Malaysia’s SkyeChip enters the AI race, but who will be its running mate?

SkyeChip has to pick its manufacturing partner carefully as chipmaking is a heavily politicised industry, experts caution

Reading Time:3 minutes

A microchip in a circuit board. Malaysia has announced its first home-grown AI processor. Photo: Shutterstock

Published: 5:30pm, 27 Aug 2025

Malaysia has announced its first home-made AI chip – a processor designed by SkyeChip – but experts warn that surviving the perils of making and selling chips in an age of global tech competition may be just as hard as achieving that breakthrough.

SkyeChip, based in Malaysia’s tech hub of Penang, on Monday unveiled its AI processor, which can be used to power anything from data centres to digital in-car systems and robots.

The invention potentially opens the door to the Southeast Asian nation’s vital semiconductor industry rising up the value chain from pure back-end manufacturing.

Malaysia provides an estimated 13 per cent of global chip demand, but until the launch of the MARS1000 edge AI processor, it had made few inroads towards upstream chip design.

SkyeChip has designed Malaysia’s first home-grown AI processor. Photo: SkyeChip

Prime Minister Anwar Ibrahim has been pushing to grow the country’s share of the lucrative front-end wafer fabrication, as well as research and development of future technology.

Select Voice

Choose your listening speed

Get through articles 2x faster

1.25x

250 WPM

Slow

Average

Fast

00:0000:00

1.25x