Here’s why the BrainChip (ASX:BRN) share price is zooming 8% higher

stylised image of exploding cloud coming out of top of a man's head representing exploding share price

The BrainChip Holdings Ltd (ASX: BRN) share price has been a strong performer on Thursday.

In morning trade the artificial intelligence technology company’s shares are up 8% to 37.3 cents.

Why is the BrainChip share price zooming higher?

Investors have been buying the company’s shares this morning after it provided an update on the development of its Akida Neuromorphic System-on-Chip. (NSoC).

According to the release, BrainChip confirms that the Register-Transfer Level (RTL) design has been completed and transferred to its manufacturing partner, Socionext America.

Socionext America will now complete the physical design of the device and all related engineering tasks required. After which, it will transfer the full device files to Taiwan Semiconductor Manufacturing Company (TSMC) for mask creation and wafer fabrication.

Following this, the mask set will be utilised to manufacture production wafers as well as support qualification testing and parametric testing of the Akida device.

“A major milestone”.

BrainChip’s CEO, Louis DiNardo, believes this is a major milestone for the company.

He commented: “The Akida device design will be transferred to TSMC for use in manufacturing production wafers in support of potential customer requirement in 2021 and beyond. This is a major milestone for the Company as we move to commercialize the Akida NSoC.”

“Our chosen markets in Smart Home, Smart Transportation, Smart Medical and Smart City include some of the most discriminating customers in the electronics industry. Through our partnership with SNA [Socionext America] and TSMC we have world-class resources and expect to have a robust Integrated Circuit (IC) that suits their requirements for both performance and reliability,” he added.

What is Akida?

The company believes that Akida brings artificial intelligence to “the edge” in a way that existing technologies are not capable.

In respect to artificial intelligence, the edge is where algorithms are processed locally on a hardware device, without requiring any connection.

Management claims Akida has a high-performance, small, ultra-low power, and enables a wide array of edge capabilities.

This includes its use in applications such as Smart Home, Smart Health, Smart City and Smart Transportation. The company explained that these applications “include but are not limited to home automation and remote controls, industrial IoT, robotics, security cameras, sensors, unmanned aircraft, autonomous vehicles, medical instruments, object detection, sound detection, odor and taste detection, gesture control and cybersecurity.”

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Returns as of 6th October 2020

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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