the impact of amortization of acquired intangible assets in the amount of 0.1 million associated with previous acquisitions, equity-based compensation expenses of 2.1 million, non-cash expenses from exchange rate differences resulting from ASC 842 in the amount of 0.2 million, and income resulted from changes in deferred taxes in the amount of 0.1 million related to intangible assets acquired in previous acquisitions and equity-based compensation expenses.Earnings Conference Call Details DSP Group will discuss its second quarter financial results, along with its outlook and guidance for the third quarter of 2020, on its conference call at 8:30 a.m. ET today, and invites you to listen via our conference call or a live broadcast over the Internet. Investors may access the conference call by dialing 1 877 870-9135 domestic US or 44 0 2071 928338 international approximately 10 minutes prior to the starting time. The password is 5493607The broadcast via the Internet can be accessed by interested parties through the Investor Relations section of DSP Groups website at or link to: replay of the conference call will be available for a week following the call. To listen to the session, please dial 1 917 677-7532, domestically or 44 0 3333009785, internationally and enter the company access code: 5493607Presentation of Non-GAAP Net Income and EPSThe Company believes that the non-GAAP presentation of net income loss and diluted earnings per share presented in this press release is useful to investors in comparing results for the second quarter and ended June 30, 2020 and 2019 because the exclusion of the above noted expenses may provide a more meaningful analysis of the Companys core operating results. Further, the Company believes it is useful to investors to understand how the expenses associated with equity-based compensation are reflected in its statements of incomeForward Looking StatementsThis press release contains statements that qualify as forward-looking statements under the Private Securities Litigation Reform Act of 1995, including Mr. 