Solid Power, Inc.

Greetings. Welcome to the Solid Power Third Quarter 2022 Financial Results and Business Update Call. Please know that this conference is being recorded. I will now turn the conference over to your host, Jennifer Almquist, with Investor Relations for Solid Power. Thank you. You may begin.

Thank you, Stacey, and thank you, everyone, for joining us. Joining me on the call today are Solid Power's Chief Executive Officer, Doug Campbell, and Chief Financial Officer, Kevin Pepsiski. A copy of today's press release is available on the Investor Relations section of our website at ir.solidpowerbattery.com. Before we get started, I'd like to remind you that parts of our discussion today will include forward-looking statements as defined by U.S. security laws. These forward-looking statements are based on management's current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Required by applicable law, we disclaim any duty to update any forward-looking statements to reflect future events or circumstances. For discussion of the risks and uncertainties that could cause actual results to differ materially from those expressed in our forward-looking statements, please see our most recent filings with the Securities and Exchange Commission, which can be found on our website at ir.solidpowerbattery.com. With that, let me turn it over to Doug Campbell.

Thank you, Jen. Good afternoon, everyone, and thanks for joining us. I'll begin today with an update on our business, then I'll pass it over to Kevin for a brief review of the financials. After that, I'll provide some concluding remarks, and we'll open the call to your questions. Since we last spoke, our team has continued its solid execution on our development milestones, though we faced operational challenges during the quarter that I will discuss in a moment. But in summary, we made 20 amp hour cell deliveries to our automotive partners. We have continued to optimize our EV cell pilot line and recently began production of full-scale EV cells. We have continued to make meaningful progress on the construction of our electrolyte production facility, and we have remained on track to begin powder production at our new electrolyte production facility in the first quarter of next year. I continue to be pleased with our team's execution as we position solar power for the long term. Let me take a moment to add a little color on each of these key milestones. First, with respect to 20 amp hour cell deliveries. During the third quarter, we began delivering 20 amp hour cells to both Ford and BMW. To date, we have delivered over 150 of these 20 amp hour cells. These cells are currently being tested by us, our partners, and third party testing facilities. Preliminarily, we are encouraged by what we're seeing as we scale. from the 2 amp hour to the 20 amp hour cell format, though a lot of work is still needed to hit our partner's commercialization targets. Further, I am pleased to say the performance of these cells drove customers to confirm additional 20 amp hour cell orders during the third quarter, which is encouraging. These additional orders led to a significant increase in 20 amp hour production during the third quarter. However, as we began increasing the production rate and volumes to meet the demand, we experienced lower initial yields. To be clear, lower initial yields for the 20 amp hour cell production in comparison to our previous 2 amp hour cell builds was not unexpected as it represents over an order of magnitude increase in production volumes including input materials, slurries, coated layers, etc. It is also worth stating that we view these yield challenges as opportunities to refine our higher volume production processes, and we remain optimistic that the learnings we achieve at our present production volume will translate to our next stage of production volume, such as entering into a sample. Our production during the quarter was also impacted by a few other issues. We saw some minor delays in the availability of materials we needed. We also experienced quality issue with some of our commodity input materials. Our team did a good job mitigating delivery delays, but it did impact our schedule. We continue to work with all of our suppliers to implement stronger upfront processes to mitigate the risk of future quality issues. Lastly, we also saw some not insignificant tightening in the labor market. While we are still successfully recruiting talent, we have seen longer lead times for hiring, which have put us slightly behind in our resource plan. This is driven in part by increased competition for battery scientists, engineers, and technicians. We are excited about some of the preliminary and creative things we are working on to allow us to continue to add talented team members. Overall, higher production volumes, lower initial yields, supply issues, and hiring challenges together meant that a majority of our time and resources were focused on 20 amp hour cell builds during the third quarter as we prioritized our partners' needs. There remains a lot of work for our team, both in terms of technology development as well as in the scaling up of our production processes. That said, I'm happy to report that we were able to achieve improvements in cell production yields over the course of the third and into the fourth quarter, although further improvements in yield are needed to hit our production targets. We are pleased with the demand for 20 amp hour cells. I'm proud to say the team is rising to the occasion through the challenges we experienced this quarter. We currently expect to deliver a few hundred more 20 amp hour cells to our partners in Q4 of this year before we can focus more of our efforts and resources on EV cell build and entry into the A sample phase. To that end, we were able during the third quarter to continue our work to optimize the EV cell pilot line and have made progress with the coding, calendaring, and laminating processes, which we believe positions as well as we begin to ramp production. While we did not make any EV cells during the third quarter due to our focus on the production of the 20 amp hour cell format, initial cell builds have begun as of last week. We anticipate that the pace of EV cell production will increase through the remainder of the year as we ramp down 20 amp hour cell production. We do, however, recognize that this shift does introduce some risk into our EV cell timeline. Optimistically, we think we can deliver a number of EV a limited number of EV cells to our customers and third-party testing houses before the end of the year. This would allow us to enter into a sample phase in 2022, thereby achieving our original target milestone. However, it is possible that these EV cell deliveries and our entry into a sample qualification could slip into 2023. In summary, we are continuing to push hard to achieve a sample in the coming months, And we will provide a more in-depth operational update in 2023 as we fully assess our production results over the quarter. And lastly, turning to our electrolyte production facility and powder production, construction of the electrolyte production facility has continued to progress nicely and is now nearing completion. In particular, all infrastructure construction is complete. and we have received a full certificate of occupancy, which has allowed us to place R&D, quality, and cell testing equipment in its final location for use by those departments. It should also be noted that move-in for this new facility is already underway as of last week in order to support our growing technical and support staff. Further, a majority of the electrolyte production equipment has been delivered and placed in their final production location, facilitating the start of the process install. The remaining equipment is currently undergoing acceptance testing at the equipment vendor's location. We fully expect the remaining pieces of equipment to be installed by the end of the present quarter. Our progress to date is encouraging and gives us a higher degree of confidence that the electrolyte pilot production line will be commissioned and validated in early 2023. We fully expect powder production volumes to ramp throughout next year as our needs increase for both EV cell builds, and potential future supply. We look forward to taking this key step towards becoming the industry leader in solid-state battery materials. We have some great pictures on our online blog that illustrate the incredible progress we've made over the last several months. My thanks to the team for their continued strong execution on this key project. With that, I'll pass it over to Kevin to take you through our first quarter results. Kevin?