EnSilica wins seven-year, $75m manufacturing and supply contract

(Sharecast News) - EnSilica said on Monday that it had won a seven-year manufacturing and supply contract expected to generate about $75m in revenue with a German manufacturer of automotive components.

The AIM-traded fabless microchip maker said it would produce an Arm-based sensing chip for the customer after winning a competitive tender process.

As the chip was already in production, EnSilica said no design or tape-out work would be required, with the company now responsible for manufacturing and supply.

The contract was expected to generate around $75m of revenue over seven years, including about $4m in the financial year ending 31 May 2027.

EnSilica said the gross margin would reflect the manufacturing-only nature of the agreement.

EnSilica said it had been selected over several competing suppliers, reflecting its growing expertise in the automotive sector and its track record in delivering chip production at scale.

"We are pleased to have secured this Contract, which will not only generate material future revenues but is expected to also deliver significant strategic benefits for EnSilica," said chief executive officer Ian Lankshear.

"The contract opens up a connection to a Tier 1 German automotive supply chain, increases wafer volume shipments through our partner foundries - reinforcing our position as a key customer - and it secures the VDA-aligned automotive quality standard required to operate within the German automotive sector."

Lankshear added that the agreement would put EnSilica in a stronger position to secure future higher-margin ASIC design opportunities in the automotive market.

At 1400 BST, shares in EnSilica were up 6.19% at 120p.

Reporting by Josh White for Sharecast.com.

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