Ouster, Inc.

Hello and welcome to Alistair's fourth quarter 2025 earnings conference call. All lines have been placed on mute to prevent any background noise. After today's presentation and remarks, there will be an opportunity to ask questions. If you would like to ask a question during this time, simply press star 11 on your telephone keypad. If you would like to withdraw your question, press star 11 again. The call today is being recorded and a replay of the call will be available on the Alistair Investor Relations website an hour after the completion of this call. I'd like to now turn the conference over to Chen Geng, Senior Vice President of Strategic Finance and Treasurer. Please go ahead.

Thank you, Operator, and good afternoon, everyone. Thank you for joining our fourth quarter 2025 earnings call. Today on the call, we have Chief Executive Officer Angus Bacala and Chief Financial Officer Ken Gianella. As a reminder, after the market closed today, Outser issued its financial news release, which was also furnished on a Form 8K and is posted in the Investor Relations section of the Outser website. Today's conference call will be available for webcast replay in the Investor Relations section of our website. I want to remind everyone that on this call, we will make certain forward-looking statements These include all statements about our competitive position and growth opportunities, anticipated industry trends, our business and strategic priorities, our operating expense targets, the impact of our recent acquisition, the development and expansion of our products, and our revenue guidance for the first quarter of 2026. Actual results may differ materially from those contemplated by these forward-looking statements. Factors that could cause actual results and trends to differ materially from those contained in or implied by these forward-looking statements are set forth in the fourth quarter 2025 financial results release and in the quarterly and annual reports we file with the Securities and Exchange Commission. Any forward-looking statements that we make on this call are based on the assumptions as of today and other than as may be required by law, OUSER assumes no obligation to update any forward-looking statements which speak only as of their respective dates. In today's conference call, we will discuss both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures discussed today is included in the financial results release. I would now like to turn the call over to Angus.

Hello, everyone, and thank you for joining. I'll start with a brief recap of the quarter and review of our strategic priorities for 2025. Ken will cover our financial results in more detail before I close with our goals for 2026. The fourth quarter capped off a year of exceptional execution for Ouster. Our fourth quarter revenue of $62 million, including $41 million of product revenue, reflects the continued demand we see across our LIDAR business and represents our 12th straight quarter of product revenue growth. GAAP gross margin was strong at 60%, and we set a new quarterly record with over 8,100 sensors shipped, bringing physical AI to life across multiple applications, including warehouse automation, robo-taxis, and mapping. Our strong results are a testament to our disciplined execution across our business. This is supported by durable global growth drivers for increasing automation efficiency and safety. These secular themes strengthened during 2025, a year where we set and executed on three strategic priorities, scaling the software-attached business, transforming the product portfolio, and executing towards profitability. First, we committed to scaling our software-attached business. Software-attached bookings more than doubled in 2025 and represented over 15% of our sensors shipped. which is up over 120% year on year. In addition, I'm excited to share that today, our in-house trained AI models are now running 24 hours a day at over 1200 Gemini and Blue City sites, spanning over 65 million square feet of roadways and facilities around the world. We are delivering physical AI at enterprise scale. We drove significant Gemini renewals, including a seven-figure annual license with a leading global technology company, and secured landmark Blue City agreements to accelerate the adoption of AI-powered LiDAR detection across Tennessee, Utah, and New Jersey. This growth was driven by the increased capabilities of Ouster Gemini and Blue City, validating our continued investments in proprietary AI model training. as well as the expansion of distribution partnerships across nearly the entirety of North America. Second, we set out to further transform our product portfolio. In 2025, we introduced powerful new features, unlocked greater performance, and reshaped how our customers integrate, manage, and utilize LiDAR data through a series of major software releases. We launched four new versions of our SDK, which included revolutionary new features. This included on-sensor 3D zone monitoring, which is the first time perception logic has been embedded directly into 3D digital LiDAR. This feature supports collision avoidance warnings, deceleration, and emergency stops, and was the result of significant demand from customers. Many of the world's largest material handling companies are using this as a critical aspect in their collision avoidance technology. We also released real-time localization, empowering customers to track the position of their assets with centimeter level accuracy and implement features like geofencing and automatic speed limit enforcement without requiring the installation of expensive and complex infrastructure. We continue to strategically invest in our proprietary AI model training, leveraging real-world data to iterate, retrain, improve, and deliver increased capabilities to our customers. Our breakthrough multi-sensor AI model, powering Ouster Gemini and Blue City, is trained on millions of labeled objects collected from hundreds of sites around the world, spanning diverse environments and weather conditions. By dramatically improving detection accuracy, efficiency, and long-term object identity persistence, we have unlocked new use cases, allowing us to support large-scale installations of 40 LiDAR sensors at a single site. We also advanced Blue City features from prototype to real-world deployments with the addition of intelligent signal actuation, which catalyzes Ouster's scaling across hundreds of intersections in 2025. Within Ouster Gemini, we released new features like Cloud Portal and Event Server. Gemini Cloud Portal allows customers to securely configure and manage deployments from any location, while Gemini Event Server creates a no-code environment that enables customers to build custom logic for applications like intrusion detection and zone occupancy without requiring heavy engineering. Finally, we made major progress in validating our next generation L4 and Chronos custom silicon as we look to redefine what's possible with digital LiDAR. Our digital LiDAR roadmap continues to drive dramatic improvements in performance and reliability, reinforcing the core advantages of our architecture. Importantly, these breakthrough chips will power our next generation sensors, which represent a major step forward in capability, scalability, and value for our customers. These advancements are expected to more than double our current addressable market for LiDAR, unlocking new applications and expanding opportunities across each of our industry verticals. We're excited to share much more on this front soon. Our execution in 2025 aligned with our long-term financial framework, progressing us further on our path towards profitability. Our core business delivered on all target metrics for 2025, excluding the benefit of royalties, full-year product revenue increased by 32% year-over-year, and we successfully navigated a volatile macroeconomic environment and the headwind of tariffs to deliver 41% gross margins. We maintained our operating expense discipline even as we absorbed the operational and compliance requirements of a growing global business. We continue to have one of the strongest balance sheets in the industry, demonstrating our ability to achieve both high growth and financial prudence. I'll now turn the call over to Ken to discuss our financial results in detail.