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Operator
You are currently holding for today's Ideal Power third quarter 2022 results conference call. At this time, we are still admitting additional participants and plan to be underway shortly. We appreciate your patience and ask that you please remain on the line.
spk07
© transcript Emily Beynon
Operator
Good day and welcome to the Ideal Power Third Quarter 2022 Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Carolyn Capaccio of LHA. Please go ahead.
Carolyn Capaccio
Thank you, Operator, and good afternoon, everyone. Thank you for joining Ideal Power's third quarter 2022 conference call. With me on the call are Dan Berdar, President and Chief Executive Officer, and Tim Burns, Chief Financial Officer. Ideal Power's third quarter 2022 financial results press release is available on the company's website at idealpower.com. Before we begin, I'd like to remind everyone that statements made on the call and webcast, including those regarding future financial results and industry prospects, are forward-looking and may be subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SEC filings for a list of associated risks. And we would also refer you to the company's website for more supporting industry information. Now I'll turn the call over to Ideal Power's President and CEO, Dan Berdar. Dan?
Dan Berdar
Thank you, Carolyn. Good afternoon, everyone, and welcome to our third quarter 2022 financial results conference call. I'll first touch on the development agreement that we announced earlier today. Then I'll give you an update on our progress to commercialize our B-Trans semiconductor technology, the introduction of our first commercial product, and review our other key priorities for the remainder of 2022. Then Tim Burns, our CFO, will take you through the numbers, after which we'll take your questions. So let's begin. Earlier today, we made a very exciting announcement. We entered into a development agreement with a top 10 global automotive OEM. This is our second engagement with a top 10 global automaker, as we've previously announced that a different top 10 global automaker is in our test and evaluation program. We're partnering with this automaker's advanced technology development team to develop a custom B-Tran power module for use in electric vehicle drive train inverters in the automaker's next generation EV platform. Ideal Power would collaborate on the development of these multi-die custom modules with a packaging firm selected by the automaker for their innovative technology. Automobile manufacturers are looking for innovative solutions and new approaches as they look to differentiate their EV offerings and are especially targeting innovations that can increase vehicle range and reduce costs. Ideal Power's B-Tran technology was selected for entry into this program after the automaker evaluated multiple new suppliers and technologies. Each was evaluated for its innovation, potential performance improvements, and return on investment. We demonstrated that our B-Tran technology and its value proposition surpassed that of other power devices and technologies under consideration. B-TRAN was selected because it also offers the potential for new inverter topologies, which are not practical with conventional semiconductor devices, as a way to improve EV drivetrain inverter efficiency. In addition, by leveraging the scale and maturity of the established silicon supply chain, we can offer cost advantages over competing technologies that rely on high-cost materials like silicon carbide. Specifically, eTRAN offers a way to improve efficiency through its superior performance characteristics over RGBTs and MOSFETs, including unique inherent bidirectional capability requiring fewer components and lower switching and conduction losses, leading to reduced cooling requirements and an increase in the range of the electric vehicle or a reduction in the size and cost of the battery, which is the largest EV cost component. And as silicon carbide supply chain improves in cost and quality, eTRAN can be fabricated in silicon carbide, offering the opportunity to further improve its performance. Planning our first development agreement is a thrilling moment, and we are very much looking forward to beginning our work with this automaker in the coming days. It represents the culmination of many months of work with the automaker's advanced technology and procurement teams as they evaluated a variety of technologies their potential performance and cost impact on their future vehicles, and the readiness of the technology for incorporation into their development and product roadmaps. The program we announced today is the first step in what is envisioned by the automaker as a multi-year program targeting delivery of production-ready silicon VTRAM-based modules in 2025. We'll have to continue to earn our role in the program as we go along, delivering against program requirements and satisfying the key milestones required to make it into actual vehicle production. We're excited about the magnitude of the opportunity, and we're ready for the challenge. The initial steps in this program will be to start a wafer fabrication run based on our current die and packaging design, followed by the delivery of initial package devices and demonstration boards. The initial deliveries will include our new bidirectional driver, and power board as part of the automaker's evaluation and technology readiness assessment of VTRAN for inclusion in future high-density power module evaluations and for potential use in EV drivetrain inverters. In the development program, we'll further optimize our device design to incorporate improvements in power density and further improvements we have planned to increase efficiency while collaborating with the module design firm as they develop the custom multi-die module incorporating VTRAN into their innovative packaging technology. This B-TRAN module will then go through initial testing and evaluation, followed by an automotive qualification process. The automotive qualification consists of unique and rigorous standards, including testing for things such as shock and vibration, which are not applicable to stationary applications. Meeting these rigorous standards will benefit our overall commercialization efforts due to the demanding requirements for product quality and long-term reliability. The module will then be evaluated in an EV drivetrain inverter Although it's not part of what is targeted for 2025 production-ready modules, there is also a longer-term target under the program that a silicon carbide BTRAN will be developed for use in EV drivetrain inverters. The development of a silicon carbide BTRAN would not only support the EV drivetrain application, but would also enable use cases for innovative power conversion architectures and additional applications such as DC-to-DC converters, vehicle-to-grid, vehicle-to-home, and vehicle-to-vehicle charging, which require bidirectional switching. Numerous automakers have announced EV roadmaps, and some have publicly discussed EV dealership investment requirements to facilitate the transition from the internal combustion engine or ICE vehicles to electric vehicles. Even at today's high prices, due to the high materials cost and production cost, EVs are not profitable for most automakers. Although there's a strong legislative support from the U.S. government for EV development and adoption, automakers need to identify and implement innovative ways to address current materials costs, production costs, and performance efficiency challenges. This exerts intense pressure on their R&D teams to lower EV production costs while simultaneously improving performance and range. eTRAN offers a distinct advantage over other technologies in EV drivetrain applications and a compelling value proposition. Having the opportunity to engage with one of the world's largest automakers at such an early stage in the development and adoption of electric vehicles is a particularly exciting opportunity, which we hope to leverage within the EV industry and other applications where V-TRAN can bring value, and in some cases, act as an enabler for new products. We'll share further updates on future calls, but this is a proprietary program, so we need the concurrence of the automaker on what we can publicly share. Our team is very excited to start work with this customer. Let's turn to our work on the United States Navy and our partner, Diversified Technologies. Last week, we began shipping additional BTRAN devices to Diversified Technologies on our project for the Naval Sea Systems Command, or NAVSEA, to develop and demonstrate a BTRAN-enabled, low-loss, 12 kilovolt DC solid-state breaker for the U.S. Navy. This represents another significant accomplishment and advances us toward fulfillment of our program deliverables to DTI in the coming months. In contrast to prior devices we delivered to DTI for testing, these devices will be paralleled into an array for incorporation into the full-scale NVDC solid-state circuit breaker that DTI is building for demonstration. As with the initial devices we shipped to DTI, These devices were produced using existing silicon wafer processing equipment, employing techniques and process flows we developed in collaboration with our wafer fabrication partners. The process and fabrication techniques we developed are specifically designed to be used in traditional high-volume silicon manufacturing facilities without the need for substantial capital investment in the conventional wafer fabs, thereby removing a potential hurdle in the manufacturing of an inherently bidirectional dye. We tested these packaged devices in our lab prior to shipment, and they met the fast switching and low conduction loss characteristics predicted in our simulations. These devices are packaged in our latest packaging design that utilizes the state-of-the-art techniques designed to provide high reliability. DTI is currently designing the driver for the solid-state circuit breaker, and we're supporting them in this effort due to the uniqueness of B-TRAN's bidirectional operation and our prior experience in designing a B-TRAN driver for discrete devices. Additional wafers are now being fabricated at both of our development fab partners and will be diced, packaged into devices, and tested prior to further shipments to DTI. The medium-voltage DC circuit breaker that results from this project will have direct applicability to military applications and commercial markets where circuit breakers are in wide use, such as electric utility distribution and transmission systems and microgrids, as well as solar, wind, and energy storage installations. Circuit breakers perform a critical function of power generation, transmission, and distribution systems to protect against power surges and short circuits. These needs have traditionally been filled by mechanical circuit breakers, which are orders of magnitude slower, prone to arcing and failure, and require manpower and cost to maintain. Solid-state circuit breakers relying on conventional power semiconductors, such as IGBTs, have not seen widespread adoption, primarily because of their high conduction losses. which results in wasted energy and the need to dissipate heat produced by their high losses. VTRAN, with its fast switching and low conduction losses, is a potentially enabling solution for large-scale solid-state circuit breaker adoption. We'll continue to provide program and technical support through the demonstration of the VTRAN-enabled breaker, and I'll provide program updates as we're able within the limitations of our NAVSEA confidentiality restrictions. As we discussed with you before, the device and packaging design used in this program will be leveraged for our customer test and evaluation program and for the design of our first commercial products. Our technical teams and fabrication and packaging partners have done outstanding work, and we're proud to ship these devices, further validating the expected performance of our low-loss bidirectional technology to DTI and in turn to the Navy. Our progress introducing our first commercial product by year-end, a multi-die power module designed primarily for the solid-state circuit breaker application, continued during the third quarter, and we expect to introduce this product by year-end. We continue to receive strong inbound levels of inquiries, particularly in applications involving circuit breakers from a broad range of commercial, research, and government entities, and are excited to introduce new BTRAN-based products to the market in the coming months. Let's move on to our test and evaluation program. Since the start of the third quarter, we further expanded our roster of participants in the DTRAN test and evaluation program with three new participants, which include a non-domestic designer and manufacturer of grid solutions interested in evaluating DTRAN for solid-state circuit breakers and other grid applications. This further illustrates the high visibility of the NAVSEA program in the technical community and this community's broad interest in the development of an innovative, lower-loss, fast-acting technology that are necessary to solve fundamental problems in both mechanical circuit breakers and solid-state circuit breakers using conventional devices. DTRAN's characteristics and benefits make it particularly well-suited to and a potential game-changer in the very large circuit breaker market. Also, two universities working closely on technology collaboration with large commercial businesses entered our evaluation program. Partnering with these universities is an important part of our strategy to capture additional government funding opportunities and to leverage the commercial relationships of these targeted universities with strong industrial companies. As a reminder, our prospective customers and partners who are looking to advance their technology roadmaps will rigorously test and evaluate BTRAN for use in their particular applications in their labs, many considerable in-house technical resources to evaluating a cutting-edge technology and the improvements and capabilities V-TRAN can create for them in their product designs. These tests will yield results, data, and feedback on performance and features we'll incorporate into our future commercial products and custom modules for use in specific applications. We have one or more test and evaluation agreements in place in each of our target markets and our pipeline of potential additional collaborations is healthy, especially in the solid-state circuit breaker and EV markets. These relationships are opening new doors to partner on additional government funding opportunities, in turn driving additional features and performance requirements for our commercial product offerings. We expect this repeating cycle of ongoing engagements to result in our introducing, over time, a range of BTRAM-based modules customized for specific applications, as is common in the traditional power semiconductor market. Next, we continue to submit for other government funding opportunities. Since the start of the third quarter, and in collaboration with universities and commercial entities, we've submitted several proposals and concept papers for government funding opportunities with the Department of Energy, the Department of Defense, and NASA. These submissions include applications in the areas of EV drivetrain, solid-state circuit breakers for renewables, grid and aircraft, as well as advanced V-train concepts. While the competition for these programs and their funding is very high and the chance of winning any given opportunity is low, this exercise provides us the opportunity to collaborate with current partners in the test and evaluation program and prospective customers that may enter that program and or development agreements with us. Let's move on to our development activities. As we grow closer to B-TRAN commercialization, our development activities are on target. Recently, our non-domestic fabrication partner with high volume production capability successfully completed engineering short loops for thin wafer handling and front-to-back feature alignment and validated key process steps for a bidirectional device on existing silicon processing equipment. While we're working well in advance of the need for high volume production, it's been critical for us to validate that some of the unique processing steps for thin double-sided wafers our product requires are can be addressed in a true production-level facility without the need for significant capital equipment expenditures. Production at a high-volume fabrication partner will result in improved quality and yield as a result of the elimination of manual wafer handling and rigorous and repeatable quality processes, faster runs, and a greater number of larger diameter wafers per run compared to development fabs. It will also help us to ensure there will be sufficient production capacity for the large customers that we're engaging and to mitigate supply chain risk. We fabricated and successfully tested our latest VTRAN driver and have multiple drivers built and ready to support our test and evaluation program. For this program, we've also designed and fabricated a full test and evaluation kit That will include a VTRAN device, a bidirectional driver, a power board, an enclosure for safety and ease of connection for instrumentation to facilitate and accelerate setup, test, and evaluation by our technology participants in the program. As we mentioned on our last call, during the third quarter, we completed the qualification of a world-class packaging firm to transition our new packaging concept for volume production and now have qualified both a domestic and non-domestic packaging firm. These firms completed their design work, including a joint design review with us, trial mechanical builds, and package their first devices, with the packaging of these devices successfully tested by a third party. Our packaging partners also have the capability to design and fabricate multi-die DTRAN modules, which are in high demand in solid-state circuit breaker and electric vehicle applications. One of these firms is working closely with us on our module design and our module design firm to ensure our initial commercial product is manufacturable in high volume. To support the commercialization of DTRAN, we engaged a third-party firm that will conduct long-term reliability testing, which involves, amongst other tests, tens of thousands of power cycles to assess the mechanical integrity and durability of the design. In addition, we've identified a firm to conduct additional third-party device characterization and testing following the completion of our deliveries under the NAVSEA program. We also selected a design firm who is nearing completion of the packaging design of our first commercial product, a multi-die power module, planned for introduction later this year. The power module packages four die without a driver. This type of product is particularly attractive for the solid-state circuit breaker application where the driver is typically done at the system level rather than the module level. We have several participants in our customer sampling program as well as inbound inquiries from potential collaborators focused on the solid-state circuit breaker application. The multi-die power module will form the basis of our second commercial product, an intelligent power module. The intelligent power module takes the multi-die power module design and adds a multi-die driver. This type of product is targeted at the renewables, energy storage, and other industrial end markets. We're targeting the introduction of this product in the first half of 2023. So now with sufficient capability and capacity to support the introduction of our first commercial products and our ongoing development activities along our product and technology roadmap, here are our objectives for the remainder of the year. First, we'll start a wafer fabrication run to support the newly announced development program for the top 10 global automaker. Second, we'll complete our first multi-die power module design targeting the introduction of this commercial product by year end. This design will leverage learnings from our discrete device fabrication and packaging efforts. Third, we'll continue to collaborate with DTI on our BTRAN-enabled solid-state circuit breaker project for Navy and chip additional BTRAN devices to DTI for incorporation into the demonstration of a 12 kilovolt NVDC breaker at a site selected by the Navy. We expect to complete deliveries to DTI in early 2023. The objective of this program Post-demonstration is for BTI to introduce a family of MVCD circuit breakers incorporating B-TRAN for sale to military, industrial, and utility markets. Fourth, with respect to our B-TRAN test and evaluation program, we'll fabricate additional customer kits to provide a B-TRAN device, driver, power board, and safety enclosure to facilitate and accelerate the evaluation process. After delivery of the kits, We'll gather testing results from these customers that provide feedback on the design and operation of the package, devices, and driver, the feature set these customers require for each application, and their priorities for individual applications. We'll then use this feedback to determine common requirements across applications and act as a foundation for the development of future B-TRAN products. And, as you know, our test and evaluation program will remain an embedded process in our sales and marketing effort, and we'll continue to work to add additional potential customers to it. Looking at our expanding BTRAN patent estate, we currently have 71 issued BTRAN patents, with 31 of those issued outside of the United States, and 22 pending BTRAN patents. During the quarter, two patents were issued in the U.S., one related to our driver and another related to our paralleling and controlling multiple B-Tran dye in a common module. Our current geographic coverage includes North America, China, Japan, South Korea, India, and Europe, all of which, along with the United States, represent all of our high-priority geographies for patent coverage. In summary, we are thrilled to enter our first B-Tran product development agreement for a custom module with a top 10 global automaker. We're also proud of the progress we've made along our roadmap for this year and excited to be shipping additional devices to BTI for the NAVSEA program and introducing our first commercial product by year end. B-Tran's unique architecture offers the advantages of inherent bidirectional switching capability, reduced switching and conduction losses, improved and more compact thermal management requirements, potentially leading to lower user costs for OEM products incorporating B-Tran and high-growth applications. We're hitting our milestones with the qualification of world-class design, packaging, and testing partners, a growing IP portfolio, a dedicated and talented team, and ample cash on our balance sheet. We cannot wait to start the development program with a top 10 global automaker and launch our first B-Tran commercial product, bringing the potential of our technology into reality. I'd like to hand the call over to Chief Financial Officer Tim Burns for a review of our third quarter financial results. Tim?
Carolyn
Thank you, Dan. I will review third quarter 2022 financial results. In the third quarter, we recorded $11,000 in grant revenue with offsetting cost of grant revenue as we continued our work on the Navy-funded NAVSEA program. At September 30th, grant revenue of $54,000 remained to be recognized under this program. Operating expenses were $1.8 million in the third quarter of 2022, slightly lower than our expectations, compared to $1.7 million in the second quarter of 2022 and $1.2 million in the third quarter of 2021. Research and development and sales and marketing expenses were higher in the third quarter of 2022 compared to the third quarter of 2021 on One, wafer costs associated with future fabrication runs, as we received wafers this quarter that we had ordered earlier in the year to mitigate potential supply chain delays. Two, higher search and placement fees and personnel costs due to headcount additions to support both B-TRAN development and our test and evaluation program. And three, other development activities, including the fabrication of B-TRAN drivers. This growth represents our planned investment in development and commercialization activities in advance of introducing our initial commercial product by the end of the year. General and administrative expenses increased this quarter on higher professional fees. Operating expenses also reflect higher stock-based compensation expense. For the fourth quarter, our development and commercialization plans include additional wafer fabrication runs, including starting a run under our new development program, designing, beginning fabrication of, and introducing our initial commercial product, further deliveries to DTI under the NAVSEA program, fabrication of additional BTRAN drivers and customer kits to support the test and evaluation program, adding more engineering and product management talent, starting the design of our second commercial product, an intelligent power module, and other B-train commercialization activities with potential new customers and partners. We continue to expect some quarter-to-quarter variability in operating expenses, particularly our research and development spending, through the timing of semiconductor fabrication runs and other development activities and hiring, as well as the potential impact of additional government funding. We continue to expect general and administrative expense in the fourth quarter to be relatively flat sequentially, excluding the impact of stock compensation expense, despite the impact of inflation on the cost of services. Net loss in the third quarter of 2022 was $1.7 million, compared to $1.2 million in the third quarter of 2021. Third quarter 2022 cash used in operating and investing activities was $1.6 million, up from $1.2 million in the third quarter of 2021, and down slightly from $1.7 million in the second quarter of 2022. This is slightly lower than the expectations we provided on our second quarter call due to the timing of hiring and other development expenses. As I mentioned, we continue to invest in both sales and marketing and research and development, and now expect a cash burn for full year 2022 of approximately $6.7 million to $6.9 million, with a fourth quarter 2022 cash burn of approximately $2 million to $2.2 million. Cash and cash equivalents totaled $18.5 million in September 30, 2022. Given our planned cash burn, which remains modest, we have ample liquidity on our balance sheet to fund operations as we commercialize our technology and to be a well-capitalized partner for the broad spectrum of companies that are either already participating or that we expect to participate in the test and evaluation of our B-Tran technology, as well as the top 10 global automaker that has engaged us for development program. As of September 30th, we had 5,903,797 shares outstanding and 1,040,248 warrants outstanding unchanged from the end of June. Including 625,948 stock options and restricted stock units outstanding, diluted shares outstanding in September 30th totaled 7,569,993 shares. At this time, I'd like to open up the call for questions. Operator?
Operator
Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, please press star one to ask a question, and we'll pause for just a moment to allow everyone an opportunity to signal for questions. Our first question comes from David Schneider, private investor. Please go ahead.
David Schneider
Yeah, hi. I have to apologize initially because I actually have seven questions. As far as the development agreement with the automotive OEM, what do you think might be the soonest that I could go buy a vehicle with your technology in it as far as a year?
Dan Berdar
Yeah, they're targeting production-ready devices from us in 2025, so I would think it's 2025 or 2026, depending on the timing of when they roll those out.
David Schneider
Okay, okay. That's really not that far away, especially from an investment point of view.
Dan Berdar
It's not because the automakers are really focused on how do they shorten that cycle for getting their electric vehicle products out. It's just they can't follow the traditional five-year path. It's just they don't have that luxury.
David Schneider
Yeah. What about, you know, I've seen other breakthrough technologies in electrification first take hold in, let's say, not in the auto industry, but actually in motorcycles. So it's a little surprising to me that, well, we don't have a very large sample size, but I'm wondering, you know, if you're talking to any of the motorcycle companies.
Dan Berdar
We're not really engaged with the motorcycle folks, but what we are engaged with are, and there are actually companies that are already in our sampling program that are focused on commercial vehicles, delivery trucks, buses, and so forth, where the standards are a little bit different, but there's a desire and electrification there as well.
David Schneider
Okay. Okay. That's very good. Also, as far as modules per vehicle, I I'm wondering if the number of BTRAN modules per vehicle would vary if you're talking about a sedan versus an SUV because that could help establish, although it would be extremely back of the envelope, we would have to assume what a BTRAN module would sell for and what your margins would be. But how many modules per vehicle and would it vary?
Dan Berdar
It will vary because the number of modules will be a function of what's the rating size of the battery, which will drive what's the total voltage and current you have to support. But also, it depends on the topology that they use, because one of the things that B-TRAN enables is some different topologies than what you can do with conventional semiconductor devices. So there's a couple of things that come in the mix that really reflect some of the novelty that we see some of the automakers experience. pursuing to come up with a differentiated high performance approach to the vehicles that they bring out.
David Schneider
Okay. And Toyota is hedging its bets on electrification. They're actually, they've got a, they're spending a lot of money on researching hydrogen as a fuel. So is there any role for a B-Tran in hydrogen fueled vehicles?
Dan Berdar
Yeah, absolutely. You know, the fuel cells, when they produce the energy, I mean, it's, it's in a, basically a lower voltage DC form, depending on how big the fuel cell stack is, that ultimately has to go through power switches to convert it to different voltages and convert DC to AC or, again, AC back to DC, depending on how they've configured their system. So there would definitely be a role for us. It wouldn't be as big as if we were the key component of the drivetrain in a conventional battery, but there's definitely a role for VTRAN in hydrogen vehicles.
David Schneider
Okay, that's very good. And as a result of you getting, let's say, more visibility in the engineering community because you're getting more partners, are you finding that engineers are starting, are you getting more inbound calls from engineers saying, hey, I'm interested in working there?
Dan Berdar
Yeah, we're seeing it's slowly starting to improve. As people are becoming aware of the technology and things like the award that we won with our APEC paper and so forth, it's raising the visibility where people want to learn more. And it's just getting some inbound people responding to some of our job postings rather than having to find them through the recruiter. The downside of that is the capability of our technical team is very high. So the standards of who they're willing to hire to work with is also equally high. So it's getting better, but it's nice to actually see some people that are reaching out to us rather than having to rely on recruiters to try and find people.
David Schneider
Yeah, and I don't think there's downside to having experts. super highly qualified engineers at your firm.
Bruce Palma
Well, the cost of not doing a good job is high, so we're particular.
David Schneider
Yeah, yeah. Intuitively, I would think that there's more, let's call it bigger bang for the buck, the larger the vehicle in incorporating B-Trend. Just because if you had General Motors Humvee or Hummer I don't know how much that thing weighs, but the battery pack is probably the weight of a baby elephant. So I would think that there's a greater role for B-Tran maybe based on the size of the vehicle. Would that be correct?
Dan Berdar
Yeah, you're correct. And that's part of why, you know, rather than looking at the motorcycles, we've been focusing more on the commercial vehicles and buses as people who get in the sampling program in addition to just the passenger vehicles.
David Schneider
Okay. Well, yeah, I know the electrification of buses is a, there's a huge effort in that. So I'll get off right now and let other people ask questions. Thank you.
spk08
Great. Thanks, David.
Operator
Our next question comes from Kelly Furman, private investor. Please go ahead.
Kelly Furman
Hey, guys. Congrats on today's announcement. That's great stuff. Thank you. The drivetrains at the company you talked about today, are they only going to be making drivetrains for themselves, or is this going to be an opportunity where they are going to actually be selling them on the open market?
Dan Berdar
We don't see anybody yet that are the big established automakers wanting to do that. But that doesn't mean it won't change as part of their own strategies to build volume. This is an automaker that has multiple brands that you would recognize. So I think they're looking for what are the platforms that they actually want to start with and how can they build those platforms out within the rest of the brands that they manufacture.
Kelly Furman
Okay, and on July 20th, 2021, you guys announced a top 10 automaker to go into the sampling program. Is this a different automaker than what you announced on July 20th, 2021?
Dan Berdar
Yes, it is. We now have two of the top 10 global automakers engaged with us in one form or another. This is obviously a deeper level of engagement since we're actually going to go do a custom module with them, but the one that we announced previously is a different automaker.
Kelly Furman
Okay. Where do we stand with them right now as far as moving the ball forward?
Dan Berdar
They are signed up for the sampling program. Our team has met with them. And then basically as soon as we get through our deliveries for NAVSEA, we'll be shipping them parts and drivers for their evaluation. And hopefully we can build that into a custom module program like the one we just announced today.
Kelly Furman
Okay. And then where do we stand with the power management company? Is that progressing along nicely?
Dan Berdar
It is. You know, part of this is our teams kind of have to work together, one, for us to get them up to speed on vTran and how it operates, but also for us to learn their application a little bit so we can guide them to, you know, how to incorporate it and get the most out of it. So the folks that we've got engaged in the program, you know, a lot of them are still in that learning curve process where we're making them smarter about the device work. They can do their own circuit design and simulation work to get ready to get devices in hand So as they tested in the context of their application, they hit the ground running.
Kelly Furman
Okay, and the last one I got you guys is for the EV charging companies. I know you guys have somebody in the sampling program. At the last trade show, bidirectionality was one of the number one topic at the show. Are you seeing a significant number of inbound activity from the EV charging company because I'm surprised that you only have one in the sample program right now. Do you anticipate that number to grow quickly?
Dan Berdar
Yeah, we do. You know, I think the early EV charging stations that were being put out there were really all about how do you get something out there to satisfy the demand. But what's happening now is I think part of what's driving all this, the discussion of bidirectionality with them, is they're finding that for a lot of these locations, particularly in urban areas, they have to couple storage batteries to deal with mitigating the demand charges when people want to charge their vehicle during peak hours of the utility rates. So the offerings from the EV charging companies are getting a little bit more sophisticated. They're having more capability, and it drives the need for a little better solutions than just taking the conventional semiconductor devices and designing a one-way charging system.
Kelly Furman
How far along with you are the companies that are sampling currently? How far along are you with them?
Dan Berdar
Most of them are probably to the point where they're ready for us to give them devices. We've got a couple more. We're doing some circuit analysis with them. But as soon as we complete the NAVSEED deliveries, we've got several that are ready to go. Okay.
Kelly Furman
Congratulations again, you guys. Very proud of the job you guys are doing. Keep it up.
spk08
Thank you very much, Kelly.
Operator
Once again, if you would like to ask a question, please press star 1. And our next question comes from Bruce Palma, private investor. Please go ahead.
Bruce Palma
Hi. Thanks for taking my call, and congratulations on the agreement today. Thank you very much. A follow-up on that, the article says a custom inverter. When you're done development, do you own that inverter design or does the car company? And is it interchangeable to another company? And is it exclusive to this automobile so you'd never make an inverter for someone else? How does that work?
Dan Berdar
Well, yeah, we're actually not going to make the inverter. We're just going to make the semiconductor devices that go into the inverter and We will work with a packaging firm that has some unique approaches to semiconductor packaging that have been selected by this automaker also. And then what the automaker will do, they will take the design work that we do collaboratively with the packaging firm, and they are designing an inverter for their EV platforms as a part of that. Now, the inverter design will be theirs. All the work that we do as part of our technology remains ours, and we're not constrained to being able to work with any other automakers or anybody else as a result of what we're doing. Okay.
Bruce Palma
So if I understand correctly, no one outside of it would appear this automobile company. They either, I guess, maybe have gotten a B-Tran from you or just working through the design of it on paper. No one in the testing evaluation has a B-Tran yet. That's not until after you've delivered NAVSEA. Is that correct? Yes.
Dan Berdar
Correct. The deliveries for NAVSEA, they need large numbers of devices for the breaker. So those deliveries, since we have a contractual obligation, is coming first. And then we are ready to support the folks in the sampling program with the work that we've been doing with getting their drivers ready, getting the sampling kit ready for them, and then being able to provide devices for them once the NAVSEA deliveries are done.
Bruce Palma
So if NAVSEA sounded like you were going to get DTI in that by the end of the first quarter, if I'm sitting here by mid-next year, if you've delivered to NAVSEA, how many people do you think would have a device from your test and evaluation by mid-year or the end of the third quarter? Where will these people finally get the 5, 10 agreements you have? You know, how many agreements are out there and how many is it by mid-year you see them having them or end of third quarter? What could we expect from that perspective?
Dan Berdar
I expect we'll see the people that are in the program. We've kind of prioritized them in terms of those that we think we want to serve first. They do take some technical support, but we would expect most of the major players that we really want to capture would have devices in the whole sampling kit with driver in the first half of the year. Okay, perfect. All right.
spk08
Well, thanks for taking my questions. Sure thing.
Operator
It appears there are no further questions at this time. Mr. Berdar, I'd like to turn the conference back to you for any additional or closing remarks.
Dan Berdar
I just want to thank everybody for joining our call. We will be participating in the Benchmark Discovery Conference in December and hope to be able to speak with those that are in attendance. In the meantime, have a happy and safe holiday season, and we look forward to giving you another update on our fourth quarter call.
Operator
This concludes today's call. Thank you for your participation, and you may now disconnect.
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