Cepton, Inc.

Greetings and welcome to the Q2 2023 Septon, Inc. Business Update and Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Huell Hsu, DFO. Thank you, Hugh. You may begin.

Thank you and welcome to SEPTOM's second quarter 2023 earnings call and business update. With me today are Junpei, co-founder and chief executive officer, and Mitch Ortini, senior vice president of business development. During the call, we may refer to our unaudited GAAP and non-GAAP measures in our earnings release. The non-GAAP financial measures should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. Reconciliations for non-GAAP measures are included in our earnings release. I'd like to remind everyone that comments made in this conference call may include forward-looking statements regarding the company's expected operational and financial performance for future periods. These statements are based on the company's current expectation and are subject to the Safe Harbor Statement. relating to the forward-looking statement contained in our earnings release and the slides that accompany this call. Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of risks, uncertainties, or other factors including those discussed in the earnings release or during today's call and those described in our filings with the US SEC. We're not undertaking any commitments to update these statements as a result of future events, except as required by law. As a quick reminder, this call is being recorded, and you can find the earnings release and slides that accompany this call, as well as the webcast replay of this call, at investors.zeptown.com. Now I'd like to turn the call over to Jun.

Thank you, Hall, and good afternoon, everyone. Thank you for joining SEPTOM's second quarter 2023 earnings call. We will provide a business update and review our second quarter financial results with you. Starting off, I'm proud to announce that we have delivered a new company record for the quarterly product revenue and gross margin. This quarter, we shipped the highest number of LiDAR units to both of our automotive and the smart infrastructure end customers since our inception. In automotive, we expect our shipment volumes to be more than double for each sequential quarter for the remainder of this year as our OEM customers look to launch the start of production at the end of this year. On smart infrastructure, we're executing our multi-million dollar contract from our largest tolling customer. This is the largest commercial deployment of our LIDARs to date for the tolling application. We have discussed with you our expected growth this year over the past few quarters. This time, I will let the results speak for themselves. Our record-setting quarters reflect the hard work and dedication put forth by our teams executing our current programs. We expect this trend to continue for the remainder of the year as we continue to ramp unit volumes for automotive series production as well as for smart infrastructure projects. On series production execution, we remain on track to fulfill orders for OEM start-up production at the end of this year. We shipped the highest number of pre-production units this quarter in support of our lead OEM program resulting from our continued commercialization efforts to increase our production capacity. This quarter, we internally developed and deployed automated manufacturing equipment to our contract manufacturing partners in order to meet series production order volumes. Automation of our manufacturing processes is an increasing priority for our hardware and software teams as unit volume continues to increase. This quarter, our development efforts have expanded into testing and calibration equipment. LiDAR sensors are highly sophisticated instruments that require the expertise of our engineering teams to maintain the required level of precision in all manufacturing steps. By investing our time and resources, our custom manufacturing solutions are scalable across different products, maximizing production efficiency, and minimizing physical footprint. We remain confident in meeting our production milestones for the remainder of the year. Last quarter, we announced our point cloud processing ASIC that we developed in-house specifically for our LIDARs. This quarter, we completed the engineering validation of this ASIC into our near range NOVA product. We have successfully integrated new ASIC into our NOVA B samples and began shipping units to our lead autonomous ground vehicle OEM customer. We expect our new X90 product line to start shipping with this ASIC by the end of this year. Across our automotive OEM customers, we're seeing increasing interest in perception solutions and we are developing automotive perception software by leveraging our proven smart infrastructure software solutions. LiDAR sensors vary in many different dimensions, from scanning patterns to point cloud density. This has created the need for a plug-and-play solution that can easily integrate into the broader ADAS software stack. In addition, automotive OEMs have the unique challenge of synchronizing multiple sensor types. We're proud to be one of the core building blocks providing valuable input data to help save lives. Please stay tuned for our further progress. Our accomplishments this quarter are certainly worth highlighting, but the record quarters like this one are just the beginning of our company. We will continue to scale our business throughout the remainder of the year. This year, there are a number of automotive programs up for grabs. We believe our extensive LiDAR portfolio of short, medium, and long-range LiDARs in combination with our experience in executing automotive production program positions us to win additional series production awards. With that, I'll turn it over to Mitch for details on our efforts with our customer programs.