EnSilica Reports Strong Contract Wins and FY26 Growth Outlook Despite SIAE Provision

EnSilica's strong contract wins and positive FY26 growth outlook, despite SIAE provision. Expert analysis for investors.

16 October 2025by Joshua Thompson5 min read57 views

This article covers information on EnSilica PLC.

LON:ENSI

EnSilica FY25 trading update: six contract wins, SIAE provision, FY26 guidance tightened

EnSilica’s latest trading update is a mixed bag: strong commercial momentum and a bigger recurring revenue base, offset by a prudent hit from a delayed customer project. The Group expects FY 2025 revenue of approximately £18.2 million and an EBITDA loss of approximately £1.3 million after a £1.6 million bad debt provision linked to SIAE. Strip that out and EBITDA would have been about £0.3 million, broadly in line with April guidance.

On the brighter side, EnSilica won six new design-and-supply deals in the year (ahead of the 3-4 target) and lifted annual chip supply revenue to £5.7 million (FY 2024 £2.9 million). Booked Non-Recurring Engineering (NRE) now stands at over US$40 million for the next two years, with total lifetime chip supply revenues expected to exceed US$250 million. That’s a healthy pipeline that keeps the long-term opportunity intact.

What EnSilica reported for FY 2025

Quick refresher on the jargon:

ASIC: a custom chip built for one application or customer.
NRE: upfront design fees paid by customers during chip development.
Recurring chip supply: revenue from shipping finished chips over many years once a design goes to volume.
EBITDA: earnings before interest, tax, depreciation and amortisation – a rough proxy for operating profitability.
Bad debt provision: an accounting charge when a receivable may not be collected on time or in full.

Metric	FY 2025 (reported/indicated)	Context
Revenue	~£18.2 million	Down on prior market expectations of £19.6 million
EBITDA	~£(1.3) million	Includes £1.6 million bad debt provision
EBITDA (ex-provision)	~£0.3 million	In line with April 2025 trading update
Chip supply revenue	£5.7 million	FY 2024 £2.9 million
New design & supply wins	6	Ahead of 3-4 target
Booked NRE (next two years)	US$40+ million	Strong visibility
Total lifetime chip supply	US$250+ million	Company forecast

SIAE delay drives a £1.6 million provision

The SIAE MICROELETTRONICA project – flagged in April – remains on hold due to SIAE’s cash constraints. SIAE has been awarded €149 million under the EU’s IPCEI programme for a product in which EnSilica’s ASIC is critical, with funds expected from 2026 and the project expected to resume then.

Given the extended delay versus the original timetable, EnSilica has taken a £1.6 million bad debt provision for amounts owed by SIAE for work done in FY 2025, and has removed SIAE-related income from future forecasts. That is conservative but sensible. It hits FY 2025 EBITDA, but it also resets expectations and reduces the risk of further SIAE-related disappointment in the near term.

Automotive customer cybersecurity issue clouding FY26 volumes

Separately, a cybersecurity issue in an automotive customer’s supply chain has emerged. It is too early to fully assess the impact, but EnSilica has prudently revised chip supply volume expectations for this customer in FY 2026. Again, conservative guidance beats wishful thinking when visibility is limited.

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FY26 outlook: revenue cover high, guidance trimmed

Despite the headwinds, FY 2026 has started well, with year-to-date revenue significantly ahead of the prior year. The company now guides to revenue of £28 million to £30 million for FY 2026 and EBITDA of £3.5 million to £4.5 million. Approximately 80% of FY 2026 revenue is already covered by existing contracts – a solid foundation.

The operational engine looks broader, with five chips in supply generating recurring revenue and thirteen chips in design generating NRE and moving towards supply. That mix should progressively tilt towards higher-margin chip shipments as projects mature.

How guidance compares with prior market expectations

	Prior market expectations*	Company now indicates
FY 2025 revenue	£19.6 million	~£18.2 million
FY 2025 EBITDA	£0.4 million	~£(1.3) million (after £1.6m provision)
FY 2026 revenue	£33 million	£28 million – £30 million
FY 2026 EBITDA	£5.1 million	£3.5 million – £4.5 million

*The Company states these were market expectations immediately prior to this announcement.

Why the pipeline looks stronger than the headline loss

There’s a clear pattern: NRE today, recurring chip supply tomorrow. EnSilica’s booked NRE of over US$40 million gives two years of visibility on design activity, and the step-up in chip supply revenue to £5.7 million shows designs are converting into long-term shipments.

The Company continues to forecast more than US$250 million of lifetime chip supply revenue across its contracts, even after stripping out SIAE. That underpins the CEO’s point: as the portfolio of supply contracts broadens, the impact of any single project diminishes. If FY 2026 lands within guidance, it would be more than 50% revenue growth year-on-year and an EBITDA margin in the low-to-mid teens, demonstrating operating leverage as volumes build.

Key positives and pressure points

Positives: six contract wins, stronger recurring revenue, US$40+ million of booked NRE, and about 80% FY 2026 revenue covered. Year-to-date trading in FY 2026 is ahead of last year, and the Board sees decreasing cash consumption with positive monthly cash generation anticipated in due course.
Negatives: the SIAE delay triggers a £1.6 million provision and trims FY 2025 profitability. FY 2026 revenue and EBITDA guidance are below prior market expectations, and the automotive cybersecurity issue adds uncertainty to near-term chip volumes.

What to watch next

Final results on 4 November 2025 for full FY 2025 detail and cash flow colour.
Any update on SIAE’s IPCEI funding timetable and the 2026 restart.
Resolution of the automotive customer’s cybersecurity issue and any impact on FY 2026 supply volumes.
Conversion of the thirteen designs in progress into supply, and additional multi-million-pound design and manufacturing wins flagged in the pipeline.

My take for investors

This is a classic scale-up wobble: a prudent hit to tidy up a delayed customer coupled with tighter guidance, but with the underlying machine moving forward. The step-up in chip supply revenue, the six contract wins, and the US$40+ million NRE book suggest the core thesis is intact – design now, supply for years.

FY 2026 still targets substantial growth in revenue and EBITDA, with most of the top line already under contract. If EnSilica executes on the supply ramp and keeps building its stable of long-term chip programmes, dependency on any one project fades and earnings should become more predictable. It is not without risk, but the direction of travel looks constructive.