Gogoro, Inc. Q3 FY2024 earnings call

• Horace Luke resigned as CEO; Tamon Tseng became Chairman, Henry Chiang Interim CEO.
• Received NASDAQ Listing Compliance Notice, with 180 days to regain $1 per share average closing price compliance.
• Government inquiry into imported parts resolved with insufficient evidence.
• Focus on three key areas: establishing profitable business, enhancing customer experience in Taiwan, prioritizing key expansion markets like India.
• Implemented cost control with $4.4 million reduction in G&A and R&D expenses excluding share-based compensation.
• Completed proof-of-concept with Taipower on energy storage using second-life Gogoro batteries.

In Q3 2024, total revenue was $86.9 million, down 5.3% year-over-year. Battery swapping service revenue was $34.9 million, up 3.8% year-over-year. Subscribers at the end of Q3 exceeded 625,000, up 9.6% from the same quarter last year. Sales of hardware and other revenues were $52 million, down 10.6% year-over-year. In Taiwan, Gogoro branded vehicle registrations were 15,551, up 1.6% from Q3 2023, and powered by the Gogoro network vehicle registrations were 16,444, making Gogoro-based vehicles 69% of total electric two-wheeled vehicle sales in Q3 2024. Gogoro branded sales were expected to represent approximately 6% to 7% of total market share and total PBGN vehicle market share slightly higher.

• Adjusted full-year revenue guidance to $305 million to $315 million, lower than previously expected.
• Gross margin materially negatively impacted in the short-term due to ongoing and accelerated battery upgrade initiatives.
• 180 days to regain NASDAQ listing compliance by achieving $1 per share closing bid for 10 consecutive business days.

• NASDAQ listing compliance risk if stock price doesn't regain $1 per share within 180 days.
• Potential impact of government inquiries though resolved, but still a factor.
• Challenges in international expansion, including market development pace and competition.
• Margin pressure from cost control measures and battery upgrade programs.

Q: What possible action plans to raise your stock price back above $1?

A: We plan to take necessary steps to regain compliance with listing requirements, including having the stock price trade above $1 for 10 consecutive days, leveraging business fundamentals and management team confidence.

Q: Is there a solid plan to address negative press and sales weakness, lack of revenue conversions from overseas ventures?

A: We have a three-point plan: focus on establishing a profitable business, laser-focused on customer experience in Taiwan, and prioritizing key expansion markets.

Q: On a steady state basis with the cost savings program from 2025, can Taiwan operations become double-digit margin business over the next couple of years?

A: View Taiwan business holistically. Gogoro network business is healthy. Working on cost reduction programs in R&D, G&A, etc. Non-IFRS gross margin in Q3 was 14.7%, and we aim to continue improving.

Q: Battery subscription service is capital intensive. Any plans to allow customers to own and buy their own battery system?

A: Business is capital intensive. We've spent heavily in Taiwan. We look to partners for international expansion. Allowing customer battery ownership is not actively pursued but open to new business models.

Q: Can you give an update on India?

A: Successfully ran pilot programs in India. Learning vehicle price matters. Battery pack factory nearing completion. Working with partners and government to influence subsidy programs for battery swapping electrification.