Ideal Power Inc.

Good morning, ladies and gentlemen, and welcome to the Ideal Power second quarter 2024 results call. At this time, all participants are in listen-only mode. At the end of management's remarks, there will be a question-and-answer session. Investors can submit their questions anytime within the meeting webcast by typing them into the Q&A button on the left side of your viewing screen. Analysts who publish research may ask questions on the phone line. For analysts to ask questions on the phone line, please press star 1. on your phone keypad at any time. As a reminder, this event is being recorded. I would now like to turn the conference over to Jeff Christensen. Please go ahead.

Thank you, Operator, and good morning, everyone. Thank you for joining Ideal Power's second quarter 2024 conference call. With me on the call today are Dan Bernard, President and Chief Executive Officer, and Tim Burns, Chief Financial Officer. Ideal Power's second quarter 2024 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 companies' 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 the associated risks. And we would also refer you to the company's website for more supporting company information. Now I would like to turn the call over to Ideal Power's President and CEO, Dan Berdard. Dan?

Thank you, Jeff. And thanks, everyone, for joining us today on our second quarter conference call. I'm excited to update you today on our progress since the start of the second quarter as we've accomplished a couple of our key milestones for the year and made significant progress with several key customers. Then I'll turn things over to Tim Burns to discuss our financial results. We'll be pleased to answer your questions after our remarks. I'm delighted to report that on a number of new developments at Ideal Power, I'll cover the key highlights briefly, then discuss them in a little bit more depth and provide context for their importance. First, we are collaborating with our third global automaker, along with our previously announced engagements with Stellantis and a second top 10 global automaker. Second, we announced a global distribution agreement with a second distributor that is particularly strong in Asia. This distributor is already placing orders with us. Adding distributors and channels to market is one of our key 2024 milestones. Third, we qualified a second wafer fabrication supplier with high volume production capability. This is also one of our 2024 milestones. Fourth, we secured orders for B-Tran devices and circuit breaker evaluation boards from a global leader in power semiconductor and power electronics solutions. Fifth, we secured an order for B-Tran devices for evaluation in solar inverter applications from a top 10 global provider of power conversion solutions to the solar industry. This company was a participant in the B-Tran test and evaluation program. Sixth, we secured an order for Simcoe power modules and drivers from a Forbes Global 500 power management market leader that also participated in our B-Tran test and evaluation program. Seventh, We added a global leader in circuit protection, industrial fuses, and power conversion technology with over a billion dollars in annual sales to the roster of our test and evaluation program. And eighth, based on the results of testing, we increased the current rating of our Simcool power module by 25%. When combined with an approximate 50% size reduction we recently implemented, we dramatically increased the Simcool module's power density. Looking first at the automotive market, we continue to leverage the work we're doing with Stellantis to attract other auto OEMs and to evaluate V-TRAN for their next generation electric and hybrid vehicle platforms. This quarter, we added a third global automaker to our list of customer engagements. After learning more about our technology and products, their team realized the potential benefit of V-TRAN in several locations in the EV drivetrain. Their initial focus is on EV contactors. This Global Automakers engineering team is working closely and meeting regularly with our engineers on the use of B-Tran-enabled contactors to potentially replace electromechanical contactors across its EV platform. Contactors serve as cutoff switches for high-power applications in EVs. They play a critical role in isolating the battery, inverter, and high-speed charging system to ensure safety when the vehicle is off or being serviced. Contactors are bidirectional, and there are typically four to six high-power contactors in every EV. In the assessment of the automotive OEM, the bidirectional nature, ability to accommodate higher voltage DC platforms, fast speed, and low conduction losses of VTRAN make a solid-state contactor a good first use case for their EVs. Solid-state contactors and EVs are an emerging market, and our technology is potentially enabling for this application due to its very low conduction losses and inherent bidirectionality. A high-power EV contactor market is forecasted to grow to over $3.7 billion in 2025. We believe that over time, solid-state contactors will potentially displace electromechanical contactors in half or more of this market. This market is additive to the serviceable addressable market for B-Tran that we've shared with you previously. We're excited to add another global automotive OEM and look forward to expanding our collaboration with them. Turning to Stellantis, As many of you know, we successfully completed Phase 2 of our program with them a few months ago and eagerly waiting to begin Phase 3. What's been happening in the meantime is we continue to meet with their team weekly while they developed and sent out the drivetrain inverter solicitation to roughly a half a dozen Tier 1 suppliers. The Tier 1 suppliers were asked to provide their proposals to supply the VTRAN-based drivetrain inverter. Solanus introduced our team to the Tier 1 suppliers we were not already working with so we could bring them up to speed on the technology, our products, the unique configuration that we developed for the application, and the corresponding test data that demonstrated we provide better performance compared to other silicon and silicon carbide solutions. The Tier 1 inverter proposals have been submitted, and Stellantis is in the process of reviewing the proposals and will down select the one or two Tier 1 suppliers to design and build the drivetrain inverter for their new EV platform. In a parallel effort, Stellantis is working with us and a large semiconductor company with expertise in driver control circuitry for the VTRAN inverter drivers. After the Tier 1 inverter supplier is selected by Stellantis, we expect to start Phase 3 working with the Tier 1 suppliers and Stellantis' team with the objective of developing a production-ready VTRAN power module for use in their EV drivetrain. Completion of the VTRAN module is still targeted for 2025. While their focus continues to be on a custom BTRAN power module for use in the EV drivetrain platform, they also continue to express interest in BTRAN for battery circuit protection as well. Turning to the previously announced Top 10 Global Automaker in our test and evaluation program, we've been able to share the unique BTRAN configuration we developed for EV drivetrain inverters with them, as well as the test data we generated under the Stellantis program. Since we're not constrained under our arrangement with Stellantis, We're using the design work and test data to attract other automotive OEMs and Tier 1s to explore and adopt V-TRAN for their next generation vehicles. As a result of the test data we provided, the top 10 automaker is moving forward and expected to order hardware for testing by their design team. We're also introducing them to the concept of V-TRAN-enabled EV contactors. This gives us two opportunities for this automaker that could evolve into formal programs. Now let's discuss industrial markets as they are expected to be the early source of our product sales and revenue. We secured orders for B-Tran devices and circuit breaker evaluation boards from a global leader in power semiconductor and power electronic solutions in connection with its launch of a multi-year DC power distribution system program. This opportunity was introduced to us through our new distributor relationship with Riosho. The company presents multiple opportunities for us as it addresses several of our target industrial markets, solid-state circuit breakers for industrial facilities and electric utility grid infrastructure, and renewable energy. For solid-state circuit breaker applications, our B-TRAN technology has clear advantages, providing dramatically lower conduction losses, lower costs, and bidirectionality compared to electromechanical breakers and IGBT and silicon carbide MOSFET-based solid-state circuit breakers. Also during the quarter, we secured an order for B-TRAN products for evaluation in solar inverter applications from a top 10 global provider of power conversion solutions to the solar industry. This customer was a previously announced participant in our B-TRAN test and evaluation program and is one of several who are advancing from that program to beginning to order products from us as part of their application-specific development work. While moving through the test and evaluation program with these large companies takes time, we're excited to see many of them taking that next step with us and begin ordering commercial products in small quantities. We're also pleased that we've not had any companies drop out of the test and evaluation program. We also secured an order for Simcool power modules and drivers from a Forbes Global 500 power management market leader that was also a participant in our test and evaluation program. This global power management market leader is evaluating Simcool against IGBT modules for use in solid-state circuit breaker applications. This customer's order for Simcool power modules follows their testing of discrete DTRAN devices, In response to this customer's request, Ideal Power provided high-volume quotes for Simcool power modules. This customer may also evaluate our technology for other power conversion applications. Also, we're very pleased that multiple customers in our test and evaluation program are advancing to initial orders with us. We also added a global leader in circuit protection in industrial markets with over $1 billion in annual sales to the roster of the D-TRAN test and evaluation programs. This global supplier presents multiple opportunities for us as they address several of our target industrial markets, including industrial fuses, renewable energy and energy storage power conversion, rail transportation, and EV power management. As part of our effort to expand our geographic and application diversification, we added a second global distributor, Ryosho, a subsidiary of Ryoden Corporation. Ryoden is listed on the Tokyo Stock Exchange and has almost $2 billion in annual sales. They have 21 international sites, including Riosho USA. Riosho is focused on the sale of semiconductors and other electronic components. This distributor already placed orders with us from a large global customer in Asia interested in the company's products for solid-state circuit protection applications. This is a significant development in the commercialization of our B-Tran technology. As a small company, we cannot efficiently reach the large global customer base for our products on our own. By leveraging the large investment in semiconductor sales and distribution networks, we can reach many customers that would be difficult to us engage or educate about our products and technology. Like Richardson Electronics, Riosho has a strong technical sales team with expertise in generating demand and securing orders for new products and technologies and has a global customer base. Their sales focus is particularly strong in Asia, which complements Richardson's geographic strength. We look forward to collaborating with Riosho to secure additional orders, particularly in the Asian markets where they have an extensive customer base. Adding distributors for our products is one of our key milestones for this year, and we'll likely add others in the coming quarters to address geographies or customer segments not covered well by our existing distributors. Another key milestone we completed in the quarter was the qualification of a second wafer fabrication supplier with high volume production capability. This facility in Europe along with our previously qualified wafer fabricator in Asia, adds dual sourcing for wafer fabrication, geographic diversity to our supply chain, and will support future revenue growth, providing ample capacity to support anticipated customer demand over the next several years. This fab successfully completed a multi-wafer full process flow engineering run of double-sided BTRAN wafers. By leveraging our proprietary proven process flow, This factory was able to produce functional bi-directional devices on their initial run without the need for special equipment or capital investment. Initial devices from this run have already been packaged by our packaging partners and successfully tested in our lab. This fab has demonstrated expertise in commercial manufacturing of high-power bipolar devices such as IGBTs. It's a qualified manufacturer of semiconductor wafers to multiple Tier 1 automotive suppliers. This will help Ideal Power to attract and engage prospective automotive OEMs and Tier 1 suppliers as customers since the FAB is ISO 9001 and ISO 14001 certified to globally recognized standards for quality and environmental management systems. Our dual sourcing for wafer fabrication in disparate geographies has no exposure to China or Taiwan to mitigate supply chain risk. Turning to product development. Based on the results of testing, we confirmed that our initial product ratings are quite conservative, and our device design is very capable of providing high performance and handling the current and voltage ratings required for our target applications. For example, our discrete device is currently rated at 50 amps and has been tested on a long duration basis at 150 amps without failure or any loss of performance. As a result of our test data, we are modestly increasing the current rating of our SimCool power module by 25%, from 160 amps to 200 amps. While we feel this is still a conservative rating, the customer feedback we've received from our test data reflects our comfort level in making this change. Along with the rating increase, we also implemented a reduction in the physical size of our power module of approximately 50%. This combination dramatically increases the power density of the Simcool power module, which allows customers to use less space in their OEM products to accommodate the semiconductor devices. which helps them lower cost while improving efficiency and overall performance. As part of our cost reduction initiatives, we're also planning on reducing the cell size of our BTRAN die. This will allow us to double the number of dies per wafer, which effectively doubles the number of dies per year that our wafer fabrication partners can produce, significantly expanding our available capacity for our large volume target customers, such as automakers. Also, since wafer processing cost is on a per wafer basis, and embodies a significant cost reduction for our products as we scale up production. We recently began our first engineering run of this second-generation B-Tran dive design. While it will take us a few runs to incorporate and finalize any learning from this effort, no significant process changes are expected. Also in the third quarter, we expect to begin the wafer runs we'll use for third-party reliability testing and automotive qualification. This tends to be a lengthy process due to the time it takes to complete thousands of power cycles and all the other testing required to meet automotive standards. Completing this process will also help us with industrial customers. Since automotive standards are the most stringent testing requirements, the acceptance of a new technology with a large industrial customers, as well as automotive OEMs and tier one suppliers, definitely benefits from being able to share the third party reliability and qualification data with prospective customers. We're not aware of any competing inherently bidirectional high-power technologies that are using anything similar to our technology. Looking at our expanding VTRAN patent estate, we currently have 87 issued patents with 40 of those issued outside the United States. Our current geographic coverage for our patents includes North America, China, Japan, South Korea, India, and Europe with pending coverage in Taiwan, all representing our high-priority patent coverage geographies. As part of our product development and introductions, we've expanded our patent efforts to include what we believe to be high-value patents for our driver design and controls and double-sided packaging designs, as both are unique due to the bidirectional nature of our technology. As a result of our continued innovations, our list of pending V-TRAN patents is now 45. In addition, we treat the proven process flow we use to make our devices as a trade secret and work under strict confidentiality with our wafer fabrication partners. So even if a competitor studied our patents, they wouldn't have the know-how to be able to fabricate the device. The bottom line is we continue to execute on our VTRAN commercialization roadmap to prepare for the significant sales ramp we're expecting, initially in industrial markets, and then followed by opportunities in hybrid and electric vehicles. We remain on track to achieve our 2024 milestones and look forward to continuous progress with existing relationships, new collaborations, and several commercial announcements in the coming months. Now I'd like to turn the call over to Tim Burns to review our financials.