MICROVISION, INC. Q1 FY2026 earnings call

• Strategic Framework: LIDAR 2.0 Transition • Management defines LIDAR 1.0 as a technology-first approach focused on high-performance standalone sensors without sufficient focus on cost, scalability, and customer integration needs. LIDAR 2.0 centers on delivering application-optimized solutions at low cost, with mature reliability and easy system integration. • Microvision's core LIDAR 2.0 competitive advantages are a broad, comprehensive product portfolio, design-to-cost engineering, an open software framework, and disciplined operational execution.

• Post-Acquisition Integration Progress • The company completed most integration of teams, technologies, operations, and customer relationships from the acquisitions of Scantino Photonics (closed January 2026) and Luminar assets (closed February 2026). • All manufacturing operations have been consolidated into the company's Orlando facility; MOVIA S and Iris are currently produced there, with HALO production being stood up, and near-term capacity is sufficient for 2026 revenue projections. High-volume manufacturing will use an outside contract manufacturer, with a final location decision expected in 2026. • Integration of software platforms is progressing well, with high commonality between Luminar's Sentinel and Microvision's Mosaic platforms enabling cost synergies.

• Commercial Progress by End Market • Industrial: Restarted shipments and active programs for mining, off-road logistics, and warehouse automation customers. The MOVIA S product is on schedule for a planned production launch in H2 2026, with strong customer feedback, and the company is engaging value-added resellers to expand reach in warehouse automation. • Security and Defense: Active engagements include drone-based LIDAR perception, aviation traffic management, and unmanned ground vehicles. The lightweight, compact MOVIA Air enables industry-first real-time on-drone mapping and terrain analytics, and the company recently announced a non-exclusive collaboration with Avular for an integrated drone payload. The U.S./Germany-based operational footprint provides a competitive advantage for security and defense contracts as a non-Chinese solid-state LIDAR supplier. • Automotive: Continued engagement with passenger vehicle OEMs developing next-generation Level 3/4 autonomous architectures. The company demonstrated its tri-LIDAR architecture integrating HALO long-range and MOVIA S short-range sensors into a full 360-degree perception system at the ACT Convention, generating strong interest from commercial vehicle and autonomous trucking customers. MOVIA S is positioned as a low-cost, high-performance sensor for robo-taxi and urban autonomy near-field obstacle detection.

Microvision reports total Q1 2026 revenue of $0.9 million, a 50% increase ($0.3 million) year-over-year. Revenue is split across the firm's three core end market segments: automotive, industrial, and security and defense. 75% of total Q1 2026 revenue came from acquired Luminar sensor sales, highlighting the immediate commercial value of the Luminar asset acquisition. Gross margin for the first quarter was 39%, a substantial increase from 7% in the year-ago quarter.

• Full-year 2026 revenue guidance is maintained at $10 million to $15 million, with the majority of revenue expected to be realized in the second half of the year.
• Full-year 2026 cash burn from operations plus CapEx guidance has been improved (downward revised) to approximately $60 million, from the prior guidance range of $65 million to $70 million, reflecting cost synergies from post-acquisition integration activities.
• Full-year 2026 gross margin guidance has been upward revised to 35% to 40%, from the prior expectation of positive gross margin, driven by optimized supply agreements and improved product mix.

Management noted that forward-looking statements are not guarantees of future performance, and actual results could differ materially due to a range of risk factors outlined in the company's SEC filings. Specific risks referenced include the slow development timeline of the automotive autonomous LIDAR market, the potential for pre-development NRE contracts in automotive to not translate to high-volume commercial production, and reliance on external contract manufacturers for future high-volume production that has not yet been fully finalized.

Q: The caller confirmed full-year 2026 gross margin guidance of 35-40%, and asked what long-term gross margin management expects as the company scales. / A: Management confirmed the 35-40% range for 2026, after hitting 39% in Q1. Long-term, management expects gross margins to expand as revenue grows across the three end markets, while the company maintains its focus on disciplined cost management. No fixed long-term ceiling was given.\n\nQ: The caller asked for details on Microvision's progress on lightweighting LIDAR for drone applications, including a target weight range, and whether the Avular partnership is exclusive. / A: Management explained that solid-state technology eliminates moving scanning parts to reduce weight, and the payload is optimized for integration into drone architectures rather than being a bolt-on add-on. The target weight is below 300 grams, moving toward below 200 grams, while retaining on-drone real-time mapping capability. The partnership with Avular is non-exclusive, so Microvision can work with other drone partners and customers.\n\nQ: The caller asked if Scantino's FMCW technology has applications for ultra-short-range use cases like semiconductor manufacturing equipment, beyond its primary ultra-long-range use case. / A: Management confirmed that the FMCW technology Scantino developed is fundamentally applicable to both ultra-long-range (for drone detection, aerial survey, and security/defense, which is the initial focus) and high-accuracy ultra-short-range applications such as robotic end-effector positioning. The first chip-scale A samples coming in early 2027 are focused on long-range use, but future 2D variants of the technology will target short-range applications.\n\nQ: The caller asked what key milestones investors should watch over the next 12-18 months to signal a shift to recurring commercial revenue. / A: Management highlighted three types of milestones: 1) announcements of customer contract wins, shared in general terms where customers allow public disclosure; 2) public product demonstrations, technical webinars, and trade show showcases scheduled throughout 2026, including multi-drone collaborative mapping demos in summer 2026 and a commercial vehicle showcase in September 2026; 3) increasing management confidence in existing guidance, as demonstrated on this call.