Innoviz Technologies Ltd. Q2 FY2025 earnings call

At the start of 2025, Innoviz set ambitious financial and business targets. Financially, revenue for the quarter was $9.7 million, with the first half at $27.1 million. On the business side, there was a development agreement with a top 5 automotive OEM for modifying the InnovizTwo for a 2027 SOP program; progress with existing L3 and L4 programs; the launch of InnovizSMART for nonautomotive applications with various collaborations; and on the production side, support from Fabrinet's high-volume line to meet growing demand across different applications.

In the second quarter of 2025, Innoviz reported revenue of $9.7 million, with the first half of the year totaling $27.1 million, exceeding the entire 2024 revenue. The company is on track to meet the full-year revenue target of $50 million to $60 million. Cash burn in the quarter was $7.3 million, consistent with guidance. On the business front, Innoviz announced a development agreement with a top 5 passenger automotive OEM for modifying the InnovizTwo LiDAR for a Level 3 global production passenger vehicle program slated for SOP in 2027. Progress continues with existing L3 and L4 programs. The InnovizSMART LiDAR was launched for industrial and nonautomotive applications, with collaborations established with companies like Cogniteam, Sparsh CCTV, and Cron AI, and compatibility with the NVIDIA Jetson AGX Orin platform was achieved.

The company continues to expect more than a twofold year-over-year revenue increase for 2025, aiming for $50 million to $60 million. NRE booking guidance has been raised to $30 million to $60 million from the previous $20 million to $50 million. An at-the-market (ATM) program of $75 million has been launched for general business purposes, including R&D, operations, and supporting production efforts.

Actual results could materially differ from forward-looking statements due to risks and uncertainties. For a discussion of important risk factors, please see the Risk Factors section of the Form 20-F filed with the SEC on March 12, 2025.

Q: What do you think it would take for the development program with the top 5 auto OEM to become a series production win and when do you expect to know of the development program is going to become a series production award?

A: As mentioned, the SOP is in '27, and we are working on the program towards SOP, converging contract details as soon as possible.

Q: If the development program does become a series production award, any clarity on what that program may look like in terms of annual volumes when fully ramped and if your LiDAR is going to be standard fit or optional on vehicles?

A: It's a very large OEM with high volumes, and it's a standard fit, with more details to be shared as we progress.

Q: Can you help investors better understand how quickly the company plans to use the $75 million ATM that you announced this morning? And any guidance on how much you may look to raise this year?

A: We will continue to minimize cash burn, work on winning more programs and getting more NREs, expect growth in LiDAR sales, and use the ATM opportunistically while considering liquidity.

Q: Can you just tell us what's different with this agreement if there -- if any, in terms of process or time line?

A: This is beyond the RFI and RFQ process, as the OEM has needs for modifications, requiring us to start design changes while working on contract details, similar to past situations with Volkswagen.

Q: Can you talk about your ability to tune the LiDAR for industrial applications? Or do you feel like you're going to end up having to start building multiple SKUs as you see some of the proliferation into some of these incremental end markets?

A: InnovizSMART is the same LiDAR as for automotive, based on the same production line, meets functional safety requirements. Nonautomotive markets have gaps in suitable sensors, so Innoviz LiDAR is well-positioned.

Q: Can you talk about your strategy for selecting customers and where you're putting energy?

A: Our main focus is 95% on the auto space, ramping production to penetrate nonautomotive customers with shorter sales cycles, using NVIDIA Jetson integration, developing InnovizThree, and looking at second generations.

Q: Would you qualitatively say this has been one of your highest commercial revenue contributions. And then it sounds like you're saying it's going to be 10x in Q3. So Q3 might be your highest commercial revenue shipments, splitting that out from NREs?

A: We are ramping our production line, with revenues from units likely peaking to date, and with the SOP with Volkswagen in 2026, we are working to book new businesses, including contributions from Mobileye.

Q: If Uber will be deploying those vehicles, say, Q1 or Q2 of '26, at what point would that -- would VW actually be pulling units from you? How many quarters in advance, I guess, I'm trying to figure out what the timing would look like?

A: Usually, the industry works on a just-in-time methodology, and we should expect to see units a quarter before deployment, with the SOP targeted for Q3, and shipping units for testing, data collection, etc.

Q: Do you expect any change in sort of pricing and margin profile? Or will those be pretty consistent with your automotive sales if and when those move into commercial developments?

A: ASPs for nonautomotive are significantly higher and margins are significantly higher compared to automotive, making nonautomotive a rewarding market for us.