Arbe Robotics Ltd.

Ladies and gentlemen, thank you for standing by. The conference will begin shortly. The conference will begin shortly. The conference will begin shortly. Ladies and gentlemen, thank you for standing by. Welcome to the Arbat Robotics Second Quarter 2025 Results Conference Call. All participants are present in listen-only mode. Following management's formal presentation, instructions will be given for the question and answer session. As a reminder, this conference is being recorded. You should have all received by now the company's special release. If you have not received it, please contact our Bez Investor Relations team at EK Global Investor Relations at -378-8040. Or view it in the investor section of the company's website, arbarobotics.com. I would now like to hand over the call to Mr. Ehud Helt of EK Global Investor Relations. Mr. Helt, would you like to begin please?

Thank you, operator. Good day to all of you and welcome to Arbat Conference Call, the discuss the results of the second quarter of 2025. Before we begin, I would like to remind our listeners that certain information provided in this call may contain overlooking statements, and the safe hardware statement outlined in today's journey release also pertains to this call. Today we are joined by Kobi Morengo, our co-founder and CEO, who will begin the call with a business update. Then we'll turn the call over to

Karim Sinto. We'll open the call up for the

question and answer session. Good day, I'd like to turn our recorder to

Kobi. Thank you, Ehud. Good morning to everyone and thank you for joining us today to discuss our results and recent business development. I will begin by reviewing some of our current business highlights. We are pleased with the strategic progress we make in the quarter. Our main target is to win this with the large OEMs of the world, and as each month passes, we are making progress. Our bearer sees the strategic order for the use of its chipsets in large-scale data collection projects. These chipsets will shift and will be deployed on fleets of more than 100 vehicles, operated by leading automotive manufacturers. In general, there is a growing industry-wide recognition among OEMs that high-end imaging radar is a requirement for a safe and free driving capability. It is true that high-resolution radar delivers superior performance in complex and challenging conditions, feeling critical perception gaps and enabling safer, more reliable autonomy. The market is moving forward, solutions based on growth and self-sufficiency, signaling a departure from the lines of business-only exposure. As a result, we are now imaging radar selection programs with several of the world's leading OEMs. Magna and Hyres, our main tier ones, are competing with our chips on all of those opportunities. Furthermore, our collaboration with NVIDIA is enabling us to move slowly forward with our customer engagement. Not less important is our solid performance in non-automotive applications. We are scaling up chip delivery to SEMsRUGS as they grow their customer base and increase their learning volume across a broad range of applications. We are very pleased to say that for the first time SEMSRUGS is delivering radars for defense applications, a growing radar applications market. This demonstrates the versatility of our technology for broader industrial and mobility markets beyond the passenger automotive markets. We also announced we've signed a new comprehensive support and maintenance agreement with SEMSRUGS under which we will receive a recurring fee to support their 4E imaging radar program built on our advanced chips and technology. We continue to move ahead with the various big processes with our target OEMs. Some of these have progressed and will successfully advance to the final stages of the process. At this point we are no longer competing against a large group of suppliers. We are now one of the final few radar technologies remaining in this stage. While the time of these selection processes is not under our control, we are pleased with the progress we have made in recent months and it remains our goal to achieve 4 OEMs between the coming years. Our initiatives are aligned with the fact to OEM selection and we anticipate that our best radar technology will serve as a key enabler for the 2028 passenger vehicle platform and we expect our revenues to begin in 2027 and ramp up in 2028 as our chipsets are used in high volume production. While 2027 may still seem some time away for us, 2027 is around the corner and we are already preparing accordingly. Thanks to our combined chips we have the wrong way to support our program as our revenues reach the ramp up stage. I do business highlight. Island Technologies, our leading tier 1 supplier in China, launched the LRR-615, a long-range imaging radar system powered by our chipset. Their system offers ultra-high resolution and reliable performance in all weather and lighting conditions, presenting a cost-effective and scalable sensor that complements, camera-rides and offers a cost-effective alternative to lidar, especially in China. Our hiring is prepared to ramp production capacity to deliver tens of thousands of units annually. China's State Administration for Market Regulation proposed a new regulation that mandates highly advanced AIDAS testing for all new level 1 and level 2 vehicle models. These requirements exceed the capabilities of the radar systems which are currently generally available in the Chinese market. We believe ARBE's high-resolution radar technology can enable OEMs to enhance AIDAS performance to meet these new standards once adopted, creating a significant market opportunity for us in China even in 2026. In closing, ARBE is very well positioned to take advantage of the industry transition to high-resolution radar. The progress we've made over the past year across OEM partnership, tier 1 integration and cross-sector reduction demonstrates the maturity of our execution and the strength of our ecosystem. We have a number of catalysts coming up over the next years, and we expect that the OEMs we are targeting concludes the radar selection process for the 2028 car models. Today, based by a solid financial foundation, we are positioned to lead the industry in the adoption of good for high-resolution radar, and we remain focused on unlocking long-term value for our shareholder builds. We expect our technology to be a key enabler in high-volume 2020-age passenger vehicle platforms with revenue growth beginning in 2027. We look forward to sharing more as we continue to move forward. Now, I would like to turn it over to our CFO, Kareem, to go over the financials.

Thank you, Koby, and hello, everyone. Let me review our financial results for the second quarter of 2025 in more detail. Revenue for the second quarter of 2025 totalled $0.3 million compared to $0.4 million in Q2 of 2024. As of June 30, 2025, backlogs stood at $0.5 million. World profit for Q2 2025 was negative $0.2 million compared to

negative $0.0. Flushing the impact of fixed-cost components given

reduced revenue year over year and revenue mixed costs. Turning to operating expenses. Total operating expenses for Q2 2025 were $11.3 million down from $11.6 million in Q2 2024. The decreasing operating expenses were primarily attributable to lower share-based compensation expenses resulting from the full vesting of prior grants and to a reduced volume of new grants. This decrease was partially offset by increased loan liability grants approved, labor costs, and unfavorable foreign exchange effects. Operating loss for the second quarter of 2025 was $11.5 million compared to $11.6 million loss in the second quarter of 2024. Adjusted EBITDA and non-GAP measurements, which exclude expenses for non-cash share-based compensation and for non-recurring items, was a loss of $8.9 million in Q2 2025 compared to a loss of $7.5 million in the second quarter of 2024. We believe that this non-GAP measurement is important in management evaluation of our use of TAS and planning and evaluating our TAS requirements for the coming period. Net loss in the second quarter of 2025 was $10.2 million compared to a net loss of $11.7 million in the second quarter of 2024. As of June 30, 2025, our debt held $26.3 million in -to-cash equivalent and short-term bank deposits, as well as $35.7 million in long-term bank deposits. Turning to our outlook, we would like to reiterate what we previously said. Our debt-leading radar technology remains a top priority for key decision makers in the automotive industry. While broader economic shifts have led to delays in automakers' rollout of advanced driver assistance systems, decision timelines have been extended. Our debt continues to engage closely with industry leaders, advancing through our skewed stages and strengthening its position for adoption. We continue with our goal to pursue forward designings with automakers in the coming year. Our debt maintains its overall financial expectations for 2025. We expect annual revenue to be weighted toward the end of the year in the range of $2 million to $5 million. Continued expectations for adjusted EBITDA for 2025 to be in the range of $29 million loss and $35 million loss. Now, we will be happy to take your questions. Operator?

Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If you have a question, please press star 1. If you wish to cancel your request, please press star 2. If you are using speaker equipment, time to lift the hands up before pressing the numbers. Please stand by while we poll for your questions. The first question is from George Dionnaras. Please go

ahead. Hi, everyone. Thank you for taking my questions. I'd like to ask first about the four design wins that you expect in the coming year. Curious as to how that number has changed at all over the last few months as we last spoke and what the competitive set looks like. It sounds like you feel like that has tightened a little bit. And if you could share any details around how you feel that that has changed as well. Thank you.

I think that overall, the amount of audience that we are walking through with them, through winning, didn't change. What really changed is the environment and the understanding of every OEM that's basically starting to develop a real, let's call it L3, L3 Eyes of Writing that they understand that current low-end imaging radar cannot solve the problem. And the multi-high level of channels radars that have at least more than a thousand channels, which basically is our system of optics and the system of mobile isotopes, are the only candidates that can really solve the problem for L3. And basically, what is though is that even in programs that they were considering to take all the shows' imaging radar as an option, they decided to focus and narrow the competition to this, I would say, two whole place between the two companies. And I think the only two companies today that have a real imaging radar, high-end imaging radar, that can solve the problem for L3, as I mentioned, is both. The other thing that we are seeing is that when OEMs begin the data collection with our radar, with our high-end radar, with our high-end radar, with our high-end radar, with our high-end radar, they see that for a bit of a lower-end application, what is called L2+, L2++, which is only L3 driving, imaging radar can actually solve the problem and they are looking to expand the selection also to those kinds of applications. So I think overall, I don't see today a customer in the market that will say that high-end imaging radar is not enough for an L3 ISOC application. The fact that there is very few amounts of competitors in this market, I think we are in a very good position to be believing in this market.

Is it possible for one OEM to pick multiple vendors for their imaging radar? Not

really, not really. Not really. I think that first of all, the data collection, because we are today in a world of full AI stuff, you need to have a data collection. In order to have an effective data collection, we are talking about millions, not even millions, millions of kilometers of driving, even miles, not just kilometers. So you need 10 or even 100 cars that are driving for a year to collect the data and to train the algorithm. So to go with two radars on the same application makes no sense. It's possible to select a different radar for a L3 stack and a different radar for a 2GaP stack, but I don't see an OEM selecting two radars for L3.

Maybe this is a final follow-up. You mentioned in your release potential for non-automotive growth, you list a couple of applications, including defense sector and smart infrastructure. Can you just expand upon that a little bit as possible? What other non-automotive applications are you seeing potential traction with over the next few years? Thank you.

So defense of defense I think is a growing sector in the last two or three years. Of course it comes from the different side of it, from detection, from border protection to autonomous trucks that move the supply to the troops, or so on. So detection of drones that are attacking and so on. So there is I think a strong demand on the defense side for low price radars. It's not the monsters of the big industries are busy today. Radars that cost millions of dollars. There is an info radar in a thousand, two thousand, three thousand dollars. Of course it's not in the volume of an automotive, but the margins are better. Smart infrastructure as you mentioned is good. There is a few other verticals that we already see the traction that we cannot yet announce. We believe that we will have also, we will be able to announce things of the growing in September or October after the summer vacation. But we feel that the non-automotive market is growing right now better than we expected. And we will be able to see the nice revenues show to them in automotive. Of course it's not in the volume of automotive, but it still we see it now as a strategic lead to the company.

Thank you. If there are any additional

questions, please press star one. If you have a sequential request, please press star two. Please stand by while we pull for more questions. This concludes the question and answer session. Before I ask Mr. Koby Marenko to go ahead with his closing statement, I would like to remind participants that a replay of this call will be available by tomorrow on our VEZ website, ourbetterobotics.com. Mr. Marenko, would you like to make your concluding statement?

On behalf of the management of Alvea, I would like to thank you, our shareholders, for your continued interest and long-term support of our business. To our employees and partners, your continued dedication is deeply appreciated. In the coming months, we will be

meeting with investors and... You got cut off in the last sentence. Koby? We contact us at investors at

alveobotics.com to schedule a meeting. And with that, we end our call. Have a good day.

Thank you. This concludes our VEZ second quarter 2025 results conference call. Thank you for your participation.