TEL AVIV, May 6 (Reuters) – Israeli chip designer Ceva Inc reported on Monday a drop in quarterly profit that missed estimates due to a decrease in royalty revenue in the handset market.

Ceva earned 1 cent per diluted share excluding one-time items in the first quarter, compared with 4 cents a year earlier. Revenue fell 3 percent to $17 million.

The company, a licensor of signal processing platforms and artificial intelligence processors, was forecast to earn 3 cents a share on revenue of $17.7 million, according to I/B/E/S data from Refinitiv.

Ceva signed eight licensing agreements in the quarter, including three with companies targeting 5G networking.

“Our royalty revenue from handsets suffered substantial headwinds due to excess channel inventory,” said CEO Gideon Wertheizer. “Our