Brainchip Holdings Ltd (ASX: BRN) shares are rebounding on Tuesday.
In afternoon trade, the struggling semiconductor company's shares are up 6% to 26.5 cents.
Why are Brainchip shares rising today?
Investors have been buying the company's shares for a couple of reasons.
One is the release of its annual general meeting (AGM) update this morning. The other is news that the company has managed to avoid a spill of its board at this meeting.
In respect to its AGM update, Brainchip CEO, Sean Hehir, acknowledged that the company hasn't delivered meaningful revenue yet, and was disappointed by this, but remains positive on the future. He said:
Let me acknowledge right up front that our revenue numbers are not there yet. The evaluation and design cycle are longer, deeper, and more complex than we anticipated as customers plan their strategic roadmaps. However, after hearing my prepared remarks, hopefully you too will share my conviction that we are a much stronger and a better positioned company and share my optimism in our near-term and long-term success.
Licensing deals
Hehir believes the company is close to getting an answer from some potential customers after being in discussions for over a year. He said:
First and foremost, I know we need to close license sales. We have several engagements that have been in evaluation for over 1 year that are near closing in on a decision. These engagements are with leading companies in audio, IOT, and microcontroller segments.
The under pressure CEO has been heavily criticised for his big salary and bonuses and distinct lack of commercial success since joining. However, he remains confident on delivering the goods for shareholders. He adds:
The board brought me on with a critical mission: to transform a promising technology into a successful product for a challenging market, while establishing the sales and marketing capabilities to drive its adoption.
We are doing the right things. I know we are on the right trajectory. When I pair all these actions with the emergence of a true edge AI market, I am more confident than ever that we are on the cusp of generating sustainable revenue streams. BrainChip has the momentum in place and potential to emerge as the undisputed leader in the exciting and continuously growing Edge AI market.
Time will tell if this proves to be the case or if the next 12 months will just be more of the same – all hype and no substance.
Board spill avoided
Brainchip shares may also be rising today after the company avoided a disruptive board spill.
While 33.41% of votes were against its remuneration report, a sizeable 85.59% of votes were against spilling the board.
