Aeva Technologies, Inc.

Please stand by, your program is about to begin. If you need assistance during your conference today, please press star zero. Good day, my name is Jess and I will be your conference facilitator. I would like to welcome everyone to AVA Technologies' fourth quarter and full year 2024 earnings conference call. During the opening remarks, all participants will be in a listen-only mode. Following the opening remarks, we will conduct a question and answer session. As a reminder, today's conference call is being recorded and simultaneously webcast. I would now like to turn the call over to Andrew Fung, Senior Director of Investor Relations and Corporate Development. Andrew, please go ahead.

Thank you, and welcome everyone to Ava's fourth quarter and full year 2024 earnings conference call. Joining on the call today are Soroush Salahian, Ava's co-founder and CEO, and Saurabh Sinha, Ava's CFO. Ahead of this call, we issued our fourth quarter and full year 2024 press release and presentation, which we will refer to today and can be found on our investor relations website at investors.ava.com. Please note that on this call, we will be making forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect our views only as of today, and should not be relied upon as representative of our views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For further discussion of the material risks and other important factors that could affect our financial results, please refer to our filings with the SEC, including our most recent Form 10-Q and Form 10-K. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of AVA's performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. The webcast replay of this call will be available on our company's website under the Investor Relations link. And with that, let me turn the call over to Soroush.

Thank you, Andrew, and good afternoon, everyone. Q4 and the startup 2025 have been an incredible period of momentum in our business, and I'm excited to update our investors and stakeholders. I think it's appropriate, though, to step back and frame how we got here. When we laid out our vision for AVA and building a market-leading perception and sensing company nearly eight years ago, we knew it was not going to be easy, and the path we were taking with FMCW would ultimately build a platform for the future, but it would take time. Importantly, we built a strong team, understood the challenging engineering problems to overcome, algorithms and software necessary to build, the hardware, semiconductors, and silicon photonics to be developed, and iterations required to bring multiple generations of a powerful product to market. If successful, we would have the building blocks required to enable both breakthrough long range perception and micron level precision for broad applications and perception. Richer data sets, faster processing, everything aligned in scalable architecture and protected by a massive wall of significant IP. We knew that this product vision was the only way to unlock the potential promise of autonomy and the other next generation capabilities for our customers across automotive, industrial robotics, and other applications. Our team was constantly faced with challenges to overcome along the way and needed an intense drive to deliver on our ambitious goals. I am proud of how we have pulled together time and again to deliver our first commercial product, Ares II, in 2022, followed by our first integrated ASIC product, Atlas, beginning of last year. These were breakthrough milestones in the LIDAR space as the promise of FMCW LIDAR was finally being delivered. These products enabled our historic series production win at Diamond Truck, one of the largest commercial vehicle manufacturers globally. We didn't stop there, however, as we have continued to push into a smaller form factor, launched a next-generation ASIC, and have increased the resolution of our market-leading Atlas Ultra product line targeting passenger vehicles. Our Atlas Ultra product has now enabled us to bring the power of our platform to the passenger vehicle market and enabled us to be awarded a joint development program from a global top 10 passenger OEM. This award opens up a new market for our products and signals the confidence large global OEMs have in our technology and future. The joint development program is focused on taking our market-leading Atlas Ultra product and fine-tuning it to fit within their specific vehicles and package it for use in their stack. The engineering work and milestones for this program are well-defined, and the team is laser-focused on delivering where we have confidence in our success. The objectives of this program are clear, and on success, enable us to be included as the LiDAR future in the global OEMs model lineup globally and for geographies outside of China. We expect to complete this program later this year, where we expect this transition to a large-scale production award amongst the largest opportunities in the industry and delivering a next-generation technology to our customers' vehicle platform. In summary, 2024 was a year of strong commercial momentum at Ava, and we expect to double down on this momentum in 2025. Let's now discuss in more detail our recent business developments. We are excited to be selected by a global top 10 passenger OEM for a LIDAR development program for its next generation global production vehicle platform, where we will jointly work on development, packaging, and integration of AVA's Atlas Ultra 40 LIDAR for use across the OEM's global line of passenger vehicles. Over the course of last year, we have discussed our advancements with this OEM, including being down selected to the final stages of the RFQ. Now, this development program window presents a key milestone in our ongoing collaboration, and it is effectively the first development phase of the series production program and is focused on the joint B sample development and packaging of our Atlas Ultra product for use across the OEM's broad lineup of vehicle models. This OEM has a long history of using time-of-flight 3D LiDAR. However, through extensive evaluation and real-world testing, of AVA-40 LiDAR, including instant velocity, immunity to interference, and other advantages over time of flight, the OEM has found that our technology is better able to address a number of key use cases needed for the OEM to successfully expand its operating design domain at higher speeds and scale to higher levels of automation across its vehicle lines and more markets. As such, they are moving to FMCW technology in order to future-proof their solution for the next generation vehicles. Importantly, separate in addition to this program, we have also secured a letter of intent from this passenger OEM toward the series production program award decision. And we expect that to transition to a large scale global production program opportunity for AVA later this year. This OEM is a leader in commercializing new technology at scale in the passenger vehicle space. With the annual vehicle volumes in the millions and the potential to be the primary feature across geographies outside of China, we believe the opportunity for this year's production program upon conversion from this development phase is expected to be massive and likely one of the largest in the automotive industry, which could cement our position as a market-leading company globally. We're excited to be awarded this development program with this OEM and are planning for Atlas Ultra startup production starting in 2027. Beyond this top 10 OEM win, we are seeing increased momentum for our funnel with other global passenger and commercial vehicle OEMs that are advancing toward FMCW technology for their vehicle platforms. Specifically, we are increasing our joint activities with other passenger OEMs, including another top 10 passenger OEM through the RFQ process and two other commercial vehicle OEM opportunities with significant volume potential based on our Atlas and Atlas Ultra platforms, and with targeted SOPs between 2027 to 2029. More broadly, interest to leverage FMCW technology is rising across the industry, as is decisions incorporating geographic considerations. We believe AVA is in a strong position with our products and cost-competitive solutions. Moving now to update for Diamond Truck on the production program. We are progressing well with Diamond Truck, having delivered on all of AVA's milestones for the program in 2024. As the exclusive long-range and ultra-long-range LiDAR supplier for the OEM's autonomous truck production program, AVA 40 LiDAR is the primary detection sensor, and we have been working closely with Diamond Truck and its subsidiary, Torque, to achieve their key milestones towards a safe and scalable commercialization of autonomous trucks. I'm happy to share that this relationship continues to deepen in 2025. We recently expanded our collaboration with Torq to include sharing of sensing data and a freightliner vehicle platform. This will enable even closer collaboration between our teams as we work together on advancing the safety architecture for autonomous trucks and enabling Torq's virtual driver software to make safer and more intelligent decisions. So in short, AVA remains on track for its start of production in 2026, to support Diamond Truck's market entry by 2027. Turning now to the latest developments around ABOS products. We unveiled Atlas Ultra at CES this past January. This is our newest and most powerful automotive grade 40 LiDAR that is designed to meet OEM requirements for level 3 and higher speed applications. Compared to our Atlas product, Atlas Ultra offers three times the resolution and the capability for a wider field of view, all in 35% slimmer packaging, which opens up even more integration options with minimal impact of vehicle styling and aerodynamics. Like other AVA LIDAR products, Atlas Ultra leverages our proprietary LIDAR-on-chip architecture, which integrates all optical components, including transmitter, detector, and lenses, onto the silicon photonics module. This, along with no use of fiber or exotic materials, allows us for a highly automated manufacturing process and ability to mass produce at affordable costs. Atlas Ultra also utilizes our custom AVA X1 SoC, or system-on-chip processor, which enables seamless integration of data acquisition, point cloud processing, scanning, and application software into a single mixed signal processing chip. Our X1 SoC also powers AVUS advanced perception algorithms that leverage PowerPoint velocity data for object detection and semantic segmentation. We are already working on integrating Atlas Ultra with key partners, such as the Global Top 10 Passenger OEM, and plan for additional availability to automotive customers later this year. At CES, we also showcased the industry's first functional behind-windshield integration of an FMCW LiDAR in collaboration with an automotive partner. This enables a high LiDAR positioning for optimal long range detection with seamless integration, minimizing impact to vehicle design and aerodynamics. The in-cabin integration is enabled by our FMCW LiDAR on chips, small form factor, low power consumption and passive cooling, which help maintain good road visibility and passenger comfort. Our operational demonstration vehicle utilizes a co-developed custom formulated glass from wide-eye by AGC that is compatible with AVA's unique FMCW wavelength to maintain long-range detection and point cloud quality. Feedback from leading OEMs following real-world on-road demonstrations have been very positive and has already led to deeper engagements. Switching now to industrial development, where we are growing rapidly with major applications of our products with industry leaders such as Nikon and SIG-AG for the $10 billion plus market opportunity in industrial robotics and factor automation. This is possible now in 2025 because of the completion and our core technology components, including our core vision LiDAR-on-chip modules and X1 SoC for industrial applications. In particular, late last year, we partnered with SICK-AG to incorporate AVUS FMCW technology into its portfolio of high precision contactless sensor solutions. As mentioned, SICK is one of the top leaders in sensor solutions with revenues of nearly $3 billion annually. Specifically though, in the multi-billion dollar market of high accuracy displacement sensors, SICK sells more than 250,000 sensors a year, which are used across a broad range of industrial robotics and factory automation applications. AVA sensors bring a number of major performance size and cost advantages versus current solutions, such as more reliable micron-level precision across many operating conditions, or the ability to measure both short and long standoff distances with the same small sensors. And because of AVA's ability to directly measure velocity, we believe our technology will open up new capabilities that bring the possibility to expand the use of AVA sensors across the industrial precision market. Having now substantially completed our validation with SICK, we're now moving to commercial deployments beginning in Q3 of this year. Turning now to our key objectives, I would like to first provide a quick recap of our 2024 goals before sharing more about our 2025 objectives. We set challenging objectives for 2024, and I am proud to say that we have achieved essentially all of them. With regards to the goal for two additional production wins, we secured an industrial win with IndoorLab and a global top 10 passenger OEM development program. Our other goals from maturing our production product to finalizing our supply chain and exceeding our financial metric targets with over 100% revenue growth were all successfully achieved. Looking to 2025, we expect the work accomplished last year will enable AVA to build on our momentum this year. Our focus is on further driving the adoption and commercialization of FMCW technology while continuing to maintain strong financial discipline. Specifically, we target winning two additional programs in 2025 beyond the top 10 passenger OEM. Second, we are on schedule to complete and release the sea sample of our Atlas product to key customers this year. This key milestone will keep us on track for our 2026 startup production with Diamond Truck. Third, we are working to expand substantially in industrial robotics and factory automation. For AVA's unique FMCW technology, has the potential to transform the industry. We are seeing significant interest from some of the global leaders in the space with potential for materially higher deployments to the tune of at least 1,000% for AVA in 2025. Fourth, we plan to complete our automated and automotive qualified production line with capacity for 100,000 plus units annually. This critical step will not only better position AVA to meet the increasing near-term interest for our 40 LIDAR, but also our upcoming commercial deployments. And fifth, we aim to achieve these objectives with a strong focus on financial growth this year. As Saurabh will discuss later on, we believe we have the ability to achieve record revenues for the company this year with approximately 70% to 100% year-over-year growth in 2025. At the same time, we expect to reduce our operating expenses this year by approximately 10% to 20% year over year. In summary, AVA is working on multiple significant commercial opportunities in 2025. And with our unique 40 LIDAR, a strong team, and liquidity position, we believe we are in a good position to execute on our objectives and capitalize on the growing momentum around FMCW. With that, Let me turn the call over to Saurabh to discuss the financials.