TIDMAWE
RNS Number : 5853G
Alphawave IP Group PLC
20 July 2023
Q2 2023 Trading and Business Update
-- Expanded customer base with 8 new design wins, including 4
new custom silicon design wins and 4 IP licence design wins
-- First 3nm custom silicon design win with our 224G SerDes IP
-- Additional 3nm IP licencing design win and 3 chiplet-based design wins
-- Strong rate of quarterly design wins reflects the scalability of our technology
-- Management remains confident in the outlook for the business
-- China business in Q2 2023 represented less than 10% of new Licence and NRE business
LONDON, United Kingdom and TORONTO, Ontario, Canada 20 July 2023
- Alphawave IP Group plc (LN: AWE, the "Company" or "Alphawave
Semi"), a global leader in high-speed connectivity for the world's
technology infrastructure, is pleased to publish its trading and
business update for the three months ended 30 June 2023.
US$m Q2 2023 Q2 2022 Change
-------- -------- -------
Licence and NRE 47.7 19.0 150%
------------------------------------------- -------- -------- -------
Royalties and Silicon Orders 36.4 9.4 290%
------------------------------------------- -------- -------- -------
New Bookings (excluding VeriSilicon
and WiseWave multi-year subscription
licences) 84.1 28.4 196%
Additional design win activity - FSA
drawdowns and China re-sale licences[1] 3.4 9.5 -64%
WiseWave multi-year subscription licences - - nm
Due to rounding, numbers presented in the table may not add up
to the totals provided and percentages may not precisely reflect
the absolute figures.
Tony Pialis, President and Chief Executive Officer of Alphawave
Semi said: "We saw continued strong sales momentum during the
quarter for our leading connectivity technology. We achieved some
exciting new wins such as our first 3nm custom silicon coherent DSP
with our 224G SerDes IP enabling 800G/1.6T connectivity in data
centers, as well as a repeat design win on an AI accelerator.
Customers' demand for our high-performance IP and products supports
our strong pipeline. We are excited about the year ahead and the
long-term continued growth potential of our business."
John Lofton Holt, Executive Chairman of Alphawave Semi said:
"Our technology leadership in the most advanced technologies is
enabling our customers to develop next-generation AI silicon. We
continue making progress on the integration of the businesses we
acquired last year, and we remain focused on strong execution and
long-term value creation."
Key Highlights
New bookings in Q2 2023 were up 196% year-on-year from US$28.4m
to US$84.1m. North American customers represented over two-thirds
of the total bookings in the quarter.
Licence and Non-recurring Engineering ("NRE") bookings in Q2
2023 were up 150% year-on-year to US$47.7m. These bookings were
primarily driven by North American customers, including a 3nm
custom silicon design win with a leading optical module company and
a 3nm IP licencing design win with a leading industrial automation
business. Chinese customers[2] represented less than 10%.
Royalties and Silicon orders were US$36.4m, up 290% over Q2
2022. The level of silicon orders was driven by pre-existing custom
silicon designs for North American and Chinese customers including
a leading North American semiconductor device company and a North
American company focused on AI accelerators.
The level of bookings in the quarter reflects the scalability of
our technology through IP licensing and custom silicon. Our
vertically integrated business model enables the business to
generate larger revenue streams and capture the full value embedded
in our custom silicon offering. In parallel, our Connectivity
Products Group made good progress toward our plan to start
generating revenue in 2024.
Expanding Technology Leadership and Strong Customer Traction
Since 2017, the Company has demonstrated connectivity technology
leadership in leading-edge technologies, including the 3nm process.
In Q2 2023 we licenced our 3nm PCIe Generation 6 and controller IP
to a leading industrial North American business. Additionally, we
secured a repeat design on an AI accelerator with a North American
customer and three chiplet-based design wins. These design wins
reflect the increased market momentum of leading-edge connectivity
and chiplet architectures. The Company expects further design wins
in 3nm and continues to work with its foundry partners in 3nm and
beyond.
With our expanded IP portfolio, we are strongly positioned to
deliver complete connectivity solutions for our IP and custom
silicon customers. In Q2 2023, we achieved our first custom silicon
design win in 3nm for a coherent DSP solution using our 224G SerDes
IP enabling next- generation 800G/1.6T connectivity for data
centers.
During the quarter Alphawave Semi expanded its ongoing
collaboration with the leading foundries in the industry. The
Company announced the launch of its first connectivity silicon
platform on TSMC's most advanced 3nm process with its ZeusCORE
Extra-Long-Reach (XLR) 1-112Gbps NRZ/PAM4 serialiser-deserialiser
("SerDes") IP. The 3nm process platform is crucial for the
development of a new generation of advanced chips needed to cope
with the exponential growth in AI generated data, and enables
higher performance, enhanced memory and I/O bandwidth, and reduced
power consumption. This flexible and customizable connectivity IP
solution together with Alphawave Semi's chiplet-enabled custom
silicon platform which includes IO, memory and compute chiplets,
allows end-users to produce high-performance silicon specifically
tailored to their applications.
Alphawave Semi also announced the expansion of its ongoing
collaboration with Samsung to include the 3nm process node. Samsung
Foundry platform customers now benefit from Alphawave Semi's most
advanced high-performance connectivity IP and chiplet technologies,
including 112 Gigabits-per-second (Gbps) Ethernet and PCI Express
Gen6/CXL 3.0, interfaces to build the complex systems-on-a-chip
(SoCs) needed to keep pace with the rapidly growing demands of
data-intensive applications such as generative AI and the
associated infrastructure required by global data centers.
In Q2 2023, there were no Flexible Spending Accounts ([3])
("FSA") drawdowns (Q2 2022: US$5.6m) and US$3.4m of China
(VeriSilicon) reseller deals ([4]) (Q2 2022: US$3.9m). Both FSA and
reseller deals represent the conversion of customer commitments to
design wins.
Overall, design win activity in the quarter was strong with 8
new design wins, 6 from new end-customers and 2 from existing
end-customers.
Alphawave Semi has more than half of the top twenty
semiconductor device companies as customers[5], a reflection of its
continued strength in the data infrastructure markets that require
the world's most advanced connectivity technology.
Outlook
The outlook for 2023 remains unchanged. Alphawave Semi expects
2023 revenue of US$340m to US$360m and adjusted EBITDA of
approximately US$87m (or approximately 25% of revenue), which is at
the mid-point of the revenue guidance range.
Despite the uncertain macroeconomic environment, our growing
pipeline reflects positive secular growth trends in data
infrastructure markets and the continued investment in
next-generation AI- centric connectivity solutions. This, combined
with our talented team and strong balance sheet, give us confidence
in our future.
About Alphawave Semi
Alphawave Semi is a global leader in high-speed connectivity for
the world's technology infrastructure. Faced with the exponential
growth of data, Alphawave Semi's technology services a critical
need: enabling data to travel faster, more reliably and with higher
performance at lower power. We are a vertically integrated
semiconductor company, and our IP, custom silicon, and connectivity
products are deployed by global tier-one customers in data centers,
compute, networking, AI, 5G, autonomous vehicles, and storage.
Founded in 2017 by an expert technical team with a proven track
record in licensing semiconductor IP, our mission is to accelerate
the critical data infrastructure at the heart of our digital world.
To find out more about Alphawave Semi, visit: awavesemi.com
Related Party Disclosures
There are no new related parties disclosed in this press
release.
###
Trademarks
Alphawave Semi and the Alphawave Semi logo are trademarks of
Alphawave IP Group plc. All rights reserved. All registered
trademarks and other trademarks belong to their respective
owners.
Contact Information:
Alphawave Semi John Lofton Holt, Executive ir@awaveip.com
plc Chairman +44 (0) 20 7717 5877
Jose Cano, Head of IR
------------------ ---------------------------- -----------------------------
Brunswick Group Simone Selzer alphawave@brunswickgroup.com
Sarah West +44 (0) 20 7404 5959
---------------- ------------------------------ -----------------------------
Gravitate PR Lisette Paras alphawave@gravitatepr.com
Siddarth Nigam +1 415 420 8420
================== ============================ =============================
LEI: 213800ZXTO21EU4VMH37
[1] Both FSA (Flexible Spending Account) drawdowns and China
re-sale licences convert previously announced contractual
commitments included within bookings reported in prior periods to
new product design wins which will be recognised as revenue over
time.
[2] These Chinese customers are out of scope from the WiseWave
and VeriSilicon agreements.
[3] FSAs or Flexible Spending Accounts represent contracts with
customers who have committed to regular periodic payments. These
payments are not in respect of specific licences but can be used as
credit against future deliverables. FSA drawdowns represent the
design win value of transactions signed during the period, against
which FSA payments will be credited and will convert to revenue
over time.
[4] In February 2021, Alphawave IP signed a three-year exclusive
subscription reseller agreement with VeriSilicon with a minimum
value of US$54 million. Reseller deals represent the subsequent
licensing of IP by VeriSilicon to third parties in China and do not
constitute additional bookings for the Company as they are part of
the US$54 million minimum commitment.
([5]) Semiconductor device companies ranked on market
capitalisation as of 11.07.23.
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END
UPDFFFVLDRIALIV
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July 20, 2023 02:00 ET (06:00 GMT)
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