Archer Aviation Inc.

Cole and I'll be the moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. I'd now like to pass it over to our host, Eric Lentil. Please go ahead.

Thank you, operator. Good afternoon, everyone, and thank you for joining us today to review Archer's first quarter operating and financial results. My name is Eric Lempel, Archer's general counsel. On the call with me today are Adam Goldstein, our founder and CEO, Mark Messler, our CFO, and Tom Yunez, our CTO. During today's call, we will be making forward-looking statements. These statements involve risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward-looking statements. For more information about these risks and uncertainties, please refer to our SEC filing under the caption, Risk Factors. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events. During this call, we will discuss both GAAP and non-GAAP financial measures. A reconciliation of certain GAAP to non-GAAP measures is included in our shareholder letter posted on our investor relations website. And now I'll turn the call over to Adam. Adam?

Thanks, Eric. At Archer, we remain steadfast in our focus on commercializing our midnight aircraft. We've designed midnight in pursuit of bringing to market an electric aircraft with world-class design and cutting-edge performance capabilities that will make it the desired air taxi globally. When I think back to 2019, when I first sat down with Tom Yunez and Jeff Bauer, to sketch out a vision for what became Midnight. We were aligned on one single goal, design an aircraft that would capture the market potential as soon as possible, meaning one that is both certifiable and manufacturable at scale, all while being purpose-built to addressing the congested 20 to 50 mile automobile commute corridors that gridlock our cities today. We decided a 12 tilt six vehicle was optimal for this mission, And then we built a full-scale, 3,500-pound, max gross weight, 40-foot wingspan aircraft called Maker. We shepherded that aircraft in 2022 and 2023 through the full flight envelope, including transition and high-speed flight, and then used those lessons to inform the design of the next evolution, our production aircraft, Midnight. Today, we are flying Midnight nearly every day and benefiting tremendously from all the lessons we learned from Maker. In Q1, our flight test team logged over 100 flights, putting us on pace to exceed our goal of 400 flights this year. And we continue to be focused on accelerating the velocity of our flight test data, aiming for reaching 10 to 15 flights a day to mimic commercial endurance. As we continue to expand the flight envelope, I couldn't be more excited to see the aircraft transition in the near future. Midnight has a 6,500-pound max gross weight and a 47-foot wingspan, making it what we believe to be the largest eVTOL aircraft in the industry. We intentionally designed Midnight at this size to maximize payload and provide necessary comforts, such as air conditioning. I believe that our choice to build a higher payload vehicle will prove to be a differentiator as we commercialize this industry. We are on a path to build six conforming Midnight aircraft to be used as part of our FAA certification program. The first of those is in final assembly now and on track to begin piloted flights later this year. Yesterday, we published a comprehensive video tour of our integrated test lab and production facility in California. Given our progress in engineering the aircraft and on our certification and flight test programs, we decided to move forward with installing our high-scale automated battery pack manufacturing line earlier this year. This line is capable of producing enough battery packs to support our planned production ramp in Georgia. I am confident that we are leading the way in the industry with this capability and that our investment there will pay off for years to come. We have also made similar investments across our supply chain, having spent over $50 million with our suppliers to ensure they are able to achieve our timeline and the production throughput we will need to support our aircraft manufacturing ramp. As these capital expenditures and upfront non-recurring costs roll off, I expect we will naturally reduce our burn and cash needs meaningfully as we shift into preparing for commercial launch heading into next year. One key piece of this strategy has been our partnership with Stellantis. As we have indicated, we are evolving our relationship to position Stellantis to be our contract manufacturing partner so that we can take advantage of their proven ability to produce vehicles at scale. which will in turn reduce Archer's cash outlay necessary to purchase materials and equipment as we start to scale production of our aircraft. We believe this capital-light strategy will put us in a unique position to rapidly scale production while minimizing cash requirements. I'm very pleased with how we have managed liquidity through this period where we have made what should be our most substantial capex in non-recurring investments. Our liquidity and cash position is nearly flat to where it was one year ago. As the founder, CEO, and the company's largest shareholder, I am sensitive to when and how much capital we take in as we balance our need and desire to grow with potential dilution. From the beginning, we have chosen a partner-first approach with some of the world's greatest companies and investors, like Stellantis, United Airlines, Abu Dhabi, and MOLUS, who believe in the value of what we are doing and are willing and able to help us ensure we get the capital we need when we need it. I continue to believe we are massively undervalued relative to the proprietary step change in technology we are creating and will remain opportunistic about how and when we take in capital on our journey to commercialization. I'm lucky to experience the day in and day out progress of making electric aviation a reality. But nothing tops getting to see the emotional reaction people have when they first experience our aircraft, no matter where we are in the world. I'm incredibly excited about turning those moments into an everyday reality. Just last week, I was in DC to celebrate the opening of our DC office with Billy Nolan, who prior to coming to Archer was the acting FAA administrator and has now transitioned to be our chief regulatory affairs officer, overseeing a team of industry and government veterans who are working on the important policy and regulatory issues our industry is facing. While in DC, I had the pleasure of meeting with lawmakers, the FAA administrator, Mike Whitaker, and leadership team and senior administration officials at the White House to update them on our progress and to discuss the importance of the FAA Reauthorization Bill and the upcoming SBAR. I'm grateful to Administrator Whitaker and the leadership team for all the progress our two teams have made together over the last several months to advance Midnight towards commercialization. Tom will provide more detail on our certification progress, which we've also highlighted in our shareholder letter. I want to now shift gears and take a moment to touch on the momentum we are seeing from commercializing flying cars all over the globe. There has been a noticeable shift over the past 12 months. Recently, I spent time abroad at the invitation of international regulators and partners, new in perspective, and I can say what I've witnessed firsthand is that never before had the excitement in demand for urban air transportation been higher than it is today. The world's cities are growing increasingly congested, while alternative transportation options remain challenging to develop and implement, and world leaders have taken note of the potential impact our industry can have on their cities. I'm humbled by the opportunity that Archer and our industry have to contribute to making a difference by ushering in this new era of electric aviation. Just last month, Midnight made its debut in Abu Dhabi for the inaugural Abu Dhabi Mobility where the UAE government ratified what I believe to be the world's largest unified governmental sign of support for our industry outside of the United States. As part of that, we signed a landmark framework agreement with the Abu Dhabi Investment Office that sets out their plan to provide us with an unprecedented investment of several hundreds of millions of dollars to accelerate our launch of air taxis in the region. Our team is proud to be partnering directly with the Director General of Audio, His Excellency, Badr Al-Olamah, with whom we've worked closely over the last year to get to this point, under the leadership of His Highness Sheikh Hamdan, who we were proud to host last month in the country's capital city. Aviation in the UAE, like most other countries, is regulated federally, and we are working in close coordination with the GCAA, the General Civil Aviation Authority, to plan for the safe integration of our aircraft into the airspace across Abu Dhabi, Dubai, and the seven Emirates. I want to offer more insight into what these early operations are shaping up to look like. There are existing skilled operators there who have meaningful experience operating aircraft within the complex UAE airspace. Rather than building a new operator to directly compete with local incumbents, we've chosen to take a more pragmatic approach to launching this market through working with commercial leaders there, like Falcon Aviation and Air Chateau. Falcon, under the leadership of His Highness Dr. Sheikh Sultan of the UAE Royal Family, has decades of experience transporting passengers within and across Dubai and Abu Dhabi via helicopters. And Air Chateau is one of the country's newest and most forward-leaning helicopter operators, located at the newly announced Al Maktoun International Airport, the future home of Emirates Airlines and soon to be the largest airport in the world. We remain focused on executing on a partner-first approach, and we look forward to continuing to work with the GCAA, ADEO, and the Department of Municipalities and Transport to enable commercial operations of our air taxis in the country as soon as late 2025. I recently also spent time in India and am more convinced than ever that India could become the largest urban air mobility market in the world. just as it has already become one of the fastest-growing electric vehicle markets. We're proud to be partnered with Rafael Batia, one of aviation's greatest pioneers, and his company, Interglobe. Through Interglobe, Rafael founded and helmed the third-largest airline in the world, Indigo, a nearly $20 billion juggernaut holding two-thirds of the domestic Indian market, with an extensive in-country and global influence and respect for its innovative approach to customer and operational excellence. In our sector, we are leading the way with maturing our plans and partners in what I am sure can be one of the largest markets for eVTOL aircraft on earth. So I'm very happy with the work our team is doing there. I want to be clear that our partnership with Interglobe is intended to extend far beyond a co-marketing arrangement or simple airport trips. Beyond the airline, Interglobe is also the country's third largest hospitality player with an extensive real estate portfolio, as well as UPS's JV partner in the region. As such, this year, we are working to finalize a comprehensive JV with Interglobe, which is contemplated to not only purchase an initial fleet of up to 200 midnight aircraft to begin operations in Delhi, Mumbai, and Bengaluru, but also to build out an extensive network of vertiports and service across the country to include fleet operations, maintenance, and pilot recruitment and training. As you can imagine, Interglobe also has a deep working relationship with India's Directorate General of Civil Aviation, the DGCA, and our team has spent time planning our approach with the regulators, Director General, Mr. Vikram Devdutt, as well as his broader leadership team to make sure we have a regulatory pathway to launch in India. UAE and India are just the first of our announced international markets. So look for us to continue sharing advancements here as we near commercialization. Also, as I mentioned, the global demand for Midnight is clear, and I'm excited for us to share more advancements on the international front here soon. Of course, a go-to-market strategy is only as good as our product, and I'm excited for Tom to share a deeper update on Midnight's progression. Tom has more experience leading an eVTOL aircraft program than just about anyone in the world. Midnight is the eighth full-scale eVTOL aircraft he has worked on, and those aircraft have flown over 2,000 flights combined. Now that we have over 750 employees at Archer, and given the progress with Stellantis and the contract manufacturing relationship that we are developing, we have elevated Tom to the role of Chief Technology Officer, with 500 engineers under Tom's organization. As part of that, we have recently shifted the manufacturing, supply chain, and quality departments to fall under a new production leader, Tony Agrizarian. Having spent 23 years at Apple in leadership roles, Tony has deep experience across complex hardware programs, These fingerprints span nearly every major Apple product from the iPhone to the iPad to the Vision Pro, from R&D, prototyping, and contract manufacturing with Apple's many CM partners. I couldn't imagine a better duo than the combination of having Tom running engineering and Tony running production to see our program through commercialization. With that, I want to step back and reflect on all the progress we've made to date. Electrification of aviation continues to increasingly emerge into the mainstream every day. which only further motivates my team here at Archer and underscores our collective commitment to pioneering advancements in transportation. Our valuation today only captures a small fraction of the incredible ambition we have to make sustainable aviation an everyday reality. We stand at the forefront of a transformative era where imagination meets innovation and dreams take flight. With that, I'll turn it over to Tom.