The Brainchip Holdings Ltd (ASX: BRN) share price is falling hard today.

Shares in the S&P/ASX 300 Index (ASX: XKO) semiconductor company closed up 4.0% on Friday trading for 39.0 cents. But things are heading the other direction today, with shares swapping hands for 35 cents apiece on Tuesday morning, down 10.26%.

For some context, the ASX 300 is down 0.2% at this same time.

Despite today's drop, the Brainchip share price remains up an impressive 116% since this time last year.

As for today's sharp fall, much of that pressure looks to be coming from the broader rout in US tech stocks. The Nasdaq Composite Index (NASDAQ: .IXIC) plunged 3.1% overnight. Generative artificial intelligence (AI) chip maker Nvidia Corporation (NASDAQ: NVDA) led the fall amid news that China's new low-cost DeepSeek AI could upend its dominance in the industry.

ASX investors will also be mulling over Brainchip's quarterly update, released this morning.

Here are the highlights.

Brainchip share price takes a tumble

The Brainchip share price is tumbling despite the company noting that the three months to 31 December (Q4) demonstrated its ability to commercialise its neuromorphic AI technology with "the potential to generate substantial growth in the future".

Much of that commercial activity occurred in the final month of the quarter.

On 10 December, for example, Brainchip announced it had been awarded a US$1.8 million contract from the US Air Force Research Laboratory to assist with neuromorphic radar signalling processing.

Later in December, Brainchip announced a US$100,000 contract with US defence contractor Bascom Hunter for the sale and support of AKD1500 chips for full-scale evaluation of commercial products.

On the development front, in October Brainchip introduced Akida Pico. According to the company, Akida Pico is "the lowest-power acceleration co-processor that enables the creation of very compact, ultra-low power, portable and intelligent devices".

Still, the Brainchip share price is likely catching some added headwinds with the company reporting a US$1.9 million unrealised loss for the December quarter, down from a US$900,000 gain in Q3.

As at 31 December, the company held US$20 million in cash, down from US$25.6 million in the prior quarter. Brainchip reported net operating cash outflows of US$4.1 million, up from US$3.4 million in the prior quarter.

What did management say?

Commenting on the three-month period that saw the Brainchip share price rocket 63%, Brainchip CEO Sean Hehir said, "The December quarter saw several strategically important commercial agreements achieved".

Hehir added:

These agreements, while relatively modest in their immediate financial impact, are nonetheless significant as they demonstrate a pathway for revenue generation from royalty-bearing IP sales agreements and from further, deeper commercial partnerships with multi-national defence and aerospace industry contractors.

Hehir also sounded a positive note on the rollout of Brainchip's Akida Pico co-processor during the quarter:

The launch of Akida Pico further demonstrates the versatility of our Akida technology platform, by providing a product that is ideally suited to ultra-low power energy-constrained battery powered devices, such as wearables.