Innoviz Technologies Ltd. Q3 FY2024 earnings call

• Announced new partnership with a leading Level 4 platform partner, entering two new OEM programs with expected SOP in 2026, with Innoviz providing a bundle of nine InnovizTwo LiDARs per vehicle.
• Progress with Volkswagen programs, including Level 3 platforms and ID. Buzz light commercial vehicle program moving forward.
• Pipeline of over 15 programs, with ~50% in RFQ stage; highlighted a potential new Level 3 program with a top-10 automotive OEM in late RFQ stage.
• Technological breakthroughs: improved InnovizTwo with uniform resolution and range, IR imaging capability in LiDAR, blockage resilience, and new short-range offering.
• Cost realignment: combined hardware and software units, leveraging technological similarities between InnovizOne and InnovizTwo to manage costs, leading to decreased cash burn.

Revenues for Q3 were $4.5 million, above the midpoint of the guidance range of $3.5 million to $5 million. Cash used in operations and capital expenditures decreased from $28.6 million in Q3 2023 by approximately 38% to $17.7 million this quarter. Revenue contribution is from various programs including those with OEMs and platform partners.

• Full-year revenues expected in range of $23.5 million to $25 million vs $20.9 million in 2023.
• Already met 2024 operational target of adding 2-3 new programs. Confident in achieving $20 million to $70 million in NRE bookings in 2024.
• Expect acceleration in revenue streams in 2025 as more customers adopt technology.

Q: Good morning, congratulations on the quarter. Wondering about details on the Level 4 commercial agreements and volumes expected from these.

A: The platform partner has around 5 customers deploying vehicles from 2026 onwards. Each program has volumes ranging from high tens of thousands to hundreds of thousands of vehicles, with nine LiDARs per vehicle.

Q: Regarding 2024 revenue guidance, granularity on NREs vs product shipments.

A: Fourth quarter mix includes product sales to BMW launched vehicles and NRE components related to programs announced during the year.

Q: For the top 10 OEM program that passed audits, details on legal arrangements and SOP.

A: Working on a few legal points to close, competing vs other LiDAR players. SOP mid-decade, volumes are meaningful for a top 10 OEM.

Q: Thoughts on cash burn sustainability and capital raising.

A: Confident in sustaining lower cash burn into next year, with new programs and NREs contributing to revenues, no immediate plans for capital raising.

Q: NRE revenue opportunity for new programs with L4 platform partner and 2025 revenue/gross profit guidance.

A: NREs are preproduction revenue; 2025 expected to be meaningful with multiple programs adding to revenues, with significant growth expected in 2026.

Q: Elaboration on LiDAR infrared imaging feature and its benefits.

A: Ability to generate camera-like image within LiDAR hardware helps in synchronization, provides better perception by allowing low-level fusion of 3D point cloud and IR image, outperforming standalone sensors.