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- Six months of soft revenue and high spending has seen tech developer Brainchip (BRN) deepen a half-yearly loss
- The company lost US$6.85 million (roughly A$9.5 million) from January to the end of June 2020, which is 53 per cent more than the loss from the same period in 2019
- On top of this, half-yearly revenue slipped 80 per cent to just over US$13,000 (roughly A$18,000)
- The company spent almost US$3.5 million (roughly A$4.9 million) on research and development over the half-year, which was more than half of total spending
- The company is now in the testing phase for its flagship Akida system-on-a-chip product
- Shares in Brainchip and trading just under five per cent lower this morning and worth 31 cents each
Six months of soft revenue and high spending has seen tech developer Brainchip (BRN) deepen a half-yearly loss.
Over the first half of the 2020 calendar year, Brainchip posted a loss of US$6.85 million (roughly A$9.5 million) — 53 per cent more than the US$4.5 million (roughly A$6.3 million) loss over the same period in 2019.
Hand-in-hand with the deepened loss was an 80 per cent decline in half-yearly revenue, with Brainchip pulling in just US$13,397 (roughly A$18,000) for the half-year compared to the US$66,635 (roughly A$93,000) made the year before.
Of course, most of Brainchip’s spending came from a busy half-year of research and development. In fact, of the company’s US$6.2 million (roughly A$8.6 million) in expenses, roughly US$3.5 million (roughly A$4.9 million) came from the research and development arm. Just under half of these R&D expenses were related to the company’s Socienext partnership.
Still, Brainchip had cash on hand of just over US$5.3 million roughly (A$7.4 million) at the end of June.
What about COVID?
The company said so far, the impact on its business from the coronavirus outbreak has been minimal.
However, Brainchip admitted that given the evolving COVID-19 situation, there is a possibility the virus could deal a blow to future earnings and cash flow. The company said it’s not feasible to try to predict how this could look, and as such has given no clear guidance for the impact of COVID-19 on operations in the future.
Nevertheless, Brainchip was still able to receive a healthy US$412,300 (roughly A$573,500) cash injection from the United States’ Coronavirus Aid, Relief, and Economic Security (CARES) act over the half-year.
Of course, as far as its share price is concerned, Brainchip has emerged as one of the key winners over the COVID-19 crisis.
The company’s shares were worth just five cents each at the start of the year but closed yesterday afternoon at 33 cents per share — a massive increase of 560 per cent.
The major catalysts for the share price rise were the completion of the wafer fabrication for its flagship Akida system-on-a-chip product and the subsequent major partnership with MagikEye, each completed over the past two months.
Today’s half-yearly report did not include any updates regarding the testing of the Akida product.
As such, the company’s share price has slipped slightly in early action today, currently down 4.62 per cent and worth 31 cents. Brainchip has a $467 million market cap.
