Amprius Technologies, Inc.

Good morning. Welcome to the Amperius Technologies First Quarter 2026 Earnings Conference Call. Joining us for today's presentation are the company's CEO, Tom Stepien, and CFO, Ricardo Rodriguez. At this time, all participants are in listen-only mode. Following management's remarks, we will open the call for questions. please note that this presentation contains forward-looking statements, including, but not limited to, statements regarding our financial and business performance, our business strategy, future product development or commercialization, new customer adoption and new applications, our growth and the growth of the markets in which we operate, and the timing and ability of Amprius to expand its manufacturing capacity, scale its business, and achieve a sustainable cost structure. These statements involve known and unknown risks, uncertainties, and other important factors that may cause AMPRES' results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied in such forward-looking statements. For a more complete discussion of these risks and uncertainties, please refer to AMPRES' filings with the Securities and Exchange Commission. This presentation includes a non-GAAP financial measure, which is adjusted EBITDA. This non-GAAP financial measure does not replace the presentation of Amprius' GAAP financial results and should only be used as a supplement to, not a substitute for, Amprius' financial results presented in accordance with GAAP and may not be comparable to calculations of similarly titled measures by other companies. A reconciliation of adjusted EBITDA to net loss, the most directly comparable GAAP financial measure, is included in our press release, a copy of which is filed with the SEC and posted on our website. Finally, I would like to remind everyone that this conference call is being webcast. A recording will be made available for replay on the company's investor relations website at ir.ampreus.com. In addition to the webcast, the company has posted a press release that accompanies these results, which can also be found on the Ampreus Investor Relations website. Before turning the call over to management, I want to highlight a few near-term IR events. On May 12th, Tom Stepien will be at Exponential in Detroit. Any investors that are attending the expo are welcome to stop by the company's booth. At the same time, Ricardo will be at the Needham Conference in New York City on May 12th and 13th. His fireside chat will be streamed online and will be available for replay on the company's IR website. On May 14th, the management team will be in New York City and taking investor meetings with KKR. The following week, Management will be attending the B. Reilly Conference on May 20th and 21st in Los Angeles. And to round out the month, management will be at the Craig Hallam Conference in Minneapolis on May 28th. Looking to June, the team will start off the month in Chicago for the William Blair Conference. Management will then attend the Jeffries eVTOL Summit on June 8th, the TV Cal and Technology Summit on the 17th, the Roth London Conference on June 17th and 18th, and the Northland Conference on June 23rd. We hope to connect with many of you at these upcoming events. I'll now turn the call over to Amperius Technologies CEO, Tom Stepien, for his comments. Sir, please proceed.

Welcome, everyone, and thank you for joining us this morning. Let's start with slide three. Last quarter, I compared the advantages offered by our batteries to the difference between standard brewed coffee and espresso. It's an idea that illustrates the difference between ourselves and those of our competitors. In this analogy, a standard graphite battery is like normal drip coffee and we're the concentrated power of espresso. Our batteries contain the same energy as standard cells in a much smaller package. If you match the volume and weight of standard coffee with a double espresso, you achieve twice the energy. When you double the energy in a battery, you can double flight time for an unmanned aircraft, for double the travel distance of a light electric vehicle. That's the Amprius Expresso advantage. Turning now to slide four. This energy advantage continues to drive robust financial performance, and in the first quarter, we sustained our strong business momentum. Our second generation Sycor silicon anode batteries are gaining broad adoption across unmanned aerial system customers and we are pleased to see the momentum we have built in Europe is now taking hold in the United States. U.S. defense spending is at an all-time high, with a growing emphasis on UASs, commonly referred to as drones. Three Ampris customers leveraging our Sitecore batteries have recently received notable multi-million dollar awards. First, I'll mention Krauss-Hemdani Aerospace. a Northern California based drone manufacturer. Their K1000 ULE is a fully electric ultra long range endurance UAS capable of 24 hour flight and a thousand mile range designed for autonomous intelligence, surveillance and communication missions across land, sea and air. They recently received a major sole source award from the US Department of War for their UAS and a separate contract worth up to $270 million from the U.S. Air Force Central Command. Then there's AeroVironment, a leading U.S. defense technology company and a long-term Ambrose customer. In March 2026, AV won a $170 million firm fixed-price U.S. Army contract to deliver P-550 UASs, designed to provide frontline units with real-time intelligence and targeting in contested environments. And then there's Teledyne FLIR, a global leader in thermal imaging, surveillance sensors, and unmanned systems, and another tenured Ambrius customer. They recently announced a European order for their Black Hornet IV, a palm-sized nanodrone measuring just 25 centimeters long with a 200-millimeter rotor diameter. The Black Hornet IV provides soldiers with live video feeds, target data, and real-time situational awareness for intelligence, surveillance, and reconnaissance in both dismounted and vehicle-integrated operations. We commend these three customers on their recent wins. Their success boosts our visibility into future purchase orders for Psycorps cells. We look forward to continuing to earn their trust and business. We are pleased to announce that our silicon anode cells were selected by a leading light electric vehicle customer based in China. This customer placed a $21 million multi-quarter purchase order for batteries for two and three wheeled vehicles. China is home to many of the world's most successful battery companies, which makes it especially satisfying to win business in this highly competitive region. Meanwhile, our ongoing project with the U.S. the Fence Innovation Unit continues to expand. In July 2025, Amprius won a development contract from the DIU. In the March quarter, the contract was increased for a third time and now totals $18.1 million. This recent increase adds delivery of three types of silicon-handled cylindrical cells and four standard-sized pouch cells. Standardization is really critical for the government. It reduces costs, simplifies logistics, and ensures systems can use the same safe, reliable, NDAA-compliant power sources. It is gratifying to receive awards from credible and independent media and trade groups. After winning a competitive CES Innovation Award in January, we were recently named a top 100 green tech company by Time. Turning now to our financial performance, I'm pleased to report Q1 revenue of $28.5 million, up two and a half X year over year, and 13% higher sequentially. The strong results give us the confidence to increase our revenue guidance for the full year to at least $130 million, five million above our previous forecast. While it is not a practice to provide specific guidance for the current quarter, I would note that a revised annual forecast implies a reacceleration of sequential top blind growth in the June quarter. Ricardo will provide more highlights on our financial performance and outlook shortly. He will also share details on our press release earlier this morning in which we announced an agreement to exchange our outstanding public warrants for common shares, which will simplify and strengthen our capital structure. Let's now take a look at slide five. Taking a step back, I'd like to review our substantial opportunity set in five principal end markets. The first is UASs, including drones used for defense, public safety, security, and logistics. Defense platforms that require high energy density typically support long loiter missions and are primarily targeted for ISR, intelligence, surveillance, or reconnaissance. Public safety drones include DFR, drone as a first responder, systems integrated directly into emergency workflows. DFR programs are expanding nationwide because they deliver faster situational awareness, reduced response times, and materially improved public safety outcomes. As more agencies adopt DFR as a core part of 911 operations, Demand for higher performance, longer endurance batteries continue to accelerate, and that plays directly to our strengths. Our second market segment is satellites in space, where our high energy density cells directly improve launch economics. Satellite launch providers charge customers by weight, making our ability to deliver the same energy at roughly half the weight, our expresso advantage, extremely valuable. The $21 million multi-quarter purchase order I mentioned earlier is an example of our traction in a third segment, light electric vehicles. The customer advantage here is fitting more capacity into standard packs or constrained spaces and enabling range. We're optimistic about the opportunity in a fourth segment, robotics. Robot performance is closely tied to battery characteristics as our CTO Ian L. Stephan recently shared with a leading battery journal. Quote, balancing the extreme discharge demands of actuation with the computational intensity of real-time AI processing requires a new generation of energy solutions. He said, high silicon anode cells represent a breakthrough delivering the energy density needed to extend operational run time, while minimizing the weight penalties that constrain efficiency, unquote. Our fifth market segment is EV toll, electrovertible takeoff and landing aircraft. EV toll and other advanced air mobility customers are developing autonomous point-to-point regional transport for both passengers and cargo. These vehicles only work with high energy density batteries. because aircraft must lift a heavy structure, a pilot, and three to four passengers. Without enough energy per kilogram, the vehicle simply can't achieve the required range, payload, or safety margins. If standard cells are chosen, the aircraft can likely get off the ground, but it likely cannot perform the required mission. Working with a third-party research firm, we size these five end markets as shown on the right-hand side of slide five. Lithium ion battery applications across these markets are estimated at $7 billion this year, growing to $13 billion by the end of the decade, nearly doubling in just a few years. Looking further out, we expect growth to accelerate meaningfully, reaching $35 billion by 2035. Let me now turn over the call to Ricardo to review our Q1 results in detail.

Thank you, Tom, and good morning, everyone. I'm happy to report that Amperes had another record-breaking quarter. As shown on slide six, we delivered $28.5 million of revenue in Q1, which translates into 13% growth over the fourth quarter of last year and 153% increase year over year. As Tom mentioned, those results give us the confidence to increase our 2026 full-year revenue forecast by $5 million to at least $130 million. I'll provide more color on the outlook shortly. As Tom noted, our revenue growth was driven by continued expansion in our Sitecore customer base, combined with increasing order volumes from existing customers as they scale their own deployments. Sitecore represented 97% of product revenue in the quarter, continuing our transition away from our legacy Symax platform. In the quarter, we generated 58% of our revenue from Europe, the Middle East, and Africa, 21% from North America, and 21% from the Asia Pacific region. The North American share increased meaningfully, both sequentially and year-over-year, consistent with the growing interest we're seeing from U.S.-based customers. While we expect this mix to fluctuate over the course of the year, we think the US business could accelerate in the second half. Now moving on to cost of revenue and gross margins. Our Q1 gross profit was $5.7 million, producing a gross margin of 20%. For context, Q4 gross margin was 24%. So we did step back quarter over quarter, and I want to be transparent about why. Overhead costs associated with our Fremont facility are being absorbed across a larger cycle revenue base, while the Symax product line continues to wind down. Our Q1 Symax related overhead costs were of more than $3 million. Essentially, these are fixed costs against only $618,000 of revenue. That created a material but temporary drag on the blended margin. We also had one month of expenses from Colorado in the quarter, which our gross without which our gross margin would have been 22%. Turning over to operating expenses. Quarterly R&D expenses were of $3.8 million. SG&A was $8.6 million, bringing total operating expenses to $12.4 million, which was down approximately $19 million quarter-over-quarter, though that comparison is heavily distorted by the $22.5 million non-cash impairment charge for Colorado in Q4 of last year. On a clean basis, our adjusted OpEx run rate is up modestly quarter-for-quarter, driven by targeted investments in our sales and go-to-market organization as we build a team to support the commercial momentum Tom described. Putting these elements together, our Q1 operating loss was $6.7 million, compared to a clean operating loss of approximately 2.9 million in Q4 after removing the Colorado one-time charge. The increase reflects the gross margin setback I described and the continued investment in commercial and R&D capabilities. The one adjusted EBITDA was negative $1.8 million, which compares to negative $5.2 million in the same quarter of last year. After two quarters of positive adjusted EBITDA, we had expected a modest step back in Q1 due to the Symax phase-out and the one-month Colorado cost carryover that I described. Our Q1 gap net loss was of $5 million, or negative 4 cents per share, based on approximately 136.9 million weighted average shares outstanding. Now turning over to the balance sheet and cash flow, we ended Q1 with $62.4 million of cash in no debt. Our cash position is down from $90.5 million at year end due to several factors which consume $37.3 million of cash in the quarter. First, accounts receivable increased by $11.5 million, reflecting the strong revenue growth we experienced near the quarter's end. Over $6.5 million of that figure has already been collected. We also paid approximately $20 million to settle our Colorado facility lease obligation as previously announced. That agreement settled what would have been an expense of more than $110 million in highly favorable terms. Largely due to that transaction, our liabilities were reduced by $29.8 million in the quarter. Capital expenditures were of $980,000 funded largely through the DIU contract. Total shareholders equity stood at $109.4 million at quarter cent. Before turning the call back to Tom, I'd like to spend a moment framing our outlook and commenting on the one exchange agreement transaction that we announced this morning. Let's also please turn to slide seven. When we communicated our 2026 baseline of at least $125 million of revenue, We said we would rather size the upside as it happens than commit to it ahead of time. We continue to see healthy demand indicators, a growing backlog, higher production volumes at all of our manufacturing partners, and increasing urgency from defense-related customers around NDAA compliance supply. With this in mind, we are raising our revenue guidance to at least $130 million in 2026. The setup for the rest of the year is constructive for our economics, particularly as our collections normalize and additional capacity from our Korean and U.S. manufacturing partners comes online. We continue to expect 2026 adjusted EBITDA of at least $4 million and the net loss of no more than $8 million or less than $0.06 per share, assuming 136.9 million shares. Our capex will ramp up over the course of 2026, but remain below $10 million for the year. And we expect this to be funded by our contract with the Defense Innovation Unit. Finally, I'd like to briefly comment on the recent announcement of our agreements to convert over 7 million public warrants that were held by institutional investors into common stock. This agreement reduces future dilution by converting warrants that would have been exercisable at lower prices into a fixed number of shares on terms that we believe are favorable to existing shareholders. It is consistent with the broader optimization of our capital structure that we've been executing, such as closing the ATM, settling the Colorado lease, and now managing our warrant overhang proactively. We're constantly looking for opportunities to simplify the balance sheet and optimize the capital structure as their operating performance gives us the leverage to do so. Thank you to everyone who worked with us on this and to the Amphish team for enabling it thanks to the prompt execution of our plans. Now, I'm happy to turn the call back to Tom. Thank you all for your continued attention and support.