Why the Brainchip (ASX:BRN) share price is falling today

Shares in the artificial intelligence developer are dipping today. We take a closer look

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The Brainchip Holdings Ltd (ASX: BRN) share price is in the red today.

At the time of writing, shares in the artificial intelligence (AI) developer are trading for 45 cents each – down 2.15%. The All Ordinaries Index (ASX: XAO) is up 0.5% while the S&P/ASX All Technologies Index (ASX: XTX) is 2.12% higher.

The price fall comes after the company released its update for the June quarter.

Let’s take a closer look.

Company profile

Brainchip shares are some of the most popular on the ASX, regularly making the list for traded shares in the week. That’s despite the fact the company has a market capitalisation of less than $1 billion.

According to Brainchip, the company is “a global technology company that is producing a ground-breaking neuromorphic processor that brings artificial intelligence to the edge in a way that is beyond the capabilities of other products”.

Why the Brainchip share price is down

In a statement to the ASX, Brainchip gave an update on its cash position and activities during the last quarter. Overall, the company experienced a cash outflow of US$2.3 million for a total cash position of US$17.7 million.

The main contributor to this position was a US$900,000 drop in customer receipts, a payment of US$2.25 million to a supplier, and more employees at the company. Brainchip collected a net inflow of US$733,000 from financing and equity options being exercised.

Investors may not be impressed with these numbers, judging by the fall in the Brainchip share price.

During the quarter, the company also made a number of announcements. These included:

  • The replacement of a member of the board.
  • An additional expert to its scientific advisory board.
  • The holding of its AGM.
  • The upgrading of its shares on the OTC market based in New York, NY.

Brainchip share price snapshot

Over the past 12 months, the Brainchip share price has increased 172%. Year-to-date, its value has appreciated only 7%.

In December 2020, Brainchip shares rocketed 57% in a single day after announcing a partnership with NASA.

The Brainchip record high is 97 cents per share, which is more than double its current share price.

Should you invest $1,000 in Brainchip right now?

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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