QuickLogic Targets Defense, Space Growth With Rad-Hard FPGA Push

QuickLogic is targeting aerospace, defense, space and critical infrastructure markets with discrete FPGAs and embedded FPGA IP, emphasizing U.S.-based design, manufacturing and trusted supply chains.

The company is developing a strategic radiation-hardened FPGA under a 2022 Department of Defense contract and is self-funding samples for defense customers. It expects evaluations by year-end, with potential program-of-record wins next year and major systems representing hundreds of millions of dollars in revenue.

QuickLogic expects device and IP-licensing revenue to increase as its defense development project winds down, supporting a goal of normalized gross margins in the high-60% range or higher. It ended the second quarter with $13.5 million in cash, no debt and a $10 million credit line.

QuickLogic NASDAQ: QUIK is targeting aerospace, defense and other long-life infrastructure applications as it expands its programmable logic offerings, President and CEO Brian Faith said during a Canaccord Genuity discussion. Faith described programmable logic as a semiconductor segment experiencing renewed demand across market sectors. QuickLogic’s current focus is aerospace and defense, where he said programmable logic represents a significant area of microelectronics spending.

The company sells discrete field-programmable gate arrays, or FPGAs, and licenses embedded FPGA intellectual property for customers to integrate into custom application-specific integrated circuits, or ASICs. According to Faith, QuickLogic’s technology allows customers to program their own IP into devices without sharing that IP with the company. He said the approach can reduce development costs and accelerate time to market compared with developing custom silicon.

Faith highlighted QuickLogic’s development of a purpose-built FPGA for strategic radiation-hardened, or rad-hard, applications. He said the U.S. Department of Defense awarded the company a contract in August 2022 to develop the technology for strategic rad-hard uses, which he characterized as mission-critical weapon and defense systems. The company also elected to self-fund a version of the technology to provide samples to companies in the defense industrial base sooner, he said.

QuickLogic has development kits in the field and has publicly disclosed sales of those kits, Faith said. Faith said the company hopes to receive evaluation feedback by year-end and begin securing designs into programs of record next year. Those programs could then move into low-rate initial production and eventually full-rate production. If successful, he said major systems could represent hundreds of millions of dollars in potential revenue for QuickLogic.

He said the company’s value proposition for defense customers includes being U.S.-domiciled, using U.S. persons on designs and manufacturing products onshore. Faith also stressed the importance of documenting the chain of custody from chip design through manufacturing, shipment and programming.

Faith said defense systems can remain in service for decades, making the ability to update algorithms particularly important. In contrast with replacing a fixed silicon component—which can involve substantial non-recurring engineering costs and lengthy design, validation and manufacturing cycles—programmable logic can allow algorithms to be updated in hours, he said.

Discussing concerns around foreign-sourced electronics, Faith said recent reports involving Chinese firmware in components used in U.K. unmanned surface vessels underscored the value of trusted supply chains. He said customers increasingly wa...