Alchip Technologies Ltd (世芯), an application-specific integrated circuit (ASIC) designer specializing in artificial intelligence (AI) accelerators, yesterday said it has recouped orders from a major customer and expects revenue to regain momentum this year after failing to secure orders from the customer last year.
“Now we have won back this important customer... The customer will only become more sticky based on the company’s track record,” Alchip chairman and chief executive officer Johnny Shen (沈翔霖) told reporters during the company’s annual general meeting in Taipei.
Alchip’s revenue sank 39 percent annually to US$992 million last year, with its biggest customer accounting for 18 percent of its total revenue, down from 60 percent in the prior year.
Photo: Vanessa Cho, Taipei Times
Shen did not name the customer, thought to be Amazon.com Inc, which subscribed to 557,325 new Alchip shares for NT$2.36 billion (US$75.04 million) earlier this month.
Alchip said that it is set to ramp up production of new 3-nanometer AI accelerators from next month for the North American customer.
To meet the customer’s demand, “it is vital to maintain a close partnership with Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), as 3-nanometer chips are in hot demand this year and probably the hottest ... even hotter than memory [chips] in my opinion,” Shen said.
Non-recurring engineering (NRE) income serves as another growth driver this year, the company said.
ASIC companies usually generate revenue from collecting NRE, the one-time cost to research, design, develop and test a new chip.
Alchip entered the ASIC business about 10 years ago by designing a customized chip for one customer, unlike many others that designed chips with general purposes for the mass market, Shen said.
Demand for ASIC-based AI accelerators is expected to surpass that for graphics processing units (GPUs), given demand from cloud service providers such as Google and Amazon, he said.
ASIC accelerators have the potential to replace GPUs in servers, although it would take time, he added.
However, the company is facing growing competition in the ASIC business from “respectful” peers, he said.
MediaTek Inc (聯發科) is one of those competitors, reportedly securing a Google contract to help design its new tensor processing unit.
Alchip believes it still maintains an advantage in designing AI accelerators for customers, given its “neutral” position as compared with MediaTek or Qualcomm Inc, which design and sell branded chips.
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