The Brainchip Holdings Ltd (ASX: BRN) share price is bouncing around on Tuesday morning.
After opening higher, at the time of writing, the semiconductor company's shares are down 2.5% to 19 cents.
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Why is the Brainchip share price falling?
Investors have been selling the company's shares this morning after market weakness offset the announcement of the early access availability of its second generation Akida IP solution.
This second generation was developed after Brainchip admitted that its much-hyped (internally) first generation offering generated next to zero sales due to "good enough" alternatives in the market.
According to the release, the second generation Akida platform is designed for extremely energy-efficient processing of complex neural network models on Edge devices.
Management notes that the support for 8-bit weights, activations, and long-range skip connections, expands the reach of models that are accelerated completely in Akida's hardware, along with other features and capabilities that help to future-proof the product.
In addition, the introduction of temporal event based neural nets (TENNs) improves the advanced processing for multi-dimensional streaming and time-series data. This can reduce model size and improve performance without compromising accuracy.
Brainchip's under-fire CEO, Sean Hehir, commented:
This is a significant step in BrainChip's vision to bring unprecedented AI processing power to Edge devices, untethered from the cloud. With Akida's 2nd generation in advanced engagements with target customers, and MetaTF enabling early evaluation for a broader market, we are excited to accelerate the market towards the promise of Edge AI.
What's next?
Time will tell if this technology is a commercial success. But with significant competition from a large group of tech behemoths, I wouldn't count on it.
The question remains, if Brainchip's technology really is that great, why wouldn't one of these tech giants just acquire it? Especially given how they spend billions on R&D each year. The likely answer is that they don't see it as a threat nor generating a sufficient return on investment.
It is also worth highlighting that with Brainchip likely to require a capital raising in the very near future, its shares could come under further pressure. Especially if it continues to generate less revenue than a café.
The Brainchip share price is down 77% over the last 12 months.
