The CEO of Arteris Inc. (AIP), a provider of on-chip communications solutions for System-on-Chip (SoC) semiconductors, is using company money to bet on an artificial intelligence (AI) startup that may have more promise than Arteris.

Arteris Chief Executive Officer K. Charles Janac recently invested $300,000 of his own money in AI startup Biflow AI Inc., which was co-founded by the son of an unnamed Arteris executive.

Shortly thereafter, Arteris contracted with Biflow to provide chatbot services, paying the company $5 million.

The disclosure, made in a footnote in the latest annual report, indicates Janac’s timely investment in Bitflow may become even more lucrative thanks to ongoing awards from Arteris:

“The Company is currently negotiating, on an arm’s-length basis, a new agreement with Biflow.ai to provide certain services to the Company in 2026.”

The $5 million chatbot contract is substantially more than Arteris has ever earned as a public company.

In fact, Arteris has never generated an operating profit and has lost more than $170 million dollars since going public.

With an Enterprise Value (EV) of approximately $684 million, Arteris is priced as if it will grow annual sales to more than $2 billion, up from an estimated $91 million in 2026. To justify its current share price of $14.92 our Reverse DCF— which quantifies investor expectations embedded in the current share price— indicates Arteris must:

—Grow sales 40% annually for the next decade, significantly faster than the 2026 consensus estimate of 29% and three-year average of 12.1%
—Increase NOPAT margin to 8%, versus our 2025 estimate of (47.4%) and three-year average estimate of (57.9%)
—Increase Invested Capital (IC) Turns to 3.0, up from our 2025 estimate of 1.5

Notably, the current share price also implies Arteris increases Return on Invested Capital (ROIC) to 24% from our 2025 estimate of (71.9%) and three-year average estimate of (68.8%):