Q4 2020 Velodyne Lidar Inc Earnings Call
[music].
Please standby we're about to begin.
Good day and welcome to the Vela Dine fourth quarter fiscal year 2020 earnings call Today's conference is being recorded.
At this time I would like to turn the conference over to Kirsten Chapman of L. H, a investor Relations. Please go ahead ma'am.
Good afternoon, and thank you for joining us on today's conference call to discuss Valentine Lidar is fourth quarter and full year 2020 financial results with us on the call our Doctor on a go pollen gardens.
Chief Executive Officer, Andrew Hamer, the company's Chief Financial Officer before we begin I would like to remind you that shortly after the close of market today Valentine issued a press release announcing its fourth quarter and full year 2020 financial results validate also published an investor presentation you.
You May access this press release and presentation in Investor Relations section of Xeloda and Lidar Dot com.
Today's discussion includes forward looking statements. Please refer to our press release for a discussion of factors that could cause the company's actual results to differ materially from those forward looking statements I would also like to remind you that during the call. We will discuss some non-GAAP measures related to validate its performance you can find the reconciliation.
If those measures to the nearest comparable GAAP measures in the press release to ensure that we address as many analyst questions as possible during the call. We request that you. Please limit yourself to one initial question and one follow up question. Then you may reenter the queue now I'd like to turn the call over to Doctor on a go pollen C O Valentine. Please.
Go ahead Sir.
Thank you Christian and thank you to everyone for joining us this afternoon.
Im on in Gabon on CEO of validating.
Our fourth quarter and full year 2020 results.
Street that we continue to expand our leadership position in the Lidar market.
<unk> is the only Lidar company today with both the breadth of product portfolio and the manufacturing capability to deliver low price lidar with multiple specifications at scale for many of the old weighted applications reached.
We ship.
<unk> 4237 per unit in the fourth quarter and 11710 for the full year. This included 718 solid state Lidar units in Q4, we are manufacturing and shipping more lidar units than all our competitors have reported.
In fact, we shipped more products in a week than all the other players have reported shipping in a whole year.
In addition, we have expanded our offerings and now provide full solutions of hardware plus software through our acquisition of map on it on AI. This is an exciting new part of the story.
In terms of manufacturing, we have fully automated wafer scale like lidar manufacturing processes in place today and operating with our contract manufacturers. We can produce at scale and we are far along the path to mass production and continue to execute on our strategy of transferring manufacturing of mature products too.
Fact manufacturing partners.
Despite COVID-19, we have not slowed down.
We continue to set production records and.
We are making significant progress on our growth plans. This uniquely positions us to meet the rapidly growing volume requirements of our customers in the coming years.
Thanks to its broad reversal in solid state lidar portfolio validating the ability to address many segments is a key competitive strength and we continue to derisk, our business model by being the leader in multiple markets with multiple customers in each.
Validating supplies over 300, plus customers, including major Oems and leading tech companies such as Caterpillar Ford artist on GM, Honda Hyundai Mobiles, Toyota Volkswagen Zooks, DD easy mile Garik, Google and like onto your system.
<unk>.
We announced agreements in the fourth quarter of 2020, covering industries from autonomous vehicles, and trucking to robotics and mapping.
As of today, we now have 26 active multi year agreements up almost 94 from three in the fourth quarter of 2020.
Over the past few months.
We announced that we signed a multiyear agreement with <unk>.
On the an active combination to be the exclusive provider of long range surround view lidar sensors for emotional SAE level for driverless vehicles.
We executed an agreement with <unk> mobility for its entire fleet of self driving shuttles.
Signed an agreement with local motors to use our sensors to enable safe reliable operation of Ali the company's three D printed electric and self driving shuttles.
We signed a five year sales agreement with top drive who will be using our lidar sensors to power its cargo and baggage ground support factors in a groundbreaking AAV program at the Cincinnati, Northern Kentucky International Airport.
And we entered into a strategic partnership with Beijing trunk technologies on trunk deck, with whom we will collaborate on developing next generation autonomous heavy trucks to accelerate the commercialization of driverless trucks on China's logistics market.
In mapping, we signed a multiyear sales agreement with Emerson a world leader in drone autonomy Lidar mapping and data analytics, who will use our centers for mapping hazardous and GPS denied environments.
Our pipeline, which is the most robust in the Lidar industry now stands at 194 projects. This is up from 183 reported for the fourth quarter of 2020, and 131 projects reported at the beginning of the year on January one 2020.
That is expanding adoption of lidar across a wide variety of industries, some of which are accelerating in a post COVID-19 world such as last mile delivery.
Our pipeline of opportunities in industries, such as robotics grew 220% from 873000 units in February of 2020 to $1 9 million units today.
I'd like to take a moment to comment on our pipeline, which is very fluid and we'll really with customers changing needs and expectations as it continues along its long term growth trajectory.
A recent example of this is an AAV project that we had with an OEM customer.
While we are on this customers first and second generation autonomous vehicle platform. The customer made a choice to use a different technology for their next generation platform. However, we continue to be actively engaged with them on multiple other opportunities, which if successful could more than offset any financial impact of this project.
We have also seen on Adas customer select on older technology for their first generation rollout, while they continue to move forward with us on projects for next generation platforms.
On the other hand recently, we had a major OEM customers, we engage with us and renew our long term relationship through a follow on multi year agreement.
Our product portfolio also includes the complex algorithms and software solutions to complement our sensor products.
Software is only possible with a robust pre existing hardware installed base like validating has today.
Our higher margin software subscription model is a natural adjacency for us.
We have made significant progress on executing new software contracts and now have 18 opportunities in our pipeline with the software component three times the number than in the third quarter of 2020.
<unk> is innovating on the cutting edge and in 2020, we launched industry first.
Our new <unk> solid state sensor product line and <unk> Lidar are smaller sensor, which are designed to be manufactured at scale and at price points targeted at broad based lidar adoption.
Valentine's relevant Lidar sensor was named a winner in the best of what's New awards by popular Science and one day 2020 Innovation award by Silicon Valley Robotics.
Last but certainly not least we have 28 valuable projects in our pipeline today.
We are the most innovative lidar company as evidenced by our track record and you will see additional new Lidar architectures and technologies introduced by us in the near future.
Validating transforms lives and communities by advancing safer mobility for all.
In the fourth quarter, we joined the Qualcomm Smart cities accelerator program to promote using Lidar technology in Smart City solutions.
By becoming part of the Qualcomm Smart cities ecosystem, we are now working with private industry governments and solution providers to create smart city applications that improve public services and enhanced safety and the quality of life.
Earlier this year, we issued a white paper in conjunction with the University of Nevada, Reno Centre of applied research that outline how roadside lidar is the key to building smart and safe transportation infrastructure.
The past few months have seen a few more lidar companies look to go public on the back of our success.
The information in their public filings validates our substantial leadership position and also showcases the massive opportunity for <unk> due to our dominance in each of their industries.
In summary, it is an incredibly exciting time for Lidar and force other line as we work towards democratizing Lidar for many applications. We believe we have hit an inflection point in the lidar industry, which is evidenced itself in our expanding pipeline and by shipping more units than ever before.
Sure.
In the fourth quarter of 2020.
In many applications Lidar status as a critical sensor is giving us the opportunity to add higher value to our customers by providing full solutions not just hardware.
I co founded <unk> Lidar predecessor company <unk> acoustics and has been involved in valid on lidar throughout its history, including serving on Valentine Lidar Board since September 2016.
We look forward to continuing to benefit from his invaluable guidance on technology and business strategy.
I'm also excited to see Sally Fickman take over the role of Chief Marketing Officer.
Her expertise in managing public relations and digital marketing will prove invaluable as we continue to execute on our strategic plans.
And finally, it's my pleasure to welcome Hamid Zaring on them to our board of directors.
In his role as corporate Vice President at Nikon Corporation, Hanmi to the responsible for the external investments strategic alliances and the private equity strategy of Nikon Corporation.
Leveraging their core competencies to enable and scale growth in new markets.
And he is responsible for Nikon strategic partnership activities in semiconductor lithography in the United States.
This is assignment we are further deepening our relationships with our valued manufacturing partner Nikon.
I would now like to turn over the call to drew for a discussion of our financials.
Thank you on IND and thank you again to everyone for joining us today on drew Hamer, the CFO for <unk> Lidar.
I'll begin with an overview of the company's fourth quarter and full year 2020 results before moving on to a discussion of our target business model supporting our positive long term outlook.
Total revenue was $17 8 million for Q4, 2020 compared to $19 million in Q4 2019.
Product revenue was $14 $4 million in the quarter compared to $18 2 million in Q4 2019.
As we disclosed in January we reduced production capabilities at our manufacturing sites late in the fourth quarter of 2020, due to COVID-19, which impaired our ability to fulfill certain customers' orders in December and negatively impacting product revenue.
As our strategy is to accelerate the adoption of lidar by lowering asps and driving higher volumes reduced Asp's also had a negative impact on revenue year over year.
We are extremely pleased to see our strategy working as demonstrated by the fact that units sold went up year over year to record levels.
As we predicted the products mix continues to transition to more efficient solid state units.
We are anticipating the sales of solid state Lidar units will be 30% in 2021 on.
On reviewing our current pipeline, we expect that this could increase to 60% of revenues by 2024.
When combined with the increasing pipeline for 2020, we continue to see that this strategy will drive long term growth for valid on.
License and services revenue was $3 $4 million up from $780000 in Q4 2019 due to cross license agreements recognized during the quarter.
GAAP gross loss was $5 3 million and non-GAAP gross profit totaled $2 1 million compared.
Compared to fourth quarter 2019, gross profit of $224000 on both a GAAP and non-GAAP basis.
GAAP operating loss was $111 $5 million and included $91 3 million of stock based compensation.
Non-GAAP operating loss was $20 $1 million compared to Q4, 2019, GAAP operating loss of $29 8 million and a non-GAAP operating loss of $27 $2 million.
GAAP net loss was $111 5 million and non-GAAP net loss was $20 $1 million cash.
GAAP loss per share was <unk> 64.
And non-GAAP loss per share was <unk> <unk>.
Loss per share for the fourth quarter as calculated using weighted average shares outstanding of $173 9 million.
As of December 31, actual shares outstanding were $175 9 million.
We had $353 million in cash and cash equivalents on our balance sheet at December 31, 2020.
Which included $73 $7 million of proceeds from the exercise of public warrants.
We received an additional $89 $3 million on proceeds as of February 19, 2021.
I will now turn to the full year 2020 results.
Total revenue was $95 4 million compared to $101 4 million in 2019.
Product revenue was $68 $4 million this compared to $81 $4 million in 2019.
For the year 2020, we sold roughly the same number of units is 2019.
Part of our strategy is to drive widespread adoption of Lidar with sensors designed to enter the market at lower price points. As a result, the average selling price was lower in 2020, which impacted revenue.
License and services revenue was $27 million up from $20 million in 2019.
The $7 million increase in license and services revenue primarily reflects recent cross license agreements, partially offset by a decrease in repair services and engineering fees.
GAAP gross profit of $25 1 million or 26% gross margin and non-GAAP gross profit of $32 5 million or 34% non-GAAP gross margin exceeded our guidance and compared to 2019, GAAP and non-GAAP gross profit of $29 8 million.
Decrease in GAAP gross margin was primarily due to $7 6 million of stock based compensation expense.
GAAP operating loss was $153 9 million exceeding our full year guidance included in the GAAP operating loss figure was $91 5 million of stock based compensation.
Non-GAAP operating loss was $62 4 million also exceeding our full year guidance.
GAAP net loss was $149 9 million and non-GAAP net loss was $65 $1 million.
Accordingly, GAAP loss per share was $1 <unk> and non-GAAP loss per share was <unk> 44.
We continue to monitor COVID-19 impact on our nearer term business and we will review our guidance practices. When we have greater visibility of its impact on our business.
Our target is to provide financial guidance starting in second half of 2021.
We saw strong growth in signed in order projects in 2020 going from three to 26 as of February 19th.
In 2020, we also saw strong growth in our project pipeline as it went from 131 to 194 as of February 19th and anticipate this growth will continue in 2021 and beyond.
We are further encouraged by the diversity of our customer base as demonstrated by the pipeline having multiple customers in multiple industries.
As we saw on 2020, having a pipeline that isn't dependent on a concentrated number of projects in one industry de risks our business model.
This progress provides support for our long term growth plans and business opportunities.
As of February 19, 2021, we estimate that we could have the opportunity for over 1 billion from our signing of awarded projects for the period 2021 through 2025.
When we combine this with a pipeline of projects that are not yet signed and awarded a $4 4 billion.
We remain confident in our ability to achieve our long term financial plans.
In addition, our manufacturing strategy of outsourcing production to our contract manufacturing partners with the objective of reducing the per unit cost of revenue together with our planned increase in licensing in software underpins our long term business outlook of total gross margins ranging in the mid to high 50%.
And EBITDA margins of more than 20%.
Please refer to our investor presentation for more detailed target business model, we remain focused on delivering disciplined growth for all our stakeholders.
In closing.
Our long term optimism remains strong recent high profile wins, our significant pipeline of contract opportunities and our commitment to new product development positions us well for the future.
We look forward to share results to reflect our progress in the quarters ahead.
On an and I are ready to address your questions. As a reminder, we currently ask the questions are focused on on our business and operations and fourth quarter and full year 2020 earnings results. Operator, we are now open for questions.
Thank you if you'd like to ask a question on todays call. Please press star one on your telephone keypad. If you are seeing pleasing speakerphone. Please pick up your handset before pressing the corresponding.
I'd like to pass on the phone line will indicate when your line is open.
Once again, please press star one at this time and ask a question.
Pause briefly to allow everyone an opportunity to signal for questions.
Okay.
And we'll go ahead and take our first question from Kelly.
Kelly with Citi. Please go ahead.
Great. Thank you hi, everybody.
Hi.
Just two questions. The first maybe just on the business development it looks like Youre on non auto now accounts for maybe.
Over 50% perhaps of your total project I'm, hoping you can maybe talk about what youre seeing on the non auto versus versus kind of on a dos AUC side and perhaps also talk about the latest on the competitive environment, particularly on the Adas side of things with fellow range all of it.
So ASP.
One as the pipeline goes we continue to see strong trend of growth in the non automotive segment.
While the automotive segment also continues to grow, especially in the in the Adas space.
I think that that broad split of half auto enhanced non auto still remains mostly irrelevant pharma on at night.
Definitely in the non automotive segment, especially in industrial robotics, we have seen on.
Explosive growth on the number of projects in that space driven by all the changes that we're seeing in on wounds.
In this post Covid world to our supply chain and the non enormous investments that big E. Commerce on logistics customers are making in that space.
Yes.
Could you repeat your second question eight day.
So maybe just on the Adas side, just talk about the competitive environment there.
Just the traction youre seeing with cell array and develop it.
Sure.
We had.
Adam.
Now about 190 per projects in our pipeline with about 61 of them being Adas projects and we are seeing a significant portion of those being demand pod validate so the ability product has continued to.
Mature and as we talked about in the in the earnings call we did.
We manufactured and shipped over 700 of these products of agents in the last quarter. So we are seeing tremendous demand and excitement around the validation projects.
We're also really excited by the fact net development.
<unk> has now entered our pipeline as well and we have over 20 projects in our pipeline net around developing so both developing and developed will continue to garner significant attention in the automotive space and we see lots of projects around them developing.
That's helpful. Let me just a second quick question just on our financials. Thank you for the update on the forward.
Outlook through 2025, I think back in September you.
You had mentioned that I think maybe roughly like 56% of your prior 2020 for revenue outlook was signed and awarded.
I don't think I'd be a position to update that today or just maybe talk about roughly kind of where you are relative to that for 2024 I believe the number was maybe like $380 million at the time that was signed on awarded back in September.
Yes, so we aren't providing any guidance that far out at this point. However, we do feel very confident with the signing on order contracts that we have currently plus the pipeline that we have that.
That we should be able to achieve our financial goals as we get out into 'twenty three 'twenty four 'twenty five.
Perfect. That's very helpful. Thanks, guys.
Okay.
Well take our next question caller. Please go ahead.
Hi, guys.
Sure isn't that bad.
Can you hear me Okay, Yes, we can thank you for dialing in.
Could you provide a little bit more color on the debate.
Design wins is that L to preload applications.
And if not can you talk about the prospect for IL, two and whether you have already design wins.
In that segment, then presumably with the timeframe on before.
Okay.
Yes, we are seeing significant interest and discussion around the prospects of using lidar for level, two especially around products like elevate products. We don't have that converted into a design win just yet.
However.
As we have talked about the floater since the day.
That is that lidar is capable of providing far far more robust functionality, even in the context of a level two applications such as pedestrian automatic emergency braking lane, keeping and lane centering on some of the existing technology because of its ability to work across on lighting conditions and because of that we are continuing to see significant.
<unk> interest on.
Automotive customers around the usage of lidar in conjunction with our software for level. Two so those conversations are still continuing and we.
We believe that Lidar will.
Be adopted.
On level two applications in the future.
Okay, Great and then I know that.
Not going to provide guidance until the second half of the year, how should I look at the unit growth this year what it is.
Expected price declines and ultimately does that translate into actual revenue growth for this year year over year.
Yes, so we can't provide guidance.
On the year.
Year on year over year, but we are thinking that we should see a jump in our unit growth. This year, because we'll be selling more <unk> and we expect develop it's to also enter the market here in the second half of the year.
Actually starting in Q2 I believe so.
With those introductions that that will bring the asps down a bit so with increasing volumes, we may see it.
Impact on revenues overall, but we're very focused mostly around getting unit volumes to expand because we believe thats, where the success of the company lies in the future.
Of course is also.
Backed up by all of the work that was done by getting our units. So that we are in production on a number of our products.
In our manufacturing operations offshore and mass production and also in the process of getting all these units up and running in offshore operations with our contract manufacturer so really.
We feel that we should be able to drive a lot more volume, which will ultimately in the years to come drive significant gross revenues.
Great. Thank you.
Thank you Jason.
Well take our next question caller. Please go ahead.
Thanks, So much guys thats on its column free.
From Oppenheimer.
Can you talk about the pipeline.
The activity around the software.
You guys can monetize with with those hardware scene.
Real active agreements around the recurring revenue potential.
Fortunately software upgrades and how should we think about that as a percentage of revenue over the next couple of years.
Yes, so we are seeing very very busy pipeline.
On I mentioned, we have a lot of projects currently focused on software products.
And that debt is expanding on a regular basis almost daily at this point.
And the types of products, we're expecting to have out there are going to be products that will allow us to.
Get to revenue model.
Kind of a SaaS nature, where they will have recurring revenue streams there'll be on a monthly annual.
Basis.
We're expecting the data growth will really start to kick in out in 'twenty three 'twenty four and should represent a larger portion of our revenues targeting right now at being at around 20% in revenues as we get to say 2024.
So those are the key drivers for us.
Software revenues.
Right and then just in terms of system design.
On a variety of different messages around.
On a portion of a sensor suite that gets assigned.
Lidar on ability to quite some of the functionality away from radar and ultrasonic sensors can you talk a little bit about that in terms of orders on them.
With the with the customer so if you look at the low.
Yes.
And the model.
Sure Yes.
I think.
On the sensor technologies will continue to progress in growth and we see that.
Investments in all the different sensor technologies continues but lidar is now <unk>.
By no means left behind with significant investments being placed with.
Public companies like <unk> being able to make significant R&D investments in the improvement on scalability of Lidar.
As that happens we see that all of these sensor technologies will asymptote towards their physics limitations and lineup by virtue of being.
Being able to really work across many different lighting condition and provide a much higher resolution then read on that.
And you mean sort of a prime position in advanced safety systems, as well as advanced robotics and autonomous systems, and we believe that trend will continue.
With all of the exciting technology.
Technology work that is happening in this day and as well as the fact that you have significant investments in software development around the usage of Lidar and Lidar based buying cloud. So we definitely see that reflected in the growth in our pipeline and in our conversations with our customers.
Great. Thanks, so much growth.
Thank you thank you Kevin.
We'll take our next question caller. Please go ahead.
Oh, Hi, Richard Shannon from Craig Hallum, guys, how are you.
Good Richard.
Thank you for dialing in.
You bet I'm going to make this as quick as I got to jump on a couple of other calls here, but let's.
Lets see you talked about on your early January press release about seeing some reduced visibility and then on I think you referred to a couple of scenarios, which I think is identified in the public realm I think we can.
You mentioned those to you.
Those things that are actually affecting this year, because the checks, indicating that there may have been for the out years there.
Are those are those correlate or are those different situations there.
I think we're seeing COVID-19, being more expecting it to be a short term kind of an impact where people are just kind of waiting to get back into their offices and get get busy we've got a lot of continuing to get good good responses around wanting to do multiyear agreements and honoring our multiyear agreements.
Sure.
They're just their hands are tied like all of ours, where they're they can't get into the office and start moving units through to customers because the customers are also at home like the rest of us.
There is a lot of excitement amongst our customer base to get back on plan and get back on track. So all of those agreements we have as well as the contracts, we're talking about entering into which are on our pipeline.
However, there's just always that uncertainty around when are they going to be able to start doing that because of the speed at which the vaccinations are rolled out geographically.
Charter free tends to have its own impacts right now.
But people are very much interested in getting back on track.
Okay. So would it be fair to say that your decision to provide some guidance for this year starting in the second half based on hopefully the COVID-19.
Dynamics are getting out of what's on getting getting better better visibility to that in that figure.
Exactly that's that's what we're expecting and that's right.
Okay. The second follow up question here is on the topic of Adas, calling.
Following on a couple of other ones earlier here, just kind of big picture here.
What do you see as potential for attach rates of Lidar to eight assets, where we were.
Where the cost is going to be a fairly high do you see this as.
As mostly replacement of other technologies or you didn't.
Conjunction with.
Yeah, I think when you talk about need us.
Really in our mind to possible applications that is level, three adas, which.
Going from like a traffic jam assist functionality to our highway autopilot.
And then the level two adas as as the previous question alluded to.
And we believe Lidar has.
Terribly strong role to play in both of course really low or high volume attach rate or lidar in automotive really open up with <unk> that where you have the ability to really see high penetration in attach rates for Linux and on the backs of <unk>.
Unit cost efficient scalable technology like our <unk>, we believe that that opportunity will open up.
And really drive volume.
The tax rates for level, three remain quite modest and low.
Starting at the high end vehicles.
Okay I appreciate the thoughts on that that's all for me. Thank you.
Thank you.
We will take our next question caller. Please go ahead.
Yeah, Hi, Thank you for taking my question.
From Needham.
Hi, Roger.
Hi, how are you.
So do you you had mentioned that.
You expect to see kind of a jump in unit growth. This year kind of following the significant unit growth in 2020, but ASP is coming down.
Try to footprint.
And to the industry.
Which may impact revenue.
It did impact revenue in 2020 in terms of that that offset between them.
Just wondering what is the kind of the right mix.
ASP reimbursement either growth these things.
When you start to see kind of revenue growth.
Just curious how to think about that.
Those competing dynamics.
Yes. So this is ed.
It's very important because it's been part of the company's strategy two <unk>.
Introduced we have a broad portfolio of products that are all designed to entry meet different customer needs and also included in those needs are coming into the market at the right price points. So that we can allow the proliferation of lidar.
Total applications the.
The impact of that of course is that it's going to be.
Bringing down the Asps is where you have a validated at $100. We have the other sensors had a couple of thousand eventually so.
We really think that as we get further out.
Into say 2022, 2023, youll start seeing hundreds of thousands of sensors being sold but there'll be a look at that lower ASP and I'm on a caution people to think of it.
In a quarter, it's very hard to make any adjustments you have to look at it kind of on a linear kind of basis because products sold mix in a given quarter.
Not necessarily represent the overall impact for so many annual basis is a better way to look at it and.
And we're expecting net debt as we get out into 'twenty, two 'twenty three and unit volume start moving up towards 100000, and maybe out as we get closer to 2012, we maybe even approaching million sensors.
That vs Asp's are going to be coming down.
The $600 range, so it's really going to be a transition.
From where we are today and the Asps. We are seeing it there will still anticipate those will continue to come down but the volumes will start to increase significantly as we get out into 'twenty three 'twenty four.
Yeah.
But you still net.
Okay.
Oh, sorry.
I only heard Doug can you repeat the question.
Sure could you provide what the blended ASP was through 2020 versus 2019.
For 2020.
Weighted average ASP was approximately $3800.
2019, I'm, sorry off the cuff I don't I don't remember I'll have to get back to you on that okay.
Okay No problem and then last question on and I saw the net.
We're doing a lot on adoption unfold.
You talked about.
The goal is to get to 30% in 2020, 150% in 2024.
Correct.
Net right.
Just wondering if you could elaborate in terms of the traction on solid state.
What's the adoption has been with your customers. Thank you.
Yes, I mean I think we.
We see definitely that is as I've said before there's more than one lidar technology needed to serve all of these different marketplace and I think there. So we really saw very well by having both the rotational product language continues to actually.
<unk>.
Work very well for us.
E V as well as trucking and and some smart city applications, but then youre seeing the solid state Lidar.
Again, a lot of traction obviously in the Adas space as well as income after robotics applications.
Applications.
So really in applications, where you have small form factor systems are systems that design aesthetics are really important.
On the solid state and direction Lidar.
Portfolio, it's ADC on a lot of traction and growth on demand.
And in those sorts of applications, including robotics Anita.
Did that address your question.
Yeah.
Well, let's just move on to our next question caller. Please go ahead actually if you don't mind I'd like to just make a correction there to Roger's question about asps in fiscal year 2020, the weighted average ASP was about $4800.
And just on 2019 was approximately $7100 sorry.
Alright. Thank you. Please go ahead.
Thank you we'll take our next question caller. Please go ahead.
Yes.
Yeah.
Hi, drew and on on its Ruben Roy from Benchmark company. Thanks for taking my question.
Thanks.
Drew I wanted to just.
Follow up on the ESP discussion, just a little bit more.
You guys mentioned, obviously, there's other lidar companies coming out.
Understand you guys are shipping.
Many many more sensors than you know a lot of the competitors, but has anything changed would you say on the last 90 days.
We've seen more discussion around lidar et cetera around the way you were thinking about Asp's, maybe back on June when you're at your analyst day.
Oh, let me, let me start talking about that I mean, no I think we have as a result of being the first mover and having the ability to sit across the table with our major customers on <unk>.
Yes at this point we have on.
All we had a clear on TNI and understanding of where the end cost of the technology needs to get to on all of these different applications to enable mass market adoption.
And really we have been making the investments on monogamy perspective and really.
Driving the technology towards the spine.
If anything you know all of the discussion around light us over the past few months has really validated.
On everything that he has said.
Both of them on leadership position as well as mainly when we think the market needs to go to enable mass market adoption and further.
As also evidenced by all of the conversations we have seen we believe that is a very strong market for lidar, both in automotive as well as in non automotive industrial applications and I think.
That that is also being borne out by what are the discussions we are seeing in the marketplace. So no nothing has really changed in terms of our outlook.
So I appreciate that on.
As a follow up I know you guys aren't providing explicit guidance here and your visibility should start to improve in the second half but.
Based on what you just said about Asp's based on when do you typically get purchase orders now which.
I think you have some lead time in backlog visibility isn't realistic at this point to expect that youre going to grow revenue in 'twenty one versus 'twenty.
Again, I can't provide guidance its really going to be about the unit volumes in the orders that come in from the customers about being able to grow revenue in 'twenty one versus 'twenty.
And until we get a better sense of people coming back into the workplace.
There's not much I can say about that right now.
Right Okay. Thanks.
Thanks, guys.
Thank you Robyn.
And our next question caller. Please go ahead.
Okay. This is Michael Franco from Wehrenberg, Thanks for taking my question.
I just wondered if you guys could maybe provide a little bit more detail around some of the business. I think you said was lost to a competitor.
Our legacy competitor in this space.
And why that was and sort of.
Whether that impacts your business with that customer.
You know on additional platforms or other you know business opportunities, but they're more if it's purely you know sort of the near term first gross production model.
Yes, I mean.
Moving on.
We cannot talk about specific cuts.
Customers and customer contracts.
Really.
As you described it well.
<unk> seen instances, where the customer may go with a lower performance.
Competitor product, while our technology is going to validation and non being put towards spaces. We continue to be very actively engaged with both our tier one partners and OEM customers around next generation platforms.
Valerie technology, which is clearly capable of five higher performance than any of the older technologies on itself.
Which by the way they are near evaluating for the next generation of <unk>.
<unk>.
Vehicles that there'll be bringing to market. So we're very very busy in those conversations on various projects that are going to be for the next gen projects that will be coming out.
Understood and just following up on that I guess, where do you see yourselves right now in terms of.
Getting the Bella rates, you sort of you know day sample auto grade qualifications.
Where are you on that process and what does that timeline look like at the moment.
Yeah I think.
We are on.
We are in we have gone through on automotive grade qualification.
In the in the fourth quarter and continue to go through that right now on each 800 product is in that space today, but I would say is automotive qualified and capable of hitting that.
The environmental as well as the level of performance for folks on our automotive applications. So I think we have made significant progress in the past.
Six months really maturing the product and we.
We see as a result of that significant opportunities in our pipeline with interest across many different Oems for that product and for our products in the relative family.
Understood. Thank you guys.
Thank you Mike.
And as a reminder, that star one if you'd like to ask a question on today's call. We will go ahead and take our next question caller. Please go ahead.
Okay.
Good afternoon, guys. This is aileen Smith from DNI can you elaborate a little on the commentary right got net of the opportunity for over $1 billion in revenue from signed on awarded projects over 'twenty 'twenty, one 'twenty five versus an additional pipeline of projects of $4 4 billion.
Typically what on the signed an award of contract makes that Bagwash backlog destination sound a bit less firm is accorded opportunity versus what we might hear from standard supplier around their respective backlogs is it a function of nailing down price thing is it differences in contract structure of production contract versus spot buys on or something else.
Yeah. So signed in awarded contracts are kind of a standard industrial agreement that we have with many of our customers that are based on unit volume agreement and they have normal price curve. So that also gives us visibility to where it will be because we get out into the coming years with those particular contracts.
And it helps us to gain confidence now is as is normal these contracts.
We'll probably have a different Pos will come in as we get closer to production in a given year so on that.
The respective customers as they understand what the production levels will be on will give us the more firm contracts is that as they approach production.
All of these contracts are designed so that they have.
A component where if the contract isn't.
On the ultimate order isn't at the level that it was originally agreed to in the signing of worded agreement up to a production agreement and then we have an opportunity to increase the price or renegotiate the price of day pay for each unit of course, if they come back and they want more units then.
The price they can go back and renegotiate the price as well so.
Standard industrial types of contracts for people to get to.
On the commercial production for a component in it.
That's an application or a solution that there'll be producing.
And David Lock us in on the front end is kind of a design win and then they do all their work put them on the final work designs into the whatever it is that they're gonna be manufacturing so that they can.
To be able to make there.
On the other end and delivering on those goods.
Okay. That's helpful on and then to ask a question on another headline recently being force decision to sell down there about on stake can you talk about what this means if anything from a customer relationship with Ford and arguably I and even potentially related with Volkswagen and separately, many automakers, including G. On.
And others over the past few years have acquired there on Lidar technology that they're working to commercialize on how is that impacting your discussions with existing and potentially on your customers.
Yes.
We're finding like in the case of four this is a relationship we've really.
<unk> benefited greatly from there you are.
In the business of making strategic investments in critical suppliers, when they need to stand them up and ensure that there'll be financial security to deliver this day.
<unk> components that they need in our case lidar.
When those when those particular companies that they've invested in are capable of standing on their own two feet so to speak.
They don't like to stick around as a financial investor that's not their nature they'd rather reallocate that capital to other investment. So we benefited greatly from this relationship with forward. Both in terms of what they've done for valid on lidar and helping it to develop its products as a partner and becoming that critical supplier for them.
And then.
Also from from their investment.
And then as we go forward where.
On a number of different projects in the pipeline.
We're we're on some existing cars in phase one phase two and are continuing to evaluate us.
As a technology that would continue to phase III some of those cars.
Yes, we are very appreciative of the relationship with Ford we continue to work with them very closely on both the current products that are being used as well as in development of new technologies.
And we would expect that to continue for a long term income.
Okay and last question, what specific milestones whether from a return to work or production bookings or other perspective do you think you need to see through the first half of this year in order to start establishing the the more formal outlook for 2021 onwards towards later this year.
Yeah sure. So this is.
I keep on having steady conversations with our sales organization in the field.
And it's really focused around the conversations youre, having with customers to start getting us or at least there their P O. So.
A lot of a lot of the countries like Europe, we thought Europe might be up sooner and now they could be locked down through 2021.
And even some of the Asian countries are seeing similar things and then they kind of keep telling me say hope so.
We have really great relationships with our customers. We continue to talk to our contacts on a regular basis and we're really waiting for them to get confident that there'll be coming back to the office and win so to have that visibility. It's really about how does how does the world start to unfold out there so that our customers who are going to be using our.
Our our lidar some system that they are building field.
We are confident that their customers are returning to the office and they're going to be able to sell through so that they can have confidence they get against those pose so from who you talked to it depends on people hope that they're going to be come back to mark to come back to the office in April others are a little less optimistic. So there may be further out we're just looking for those conversations to firm up so that we can get confidence.
And when those orders are going to come in.
And then we can start providing clear guidance.
Okay, great. Thanks for taking the questions.
Okay. Thank you. Thank you.
Yes.
As there are no further questions at this time I would like to turn the call back over to Mr. Gopal on for any additional or closing remarks.
Thank you and thank you all for joining us today and for your great questions. It is a very exciting time for lidar and for the other day we.
We believe we have hit an inflection point in the lidar industry and demonstrated by the record unit shipments in the fourth quarter and on expanding pipeline, which we believe is the most robust in the industry.
In 2020, we significantly enhanced our balance sheet supporting this robust pipeline. This together with our leadership in broadly diversified end markets with Lidar gives us great confidence in our long term outlook for growth.
We look forward to sharing on continued successes with you and hope everyone has a great rest of the day.
Yes.
Thank you.
Once again that does conclude today's conference we do appreciate your participation.
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