QuickLogic, a fabless semiconductor company known for its embedded FPGA (eFPGA) technology, recently announced promising Q1 2024 earnings. While revenue jumped 45% year-over-year, fueled by the growing demand for eFPGA IP, analysts fixated on a sequential dip in revenue, failing to recognize a key development within the earnings transcript – a development that could revolutionize the AI landscape.

Buried within the Q1 2024 earnings call transcript is the announcement of a finalized contract with a "large international company" to provide eFPGA IP for an ultra-low-power system-on-chip (SoC) targeting commercial and industrial IoT applications. The game changer? The eFPGA IP is specifically being utilized for AI acceleration.

This marks a seismic shift in the AI landscape. Traditionally, AI acceleration has been confined to power-hungry processors and specialized GPUs in data centers. QuickLogic, with its expertise in ultra-low-power eFPGA technology, is poised to bring AI acceleration to the edge, embedding intelligence directly into the devices we use daily.

Why This Matters

The implications for the burgeoning IoT market are immense. Billions of interconnected devices, ranging from smart home appliances to industrial sensors, generate an overwhelming amount of data. Processing this data in the cloud is inefficient and often impractical. Embedding AI acceleration directly into these devices using QuickLogic's eFPGA technology empowers real-time decision making, enhances functionality, and significantly improves efficiency.

"Market research firm Market US predicts the chiplet market, a technology that seamlessly integrates with QuickLogic's eFPGA IP, will skyrocket to $107 billion by 2033. This represents a 10-year CAGR of over 42%, overshadowing QuickLogic's projected growth."

Beyond the Numbers

QuickLogic's "storefront" strategy, which involves designing and delivering complete devices for customers lacking in-house resources, positions them uniquely to capitalize on this AI-at-the-edge opportunity. They can provide the eFPGA IP and manage the design, fabrication, testing, and delivery of finished devices, opening a market potentially orders of magnitude larger than their core IP licensing business.

QuickLogic's Revenue Growth

The following chart illustrates QuickLogic's projected revenue growth, fueled by their eFPGA IP and AI-at-the-edge strategy.

The Hypothesis

QuickLogic's foray into AI-at-the-edge, coupled with their storefront strategy and the explosive growth of the chiplet market, positions them to become a major player in the evolving AI landscape. This isn't about competing directly with established data center giants like NVIDIA; it's about pioneering an entirely new market where intelligence resides at the edge, embedded within the very devices that shape our lives.

Wall Street's Myopia

Wall Street, focused on short-term sequential revenue declines, seems to be missing the bigger picture. Astute investors, however, are those who look beyond immediate numbers and understand the transformative potential of bringing AI to the edge. In this quiet AI revolution, QuickLogic holds the key.

"Fun Fact: QuickLogic's technology is already powering some of the world's most popular smartphones! Their ultra-low-power EOS S3 chip helps extend battery life and enhance audio quality for millions of users globally. Your smartphone might be powered by QuickLogic right now!"