Why is the Brainchip share price rocketing 14% today?
The Brainchip Holdings Ltd (ASX: BRN) share price is starting the week on a positive note.
In morning trade, the semiconductor company's shares are up 14% to 27.5 cents.
Why is the Brainchip share price rocketing?
Investors have been bidding the company's shares higher today after it announced a new license agreement.
According to the release, Frontgrade Gaisler has licensed the company's Akida 1.0 Neuromorphic AI IP for incorporation into its space-grade, fault-tolerant, system-on-chip solutions for hardware AI acceleration across multiple product generations.
Frontgrade Gaisler is a Swedish provider of radiation-hardened microprocessors for space applications
The release notes that this builds on their collaboration announced earlier this year to evaluate Brainchip Akida silicon devices.
Management believes this commercial licence agreement paves the way for artificial intelligence (AI) chips to be deployed in space. Its notes that the Akida neuromorphic computing solution was selected based upon providing real time data stream processing with resiliency, autonomy, and accuracy at the lowest power, mass, and volume.
Successful evaluation
Brainchip revealed that the licence agreement progressed after a successful evaluation engagement with Frontgrade Gaisler where the two parties and the European Space Agency (ESA) collaborated to evaluate the Akida neuromorphic processor silicon on insulator samples and software.
The ESA's microelectronics and data handling engineer, Laurent Hili, commented:
While many fields no doubt can benefit from neuromorphic computing, one essential area is computer vision applications where current FPGA or GPU technologies do not bring satisfactory results for edge deployments when considering mass, volume and power constraints. This program has demonstrated the superiority of neuromorphic technology through several on-going activities with satellites, IP and component suppliers such as Frontgrade Gaisler and BrainChip.
Agreement terms
The release reveals that under this new commercial Akida IP licence agreement, Brainchip is entitled to receive a 10% royalty on the net sale price of Frontgrade's first licensed product.
Furthermore, after 24 months Frontgrade has the option to purchase additional software maintenance for $125,000 per year. Frontgrade also has the option to obtain an additional Akida 1.0 IP licence for one more licensed product for a fee of 150,000 euros or a royalty of 15% of the net sale price of the second licensed product.
However, Brainchip warned that it is currently unable to estimate potential future royalty revenues.
Brainchip CEO, Sean Hehir, said:
This collaboration with Frontgrade Gaisler to licence Akida IP for implementation into space SoCs represents an important step in space-based AI deployments, turning into reality what once was considered unattainable. We are pleased to expand on our trusted relationship with Frontgrade as they push the boundaries of space computing.
The post Why is the Brainchip share price rocketing 14% today? appeared first on The Motley Fool Australia.
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