Sivers Semi signs $16.4 million satcoms deal
Strategic development agreement with European satellite communications company includes the development of multiple chips
Sivers Semiconductors AB has has signed a strategic development agreement worth $16.4 million (approx. 170 MSEK) with a European satellite communications company to develop several chipsets for satellite communication ground terminals.
Sivers has already received purchase orders of approx. $1.6M for development work to this project from August to November 2022 .
The agreement, which is with the business unit, Sivers Wireless, includes the development of multiple chips, forming the core of the customer’s next generation of ground terminals, aimed at a broad range of SATCOM markets, including government and defence, commercial (aero, maritime and rail), enterprise data, and consumer broadband services.
This contract, in addition to a previous beamformer IC contract won by MixComm (acquired by Sivers in 2022), constitutes a long-term deep strategic partnership where Sivers will deliver multiple different types of chips for the customers’ current and next generation ground terminals. The long-term partnership is expected to last long past 2030 with Sivers’ chips being used in a growing number of terminals from 2023 and beyond.
The current generation of terminals will launch and start pre-series production in the first quarter of 2023, for which Sivers already has received volume orders of approx. $1.7M (17.5 MSEK) for the beamforming ICs mentioned earlier, which was announced 21st of October 2022.
Development activities for this agreement started in August 2022 and are planned to run through July 2024. It is estimated that the bulk of the work and revenue will be recognised in 2023. This work is expected to be followed by volume deployments, starting in 2024 or 2025 for the second-generation terminals.
Sivers estimates that up to 75 percent of the agreement will be revenue-recognized from the fourth quarter of 2022 through the end of 2023. In addition, Sivers expects that the number of chips from Sivers to this customer will increase between the current generation and the next generation of ground-based satellite terminals.
“This is the largest development project ever for Sivers, and I am thrilled to see how the combined capability of our US and Swedish teams has enabled us to win this deal, " says Anders Storm, Group CEO, Sivers Semiconductors.
"This further strengthens Sivers’ solutions within the satellite communications market, and it is encouraging to see how well our teams work together on this project. Satellite communication is already shaping up to a very substantial market for us in 2023 and we have great hopes for this customer to become successful and win growing market share in a market with a very extensive TAM."