SAN JOSE, Calif. – Ten years ago, Cypress Semiconductor effectively made a $50 million bet on a new processor platform, launching its first generation programmable system on chip (PSoC). Today Cypress rolls out the first two products of a mid-life kicker that shores up a new drive into the 16- and 32-bit microcontroller market.
It’s been an up and down ride. Two years ago, PSoC hit a $450 million annual run rate, but after a market slowdown and some big consumer design wins went bust it retrenched to a $250 million/year business.
This year, Cypress chief executive T.J. Rodgers forecasts a modest return to revenue growth for PSoC and Cypress as a whole, although gross margins may decline. We caught up with him right after a quarterly conference call when he delivered that message to analysts who responded by pounding down the price of Cypress shares.
“Since 8 a.m. this morning I lost about $19 million,” Rodgers said when asked how the call went.
Without a pause, he dove into the details of a product line he sees reshaping the playing field in the $15 billion microcontroller market. “Never has one company put so much on one chip that’s so flexible and sold it for a buck,” he said.
First silicon on PSoC 4 came back from the fab ready for production. So in a sign of Rodgers’ strong belief in the platform, he put it on the cover Cypress’ 30th anniversary annual report.
The fourth generation is the first Cypress chip to use an ARM Cortex M0. The 4100 hits up to 24 MHz with the core that ekes out 0.9 MIPS/MHz. It includes a library of programmable analog functions and sells for prices starting at $1.
The 4200 gooses data rates to 48 MHz and adds a library of programmable digital functions. Both are supported by the PSoC Creator 2.2 integrated design environment and come with developer kits that sell for $25.
Over the next two years, Cypress aims to expand the amount of memory and the programmable analog and digital blocks on PSoC 4 by a factor of four or more. Meanwhile, Cypress engineers are already at work on a PSoC 7 generation, a new high-end line using an undisclosed ARM core.
To date, PSoC has focused mainly on low-end apps in the 8-bit MCU space. Rodgers shows market research figures ranking Cypress in sixth place in 8-bitters, ahead of NXP, Fujitsu, Toshiba and others thanks to its uptake so far.
But in the overall microcontroller market Cypress sits at number 12. The company’s MCU revenues fell a whopping 30 percent last year in part because the market slowed, some Cypress cellphone wins went sour and the company did not meaningfully participate in the 32-bit sector that grew nearly eight percent.