Archer keeps the patent news flow coming with US approval, wild share price ride continues
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Semiconductor technology company Archer Materials (ASX:AXE) has added another patent announcement to its recent list, flagging a new approval in the US market.
The US patent is for Archer’s CQ qubit (quantum-bit) computing chip technology, the company said, which is currently under development at the University of Sydney.
AXE said the approval will free it up to “explore opportunities to work with quantum computing partners in the US”.
Shares in AXE initially rose by more than 10% in morning trade before easing back slightly.
FY22 has been a wild ride so far for AXE investors, with the stock more than doubling since July 1 (AXE shares are up more than 300% calendar year-to-date).
Most of its recent activity has been based around patent news flow. The company said it received approval for patents in South Korea and China in early August — catalysts for sharp jumps in the share price.
Later that month, the stock dipped following media reports that Archer had failed to disclose objections to its application by patent regulators in Australia.
In response, the company advised that its patent application was still active. It said back in February this year, IP Australia raised some corrections and clarifications, and gave AXE one year to respond (deadline: Feb 11,2022).
From August highs above $2.50, Archer shares fell back to $1.60. But the stock has rallied sharply over the past week in the lead-up to today’s announcement.
Citing the US as a major hub globally for semiconductor technology and development, Archer said today’s patent news is a “significant step” in its efforts to “access global markets and participate in the US technology economy”.
Commenting on the update, Archer CEO Dr Mohammad Choucair said the company is developing an “entirely new technology” with its CQ qubit chip.
In that context, most semiconductor R&D and innovation globally takes place in the US, where patent protection plays a key role, he said.
“We continue to work through the patent application processes related to the 12CQ chip in Europe, Australia, and Hong Kong,” Choucair said.
Earlier this month, Archer — which pivoted from resources to semiconductors — also provided an updated on its plans to divest its mineral exploration tenements to iTech Minerals, a company which is planning to list on the ASX.
Under the terms of the deal, Archer will sell its assets in a share-based transaction, in return for 50 million iTech shares.
The deal is conditional on iTech successfully listing on the ASX.
A pre-revenue tech development company, Archer’s quarterly cash flow report for the June quarter showed it booked $631,000 of cash outflows, comprised mainly of staff costs ($493,000) and admin costs ($174,000). Exploration and evaluation costs amounted to $11,000.