Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures

U.S. Dollars in thousands, except per share amounts

Three months ended

Year ended

December 31

December

2019

2018

2019

2018

Unaudited

GAAP net income

$3,062

$2,303

$28

$574

Equity-based compensation expense included in cost of revenue

166

108

630

588

Equity-based compensation expense included in research and development expenses

1,543

1,267

5,857

5,141

Equity-based compensation expense included in sales and marketing expenses

383

341

1,495

1,587

Equity-based compensation expense included in general and administrative expenses

779

568

2,736

3,051

Income tax benefit related to equity-based compensation expenses

(101)

(312)

(574)

(712)

Amortization of intangible assets related to acquisitions of RivieraWaves and Hillcrest Labs business, investments in NB-IoT and Immervision technologies, and deal costs and write off of an acquired lease related the Hillcrest Labs transaction

945

304

3,203

1,241

Revaluation of investment in other company, net of taxes

—

670

—

670

Non-GAAP net income

$6,777

$5,249

$13,375

$12,140

22,373

22,197

22,323

22,503

Weighted-average number of shares related to outstanding stock-based awards (in thousands)

462

404

475

388

Weighted-average number of Common Stock used in computation of diluted earnings per share, excluding the above (in thousands )

22,835

22,601

22,798

22,891

GAAP diluted net income per share

$0.14

$0.10

$0.00

$0.03

Equity-based compensation expense, net of taxes

$0.12

$0.09

$0.45

$0.42

Amortization of intangible assets related to acquisitions of RivieraWaves and Hillcrest Labs business, investments in NB-IoT and Immervision technologies, and deal costs and write off of an acquired lease related the Hillcrest Labs transaction

$0.04

$0.01

$0.14

$0.05

Revaluation of investment in other company, net of taxes

—

$0.03

—

$0.03

Non-GAAP diluted net income per share

$0.30

$0.23

$0.59

$0.53