Key ASIC Bhd Releases Q3 FY2026 Results: Revenue Growth, Narrowing Losses, and Strategic Updates

Key Financial Highlights

• Revenue Surge: Key ASIC Bhd reported a substantial increase in revenue for the quarter ended 28 February 2026, reaching RM5.60 million, a 91% jump compared to RM2.93 million in the previous quarter and up from RM3.76 million year-on-year.
• Losses Narrowed: Quarterly loss before tax improved to RM0.96 million, a significant reduction from a loss of RM1.96 million in the preceding quarter and RM1.68 million in the same quarter last year.
• Cumulative Performance: For the nine months ended 28 February 2026, cumulative revenue stood at RM14.57 million (up from RM9.63 million YTD 2025), while cumulative loss before tax narrowed to RM3.24 million (from RM6.22 million YTD 2025).
• Gross Profit: Gross profit for the quarter was RM1.38 million, slightly below last year’s RM1.44 million but up on a cumulative YTD basis.
• Cash Flow Improved: Net cash generated from operating activities was RM1.92 million, reversing a net outflow of RM3.58 million in the previous full year. Cash and equivalents increased to RM9.36 million as at 28 February 2026.
• Balance Sheet Position: Total assets increased to RM27.65 million, with a net assets per share of RM0.0101. Total equity declined to RM14.17 million from RM17.79 million as of 31 May 2025 due to cumulative losses.

Operational and Business Developments

• Segment Analysis: The recurring engineering services segment continues to be the main revenue driver, contributing RM14.22 million YTD (before eliminations), with non-recurring engineering services trailing at RM2.91 million.
• Geographical Exposure: The majority of revenue is derived from Malaysia (RM4.10 million for the quarter), with Taiwan contributing RM1.51 million.
• R&D Investment: Research and development expenses remain high at RM1.11 million for the quarter and RM3.60 million YTD, reflecting the company’s commitment to innovation and new product development.
• Product Pipeline: Key ASIC is in the advanced stage of developing a high-precision, high-performance RF chip for Global Positioning System (GPS) applications, which is being “taped out” for sampling. The company underscores the potential for this chip to serve broader markets, including advanced driver assistance systems (ADAS), autonomous robotics, asset tracking, smart infrastructure, and defense navigation systems.
• Intellectual Property and SoC Design: The group continues to actively participate in complex system-on-chip (SoC) design engagements leveraging its proprietary design platforms and accumulated technical expertise, particularly targeting IoT, AI-driven, and edge-based applications. This is leading to improved revenue visibility and a strengthening project pipeline.

Corporate Actions and Capital Structure

• Private Placement: Key ASIC had obtained Bursa Malaysia’s approval for a private placement of up to 156,751,000 new shares. As of the report date, no new shares have been issued under this mandate. Bursa Malaysia has granted an extension until 14 October 2026 to complete the placement. The potential fund-raising may impact the company’s capital base and valuation once executed.
• Share Capital Changes: During the period, 83,000 shares were issued pursuant to the exercise of ESOS options, raising RM83,000.

Other Noteworthy Points for Shareholders

• No Dividends Declared: No interim dividend was recommended for the quarter.
• No Borrowings or Debt Securities: The group remains ungeared with no outstanding borrowings or issued debt securities.
• No Material Litigation: There are no pending material litigations as at the date of the report.
• No Unusual or Exceptional Items: The quarter was free from any unusual items affecting assets, liabilities, equity, net income, or cash flows.
• Taxation: Tax expenses for the period amounted to RM46,000.
• Accumulated Losses: Group accumulated losses increased to RM8.78 million as at 28 February 2026, up from RM5.49 million at 31 May 2025. Of these, RM7.79 million are realised losses.
• Earnings Per Share: Basic and diluted loss per share for the quarter was -0.07 sen, and -0.23 sen YTD.

Potential Price-Sensitive and Shareholder-Relevant Matters

• Strong Revenue Growth and Improved Losses: The company’s stronger top-line growth and narrowing losses are positive signals for investors, reflecting improved operational execution and cost management.
• Upcoming Product Launches: The imminent sampling of the high-performance GPS RF chip and expansion into AI, IoT, and edge computing applications could significantly boost future revenue streams and position Key ASIC as a key player in next-generation chip solutions.
• Potential Equity Dilution: Shareholders should monitor the status of the proposed private placement, which, if executed, could dilute existing holdings but also potentially strengthen the company’s balance sheet for future growth.
• R&D Spending Remains High: While R&D investment is essential for long-term competitiveness, it continues to weigh on current profitability. Success in commercializing new products will be critical to justifying this outlay.

Outlook

Key ASIC’s management remains optimistic about capitalizing on the ongoing adoption of AI and IoT in both consumer and industrial segments. The company’s focus on high-value, complex chip designs and its expanding project pipeline are expected to provide improved revenue visibility going forward. However, investors should continue to monitor the company’s progress in commercializing new technologies and the timing and impact of any future capital raising activities.

Disclaimer

This article is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. Investors should conduct their own due diligence or consult their financial adviser before making any investment decisions. The information is based on unaudited quarterly financial statements and may be subject to changes.

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