Poet Technologies (POET +5.54%) stock imploded this morning, falling 44% through 11:15 a.m. on reports of a feud between the tiny semiconductor packaging specialist and semiconductor giant Marvell Technology (MRVL +1.91%).
Poet has developed technology to use photonics (light) rather than copper wires to rapidly transfer data among artificial intelligence chips, and at first, it seemed to catch Marvell's attention. Last week, Poet scored a big win when news began filtering out about a big purchase order from Celestial AI, a company Marvell acquired in February.
But Poet spoke too soon.
Image source: Getty Images.
Marvell's mad at Poet
Marvell is not happy about its purchase order being made public, and is accusing Poet of violating confidentiality obligations by publicly disclosing Celestial AI's purchase.
Result: As Poet revealed this morning, "all purchase orders received by [Poet] from Celestial AI, including the ones for initial production units first disclosed ... by the Company in a press release on April 25, 2023" have now been canceled.
Now, instead of being able to boast about (and profit from) a big sale to a marquee customer, Poet is watching its order book vaporize.
NASDAQ: POET
Key Data Points
What's next for Poet?
So is this the end for Poet? Management insists all is well, as it still has a "recently disclosed purchase order with another technology company with a value of approximately $5 million" -- five times the $1 million in sales it made last year -- but investors don't seem convinced.
Whiz-bang technology or not, Poet's been losing money for 20 straight years. Wall Street analysts expect it to keep on losing money as far out as anyone's making estimates (i.e., 2027). Poet really needed this sale to start changing its story, but now the sale seems out of reach.
And Poet's got no one to blame for it but itself.
