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I did listen to the Nvidia earnings call on Wednesday. It was both impressive and scary.
They are telling the same story as AWE ie we are at the dawn of new era of computing driven by data, custom silicon and AI.
The main thing that I have learnt in life is that there are always 'unintended consequences'. God knows where it ends up. I can't say that I'm looking forward to it.
All my life I have worked in the technology space. However the older I get the less and less I want it in my life. I avoid anything with the word 'Smart' in it. I'd like to but a new car and by that I mean something with a good engine, good brakes, that is reliable and starts with the turn of a key. I don't want the abomination that is an EV. Generally the offerings are over spec'd, over engineered, over priced junk that is full of bug ridden / hackable 'Smarts'. I don't want to have a 'relationship' with my vehicle. Meanwhile it is almost impossible to get a car with something that I do want - a spare wheel.
My luddite views aside my portfolio is significantly up this morning. Personally I'd forgo the gains if the brakes could be put on the 'Brave New World'.
Another excellent background briefing BlueRaphus. I'm never anything other than very impressed with Tony Pialis.
I'm sure that those at the cutting edge are acutely aware of the of the challenges faced by the semi conductor industry including the ability to shift enough data to keep processors fed, having maxed out the physical limits of monolithic Integrated Circuits the need to replace them with modular solutions, power management etc
However the interview did seem to be a bit of an eye opener for the chap conducting the interview, the problems appear to be less appreciated by the wider audience. So for now Alphawave seems to be flying under the radar even though they are at the leading edge in multiple fields that need to be combined to provide tomorrows solutions. I'm not bothered. I will accumulate when I can.
George and Tony talk generally about the future of AI chips: 56 minutes
https://www.youtube.com/watch?v=VYx1rGieDmE&t=12s
For those without the time to listen to the whole podcast a summary of the discussion can be found on George's website here:
https://linkeddataorchestration.com/2024/02/13/the-future-of-ai-chips-leaders-dark-horses-and-rising-stars/
Tony doesn't do too much bigging up of Alphawave in this discussion but he does highlight that the major challenge facing AI moving forward is not compute. His view is that the ability to design and implement compute is already there. The challenge is the connectivity needed to connect the compute in order to process all of the data. This is what AlphaWave is focusing on.
Hi BlueRaphus,
your link is a very accessible short background read.
Re the new CRO (Chief Revenue Officer) - "Before joining Alphawave Semi, he was Senior VP of Worldwide Sales and Corporate Marketing at Inphi, leading the company’s expansion into new markets such as hyperscaler data centers and networking, and achieving more than 10X growth in revenue and stock price when Inphi was acquired by Marvell."
No pressure then.
"Their revenue guidance for 2023 is $340m -> $360m. If they do no more than hold their own $355 compounded by 23% would get them to $1000m by the end of 2027. I'd like to think they could do better."
Absolutely! I very much suspect that they will in fact do much better than that. I don't like saying so as I try to keep a conservative mindset on my personal expectations less that I should be disappointed!
The Redgate article reminds me of the Whitepaper that Alphawave Semi have issued recently and is a highly recommended read:
https://awavesemi.com/wp-content/uploads/2024/02/LFC-Design-Booklet_1.0.1.pdf
Their addressable market is recession proof and growing exponentially . 23% per annum seems perfectly plausible.
https://www.red-gate.com/blog/database-development/whats-the-real-story-behind-the-explosive-growth-of-data
Their revenue guidance for 2023 is $340m -> $360m. If they do no more than hold their own $355 compounded by 23% would get them to $1000m by the end of 2027. I'd like to think they could do better.
Bearing in mind that Alphawave Semi are targeting to achieve revenue of more than $1 billion by 2027 they have recently appointed Charlie Roach as Chief Revenue Officer who carries more than 20 years of experience working with high growth semi conductor companies such as Inphi that was eventually acquired by Marvell after the company grew its revenue by more than 10x.
https://awavesemi.com/press-release/alphawave-semi-announces-appointment-of-charlie-roach-as-chief-revenue-officer/
An interesting snippet on the tectonic shifts within the foundry industry
https://www.youtube.com/watch?v=2y_iv8coTYM
I assume this sp will automaticlly drop approx 4% on Tuesday because of the dilution, unless the recent news bouys more rises, again offsetting the dilution. Ideas ? GLA.
It may retrace on account of the fact there's been a strong bull run recently but not because of the block listing. The block release application of 28,000,000 shares isn't immediately added to the shares issued total. Instead, the new shares will be dished out gradually over the course of time. At the beginning of every month you will see the Total Voting Rights RNS showing the total issued share capital. At Feb 1st it was 723,693,569. The new total in March won't be a sudden increase of 28,000,000 but some smaller amount depending on how many shares they awarded to employees in the month of February. Hope that helps.
...the news of the block listing didn't appear to have any detriment to the sp on the 6th. However, decent news re ARM could have off set it ?
I assume this sp will automaticlly drop approx 4% on Tuesday because of the dilution, unless the recent news bouys more rises, again offsetting the dilution. Ideas ? GLA
Blue....Well done for taking the time to explain all that to Litoum. There's many on many discussion sites who would just have given a sarcastic or unhelpful comment.
Top man ( or woman of course) LOL.
It does help. Thank you. Let’s hope it’s an incentive and an indication of success.
"Regarding the RNS. Please explain what a block listing is….
Will it have an influence on the stock price?"
AWE like many listed companies have an employees share scheme as part of an incentive to achieve work targets etc.
In a nutshell Exchange rules require that additional shares to be listed on the market have to be authorised by the shareholders (which is done at the AGM) and applied for through the stock exchange. It basically means share dilution unfortunately. Ideally, a company should aim to minimise share dilution or avoid it altogether. For a non-dividend paying company like AWE, you should be prepared to expect a small amount of dilution as time goes on like about 1 to 2% per year. In my analysis of AWE I allow for 2.5% dilution per year. At the moment AWE are exceeding that somewhat. This will be something I will be taking up with company next time I write to them. Unfortunately , there's not a lot we can do as shareholders to stop them doing this as insiders own more than 50% of the stock and therefore can dictate almost anything they like at AGMs. We want employees to be incentivised of course, because that normally translates to better company performance which in turn should increase the company valuation - so the issuance of more shares is always a balancing act - be it for a placing to raise more cash (which for AWE should not be necessary given the progress they are making) or for employee share plans. Hope that helps.
The share price is flying up again today - a 9% rise as i type this - lovely jubbly :)
Regarding the RNS. Please explain what a block listing is….
Will it have an influence on the stock price?
Thank you for the replies. I’ve topped up.
"I think its more to do with this news story to be honest :)"
The press release on the Nubis collaboration came out last week along with a couple of others.
The upward movement today, however, is more likely related to the news that has came out of Arm Holdings last night.
https://www.reuters.com/technology/arm-shares-soar-ai-fueled-boom-brightens-growth-prospects-2024-02-08/
Alphawave Semi is one of about 12 participants that are part of the Arm Total Design collaboration that allows combination of the participants designs on to the Arm Neoverse CSS architecture.
I think its more to do with this news story to be honest :)
https://www.geeky-gadgets.com/optical-pci-express-6/
A nice rise this morning. How closely linked is Alphawave to the good news coming from Arm Holdings overnight?
If you want to better understand why the chiplet technology is key for the future of semiconductor industry, and when (and how) it will develop and represent a great source of revenues for companies like Alphawave Semi... just look at this white paper!
https://awavesemi.com/resource/will-chiplet-adoption-to-mimic-ip-adoption/
And another
https://awavesemi.com/press-release/alphawave-semi-and-teledyne-lecroy-unveil-pcie-7-0-signal-generation-and-measurement/
Presumably if they throw enough mud at the wall some of it is going to stick.
Another collaboration that popped up recently from SC23 (Super computing 2023 - Denver mid November)
https://www.youtube.com/watch?v=qfX6uCgsZ1k
Https://awavesemi.com/press-release/alphawave-semi-and-proteantecs-collaborate-to-provide-system-insights-and-analytics-for-custom-silicon-and-chiplets/
“As chiplets and custom silicon SoCs grow in complexity, data-driven insights and analytics play an increasingly critical role in bringing chips to market quickly and assuring their health and performance at scale,” said Mohit Gupta, SVP and GM, Custom Silicon and IP at Alphawave Semi. “Our collaboration with proteanTecs offers us a differentiated edge and enables us to bring our customer’s complex solutions to market at higher performance, at a faster pace. Mutual customers gain on-chip monitoring through the entire product lifecycle, extending all the way from production into the field.”
https://awavesemi.com/press-release/nubis-communications-and-alphawave-semi-showcase-first-demonstration-of-optical-pci-express-6-0-technology/
“AI applications are reshaping data center networks, with hyperscalers deploying increasingly large clusters of disaggregated servers distributed over longer distances. This shift has generated heightened interest in PCIe over Optics among several of our customers,” said Tony Chan Carusone, CTO at Alphawave Semi. “Through our collaboration with Nubis, we’re pleased to demonstrate how we’re leveraging Alphawave Semi’s leadership in connectivity IP and silicon to enable PCIe optical connectivity solutions that accelerate high-performance AI computing and data infrastructure.”
So to achieve a 'brand awareness uplift' AWE should replace their marketing team with GPT-4 ?
I asked GPT-4 why AWE's offerings are attractive/cutting edge/different from other conventionally available options provided by large incumbent semiconductor companies:
Performance Metrics: "Alphawave Semi prides itself on delivering top-tier performance in SerDes technology, offering solutions that excel in data throughput, latency, and power efficiency. Our chiplets are designed to operate at industry-leading speeds, significantly surpassing conventional standards, while maintaining low power consumption, which is crucial for data center operations."
Technology Differentiators: "Our chiplets leverage proprietary, cutting-edge technologies that include advanced modulation schemes and sophisticated error correction algorithms to enhance signal integrity and throughput over a wide range of conditions. This unique approach not only differentiates us from traditional options but also provides our clients with a competitive edge in terms of efficiency and performance."
Compatibility and Integration: "We ensure broad compatibility with various processor architectures and data center hardware through our flexible design principles. Alphawave Semi's solutions are crafted to seamlessly integrate into diverse ecosystems, evidenced by our successful partnerships and integrations across the semiconductor industry."
Scalability and Future-Proofing: "Our chiplet designs are inherently scalable, designed to meet the current and future demands of data-intensive applications, especially in AI and machine learning. We continuously innovate to ensure our products are future-proof, enabling easy scaling and upgrades as your data center needs evolve."
Ecosystem and Partnerships: "Alphawave Semi is at the center of a robust ecosystem, supported by comprehensive software tools, development kits, and strong partnerships with key technology providers. This ecosystem is designed to facilitate the rapid deployment and optimization of our chiplets in any data center environment."
Customization and Flexibility: "We understand that one size does not fit all in the data center world. That's why we offer a high degree of customization and flexibility in our chiplets, allowing for programmability and configurability to meet specific performance criteria or integration needs."
Reliability and Durability: "Reliability is a cornerstone of our product design. Our chiplets boast excellent mean time between failures (MTBF) rates, backed by comprehensive testing under extreme conditions. We can share detailed reliability reports and testimonials from existing deployments to underscore our commitment to durability."
Support and Services: "Post-purchase, Alphawave Semi provides unparalleled technical support and services, ensuring any issues are addressed quickly to minimize potential downtime. Our global support team is dedicated to assisting with deployment, optimization, and maintenance, ensuring smooth operation."
TCO: long-term savings in energy, cooling