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spk07: Today's conference is scheduled to begin shortly. Please continue to stand by. We thank you for your patience. © transcript Emily Beynon Welcome to the Gogoro, Inc. first quarter 2022 earnings call. This session will be recorded. All participants are currently muted during the question and answer session. If your question is selected, your microphone will be unmuted so that you can ask your question. I'd like to introduce Bruce Akin, CFO of Gogoro, who will kick us off.
spk02: Thanks, operator. And thanks to everyone for taking the time to join us today. I'm Bruce Aiken, CFO of GoGrow, and I'm pleased to welcome you to our first ever quarterly earnings call. Hopefully by now you've seen our earnings release. If you haven't, it is available on the investor relations tab of our website at www.investor.gogrow.com. We will also be displaying materials on the webcast screen as we go along. Given that this is our first earnings call, our Chairman and CEO, Horace Luke, will provide a quick company introduction before we review Q1 results. We're pleased with our Q1 results. We look forward to sharing those with you, as well as giving some guidance into what we're seeing as the outlook for Q2 and the balance of 2022. Before Horace shares, I'd like to introduce Michael Bowen, who will share the process for today's call and provide some important disclosures.
spk10: Thanks, Bruce. As a reminder, you are all currently on mute, but we will then move into a Q&A session after the prepared remarks, and we'll answer as many questions as time allows. After Horace is given a brief overview of GoVero and some of the business highlights from Q1, Bruce will go a bit deeper into the Q1 financial results. Before we get started, allow me to remind you that during the call, we will make statements regarding our business that may be considered forward-looking within applicable securities laws, including statements regarding our second quarter and fiscal 2022 results. management's expectations for our future financial and operational performance, the capabilities of our technology, projections of market opportunity and market share and our potential growth, statements relating to the expected impact of the COVID-19 pandemic, statements relating to the potential of our strategic collaboration, partnerships and joint ventures, statements regarding regulatory developments and our plans, prospects, and expectations. These statements are not promises or guarantees and are subject to risks and uncertainties. which could cause them to differ materially from actual results. Information concerning those risks is available in our earnings press release distributed prior to the market open today and in our SEC filing. We undertake no obligation to update forward-looking statements except as required by law. Further, during the course of today's call, we will refer to certain adjusted financial measures. These non-IFRS financial measures should be considered in addition to, not as a substitute for, or in isolation from IFSR measures. Additional information about these non-IFSR measures, including reconciliation of non-IFRS to comparable IFRS, is included in our press release and investor presentation provided today. Now over to Horace.
spk03: Thanks, Bruce and Michael. This is our first earning call as a publicly traded company, and we're thrilled to have this opportunity to meet with you all today. We completed our business combination with Polymer Global on April 4th and began trading on the NASDAQ under the ticker GGR on April 5th. I'd like to begin today by giving you a brief introduction to Gogoro and our business model. Perhaps it is well known to some of you today, but it may be new for others that are on the call, so I do want to spend a little time on a quick introduction and set the stage for business priorities for 2022. GoGo was founded in 2011 with the mission to put smart, swappable electric power in reach of every urban riders in the world. we believe that electric mobility adoption is inevitable and that two wheelers will drive this transformation faster than any other mode of transportation in urban centers around the world where millions of people are living on top of each other where space and time is really hard to come by battery swapping is the only viable solutions to refuel these small, agile two-wheelers. And by developing our own technology in a very customer-centric, vertically integrated way, it gives us a unique advantage over other competitors. And lastly, by partnering with some of the world's most well-known two-wheel OEMs, we're able to reach the over half a billion riders in the world's largest two-wheeler markets. Think of Gogoro as a technology and platform provider. Yes, we build and sell our own branded vehicles, which continue to be among the best performing electric two-wheelers available in the market today. But we also enable a total of 10 brands to sell over 47 different SKUs of vehicles on our battery swapping platform to take advantage of the battery swapping network we have developed and deployed. These SKUs are both two-wheel and three-wheelers. They can be lighter, lower speed vehicles powered by a single battery, or 125cc equivalent vehicles powered by two batteries, or even larger 13kW three-wheelers which uses a total of four battery packs. Our model is that the customer purchased a Go Girl or a partner vehicle with the battery not included. This provides dual benefits. The cost of the battery, which is approximately 35% to 45% of the BOM cost for many EVs, can now be excluded from the vehicle price. And instead of buying the battery, customers can select from a wide variety of swapping subscription plans that meet their needs. Those plans are like data plans for a cell phone. And in Taiwan, they range in price from entry-level plans at approximately $10 a month to an all-you-can-ride plan, which costs around $40 a month. customers accumulate quickly and generate reoccurring revenue for the roughly 10-year lifespan of the vehicle. We believe with battery swapping, we have addressed the biggest concern of our customers when it comes to safety, riding range, battery charging time, and cost. By placing efficient GO stations across cities, we created a unique end-to-end user experience that has been recognized as the best of its kind in the world. We've been very successful launching GoGo branded and partner vehicles and services in Taiwan, where we now have over 467,000 subscribers and over 2,185 Go stations. We handled over 277 million total battery swaps to date, and every day our automated system manages over 350,000 swaps. Combined, our riders have accumulated over 5 billion kilometers written using battery swapping and save hundreds of thousands of tons of CO2 from emitting into the air. The go-go battery swapping system is rugged and we're ready to continue our growth in Taiwan while also expanding into new markets. Between Taiwan, China, and India alone, there's a total available market of approximately 60 to 65 million units per year. We've established great partnerships, and we're excited for our upcoming expansion and growth. Additionally, Goggle continues to invest in R&D. Approximately 22% of our workforce is engaged in either hardware or software product development. We have self-developed all our hardware and software capabilities, and today we manufacture vehicles as well as powertrains and battery packs in our own highly automated facilities. Self-developed technology is at the core of what and who Goggle is. We believe we have the right business model and building blocks for scale and we're ready to go. Despite experiencing some impact from COVID in mid 2021, we ended the year with $366 million in revenue, $39 million overall guidance and slightly up from 2020. We exited 2021 with over 450,000 subscribers and 23% increase from a year before. We've been EBITDA positive since 2019 and have built a company with real technology, real products, and real revenue. I invite you to review the materials on our investor site and other online content to get a deeper perspective on Go Girl. We're passionate about what we do. We make it irresistible for customers to be responsible. Let me now shift gear a bit and fill you in on our macro strategy for 2022. We have three areas of focus. First, we'll continue to expand our vehicle and hardware sales in Taiwan by increasing our penetration, broadening our coverage, and growing sales of B2C, B2B, and B2G customers. Secondly, we will further develop our go-go solution business. We will build on the success of our go-go component kits to enable our partners to further diversify product offerings and launch multiple SKUs in China and India. Last but not least, we'll go-grow network business in Taiwan and internationally. We'll increase go-station density and continue to improve network efficiency and launch services in additional cities in China and India, as well as grow the pilot in Indonesia. Combined, we expect these strategies to result in an estimated $460 million to $500 million in revenue in 2022 and and set the stage for further success and expansion. Bruce will now walk us through our business and financial highlights for 2022 Q1.
spk02: Thanks Horace. Q1 2022 was a record Q1 revenue quarter for Gogoro and another solid quarter of execution. We saw a large increase in vehicle and hardware sales versus previous years and continued to accumulate subscribers on our Taiwan network. Additionally, we expanded our network offering in China to three cities and are continuing to make progress in other markets. Let me unpack each of those a bit in terms of our Q1 progress. According to statistics published by Taiwan's Department of Motor Vehicles, there were 12,806 Gogoro vehicles registered in Q1, up from 8,120 in 2021, a 57.7% increase. Additionally, partner vehicles, which are tracked under each brand's individual sales, represented additional volume in Q1. We extended our Taiwan channel, and now Gogoro vehicles are for sale in a total of 310 traditional scooter sales locations. Making Gogoro vehicles broadly available and increasing the customer touchpoints is important. Our market share in the six biggest cities in Taiwan was 9.2% during Q1, up from 5.8% in Q1 2021. Our partners launched several new vehicles in Q1, perhaps most notably the Yamaha EMF and also the A-Motor AI4. In China, after initially launching in Hangzhou in Q4 of 2021, additional network services were launched in Wuxi and in Kunming. We now have more than 100 active stations in Hangzhou, 40 in Wuxi, and 35 GO stations operational in Kunming. Unfortunately, China's current COVID circumstances create uncertainty with regards to the balance of 2022, but our plans are to enter six cities before the end of this year. There are currently six SKUs of Yadi vehicles available. Yadi plans to launch a total of more than 10 SKUs by year end. Dachang Jiang, another partner in China, will launch a one-battery-powered Emoto this year as well. Providing customers with sufficient choice of power, price, and styling is important to the scaling of the Ai Huan Huan JV network, which is invested by Yadi and Da Chang Jiang. We continue to progress towards a late 2022 network launch in India, where consumer adoption of EVs was trending positively until a recent spate of battery fires. Working together with India's largest vehicle OEM, Hero Motor Corp, we believe the Gogoro battery swap solution serves an unmet need in the second largest two-wheeler market in the world. We were still a privately held company in Q1, working towards our business combination with Poema Global. Our business combination included a pipe which was heavily oversubscribed and included investment from existing shareholders, large new strategic shareholders, and new institutional investors. These investments came at no discount and resulted in a total of $344.8 million delivered to GoGrow's balance sheet before transaction expenses. This cash gives us ample capital for planned expansion into China, India, and future markets. We continued to focus heavily on product development, both on vehicles and on batteries, and announced a few new important milestones in Q1. At our core, we are an innovation and technology company. A self-developed smart core technology provides high-speed computing power with an expandable open architecture that enhances processing speed and connectivity of the electronic control unit and motor control unit, increasing memory, long-distance remote monitoring, and IO control. The SmartCore platform provides three times the computing power available on Go-Go's current smart scooters today, enabling a new generation of smart two-wheel vehicles. The world's first two-wheel solid-state battery pack, developed in conjunction with Prologium, increases battery density by approximately 40%. While it will take some time for this technology to be commercially scalable, Gogoro continues to show what is possible in electric-powered two-wheelers. We manufactured our one millionth battery pack during Q1 and continue to be able to have full forward and backwards compatibility. The millionth battery pack powers the first Gogoro vehicle ever manufactured, and the oldest battery pack in our network can power the latest and greatest vehicle just shipped. To demonstrate the myriad of opportunities that exist for battery packs and the true interoperable nature of our hardware we introduced to second life use cases for our batteries being deployed in smart streetlights and smart parking meters finally in the area of policy important progress was made. The Taiwan government announced a renewed commitment to the banning of sales of ICE vehicles, with a plan to mandate no-emission vehicles comprise 30% of all two-wheelers sold by 2030, 70% by 2035, and a complete ban on internal combustion engine vehicle sales by 2040. We believe this is made possible partly based on the popularity of our swap-and-go battery swapping network successfully deployed in Taiwan today. The Indian government has published draft guidance on battery swapping standards, and in Singapore we successfully worked with the government to release TR25, a battery swapping technical reference. These documents indicate a clear move toward the need for safe, scalable battery swapping solutions, and Gogoro's solutions fall within these guidelines. We expect to continue meaningful dialogue with a variety of governments to see how Gogoro technology can aid in the faster adoption of safe battery swapping solutions for urban centers around the region. With that summary of our business highlights, let me shift our focus specifically to our financial performance. We've accomplished so much in Q1, and I'm happy to share our financial metrics. Let me specifically add some color into revenue, gross margin, EBITDA, and net loss results, as well as providing some guidance for the balance of 2022. We typically experience seasonality in the first quarter of the fiscal year due primarily to weather and to the Chinese New Year holidays, resulting in Q1 revenue typically being lower than the other quarters of the year. Government reported registration of all scooters in Q1 versus full year during the last three years ranged from approximately 18% to 21% in Taiwan, and seasonality impacts hardware sales. For the first quarter, revenue was $94.5 million, up 61% from $58.7 million in the same quarter last year. Sales of hardware and other revenues for the first quarter was $65.1 million, up 87.1 from 34.8 million in the same quarter last year, primarily as a result of increased market share in Gogoro-branded scooter sales in Taiwan. Government-reported registrations of Gogoro vehicles increased by 57.7% compared to the first quarter of 2021. Gogoro network revenue for the first quarter was $29.4 million, up 23%, from $23.9 million in the same quarter last year. This growth reflects a continuation of growth in the electric transport market in Taiwan and an increase in our subscriber base in Taiwan. For the first quarter, gross margin was 13.7%, up from 12.7% in the same quarter last year. For the first quarter, non-IFRS gross margin was 14.2%, up from 12.7% in the same quarter last year. Gross margin and non-IFRS gross margin were driven by favorable changes in product mix and a decrease in production cost per electric scooter as we scale our production. First quarter 2022 net loss was $21.7 million, an increase of $2.5 million from $19.2 million in the same quarter last year. The additional net loss was primarily driven by employee share-based compensation and expenses associated with our merger with Poema Global. Adjusted EBITDA was $13.5 million, up 124.1% from $6 million in the same quarter last year. The increase was primarily due to an increase in our market share in sales of hardware, accompanied by an increase of GoGrow network subscribers, excluding non-cash share-based compensation and one-time non-recurring costs associated with our merger with Poema Global. Gogoro raised $344.8 million in gross proceeds from the completion of our merger with Palema Global on April 4, 2022. His cash gives us the ability to invest in growth markets, and you will see us begin to deploy this capital in a variety of ways, investments in manufacturing, expansion of our networks, and other activities. We're pleased with our Q1 results. But at the same time, we're cognizant of a variety of macroeconomic, pandemic, and other global factors and current events which could cause our results in the balance of 2022 to be impacted. China is experiencing a great deal of COVID uncertainty. Taiwan is currently experiencing a COVID wave. Global supply chains are under pressure. Inflation is increasing. And we have been and could continue to be impacted. So we're providing guidance of revenue in the range of $460 to $500 million for the full year 2022, which represents an anticipated increase of 25.7 to 36.6% compared to full year 2021. Q2 revenue is expected to contribute around 20% of full year revenue. And given the uncertainty from COVID impact in both Taiwan and international markets, and the associated foreign exchange downside risk from local versus U.S. dollar currency. We estimate that we will generate 90% to 95% of the full-year revenue from the Taiwan market. It has been a super eventful quarter for GoGirl, and we look forward to continuing to work hard to introduce battery swapping capability to new markets and new customers. Operator, I will hand it over to you for Q&A.
spk07: Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star 1 on your telephone and light for your name to be announced. If you wish to withdraw your request, please press the pound or hash key. Once again, it's star 1 for questions. Our first question comes from the line of phone down from benchmark company. Please go ahead.
spk09: Thanks for taking my questions. Hi, congrats on a very strong quarter. My first question is regarding the guidance. I understand there are a lot of moving parts right now, especially just given COVID situation. Just wonder, you know, what are the assumptions you have taken in terms of low end versus your, you know, high end of the guidance, you know, how impactful, I guess, the COVID situation has been for second quarter specifically. And secondly, your bottom line has been improving. Just wonder what's the assumptions for our guidance for 2022 bottom line on EBITDA side and the key drivers behind it, if that's possible.
spk02: So given the external headwinds fund that we mentioned, including COVID, some macroeconomic factors, and those kinds of things, we decided to provide a revenue range, as we thought that was a conservative approach. We don't know what will happen exactly in the second half of the year. In China, we don't know exactly what will happen in Taiwan. We're excited about the products that we've got. We're excited about our technology. And so we've chosen to give the full year guidance of $460 to $500 million. EBITDA will continue to grow this year. We're providing only revenue projections going forward, but we're excited again about the prospects. We do believe that there is going to be healthy EBITDA growth, and we'll be happy to share those results as we come across them every quarterly.
spk09: And Sue, thanks, Bruce. Second question is in regards to your international expansion. You mentioned that you're on track to launch in India before year end. Just wonder any additional color you could share at this point. And in addition, I saw that you guys are scheduled to launch in Israel, I guess, in the summer. Just wonder what's the market opportunities there and, you know, potential, I guess, P&L contribution, you know, whether this year or probably more in the future.
spk02: Sure. So with our India expansion, as mentioned, we're on track to launch services towards the tail end of 2022. You may have seen recently that a number of different organizations have been slowing their electric transitions in India. We believe that our battery swapping solution provides a great opportunity for customers in India to have a really safe battery swap solution, and so we're excited to launch there. Vehicle development underway, and early stage development of network underway as well.
spk17: In terms of the trail analysis we made, we're always looking for, and we've learned a lot from that expansion. Thank you, Bruce. I'll go back to the line.
spk07: Thank you. Once again, ladies and gentlemen, if you wish to ask a question, please press dial 1 on your telephone keypad. We have a follow-up question from Feng Zhang from Benchmark Company. Please go ahead.
spk09: A few follow-up on my side. First of all, Any potential disruptions you guys have observed on the supply chain side? I'm just wondering what's the current observation and what expectation from here?
spk05: Thanks, Fang. This is Horace.
spk06: So, yes, there are, you know, there are obviously with the COVID impact and with all that's happening on, you know, in the world, there are always possibility of disruption. For the next quarter, we don't see much of that coming in and impacting us. However, we are very cognizant of that, and we're always watching out for anything that we need to do to kind of mitigate the risk. So on our side, I think we are cautious, but also at the same time, we're well prepared for it.
spk09: I'm astute. Thanks, Mark. Second follow-up is actually on your Southeast Asia. It seems like, you know, there's continued partnership, you know, with, you know, local governments there. I just wonder, you know, what's the roadmap on your side for further partnership? I understand, you know, some pilot study going on, but just wonder what are the potentials getting up for you in that market?
spk06: Yeah, obviously with a market like Southeast Asia, especially with the pilot we launched in Jakarta with a GoTo and GoJack team, the idea was really to test out whether or not it will be well received by the riders, especially for the commercial use that the rider will be using for their very demanding use cases during the day. I would say that I'm happy to report that the feedback has been outstanding from just overall the end riders' usability and the swappability of the battery. We had also launched the pilot with the president of Indonesia showing up, and I would say that he was extremely excited about seeing electrification and how this could really impact his country. So we'll continue to work with not only the GoTo and the GoJack team, but also with Foxconn as well as the Indonesian government to ensure that we have a very successful preparation for that market. I would say that we're excited about continuing to find out what we can do in addition to what we currently offer today to be able to address all the diversity there is in that market.
spk09: Very helpful. Thanks, Horace. Last question on my side is about your capital deployment. You mentioned that, you know, there are a couple of directions you're thinking. Just wondering, it seems like companies are very committed on the R&D side. Just wondering what are the major technology upgrades or product upgrades are we potentially expecting from here? And secondly, any potential consideration on the MAA side?
spk04: Okay, great.
spk06: I think, you know, as we look at what we offer, you know, from, you know, you can call product offering or technology offering, it goes from all the way from the vehicle side to, of course, most recently, you've seen us launching the world's first solid-state battery prototype for swappable batteries. We continue to push forward in the end user side of the innovation, but also at the same time, there's been a lot of innovation, a lot of hard work on the back side of the entire system. A great example is the question you asked earlier about Israel. The amazing thing we did with Israel is that we were able to launch both Israel and Jakarta without really sending any so-called boots on the ground. We're able to do that all remotely with both a telematic system that's on the station, but also at the same time with all our servers and tools that we've been working so hard to prepare for over the last several years as we kind of refine our system in Taiwan going through, as Liz mentioned earlier, generations of batteries and generations of stations and generations of AI tools and machine learning system in the backside to be able to launch successfully in both of those markets earlier this year. Now, that is a great demonstration as to kind of how we're thinking about technology and innovation holistically from end to end, not just necessarily from enabling technology or end user experience technology, but also at the same time, the technology that's behind it that runs all of it. How do you ensure that you provide the right swap, have the right billing system, have the right O&M and management and ticketing system so that the entire network and infrastructure can be managed in a very smooth and efficient and low-cost kind of way. So that's the part on the technology side. And then as well, M&A, you know, of course, Google is always interested in looking at growing our abilities, not only within internally, but also through partnerships or other possibilities. So, you know, we're always giving an eye out, and I think this is a great decade as we transition to clean mobility and electrification of vehicles. There's a lot of technologies and a lot of passionate, you know, companies out there that we can definitely partner with. So, you know, nothing to report here other than, you know, we, of course, you know, keep our eyes out. And I think, you know, over time, GoGo has, of course, been the first mover in this market and will continue to try and stay ahead with technology that are, you know, groundbreaking.
spk09: And it's good. That's very helpful. Thanks, Harriet. That's all my questions. And congrats on the good quarter.
spk07: Thank you. As a reminder, if you wish to ask a question, please press dial 1 on your telephone keypad. Once again, it's dial 1 for questions, ladies and gentlemen. This concludes our question and answer session. I would like to turn the conference back to Horace and Bruce for any closing remarks.
spk06: Thanks, Operator. Thank you, Bruce, and thank you, Michael. Thanks to everybody who joined us on this call. Google has had a record revenue quarter. We grew on a number of fronts. We'll continue to develop new technology, as I mentioned, increase our efficiency, and focus on growing the user base on our Taiwan network and also expand internationally into markets that we already have established partnerships in. With a recent merger with Bulimia Global, we are well-funded and excited to take our vision to over half a billion riders in the countries that we're going into. I can't wait to report any future results. So thank you, everybody, for joining the call today. I'm super excited to be to be talking to you guys. Thank you.
spk07: Thank you. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. Thank you. Thank you. Music. Thank you.
spk01: Thank you. Thank you.
spk07: Welcome to the Gogoro, Inc. first quarter 2022 earnings call. This session will be recorded. All participants are currently muted during the question and answer session. If your question is selected, your microphone will be unmuted so that you can ask your question. I'd like to introduce Bruce Ecken, CFO of Gogoro, who will kick us off.
spk02: Thanks, operator. And thanks to everyone for taking the time to join us today. I'm Bruce Aiken, CFO of Gogoro, and I'm pleased to welcome you to our first ever quarterly earnings call. Hopefully by now you've seen our earnings release. If you haven't, it is available on the investor relations tab of our website at www.investor.gogoro.com. We will also be displaying materials on the webcast screen as we go along. Given that this is our first earnings call, our Chairman and CEO Horace Luke will provide a quick company introduction before we review Q1 results. We're pleased with our Q1 results. We look forward to sharing those with you, as well as giving some guidance into what we're seeing as the outlook for Q2 and the balance of 2022. Before Horace shares, I'd like to introduce Michael Bowen, who will share the process for today's call and provide some important disclosures.
spk10: Thanks, Bruce. As a reminder, you are all currently on mute, but we will then move into a Q&A session after the prepared remarks, and we'll answer as many questions as time allows. After Horace is given a brief overview of GoVero and some of the business highlights from Q1, Bruce will go a bit deeper into the Q1 financial results. Before we get started, allow me to remind you that during the call, we will make statements regarding our business that may be considered forward-looking within applicable securities laws, including statements regarding our second quarter and fiscal 2022 results. management's expectations for our future financial and operational performance, the capabilities of our technology, projections of market opportunity and market share and our potential growth, statements relating to the expected impact of the COVID-19 pandemic, statements relating to the potential of our strategic collaboration, partnerships and joint ventures, statements regarding regulatory developments and our plans, prospects, and expectations. These statements are not promises or guarantees and are subject to risks and uncertainties. which could cause them to differ materially from actual results. Information concerning those risks is available in our earnings press release distributed prior to the market open today and in our SEC filing. We undertake no obligation to update forward-looking statements except as required by law. Further, during the course of today's call, we will refer to certain adjusted financial measures. These non-IFRS financial measures should be considered in addition to, not as a substitute for, or in isolation from IFSR measures. Additional information about these non-IFSR measures, including reconciliation of non-IFRS to comparable IFRS, is included in our press release and investor presentation provided today. Now over to Horace.
spk03: Thanks, Bruce and Michael. This is our first earning call as a publicly traded company, and we're thrilled to have this opportunity to meet with you all today. We completed our business combination with Polymer Global on April 4th and began trading on the NASDAQ under the ticker GGR on April 5th. I'd like to begin today by giving you a brief introduction to Gogoro and our business model. Perhaps it is well known to some of you today, but it may be new for others that are on the call, so I do want to spend a little time on a quick introduction and set the stage for business priorities for 2022. GoGo was founded in 2011 with the mission to put smart, swappable electric power in reach of every urban rider in the world. We believe that electric mobility adoption is inevitable, and that two-wheelers will drive this transformation faster than any other mode of transportation. In urban centers around the world where millions of people are living on top of each other, where space and time is really hard to come by, battery swapping is the only viable solution to refuel these small, agile two-wheelers. and by developing our own technology in a very customer-centric, vertically integrated way, it gives us a unique advantage over other competitors. And lastly, by partnering with some of the world's most well-known two-wheel OEMs, we're able to reach the over half a billion riders in the world's largest two-wheeler markets. Think of Gogoro as a technology and platform provider. Yes, we build and sell our own branded vehicles, which continue to be among the best performing electric two-wheelers available in the market today. But we also enable a total of 10 brands to sell over 47 different SKUs of vehicles on our battery swapping platform to take advantage of the battery swapping network we have developed and deployed. These SKUs are both two-wheel and three-wheelers. They can be lighter, lower speed vehicles powered by a single battery, or 125cc equivalent vehicles powered by two batteries, or even larger 13kW three-wheelers which uses a total of four battery packs. Our model is that the customer purchased a Go Girl or a partner vehicle with the battery not included. This provides dual benefits. The cost of the battery, which is approximately 35% to 45% of the BOM cost for many EVs, can now be excluded from the vehicle price. And instead of buying the battery, customers can select from a wide variety of swapping subscription plans that meet their needs. Those plans are like data plans for a cell phone. And in Taiwan, they range in price from entry-level plans at approximately $10 a month to an all-you-can-ride plan, which costs around $40 a month. customers accumulate quickly and generate reoccurring revenue for the roughly 10-year lifespan of the vehicle. We believe with battery swapping, we have addressed the biggest concern of our customers when it comes to safety, riding range, battery charging time, and cost. By placing efficient GO stations across cities, we created a unique end-to-end user experience that has been recognized as the best of its kind in the world. We've been very successful launching GoGo branded and partner vehicles and services in Taiwan, where we now have over 467,000 subscribers and over 2,185 Go stations. We handled over 277 million total battery swaps to date, and every day our automated system manages over 350,000 swaps. Combined, our riders have accumulated over 5 billion kilometers written using battery swapping and save hundreds of thousands of tons of CO2 from emitting into the air. The go-go battery swapping system is rugged and we're ready to continue our growth in Taiwan while also expanding into new markets. Between Taiwan, China, and India alone, there's a total available market of approximately 60 to 65 million units per year. We've established great partnerships, and we're excited for our upcoming expansion and growth. Additionally, Goggle continues to invest in R&D. Approximately 22% of our workforce is engaged in either hardware or software product development. We have self-developed all our hardware and software capabilities, and today we manufacture vehicles as well as powertrains and battery packs in our own highly automated facilities. Self-developed technology is at the core of what and who Goggle is. We believe we have the right business model and building blocks for scale, and we're ready to go. Despite experiencing some impact from COVID in mid-2021, we ended the year with $366 million in revenue, $39 million overall guidance, and slightly up from 2020. We exited 2021 with over 450,000 subscribers and 23% increase from a year before. We've been EBITDA positive since 2019 and have built a company with real technology, real products, and real revenue. I invite you to review the materials on our investor site and other online content to get a deeper perspective on Go Girl. We're passionate about what we do. We make it irresistible for customers to be responsible. Let me now shift gear a bit and fill you in on our macro strategy for 2022. We have three areas of focus. First, we'll continue to expand our vehicle and hardware sales in Taiwan by increasing our penetration, broadening our coverage, and growing sales of B2C, B2B, and B2G customers. Secondly, we will further develop our Go-Gro solution business. We will build on the success of our Go-Gro component kits to enable our partners to further diversify product offerings and launch multiple SKUs in China and India. Last but not least, we'll grow our go-go network business in Taiwan and internationally. We'll increase go-station density and continue to improve network efficiency and launch services in additional cities in China and India, as well as grow the pilot in Indonesia. Combined, we expect the strategy to result in an estimated $460 million to $500 million in revenue in 2022 and set the stage for further success and expansion. Bruce will now walk us through our business and financial highlights for 2022 Q1. Thanks, Horace.
spk02: Q1 2022 was a record Q1 revenue quarter for Gogoro and another solid quarter of execution. We saw a large increase in vehicle and hardware sales versus previous years and continued to accumulate subscribers on our Taiwan network. Additionally, we expanded our network offering in China to three cities and are continuing to make progress in other markets. Let me unpack each of those a bit in terms of our Q1 progress. According to statistics published by Taiwan's Department of Motor Vehicles, there were 12,806 Gogoro vehicles registered in Q1, up from 8,120 in 2021, a 57.7% increase. Additionally, partner vehicles, which are tracked under each brand's individual sales, represented additional volume in Q1. We extended our Taiwan channel. And now Gogoro vehicles are for sale in a total of 310 traditional scooter sales locations. Making Gogoro vehicles broadly available and increasing the customer touch points is important. Our market share in the six biggest cities in Taiwan was 9.2% during Q1, up from 5.8% in Q1 2021. Our partners launched several new vehicles in Q1. perhaps most notably the Yamaha EMF and also the A-motor AI-4. In China, after initially launching in Hangzhou in Q4 of 2021, additional network services were launched in Wuxi and in Kunming. We now have more than 100 active stations in Hangzhou, 40 in Wuxi, and 35 GO stations operational in Kunming. Unfortunately, China's current COVID circumstances create uncertainty with regards to the balance of 2022, but our plans are to enter six cities before the end of this year. There are currently six SKUs of Yadi vehicles available. Yadi plans to launch a total of more than 10 SKUs by year end. Dachang Jiang, another partner in China, will launch a one-battery-powered e-moto this year as well. Providing customers with sufficient choice of power, price, and styling is important to the scaling of the Ai Huan Huan JV network, which is invested by Yadi and Da Chang Jiang. We continue to progress towards a late 2022 network launch in India. where consumer adoption of EVs was trending positively until a recent spate of battery fires. Working together with India's largest vehicle OEM, Hero Motor Corp, we believe the Gogoro battery swap solution serves an unmet need in the second largest two-wheeler market in the world. We were still a privately held company in Q1, working towards our business combination with Poema Global. Our business combination included a pipe which was heavily oversubscribed and included investment from existing shareholders, large new strategic shareholders, and new institutional investors. These investments came at no discount and resulted in a total of $344.8 million delivered to GoGrow's balance sheet before transaction expenses. This cash gives us ample capital for planned expansion into China, India, and future markets. We continued to focus heavily on product development, both on vehicles and on batteries, and announced a few new important milestones in Q1. At our core, we are an innovation and technology company. A self-developed SmartCore technology provides high-speed computing power with an expandable open architecture that enhances processing speed and connectivity of the electronic control unit and motor control unit, increasing memory, long-distance remote monitoring, and I.O. control. The SmartCore platform provides three times the computing power available on Go-Go's current smart scooters today, enabling a new generation of smart two-wheel vehicles. The world's first two-wheel solid-state battery pack, developed in conjunction with Prologium, increases battery density by approximately 40%. While it will take some time for this technology to be commercially scalable, Gogoro continues to show what is possible in electric-powered two-wheelers. We manufactured our one millionth battery pack during Q1 and continue to be able to have full forward and backwards compatibility. The millionth battery pack powers the first Gogoro vehicle ever manufactured, and the oldest battery pack in our network can power the latest and greatest vehicle just shipped. To demonstrate the myriad of opportunities that exist for battery packs and the true interoperable nature of our hardware, we introduced two second-life use cases for our batteries, being deployed in smart streetlights and smart parking meters. Finally, in the area of policy, important progress was made. The Taiwan government announced a renewed commitment to the banning of sales of ICE vehicles, with a plan to mandate no-emission vehicles comprise 30% of all two-wheelers sold by 2030, 70% by 2035, and a complete ban on internal combustion engine vehicle sales by 2040. We believe this is made possible partly based on the popularity of our swap-and-go battery swapping network successfully deployed in Taiwan today. The Indian government has published draft guidance on battery swapping standards, and in Singapore we successfully worked with the government to release TR25, a battery swapping technical reference. These documents indicate a clear move toward the need for safe, scalable battery swapping solutions, and Gogoro's solutions fall within these guidelines. We expect to continue meaningful dialogue with a variety of governments to see how Gogoro technology can aid in the faster adoption of safe battery swapping solutions for urban centers around the region. With that summary of our business highlights, let me shift our focus specifically to our financial performance. We've accomplished so much in Q1 and I'm happy to share our financial metrics. Let me specifically add some color into revenue, gross margin, EBITDA, and net loss results, as well as providing some guidance for the balance of 2022. We typically experience seasonality in the first quarter of the fiscal year due primarily to weather and to the Chinese New Year holidays, resulting in Q1 revenue typically being lower than the other quarters of the year. Government reported registration of all scooters in Q1 versus full year during the last three years ranged from approximately 18% to 21% in Taiwan, and seasonality impacts hardware sales. For the first quarter, revenue was $94.5 million, up 61% from $58.7 million in the same quarter last year. Sales of hardware and other revenues for the first quarter was $65.1 million, up $87.1 from $34.8 million in the same quarter last year, primarily as a result of increased market share in Gogoro-branded scooter sales in Taiwan. Government reported registrations of Gogoro vehicles increased by 57.7% compared to the first quarter of 2021. Gogoro network revenue for the first quarter was $29.4 million, up 23% from $23.9 million in the same quarter last year. This growth reflects a continuation of growth in the electric transport market in Taiwan and an increase in our subscriber base in Taiwan. For the first quarter, gross margin was 13.7%, up from 12.7% in the same quarter last year. For the first quarter, non-IFRS gross margin was 14.2%, up from 12.7% in the same quarter last year. Gross margin and non-IFRS gross margin were driven by favorable changes in product mix and a decrease in production cost per electric scooter as we scale our production. First quarter 2022 net loss was $21.7 million, an increase of $2.5 million from $19.2 million in the same quarter last year. The additional net loss was primarily driven by employee share-based compensation and expenses associated with our merger with Poema Global. Adjusted EBITDA was $13.5 million, up 124.1% from $6 million in the same quarter last year. The increase was primarily due to an increase in our market share in sales of hardware, accompanied by an increase of GoGrow network subscribers, excluding non-cash share-based compensation and one-time non-recurring costs associated with our merger with Poema Global. Gogoro raised $344.8 million in gross proceeds from the completion of our merger with Palema Global on April 4, 2022. This cash gives us the ability to invest in growth markets, and you will see us begin to deploy this capital in a variety of ways, investments in manufacturing, expansion of our networks, and other activities. We're pleased with our Q1 results. But at the same time, we're cognizant of a variety of macroeconomic, pandemic, and other global factors and current events which could cause our results in the balance of 2022 to be impacted. China is experiencing a great deal of COVID uncertainty. Taiwan is currently experiencing a COVID wave. Global supply chains are under pressure. Inflation is increasing. And we have been and could continue to be impacted. So we're providing guidance of revenue in the range of $460 to $500 million for the full year 2022, which represents an anticipated increase of 25.7 to 36.6% compared to full year 2021. Q2 revenue is expected to contribute around 20% of full year revenue. And given the uncertainty from COVID impact in both Taiwan and international markets, and the associated foreign exchange downside risk from local versus U.S. dollar currency. We estimate that we will generate 90% to 95% of the full-year revenue from the Taiwan market. It has been a super eventful quarter for GoGoro, and we look forward to continuing to work hard to introduce battery swapping capability to new markets and new customers. Operator, I will hand it over to you for Q&A.
spk07: Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star 1 on your telephone and write for your name to be announced. If you wish to withdraw your request, please press the pound or hash key. Once again, it's star 1 for questions. This question comes from the line of phone down from benchmark company. Please go ahead.
spk09: Thanks for taking my questions. Hi, congrats on a very strong quarter. My first question is regarding the guidance. I understand there are a lot of moving parts right now, especially just given COVID situation. Just wonder, you know, what are the assumptions you have taken in terms of low end versus your high end of the guidance. You know, how impactful, I guess, the COVID situation has been for second quarter specifically. And secondly, your bottom line has been improving. Just wonder what's the assumptions for our guidance for 2022 bottom line on the EBITDA side and the key drivers behind it, if that's possible.
spk02: So given the external headwinds fund that we mentioned, including COVID, some macroeconomic factors, and those kinds of things, we decided to provide a revenue range, as we thought that was a conservative approach. We don't know what will happen exactly in the second half of the year. In China, we don't know exactly what will happen in Taiwan. We're excited about the products that we've got. We're excited about our technology. And so we've chosen to give the full year guidance of $460 to $500 million. EBITDA will continue to grow this year. We're providing only revenue projections going forward, but we're excited again about the prospects. We do believe that there is going to be healthy EBITDA growth, and we'll be happy to share those results as we come across them every quarter.
spk09: And Sue, thanks, Bruce. Second question is in regards to your international expansion. You mentioned that you're on track to launch in India before year end. Just wonder any additional color you could share at this point. And in addition, I saw that you guys are scheduled to launch in Israel, I guess, in the summer. Just wonder what's the market opportunities there and, you know, potential, I guess, P&L contribution, you know, whether this year or probably more in the future.
spk02: Sure. So with our India expansion, as mentioned, we're on track to launch services towards the tail end of 2022. You may have seen recently that a number of different organizations have been slowing their electric transitions in India. We believe that our battery swapping solution provides a great opportunity for customers in India to have a really safe battery swap solution, and so we're excited to launch there. Vehicle development underway, and early stage development of network underway as well.
spk17: In terms of the trail analysis we made, we're always looking for and we've learned a lot from that expansion. Thank you, Bruce. I'll go back to the line.
spk07: Thank you. Once again, ladies and gentlemen, if you wish to ask a question, please press dial 1 on your telephone keypad. We have a follow-up question from Feng Zhang from Benchmark Company. Please go ahead.
spk09: A few follow-up on my side. First of all, Any potential disruptions you guys have observed on the supply chain side? I'm just wondering what's the current observation and what expectation from here?
spk05: Thanks, Fong. This is Horace.
spk06: So, yes, there are, you know, there are obviously with the COVID impact and with all that's happening on, you know, in the world, there are always possibility of disruption. For the next quarter, we don't see much of that coming in and impacting us. However, we are very cognizant of that, and we're always watching out for anything that we need to do to kind of mitigate the risk. So on our side, I think we are cautious, but also at the same time, we're well prepared for it.
spk09: Understood. Thanks, Mark. Second follow-up is actually on your Southeast Asia. It seems like, you know, there's continued partnership, you know, with the, you know, local governments there. I just wonder, you know, what's the role map on your side for further partnership? I understand, you know, some pilot study going on, but just wonder what are the potential scaling up for you in that market?
spk06: Yeah, you know, obviously with a market like Southeast Asia, especially with the pilot we launched in Jakarta with a GoTo and GoJack team, the idea was really to test out whether or not it was well-received by the riders, especially for the commercial use that the rider will be using for their very demanding use cases during the day. I would say that I'm happy to report that the feedback has been outstanding from just overall the end riders' usability and the swappability of the battery. We had also launched a pilot with the president of Indonesia showing up, and I would say that he was extremely excited about seeing electrification and how this could really impact his country. So we'll continue to work with not only the GoTo and the GoJag team, but also with Foxconn as well as the Indonesian government to ensure that we have a very successful preparation for that market. I would say that we're excited about continuing to find out what we can do in addition to what we currently offer today to be able to address all the diversity there is in that market.
spk09: Very helpful. Thanks, Horace. Last question on my side is about your capital deployment. You mentioned that, you know, there are a couple of directions you're thinking. Just wonder, it just seems like companies are very committed on the R&D side. Just wonder what are the major technology upgrades or product upgrades are we potentially expecting from here? And secondly, any potential consideration on the MAA side?
spk04: Okay, great.
spk06: I think, you know, as we look at what we offer, you know, from, you know, you can call product offering or technology offering, it goes from all the way from the vehicle side to, of course, most recently, you've seen us launching the world's first solid-state battery prototype for swappable batteries. We continue to push forward in the end user side of the innovation, but also at the same time, there's been a lot of innovation, a lot of hard work on the back side of the entire system. A great example is the question you asked earlier about Israel. The amazing thing we did with Israel is that we were able to launch both Israel and Jakarta without really sending any so-called boots on the ground. We're able to do that all remotely with both a telematic system that's on the station, but also at the same time with all our servers and tools that we've been working so hard to prepare for over the last several years as we kind of refine our system in Taiwan going through, as Liz mentioned earlier, generations of batteries and generations of stations and generations of AI tools and machine learning system in the backside to be able to launch successfully in both of those markets earlier this year. Now, that is a great demonstration as to kind of how we're thinking about technology and innovation holistically from end to end, not just necessarily from enabling technology or end user experience technology, but also at the same time, the technology that's behind it that runs all of it. How do you ensure that you provide the right swap, have the right billing system, have the right O&M management and ticketing system so that the entire network and infrastructure can be managed in a very smooth and efficient and low-cost kind of way. So that's the part on the technology side. And then as well, M&A, you know, of course, Google is always interested in looking at growing our abilities, not only within internally but also through partnerships or other possibilities. So, you know, we're always giving an eye out, and I think this is a great decade as we transition to clean mobility and electrification of vehicles. There's a lot of technologies and a lot of passionate, you know, companies out there that we can definitely partner with. So, you know, nothing to report here other than, you know, we, of course, you know, keep our eyes out. And I think, you know, over time, GoGo has, of course, been a first mover in this market and will continue to try and stay ahead with technology that are, you know, groundbreaking.
spk09: And it's good. That's very helpful. Thanks, Karius. That's all my questions. And congrats on the good quarter.
spk07: Thank you.
spk14: Thank you.
spk07: As a reminder, if you wish to ask a question, please press dial 1 on your telephone keypad. Once again, it's dial 1 for questions, ladies and gentlemen. This concludes our question and answer session. I would like to turn the conference back to Horace and Bruce for any closing remarks.
spk06: Thanks, Operator. Thank you, Bruce, and thank you, Michael. Thanks to everybody who joined us on this call. Google has had a record revenue quarter. We grew on a number of fronts. We'll continue to develop new technology, as I mentioned, increase our efficiency, and focus on growing the user base on our Taiwan network and also expand internationally into markets that we already have established partnerships in. With a recent merger with Bulimia Global, we are well-funded and excited to take our vision to over half a billion riders in the countries that we're going into. I can't wait to report any future results. So thank you, everybody, for joining the call today. I'm super excited to be to be talking to you guys. Thank you.
spk07: Thank you. The conference is now concluded. Thank you for attending today's
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