Aurora Innovation, Inc. Q4 FY2025 earnings call

• Driverless Milestones: Aurora Driver passed 250,000 driverless miles in January 2025, expanded addressable market to over 3.6 billion vehicle miles with 7 additional driverless lanes, maintained 100% on-time performance and zero collisions.
• Software and Weather: Latest software release enabled driverless operations in inclement weather (rain, fog, heavy wind) and expanded operational domain to multiple lanes (e.g., El Paso to Fort Worth, Dallas to Laredo).
• Partnerships and Manufacturing: Partnership with Volvo entered industrialization phase; first Volvo VNL Autonomous trucks with Aurora Driver off pilot line. New program with International LT truck targets Q2 2026 launch; Roush selected as upfitter to produce 20 trucks per week. Third-generation hardware kit in progress with AUMOVIO.
• Customer Agreements: Secured Detmar Logistics agreement for driverless freight delivery, with supervised operations starting and transition to driverless in Q2 2026.

Fourth quarter 2025 revenue totaled $1 million, with a 25% sequential increase from the third quarter. Fiscal year 2025 revenue was $3 million, and total year adjusted revenue (including pilot revenue) was $4 million. Operating loss for the fourth quarter, including stock-based comp, was $238 million. Cash spend was below externally communicated targets, with $1.5 billion in liquidity at year-end.

• Revenue: 2026 revenue expected $14M-$16M (up 400% y-o-y at midpoint), back-end loaded with Q4 contributing over half.
• Trucks in Operation: Expect to exit 2026 with over 200 driverless trucks, translating to ~$80M revenue run rate for Transportation as a Service.
• Cost Reduction: Second-generation hardware kit expected to reduce hardware costs by over 50%, targeting breakeven gross margin on run rate basis by end of 2026.
• Cash Flow: Anticipate quarterly cash use ~$190M-$220M in 2026, expect free cash flow positive in 2028.

• Regulatory/Market Uncertainties: Risks from known and unknown factors in business, markets, and economy as outlined in annual reports.
• Hardware/Manufacturing Risks: Potential delays in manufacturing, validation, or OEM integration could impact timelines and scaling.
• Weather/Operational Risks: Inclement weather previously constrained operations, though latest software mitigates this, but ongoing weather impacts could affect utilization.

Q: Nancy from Morgan Stanley asks about squaring away end of year truck guidance with revenue expectations.

A: David Maday responds that revenue is back-end loaded with fleet launch in Q2 and ramp-up in Q3, expecting to operate over 200 driverless trucks by year-end.

Q: Andres from Cantor Fitzgerald asks about 50% improvement in driver hardware cost.

A: Christopher Urmson explains design for manufacturability, material cost reduction, and synergies with AUMOVIO in reducing hardware costs.

Q: Chris Pierce from Needham & Company asks about free cash flow and revenue guidance.

A: David Maday talks about sufficient liquidity and plans for future Analyst Day to provide outlook beyond 2026.

Q: Leanne from Canaccord Genuity asks about observer launch impact on OEM partners.

A: Christopher Urmson and David Maday discuss positive engagement with OEMs and different paths with each partner (e.g., Volvo vs. PACCAR).

Q: Mark from Goldman Sachs asks about 2027 outlook and lineside integration.

A: Christopher Urmson talks about Volvo pilot line progress and AUMOVIO partnership progress for third-generation hardware kit in 2027.

Q: Itay from TD Cowen asks about customer interest and lane visibility.

A: Christopher Urmson and David Maday discuss ability to roll out new lanes driven by customer demand and large market size for freight corridors.