Enovix Corporation

Thank you for standing by and welcome to the Enovix Corporation third quarter 2024 earnings conference call. Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. As a reminder, today's program will be recorded. And now I would like to introduce your host for today's program, Robert Leahy, Head of Investor Relations. Please go ahead, sir.

Thank you. Hello, everyone. and welcome to Inovix Corporation's third quarter 2024 financial results conference call. With us today, our president and chief executive officer, Dr. Raj Taluri, chief financial officer, Farhan Ahmad, and chief operating officer, Ajay Marathi. Raj and Farhan will provide an overview, and then we'll take your questions. After the Q&A session, we'll conclude our call. Before we continue, let me kindly remind you that we released our third quarter 2024 shareholder letter after the market closed today. It's available on our website at ir.inovix.com. A replay of this video call will be available later today on the investor relations page of our website. Please note that the shareholder letter, press release, and this conference call all contain forward-looking statements that are subject to risks and uncertainties. These forward-looking statements are based on current expectations and may differ materially from actual future events or results due to a variety of factors. For a discussion of those factors that could affect our future financial results in business, please refer to the disclosure in today's shareholder letter and our filings with the Securities and Exchange Commission. All of our statements are made as of today, October 29th, 2024, based on information currently available to us. We can give no assurance that these statements will prove to be correct. and we do not intend and undertake no duty to update these statements except as required by law. During this call, we will also discuss non-GAAP financial measures, which are not prepared in accordance with generally accepted accounting principles. You can find a reconciliation of the GAAP financial measures to non-GAAP financial measures in our shareholder letter, which is posted on the investor relations page of our website. I'll now turn the call over to Raj to begin. Raj?

Thank you, Rob, and thank you all for joining us today. For our format today, I'll start with a recap of our recent results, some of our recent milestones, and before I turn it over to Farhan for the financials and the outlook. I'll have a few closing comments, and then we'll take your questions. Now, we had a very productive second quarter. To recap our recent achievements, First, we delivered a Q3 revenue of $4.3 million, above the midpoint of our forecast. We grew 13% sequentially and expect even further growth in the Q4. Second, we opened our Fab 2 in Malaysia. This was a really huge deal for us because numerous leading smartphone and IoT companies toured our facility. They're impressed by the quality of our first production lines. and now they're even more confident in our manufacturing capability. Third, I'm pleased to announce that we executed a new agreement with the leading global smartphone OEM for the qualification of our battery cells and the late 25 launch of one of their phone models, and this would mark our first official entry into our smartphone market. The ramping FAB2 on schedule and showing it to prospective customers was a very pivotal accomplishment for the company, which until now only made batteries from here in R&D headquarters in California. It's also a significant accomplishment that we shipped EX1M samples from Fab 2 just weeks after the grand opening consistent with our plan. Now, the agility line is fully operational, and the initial yields in the agility line are comparable to the final levels we achieved with our first line in California and with improvements expected from there. The high volume line is also on track to complete site acceptance and testing in 2024, which is consistent with our timeline and start mass production for smartphones IoT customers in late 25. Now we are thrilled to announce today that we formalized a strategic partnership with the second leading smartphone OEM. Now this agreement outlines the key milestones. that we are working together with them, and upon meeting them, we are set to enter the smartphone market 25 with high-volume production. I've said many times before that our first commercial smartphone deal would be the hardest. We still have a lot of work to do in passing the customer qualification process and ramping the high-volume line, but we're doing that together with our first expected customer. Now, to further bolster our 2025 sales pipeline, we aligned on a production schedule with a leading IoT customer, which includes a mass production purchase order. This partnership, as well as the progress we're making on the EV space, underscores our ability to diversify into high-value sectors beyond just smartphones. Now, I'm very pleased with our recent commercial success and believe the opening of FAB2 has been a very helpful contributor. We're also getting benefit from the recent surge in AI-enabled smartphones, which is further validating our strategy and driving significant pull for our products and the transformative leap in energy that we can provide. Now, last quarter, I mentioned that 4,000 to 5,000 milliampere battery in smartphones in our pockets today could soon go to more than 6,000 milliampere percent beyond due to AI. Here we are just three months later. I report to you there are customers now asking us for 7,000 milliampere smartphone batteries. Now, why is this important? This is important because the smartphone size has not increased. So the industry will need higher energy density batteries to fit this increased capacity in the same space, which, you know, works very well for a company like Enovix, which works on producing high energy density batteries. As I mentioned earlier, we've already started shipping of EX1M. Now, as the needs of our customers continue to increase, we're also launching EX2M as fast as possible. Now, as I mentioned before, EX2M will increase the energy density on top of EX1M. The first sample shipments, the select customers of EX2M are scheduled in Q4, and these are key also to accelerating our timeline to full-scale mass production in 2025 and beyond. We also completed the product definition and roadmap beyond the X2M, reaffirming our commitment to pushing the boundaries of innovation and delivering industry-leading solutions to our customers across a wide range of industries. With that, I'll turn it over to Farhan for the financials.