Silicom Ltd. (NASDAQ: SILC) announced it secured a design win with a European provider of encryption and secure communication solutions for an FPGA Smart NIC product. The contract is valued at approximately $3 million annually, according to a company statement.

The customer selected Silicom's FPGA SmartNIC after evaluating one of the company's off-the-shelf products, which demonstrated performance requirements for advanced encryption solutions including Post Quantum Cryptography. Silicom will customize the card to meet the customer's specifications during the coming months.

The customer has placed initial commitments totaling approximately $1 million. Silicom expects to deliver products per this initial commitment during the second half of 2026, scaling toward the anticipated $3 million annual deployment.

The companies are discussing a next-generation, higher-speed FPGA Smart NIC planned for launch in 2028, as well as a potential full system solution combining a server with an FPGA Smart NIC. These opportunities could expand the partnership and add to Silicom's annual revenues from this customer.

"This encryption leader's selection of Silicom reflects the excellent performance of our off-the-shelf products, which it tested thoroughly, and its appreciation for our exceptional rapid customization capabilities," said Liron Eizenman, Silicom's CEO.

Silicom, based in Kfar Sava, Israel, provides networking and data infrastructure solutions for cloud, data center and edge environments. The company's portfolio includes server adapters, hardware acceleration engines, AI NICs, FPGA-based smart cards, and Post Quantum Cryptography hardware accelerators.