BrainChip Holdings Ltd - Quarterly Activities and Financial Report - 30 June 2024
BRN (BRN) Share Update July 2024 Thursday 25th
BrainChip Holdings Ltd Reports Quarterly Activities and Financial Updates
BrainChip Holdings Ltd (ASX: BRN, OTCQX: BRCHF, BCHPY), the world's first commercial producer of neuromorphic artificial intelligence technology, has released its Quarterly Activities Report and Appendix 4C for the period ending 30 June 2024.
Instant Summary:
- Cash balance as of 30 June 2024: US$10.9M
- Collaboration with Frontgrade Gaisler for AI-integrated space-grade microprocessors
- Introduction of new CTO, Dr. Tony Lewis, and focus on TENNs algorithm
- Closure of Brainchip Research Institute in Perth for streamlined R&D
- New Australian patent for one-shot learning technology
- Penn State joins BrainChip University AI Accelerator Program
Operations Update
From March to June 2024, BrainChip focused on advancing customer engagements towards commercialization. On 6 May, the company announced a partnership with Frontgrade Gaisler to integrate BrainChip’s neuromorphic processor into next-generation fault-tolerant, radiation-hardened microprocessors. This collaboration aims to introduce the first space-grade SoC with true AI capabilities, enhancing computing resources for space-borne systems.
On 21 May, BrainChip held its AGM in Sydney, where CEO Sean Hehir introduced new CTO Dr. Tony Lewis. Dr. Lewis presented the potential of BrainChip’s TENNs algorithm, demonstrating its ability to enhance the performance of Large Language Models like ChatGPT2. This focus on TENNs was further highlighted in a presentation by Rudy Yan Ru Pei at the AIS 2024 workshop in Seattle.
Financial Update
BrainChip ended the June quarter with a cash balance of US$10.9M, down from US$12.9M in the previous quarter. The company reported net operating cash outflows of US$3.9M, a slight improvement from the prior quarter's US$4.4M. Cash inflow from customers was US$0.05M, reflecting long sales cycle times but a positive outlook based on active engagements.
Total payments to suppliers and employees were US$4.1M, slightly lower than the previous quarter. Payments to the Board of Directors totaled US$337,075. Financing activities included proceeds from a capital call notice to LDA Capital, resulting in the sale of 31.1M shares and cash inflows of US$1.8M.
Strategic Developments
In late June, BrainChip decided to shut down the Brainchip Research Institute in Perth to consolidate its R&D team under the CTO’s supervision, aiming for better coordination and reduced expenses. Some team members relocated to the Laguna Hills office in the US. Despite this challenging decision, BrainChip will maintain its Company Secretarial, Share registry, and Investor Relations functions in Australia.
On 6 May, BrainChip was granted a new Australian patent for one-shot learning technology, reinforcing its leadership in efficient machine learning processes. Additionally, on 9 May, Pennsylvania State University joined the BrainChip University AI Accelerator Program, providing students access to cutting-edge neuromorphic technology.
The collaboration with Frontgrade Gaisler is a significant milestone, potentially boosting BrainChip’s reputation and opening new markets in the space industry. The introduction of Dr. Tony Lewis and the focus on the TENNs algorithm could drive future innovations and commercial success. The financial updates indicate a stable cash position, though the closure of the Perth research institute may raise concerns about R&D continuity.
Investor Reaction:
Investor reactions have been mixed. Some are optimistic about the potential of the Frontgrade Gaisler partnership and the focus on TENNs, while others are cautious about the financial outflows and the impact of the research institute closure.
Conclusion:
Investors should keep an eye on BrainChip’s strategic developments and financial health. The company's efforts to innovate and streamline operations could lead to significant long-term gains. Stay informed on BrainChip’s progress and consider the potential impacts on your investment portfolio.