Irvine-based chip startup Quartics Inc. expects to turn a profit next year after a couple years in the trenches.
“Next year is going to be a big year for us,” Chief Executive Sherjil Ahmed said. “We think the company is on a very nice growth curve.”
Quartics’ chips are designed to improve regular and high-definition video on the Web, handheld digital camcorders, cell phones, Blu-ray discs, computers and video game consoles.
The company expects to see sales of about $5 million this year. That could jump to $25 million in 2011 as customers ramp up production, according to Ahmed.
Quartics’ selling point is that its chips are programmable. Customers can load them with custom programming to do a variety of functions.
Programmable chips also shrink the time needed to design consumer electronics, helping get products to store shelves quicker.
In coming months, Quartics expects to announce four customer wins, including two “tier one” PC makers and two TV makers, according to Ahmed.
He declined to name names.
Quartics is banking on the increasing use of video on a number of devices, such as Apple Inc.’s iPod and iPad, smartphones, video game consoles, computers and televisions.
“Video entertainment is a large reason why people buy these devices,” Ahmed said. “It’s a major shift from just four or five years ago.”
Quartics’ chips come into play when video needs to be upgraded from standard resolution to high-definition, or to 3D. The chips also convert video for one device, say a PC, to another, like a digital TV.
The company is marketing its chips, dubbed QVu, mainly to TV and laptop makers.
The Business Journal estimates that Quartics has raised some $30 million in venture funding. It’s most recent $6 million round was done in January.
Quartics is in the midst of raising another round from existing investors, a company spokesman said.
Backers include Palo Alto-based private equity firm Hercules Technology Growth Capital Inc. and other undisclosed private investors.
Founder and former chief executive Safi Quereshey also is an investor. Quereshey was a cofounder of Irvine computer maker AST Research Inc., which no longer is in business.
Quartics underwent an executive shakeup and a change of direction last year.
In 2008, the company launched an executive search to find a chief executive to replace Quereshey, who came out of retirement to run the startup in 2003.
Quereshey continues to work at Quartics as an “active” chairman, Ahmed said.
The company recruited Mario Rivas, an executive from Sunnyvale-based Advanced Micro Devices Inc., who headed the chipmaker’s computing solutions group.
Quartics also embarked on a short-lived strategy to market chips that wirelessly link computers and cell phones to digital TVs.
“We dabbled in it for a little bit but pulled out quickly because it was taking away our focus from QVu,” he said.
Rivas left Quartics in late 2009. Ahmed then was promoted from president to the top post.
The company has been quietly filling out its executive suite.
It added Dave DiOrio, a former Broadcom Corp. executive, this year. DiOrio ran the digital TV division at the Irvine-based chipmaker. He also held posts at Advanced Micro Devices and Texas Instruments Inc.
Quartics also hired Rick Goerner, a chip veteran who was chief executive of Tustin’s Silicon Systems Inc., which was bought for $575 million by Texas Instruments in the mid-1990s.
Earlier this year, Quartics opened a development center in China with 20 engineers.
The chipmaker is looking to bring another 30 to its Shanghai office this year.
Ahmed is mum about Quartics’ long-term plans.
The company’s investors are “patient money” and “want to build the company out more before we entertain anything,” he said.
