KUALA LUMPUR (March 6): Key ASIC Bhd clinched four turnkey application-specific integrated circuit (ASIC) design service contracts worth RM16 million over a three-year period.

In a Bursa Malaysia filing on Monday (March 6), Key ASIC said the four contracts include two contracts from existing end customers. Another two are from new customers, including a Hong-Kong-based client.

“In addition to the non-recurring engineering fees, the projects usually contribute to a multi-year revenue stream from the shipment of the wafers or chips,” it said.

Outsourcing of turnkey design services is expected to continue to grow rapidly, Key ASIC said in the filing.

The turnkey ASIC design service includes licensing of intellectual property (IP) blocks, engineering design services, multi-project wafer services, testing programme development for mass production of chips, and mass production of chips.

“Though it is a capital intensive and time-consuming effort, our persistent investment in the development of IPs which are the key building blocks of ASIC or SoC (system-on-chip) is generating results,” said Key ASIC chief executive officer Eg Kah Yee.

The group’s shares closed unchanged at six sen, and its market capitalisation was RM83.61 million.