Q4 2021 EVgo Inc Earnings Call

Greetings and welcome to the EV go fourth quarter and full year 2021 earnings call. At this time, all participants are in a listen only mode.

Welcome to the EVGO fourth quarter and full year 2021 earnings call.

A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.

Please note. This conference is being recorded I'll now turn the conference over to your host Ted Brooks of Investor Relations you may begin.

Ted Brooks: Hi, everyone. Welcome to EVgo's fourth quarter and full year 2021 earnings call. My name is Ted Brooks and I head investor relations.

Hi, everyone welcome to <unk> fourth quarter and full year 2021 earnings call. My name is Ted Brooklynite head Investor Relations at the company.

Ted Brooks: Today's call is being webcast and can be accessed from the Investors section of our website at investors.evgo.com. The call will be archived and available later today.

Today's call is being webcast and can be accessed from the investors section of our website at investors <unk> E V go Dot com.

The call will be archived and available there and the company's results investor presentation, and a transcript of today's proceedings will be available at the events and presentations section of the investors page after the conclusion of today's call.

Ted Brooks: Investor presentation and a transcript of today's proceedings will be available at the events and presentations section of the investors page after the conclusion of today's call.

Ted Brooks: Joining me on today's call are Kathy Zoi, Evigo's CEO , and Olga Shevarenkova, the company's chief financial officer.

Joining me on today's call are Kathy Julie <unk>, CEO , and Olga Chevron cobalt, the company's Chief Financial Officer.

Ted Brooks: Today, we will be discussing EVgo's latest financial results for the fourth quarter and full year 2021, followed by a Q&A.

Today, we will be discussing UV goes latest financial results for the fourth quarter and full year 2021, followed by a Q&A session. During the call management will be making forward looking statements regarding the 2022 fiscal year and our outlook for expected growth and investment initiatives.

Ted Brooks: During the call, management will be making forward-looking statements regarding the 2022 fiscal year and our outlook for expected growth and investment initiatives.

These forward looking statements involve risks and uncertainties many of which are beyond our control and could cause actual results to differ materially from our expectations, including among other risks and uncertainties the severity and duration of the effects of the COVID-19 pandemic.

Ted Brooks: Many of which are beyond our control and could cause actual results to differ materially from our expectations, including among other risks and uncertainties, the severity and duration of the effects of the COVID-19 pandemic. These forward-looking statements apply as of today.

These forward looking statements apply as of today and we undertake no obligation to update these statements. After this call.

Ted Brooks: For a more detailed description of factors that could cause actual results to differ, please refer to our Form 10-K filed soon with the SEC and posted to the Investor section of our website. Also, please note that certain financial measures

For a more detailed description of factors that could cause actual results to differ.

Please refer to our Form 10-K filed soon with the SEC and posted to the investors section of our website.

Also please note that certain financial measures. We use on this call are on a non-GAAP basis for historical periods. We provided reconciliations of these non-GAAP financial measures to GAAP financial measures in the Investor presentation can be found on the investors section of our website.

Ted Brooks: historical periods. We provide reconciliations of these non-GAAP financial measures to GAAP financial measures, and the investor presentation can be found on the investor section of our

Speaker Change: With that, I will turn the call over to Kathy Zoi, EVgo's CEO . Kathy?

With that I will turn the call over to Kathy Zoe E V go CEO kathi.

Okay.

Thanks, Ted and good morning, everyone.

Kathy Zoi: EVgo has another strong quarter, wrapping up a tremendous first year as a public company.

E V go has another strong quarter wrapping up a tremendous first year as a public company.

Made significant progress in solidifying our position as the nation's largest public fast charging network for electric vehicles and a rapidly growing market.

Kathy Zoi: largest public fast-charging network for electric vehicles in a rapidly growing EV market.

I'd like to begin this morning, with some observations about the EV industry, given the escalating market momentum and enthusiasm we're seeing across the U S.

Kathy Zoi: I'd like to begin this morning with some observations about the EV industry, given the escalating market momentum and enthusiasm we're seeing across the U.S.

Kathy Zoi: 2021 alone, the market share of electric vehicles more than doubled along with U.S. driver purchases.

In 2021 alone the market share of electric vehicles more than doubled along with U S driver purchases of Evs.

Approximately 475000 electric vehicles, but purchase in the U S last year roughly double of sales from just the year before.

Kathy Zoi: Approximately 475,000 electric vehicles were purchased in the U.S. last year, roughly double of sales from just the U.S.

This is just the beginning auto manufacturers are planning to introduce approximately 50, new EV models just over the next 24 months, including the arrival of E vs in segments like Suvs and pickup trucks that will unlock new demographic frontiers in EV adoption.

Kathy Zoi: Auto manufacturers are planning to introduce approximately 50 new EV models just over the next 24 months.

Kathy Zoi: including the arrival of EVs in segments like SUVs and pickup trucks that will unlock new demographic frontiers in EVs.

Kathy Zoi: And by 2025, dozens more will follow, creating an abundance of easy choice for every.

And the 2025 dozens more will follow creating an abundance of easy choice for every type of driver.

Kathy Zoi: We expect these trends will be further accelerated by tailwinds in the macro.

We expect these trends will be further accelerated by tailwind in the macro environment as electrification of transportation has never been more widely accepted and anticipated.

Kathy Zoi: as electrification of transportation has never been more widely accepted and anticipated.

Kathy Zoi: The improving cost and breadth of offerings comes at a time when rising commodity prices makes EV ownership more economically attractive than ever.

The improving cost and breadth of offerings comes at a time when rising commodity prices makes it easy ownership more economically attractive than ever.

As the pace and easy adoption accelerates forecasters expect annual EDI purchases to triple by 2025, and then triple again by 2030.

Kathy Zoi: As the pace of EV adoption accelerates, forecasters expect annual EV purchases to triple by 2025 and then.

It's worth remembering that we expect the demand for D C fast charging to outpace its already rapid market growth.

Kathy Zoi: It's worth remembering that we expect a demand for DC fast charging to outpace this already rapid market growth.

Automakers are meeting the consumer demand for fast charging solution with battery technology is capable of supporting significantly higher levels of charging throughput.

Kathy Zoi: with battery technologies capable of supporting significantly higher levels of charge.

Kathy Zoi: With Edygo's growth and ability to scale profitability tied to Edy

When he goes growth and ability to scale profitability tied to EV adoption, we are energized by the powerful secular trends, bringing more evs to the road everything we're witnessing across the industry reinforces our confidence in this market and even goes leading position within it.

Kathy Zoi: We are energized by the powerful secular trends bringing more EVs to the...

Kathy Zoi: Everything we're witnessing across the industry reinforces our confidence in this market, and EVgo's leading position with

Kathy Zoi: That's why we have more conviction than ever in the investments we're making and the plan we're executing.

It's why we have more conviction than ever and the investments, we're making and the plan we're executing against.

Let me now highlight some of those remarkable accomplishments in fiscal year 2021.

Kathy Zoi: Let me now highlight some of EDCO's remarkable accomplishments in fiscal year 2021. We delivered 26.4 gigawatt hours of

We delivered 26.4 gigawatt hours of charging throughput a 68% increase over 2020.

This demand for E. D goes charging services led to $22.2 million and revenues of 52% increase over 2020.

Kathy Zoi: This demand for EVgo's charging services led to $22.2 million in revenue, a 52% increase over 2020. We ended the year with 340,000 customer accounts as more drivers chose EVgo.

We ended the year with 340000 customer accounts as more drivers chosen V go as a key charging partner up from 231000 at the start of 2021.

Kathy Zoi: This equates to about 80% of non-Tesla EVs sold in the U.S. last year coming to EVgo.

This equates to about 80% of non Tesla E V sold in the U S last year coming to E V go.

Yeah.

Kathy Zoi: This demand for EVgo and our charging services extends past individual drivers and is illuminated by our numerous partnerships throughout the industry. Further

This demand for E V go and are charging services extends past individual drivers and it's illuminated by our numerous partnerships throughout the industry.

Further cementing our market leadership in the EV charging space.

Kathy Zoi: hear it time and again when potential partners call us and we're often that first phone call that

We hear it time and again when potential partners call us and we're often that first phone call. They make they recognize either go to the experienced track record and leadership position.

Kathy Zoi: They recognize EVgo's experience, track record, and leadership.

Over the last year, we signed several new landmark partnerships with key Oems, including Subaru and Toyota.

Kathy Zoi: Over the last year, we signed several new landmark partnerships with key OEMs, including Subaru and Toyota.

Kathy Zoi: Uwe Goh is now the charging partner of automakers responsible for over 40% of U.S. light-duty vehicles.

V. Go is now the charging partner of automakers responsible for over 40% of U S light duty vehicles sale.

Kathy Zoi: As each of these OEM leaders ramps their own EV production, EVgo is exceptionally well positioned to be the charging network of choice for new EVs.

Each of these OEM leaders ramps their own E V production E. V. Go is exceptionally well positioned to be the charging network of choice for new EV drivers.

Kathy Zoi: We've also grown our fleet business with numerous new and expanded partnerships that include Uber, Merchant Fleet, and leaders in the autonomous vehicle industry.

We've also grown our sleep business with numerous new and expanded partnerships that include Eva much asleep and leaders in the autonomous vehicle space.

Kathy Zoi: And we're introducing our eVgo Xtend business line to the market today, an offering we're extremely excited about.

We're introducing our eagle extend business lines in the market today and offering we're extremely excited about.

Operationally, we ended the year with over 1600 D. C. S T cells in operation and increase the size of the E. V go development pipeline to approximately 3100, new store marketing a 26% rise since the end of the third quarter in this crucial element of our growth story.

Kathy Zoi: We ended the year with over 1,600 DC FC stalls.

Kathy Zoi: and increase the size of the EVgo development pipeline to approximately 3,100.

Kathy Zoi: marking a 26 percent rise since the end of the third quarter in this crucial element of our growth story. Over the longer term, we have a funnel of approximately

Over the longer term, we have a funnel of approximately 4000 additional sites each to host at least for charging stalls.

Kathy Zoi: represents close to five times the number of fast charging station locations we currently operate.

Which represents close to five times the number of fast charging station locations. We currently operate.

In terms of technology E. V go continues to add value to our infrastructure business by developing innovative software products that attract new customers and deepen relationships with existing drivers and b to be partners.

Kathy Zoi: EVgo continues to add value to our infrastructure business by developing innovative software products that attract new customers.

Kathy Zoi: deep in relationships with existing drivers and B2B partners.

Kathy Zoi: This includes the rollout of EVgo Optima, our customized software for fleets.

This includes the rollout of E V go Optima, our customized software for fleets, a new mobile app and even go inside a proprietary software or an API suite. All designed around the same principle of anticipating how to meet our customers' charging needs and a comprehensive and intuitive way.

Kathy Zoi: easy go inside our proprietary software and API.

Kathy Zoi: all designed around the same principle of anticipating how to meet our customers' charging needs in a comprehensive and intuitive way.

Kathy Zoi: In short, EVgo has been busy in 2021 laying the foundation for a comprehensive electrified transportation system.

In short E. V go has been busy in 2020 , one laying the foundation for a comprehensive electrified transportation future.

Kathy Zoi: I'll return to these achievements and expansions of our business in more detail in a few moments. But let me now touch on the passage of the federal government's infrastructure legislation in November .

I'll return to these achievements and expenses of our business in some more detail in a few moments, but let me now touch on the passage of the federal government infrastructure legislation in November and important moment that will certainly generate material effects.

The national electric vehicle infrastructure program or Nettie.

Kathy Zoi: National Electric Vehicle Infrastructure Program, or NEVI.

Kathy Zoi: allocate five billion dollars to states over the next five years.

Well allocate $5 billion to states over the next five years with an initial $615 million being made available later this year.

Kathy Zoi: with an initial $615 million being made available later this year. This federal support for fast-charging infrastructure may cover as much as 80% of a project's cost.

This federal support for fast charging infrastructure. It may cover as much as 80% of the project's path and they include coverage of operating costs as well as capital expenditures.

Kathy Zoi: Federal support may be complemented by local or private sources.

The federal support may be complimented by local or private sources of funding, marking a significant benefit to developers like E. V go and incentivizing. The continued widespread build out of a more comprehensive national fast charging network.

Kathy Zoi: marking a significant benefit to developers like eVgo and incentivizing the continued widespread build out of a more comprehensive

I need to go expected preference of federal infrastructure funds will be toward Buildout, along highway corridors first with requirements that charges be at least 150 kilowatts and capacity with at least four charging salt per location.

Kathy Zoi: As you would have expected, preference of federal infrastructure funds will be toward build-out along highway corridors.

Kathy Zoi: requirements that chargers be at least 150 kilowatts in capacity with at least four charging stalls per location.

Kathy Zoi: Those locations are meant to be no more than one mile off a highway in most cases.

Those locations are meant to be no more than one mile off of highway in most cases.

Kathy Zoi: states must submit their fast-charging infrastructure plans to the federal government by August 1st, with approvals of those plans expected

States must submit their fast charging infrastructure plans through the federal government by August 1st with approvals of this plan is expected by the end of September .

And while E. V. Go is looking forward to participating in that he wants the program structures are finalized at the state level.

Kathy Zoi: And while EVGO is looking forward to participating in MEVY once the program structures are finalized at the state level.

Our guidance for 2022 does not incorporate any financial benefits that might arise from these affected over the coming quarters, we will provide investors with updates on state level implementation. The role E. V. Go was playing in different geographies and the financial upshot for the company.

Kathy Zoi: does not incorporate any financial benefits that might arise.

Kathy Zoi: Over the coming quarters, we will provide investors with updates on state-level implementation, the role eVGO is playing in different geographies, and how we can best support them.

Kathy Zoi: as we look back on the rapid evolution of the EV charging industry in 2020.

As we look back on the rapid evolution of the EV charging industry in 2020 one.

Kathy Zoi: and look ahead to what we expect will be even more substantial growth ahead. I thought it was timely to revisit EVgo's approach to...

[noise] ahead to what we expect will be even more substantial growth ahead.

I thought it was timely to revisit UV goes approach to the market.

Always had a driver and customer centric focus.

Kathy Zoi: building chargers where we think they will help spur the adoption of EVs, and where the

[laughter] Chargers, where we think they will help spur the adoption of the lease and where they will be used.

The complement to that of course is providing solutions to the auto manufacturers and the site has that need EV charging infrastructure built to accommodate their own customers' needs.

Kathy Zoi: providing solutions to the auto manufacturers and the site hosts that need EV charging infrastructure built to accommodate their own customers' needs.

As a leader in the sector. Even go has a finely honed methodologies for determining where and when to build own and operate fast charging infrastructure to meet our investment hurdles and unlock long term cash flow and profitability for our investors, Hence even goes historical focus on owning assets in high traffic metropolitan areas.

Kathy Zoi: EVgo has a finely honed methodology for determining where and when to build, own, and operate fast-charging infrastructure to meet our investment hurdles and unlock long-term cash flow and profitability for our investors.

Kathy Zoi: EBGOTE's historical focus on owning assets in high-traffic metropolitan areas.

With interest in E D market expanding to lower traffic rural geographies and corridors E.

Kathy Zoi: with interest in the ED market expanding to lower traffic, rural geographies and corridors.

Kathy Zoi: EDGO is receiving requests to parlay our world-class experience in building stations and operating the most expansive and reliable public network in America to new geographies.

E V go is receiving requests to parlay, our world class experience and building stations and operating the most expansive and reliable public network in America to new geographies.

Kathy Zoi: geographies in which we would prefer to be the services provider rather than the asset owner. Fueling along interest rates.

Graffiti in which we would prefer to be the services provider rather than the asset owner.

Fueling along Interstate is an example of such an opportunity.

Kathy Zoi: We expect growth in this area to be bolstered by the passage of the infrastructure legislation whose policy objectives include national charging infrastructure ubiquity.

We expect growth in this area to be bolstered by the passage of the infrastructure legislation. This policy objectives include Nashville charging infrastructure ubiquity.

With this in mind, maybe goes excited to announce the formalization of our White label services provided for years to partners like Kaiser Health reading out in power and Salt River project in the form of the new offering under the banner E V go extend.

Kathy Zoi: With this in mind, EVGO is excited to announce the formalization of our white label services provided for years to partners like Kaiser Health, Green Mountain Power, and the American

Kathy Zoi: in the form of a new offering under the banner, EVGo Express.

Kathy Zoi: Eviego Extend partners will leverage all the end.

E V go extend partners will leverage all the end to end benefits IBD goes a decade plus of planning building operating and maintaining the nation's most reliable charging network, while the partners themselves purchase and then retain ownership of the charging assets.

Kathy Zoi: The BD goes decade-plus of planning, building, operating, and maintaining the nation's most reliable charging station.

Kathy Zoi: while the partners themselves purchase and then retain ownership of the charging assets.

Formalization of either go extend into our solution suite with customers and drivers first.

Kathy Zoi: unlocks another avenue for value creation and near-term growth upside, expands EVgo's geographic

Unlock another avenue for value creation, and near term growth upside.

Expand E V goes geographic reach and potential partners.

Kathy Zoi: complements efforts in the rest of our business that relate to fleet, software, and scaling efficiencies.

And complements efforts and the rest of our business that relate to fleet software and scaling efficiencies.

E V go extend leverages, our core competencies to expand our network footprint beyond sites that currently meet our underwriting hurdles offload ownership creates.

Kathy Zoi: expand our network's footprint beyond sites that currently meet our underwriting hurdles for asset ownership. It creates another way for us to be able to move forward.

Creates another way to grow recurring revenues and mitigates risk associated with sites that are likely to have low utilization in the intermediate term.

Kathy Zoi: and mitigates risk associated with sites that are likely to have low utilization in the intermediate.

Kathy Zoi: We're working on several exciting potential EVGo Xtend partnerships that will provide upside to our...

We're working on several exciting potential easy go extend partnerships that will provide upside to our overall growth in the years to come we're hopeful that we will be able to communicate more concretely about these efforts soon please stay tuned for updates.

Kathy Zoi: We're hopeful that we will be able to communicate more concretely about these efforts soon. Please stay tuned.

As mentioned at the outset, you may have seen recent announcements from E. V go on new partnerships with two major auto Oems Subaru and Toyota.

Kathy Zoi: You may have seen recent announcements from EVgo on new partnerships with two major auto OEMs, Subaru.

Kathy Zoi: Subaru, EVgo was proud to become the preferred charging partner for their first electric vehicle, the Solterra EV, which is expected to become available in the U.S. this summer.

With Subaru E. V go was proud to become the preferred charging partner for their first electric vehicle. The Socal R. E V, which is expected to become available in the U S. This summer.

Kathy Zoi: EVgo's business deal with Toyota provides for one year of unlimited charging on EVgo's network for buyers or lessees of Toyota's first widely available electric offering, the BZ-4X, which Toyota anticipates will be available in 2022.

E D goes business deal with Toyota provides for one year of unlimited charging on E. V goes network for buyers of four left ease of Toyota's first widely available electric offering the BZ Forex, which Toyota anticipates will be available later this year.

Kathy Zoi: This marks Toyota's first move in significant plans to become fully electric, and EVgo is delighted to have been selected as...

This marks Toyota first moving significant plans to become fully electric and E. V. Go was delighted to have been selected as their fast charging partner.

As I noted earlier with Toyota and Subaru along with existing partnerships with other Oems.

Kathy Zoi: As I noted earlier, with Toyota and Subaru, along with existing partners...

Kathy Zoi: Evigo now has charging relationships with auto manufacturers that together represent over 40% of annual auto sales in the U.S.

E V go now has charging relationships with auto manufacturers that together represent over 40% of annual auto sales and the evil.

Provides clear evidence of the success E. V. Go has had in building and operating Americans most robust fast charging network over the last dozen years.

Kathy Zoi: success EVgo has had in building and operating America's most robust fast-charging network

Kathy Zoi: One of the many reasons EVgo is able to attract and retain high quality partnerships is a commitment to technology enabled innovation across the company.

One of the many reasons E V go was able to attract and retain high quality partnership is a commitment to technology enabled innovation across the company.

One of these innovations its E V go inside which is a suite of software and a P is it helps E V go partners manage the customer experience process from enrollment to charging to billing. We recently released an updated mobile app that showcases both a sophisticated and a friendly design that welcomed drivers to the E V go charging experience.

Kathy Zoi: It is a suite of software and APIs that helps eVgo partners manage the customer experience process from enrollment to charging to billing. We recently released an updated mobile app that showcases both a sophisticated and a friendly design that welcomes drivers to the eVgo charging platform.

Yes.

Kathy Zoi: And our eVgo Reservations and eVgo Advantage software products have broadened their reach into new locations during...

And our E. D go reservations and easy go advantage software products have broadened their reach into new locations during 2021, and even goes clubs share surpassed 2 million registered users.

Kathy Zoi: NEVGO's PlugShare surpassed 2 million registered users.

Electrification activity in the fleet segment has rapidly expanded during the last 12 months with EDI goes current fleet clients like Uber Lyft, and two leading E V companies ramping their easy deployment and dozens of new fleet operators, placing their first orders for EV.

Kathy Zoi: like Uber, Lyft, and two leading A.V. companies ramping their E.V.

Kathy Zoi: dozens of new fleet operators placing their first orders.

Kathy Zoi: These newcomers to electrification are beginning to engage in charging infrastructure planning as they await arrival of their EVs.

These newcomers to electrification are beginning to engage in charging infrastructure planning as they await a rival of their evening.

Either go sleep team is at work, helping fleets Kraft infrastructure programs that will meet their needs through our E. V go Optima EV gold and even go inside solutions, we look forward to sharing updates with you in the coming quarters.

Kathy Zoi: programs that will meet their needs through our EVgo Optima, EVgold, and EVgoInside solutions. We look forward to sharing up

Before I turn the call over to Olga I want to underscore the easy go investment opportunity in the context of the growing E V ecosystem as a whole.

Kathy Zoi: Before I turn the call over to Olga, I want to underscore the EVgo investment opportunity in the context of the growing EV ecosystem as a whole.

As we shared E. V go is a pure play EV charging company with a special focus on D. C fast charging and a history of executing and operating at a superior level with uptime in the high 90% range for our Chargers, historically and with over a decade of delivering on our promises to site hosts and drivers.

Olga Shevarenkova: As we've shared, EVgo is a pure play EV charger.

Olga Shevarenkova: special focus on DC fast charging and a history of executing and operating at a superior

Olga Shevarenkova: with uptimes in the high 90% range for our chargers historically, and with over a decade of delivering on our promises to site hosts and donors.

Olga Shevarenkova: We are a pioneer with a first-mover advantage in this sector, including being powered by 100% renewable energy. Our relentless focus on innovation and technology…

We are a pioneer with a first mover advantage in this sector, including being powered by 100% renewable energy.

Our relentless focus on innovation and technology products and solutions has provided us with an edge in designing and engineering charging locations in a way that attractive partners and drivers.

Olga Shevarenkova: provided us with an edge in designing and engineering charging locations in a way that attracts partners and drivers. We have a world-class executive leadership team with deep expertise.

We have a world class executive leadership team with deep expertise in clean energy and it has a clear vision for leading an electrified future.

And the superstar employees across every function of D. V. Go are not only committed to excellence in delivery of E. V go charging services, but there's a larger mission of a decarbonize transportation future.

Olga Shevarenkova: And the superstar employees across every function at eVGo are not only committed to excellence and delivery of eVGo charging services, but to the larger mission of a decarbonized transportation future. eVGo has ESG in our DNA. eVGo's experience and track record of execution are durable advantages in efficiency.

E V go I E S G in our DNA.

Do you think those experience and track record of execution are durable advantages in a sector with tremendous growth opportunity.

We've done this all with a keen focus on financial discipline and long term margin potential.

Mitigation.

Olga Shevarenkova: underwriting that prioritizes profitability and the prudent allocation of investment.

Underwriting it prioritizes profitability and the prudent allocation of Investor capital.

As older will share even in these early stages, we have realized positive results of this discipline with growth in both customers and throughput driving cashless and providing concrete evidence of what the future will bring across the E. V. Go platform is easy adoption continues.

Speaker Change: As Olga will share, even in these early stages, we have realized positive results of this discipline with growth in those.

Speaker Change: providing concrete evidence of what the future will bring across the eVGO platform as eV adopts

Speaker Change: We are more excited than ever about the immense opportunity in this space and EVgo's position in the market as EV adoption is set for takeoff. We expect a lot of positive results.

We are more excited than ever about the immense opportunity in the space and easy goes position in the market as E. B adoption is set for takeoff.

We expect a lot of positive inflection points in 2022, with increasing driver demand Oems, introducing new vehicles and the implementation of supportive policy.

Speaker Change: with increasing driver demand, OEMs introducing new vehicles, and the implementation.

Speaker Change: But we would also point to the long term and remind everyone that we are in the early innings of a major sectoral crisis.

But we would also point to the long term I remind everyone that we are in the early innings of a major sectoral transformation. The electrification of the multi trillion dollar transportation sector is just getting started.

Speaker Change: The electrification of the multi-trillion dollar transportation sector is just getting started.

Even though with poised to be a key player in this transformation and we couldnt be feeling better about the future.

Speaker Change: With that, I will turn it over to Olga to discuss some of our financial and operational highlights.

And with that I will turn it over to Olga to discuss some of our financial and operational highlights.

Okay.

Thanks Kathy.

Olga Shevarenkova: I will start with some key operational highlights and review of our financial performance in the fourth quarter and full year of 2021.

Start with some key operational highlights and review of our financial performance in the fourth quarter and full year of 'twenty or 'twenty, one as Kevin noted networks throughput of 26.4 gigawatt hour exhibited material gross influences went to one with a 68% year over.

Olga Shevarenkova: network throughput of 26.4 gigawatt hours, exhibited material growth in 2021 with a 68% year-over-year growth rate.

<unk> increase.

95% increase in the fourth quarter of 21 to one versus the fourth quarter of 2000 and fun.

Olga Shevarenkova: fourth quarter of 2021 versus the fourth quarter of 2020.

Sure, but for the year exceeded our guidance range of 24 to 26 gigawatt hours provided you in our third quarter earnings call.

Olga Shevarenkova: 24 to 26 gigawatt hours provided during our third quarter.

Our active engineering and construction development pipeline exhibited big gains during the year and then it went to 21 was over 31 hundreds calls our active engineering and construction development pipeline was at 2500 at the end of third quarter exhibiting a 26.

Olga Shevarenkova: Our active engineering and construction development pipeline exhibited big gains during the year.

Olga Shevarenkova: Ending 2021 with over 3100.

Olga Shevarenkova: Our active engineering and construction development pipeline was at 2,500 at the end of third quarter, exhibiting a 26 percent quarter-over-quarter

6% quarter over quarter sequential increase.

Olga Shevarenkova: We ended 2021 with 340,000 customers.

And the 2021 with 340000 customer accounts.

Oh, no and that work, which represents 47% growth year over year.

Olga Shevarenkova: on our network, which represents 47% growth year-over-year. Overall, over 100.

Overall over 109000 customer accounts were added to even though it was not working once it went to one which represented roughly 80% of Non-catholic E. V. Sale. We also continue to attract Tesla drivers our data suggest the Tesla drivers continues to comprise about.

Olga Shevarenkova: 71, which represented roughly 80% of non-Tesla EV sales.

Olga Shevarenkova: to comprise about 15% of our new customer accounts, and that Tesla drivers.

15% of our new customer accounts and that Tesla drivers represented approximately 6% of total physical retail charging throughput.

Olga Shevarenkova: total EVgo retail charging throughput at the end of 2021.

Kind of two months, it's been too long.

Olga Shevarenkova: Revenue in the fourth quarter of 2021 increased 70 percent versus the fourth quarter of last year and 15 percent quarter over quarter sequential.

Revenue in the fourth quarter of 'twenty or 'twenty, one increased seven 2% versus the fourth quarter of last year, and 15% quarter over quarter sequentially.

The combination of EV adoption and even goes business development efforts drove high activity in both retail and fleet segments.

Olga Shevarenkova: growth business development efforts drove high activity in both retail and fleet segments. Adjusted gross margin

Adjusted gross margin hit new highs of 28% during the fourth quarter.

Olga Shevarenkova: due to high usage and growth in high-margin, data-driven ancillary services business lines.

Due to high usage and growth in high margin data driven ancillary services business lines.

Turning now to the full year results.

Olga Shevarenkova: Revenue increased 52% year-over-year to $22.2 million dollars.

Revenue increased 52% year over year to $22.2 million.

But the upper end of our guidance range.

Olga Shevarenkova: of 20 to 22 million dollars provided during the third quarter.

Was it just $1 million to $2 million provided during the third quarter earnings call.

This was primarily driven by an 88% increase in retail charge in revenue year over year, and an 84% increase in ancillary revenue.

Olga Shevarenkova: This was primarily driven by an 88% increase in retail charging revenue year-over-year and an 84% increase in ancillary revenue, including the addition.

The addition of a cargo revenues.

Adjusted gross margin for the full year increased from 3% in trying to advance it to 23% as much as once you want.

Olga Shevarenkova: Adjusted gross margin for the full year increased from 3%

Olga Shevarenkova: 23 percent in 2021. As we continue to...

We continue to scale the business driven by greater contribution from high margin data driven ancillary revenues like with cargo.

Olga Shevarenkova: driven by greater contribution from high-margin data-driven ancillary revenues like Recargo, and network throughput growth that allow to exercise

And network throughput grows that allowed to exercise.

I shouldn't have leverage.

Finally adjust.

Olga Shevarenkova: adjusted EBITDA was negative $51.4 million for the year, which was ahead of our guidance of negative...

Adjusted EBITDA was negative $51.4 million for the year.

Which was ahead of our guidance of negative $54 million to $58 million as revenue was stronger and G&A expenses grew at a slower rate than anticipated.

Olga Shevarenkova: as revenue was stronger and DNA expenses grew at a slower rate than anticipated.

And note on stole deployments for the full year.

Olga Shevarenkova: We finished 2021 with 1,676 operational stalls and 1,903 stalls, either operational or non-operational.

We finished two months of funds to one with 1676 operational stalled.

And 1903 stores, either operational or under construction.

Olga Shevarenkova: Both of these figures were in line with our guidance provided on the third quarter call.

Both of these figures were in line with our guidance provided on the third quarter call.

I would like to spend a few minutes talking about even goes business model and key profitability drivers there.

Olga Shevarenkova: talking about EVgo's business model and key profitability drivers.

If you go business model sensors are deploying charging infrastructure the junior rates double digit unlevered pretax IRR.

Olga Shevarenkova: centers at deploying charging infrastructure that generates double-digit unlevered

I would like to walk you through our deployment criteria and station economics.

Olga Shevarenkova: I would like to walk you through our deployment criteria and

Olga Shevarenkova: EVgo employs both short-term and long-term demand models to determine expected usage for every project we develop. Our short-term model, which predicts

If you go employees, both short term and long term demand models to determine expected usage for every project we developed.

Our short term model, which predicts demand down to the census block.

Or about 110th the size of a Zip code.

Olga Shevarenkova: has been highly accurate in its predictive capabilities. Our longer-term model overlays short-term forecasts against.

Has it been highly accurate and its predictive capabilities.

Our longer term model overlays short term forecast against adoption trends in the marketplace for Evs and fast charging.

Every project, we underwrite we develop a financial model using this utilization forecast revenue per kilowatt hour evolution regulatory credit pricing evolution if applicable.

Olga Shevarenkova: To develop a financial model using this utilization forecast, revenue per kWh evolution, regulatory credit pricing evolution, if applicable,

And those are costs and energy costs or the existing tariff.

Olga Shevarenkova: Note we do not assume improvements in those energy costs unless new tariffs have been approved by utilities. I would like to highlight that modeled non-energy costs for every project are quite uncompetent.

No we do not assume improvements in those and there is a cost unless you have tariffs haven't been approved by you deal with it.

I would like to highlight that model non energy costs for every project are quite uncomfortable.

And include maintenance warrants is rents property taxes connectivity charges call center caused payment fees and the portion of asset management and customer operations teams salary.

Olga Shevarenkova: and the portion of asset management and customer operations team's salary.

Topics estimates provided by either goes engineering team based on contracts with vendors and specific project design.

Olga Shevarenkova: based on contracts with vendors and specific projects.

Olga Shevarenkova: Estimates only include CAPEX funding support, such as governmental grants or OEM offsets, if it is available.

Estimates only include Catholics funding support such as governmental grants or OEM offsets.

It is available to us at this specific location.

Olga Shevarenkova: Finally, we continue to model no residual value in our underwriting process and practice with

Finally, we continue to model no residual value in our underwriting process practice with views of suitably conservative, but also likely to present upside opportunity for us as the market develops.

Olga Shevarenkova: but also likely to present upside opportunity for us as the market develops.

With respect to stations in operation, we'll continuously evaluate network financial performance on a cash flow basis by market.

Olga Shevarenkova: We continuously evaluate network financial performance on a cash flow basis by

Olga Shevarenkova: calculated as charging and regulatory credit revenue.

Which is calculated as charging and regulatory credits revenue minus energy and non energy cost using the same cost categories as the ones we used during the underwriting process.

Olga Shevarenkova: minus energy and non-energy costs using the same cost categories as the ones we use during

Olga Shevarenkova: California is the most advanced EV market in the world.

California is the most advanced easy market in the U S. It has attractive electricity cost elsewhere fashion S. T I quite as revenue opportunities favorable fleet dynamics.

Olga Shevarenkova: It has attractive electricity costs, LCFS and FCI credit revenue opportunities, favorable fleet dynamics, and the highest CV penetration rate in the country.

And the highest penetration rate in the country.

If it goes California charging that book already generate positive cash flows today.

Isn't illustrative case study I would like to highlight the specific performance of the San Francisco Metro markets within California.

Olga Shevarenkova: I would like to highlight the specific performance of the San Francisco metro market within co-efficient.

San Francisco EV adoption rate is about 3%.

Olga Shevarenkova: San Francisco EV adoption rate is about 3%.

Among the highest in the United States.

And if your influences in Q1, even though at a rate of 292 stores in the area, resulting in 814% utilization rate junior raising $1 9 million kilowatt hours of throughput in the fourth quarter of two months of 'twenty one.

Olga Shevarenkova: one, EasyGo operated 292 stalls in the area, resulting in

Olga Shevarenkova: 8.4 percent utilization rate generating 1.9 million kilowatt hours of throughput in the fourth quarter.

The San Francisco charging network generates 43% cash flow margin for ego driven.

Olga Shevarenkova: The San Francisco charging network generates 43% cash flow margins per EV goal.

Driven by solid utilization levels, and a chocolate or answers your cost environment, LCR fast add ons and dedicated fleets stall take or pay contract.

Olga Shevarenkova: extractive energy cost environment, LCFS add-ons, and dedicated fleet

These margins and cash flow generation ability will increase with further EV adoption.

Olga Shevarenkova: These margins and cash flow generation ability will increase with further EVI.

Olga Shevarenkova: San Francisco is far from the only metro market demonstrating such results.

San Francisco is far from the only metro market demonstrating such results.

Other metro areas in California, such as Los Angeles show similar results and we think comparable profitability trends in markets outside of California as well.

Olga Shevarenkova: showed similar results, and we're seeing comparable profitability trends in markets outside of California as well. I can call attention to port-

Call, It Samsung Portland, Oregon, and Phoenix, Arizona.

Olga Shevarenkova: Two more examples of metro markets where EVgo portfolios are generating positive cash.

Two more examples of metro markets, where illegal portfolios are generating positive cash flow.

Olga Shevarenkova: and this is in markets that have lower EV penetration than California and do not have the advantage of meaningful regulatory credit.

And this is in markets that have lower penetration than California, and do not have the advantage of meaningful regulatory credits that.

Olga Shevarenkova: The rising tide of EV adoption continues to improve performance in these markets and many other applications.

The rising tide of a V adoption continues to improve performance in these markets and many other across the country.

Olga Shevarenkova: EasyGo is a rigorous investment process and Sideshell app.

Is it go as rigorous investment process and site selection.

Olga Shevarenkova: a bearing fruit across a number of tea markets already today. Even when EV penetration remains very low, about 0.5%

Bearing fruit across a number of key markets already today.

Even when they are at penetration remains very low about 0.5% nationally, which demonstrates the strength of our business model and the attractive upside potential.

Olga Shevarenkova: which demonstrates the strength of our business model and the attractive upside potential. If it goes overall path to

If it goes overall path to profitability is closely tied to the adoption.

We would like to illustrate what could happen to either go revenue in EBITDA generation and how easy go is positioned to profitably scale when EV adoption increases from 0.5% today, two 5%, 10% and 15% in the future no thing.

Olga Shevarenkova: What could happen to if you go reminant, if it's a degenerate?

Olga Shevarenkova: and how EVgo is positioned to profitable scale when EV adopters

Olga Shevarenkova: from 0.5% today to 5%, 10%.

Olga Shevarenkova: and 15% in the future, noting this estimate still represents the EV market in its infancy.

These estimates still to present, the EV market in its infancy.

It's 5% to be adoption, we estimate even though revenue of between 1.9 and to fund $1 billion with corresponding adjusted EBITDA of 600 to 800 million, representing 30% to 35% margin.

Olga Shevarenkova: We estimate EVgo revenue of between $1.9 and $2.1 billion.

Olga Shevarenkova: with corresponding adjusted EBITDA of $600 to $800 million, representing a 30% to 35%...

As of the adoption increases to 10%, we expect revenue to reach $3.2 billion to $3.4 billion with adjusted EBITDA of one one to 1.3 billion, representing adjusted EBITDA margins of 35% to 40%.

Olga Shevarenkova: We expect revenue to reach $3.2 to $3.4 billion.

Olga Shevarenkova: with adjusted EBITDA of 1.1 to 1.3 bits.

Olga Shevarenkova: representing adjusted EBITDA margins of 35%.

Olga Shevarenkova: At 15%, we estimate revenue of between $4.8 and $5 billion.

15%, we estimate revenue of between four eight and $5 billion with adjusted EBITDA of 1.722 billion with 35% to 40% margin.

Olga Shevarenkova: with adjusted EBITDA of $1.7 to $2 billion, with...

Olga Shevarenkova: EBITDA margin improvements are expected to be achieved by operational and SG&E.

EBITDA margin improvements I expect it to be achieved by operational and SG&A leverage.

Olga Shevarenkova: Evigo expects to be profitable on an adjusted EBITDA basis at roughly 2.5% of the adoption rate from the

Even go expects to be profitable on an adjusted EBITDA basis at roughly 2.5% of the adoption rate from there the upside compounds.

In the near term, we're introducing 2022 guidance based on our cost expectations for the full year.

Olga Shevarenkova: We're introducing 2022 guidance based on our current expectations for the full year. There are a number of factors that will impact our results, however, the most salient of which is the VADOC.

There are a number of factors that will impact our results. However, the most salient of which is at the adoption.

Supply chain and other global economic and political challenges may present, a short term obstacle for Oems and get them to new model from their old.

Olga Shevarenkova: may present a short-term obstacle for OEMs in getting new models on the road.

Olga Shevarenkova: At the same time, we will continue to strategically invest in the massive mid-term and long-term growth trends.

At the same time, we will continue to strategically invest in the massive midterm and long term growth trends.

As we invest we will prioritize profitable growth with a focus on expanding margins all the time.

Olga Shevarenkova: We will prioritize profitable growth with a focus on expanding margins.

Olga Shevarenkova: For the fourth year, 2022, we expect to deliver network throughput of 50 to 60 gigawatt hours, revenue

Well the full year 'twenty to 'twenty, two we expect to deliver network throughput of 50 to 60 gigawatt hours revenue $48 million to $55 million.

Olga Shevarenkova: Adjusted EBITDA of negative $75 to $85 million.

Adjusted EBITDA of negative $75 million to $85 million and.

Olga Shevarenkova: and total DC fast-charging stalls in operation under construction at year-end 2022 of 3,000 to 3,000.

In total these G fast charging stall in operation or under construction at year ends when it went to two of 3000 to 3300 adults.

Both revenue and network throughput guidance represent a more than doubling of comparable figures the twin sister funds, who want to adults.

Olga Shevarenkova: Both revenue and network throughput guidance represent a more than doubling of comparable figures to 2021 results.

The drivers for adjusted EBITDA reflects increased investments in technology and personnel to respond to expanding the market opportunity is.

Olga Shevarenkova: flagged increased investment in technology and personnel to respond to expanding market opportunities.

Olga Shevarenkova: and encapsulate our expectations for LCFS pricing and public company expenses. Finally, total stock

And constellate, our expectations for L CFS pricing and public company expenses finding.

Finally.

Total installed in operation or under construction reflect the advancements we're making in the size of the pipeline and the successful reducing the time and development.

Olga Shevarenkova: in the size of the pipeline and the success in reducing the time in development.

Both of which are driven in part by the technology and personnel investments I just restaurants.

Olga Shevarenkova: Both of which are driven in part by the technology and personnel investments I just referenced.

We're seeing a lot of progress and enthusiasm in the business with a number of strategic commercial partnerships in various stages of development.

Olga Shevarenkova: with a number of strategic commercial partnerships in various stages of development.

We believe.

Olga Shevarenkova: that EVgo has a substantial growth runway over the next decade.

But even go has a substantial growth runway over the next decade and beyond.

Olga Shevarenkova: Assuming electric vehicles and operations grow at 35% to 40% 9-year CAGR, as many forecasters agree on, we are looking at an 80% to 85% CAGR for network superchargers.

Assuming the electric vehicles and the duration grow at 35% to 40% a nine year CAGR as many forecasts degree on we're looking at an 80% to 85% CAGR on that Brooks throughput, 70% to 75% CAGR for revenue and 40% to 45% CAGR for D C charging.

Olga Shevarenkova: 70% to 75% CAGR for revenue and 40% to 45% CAGR for DC charging stock.

Stalls.

Olga Shevarenkova: Given the strong tailwinds and significant industry momentum Cathy discussed earlier,

Given the strong tailwind and significant industry momentum Kathleen discussed earlier.

We see a massive opportunity ahead and believe that Eagle is well positioned to capitalize on it.

Olga Shevarenkova: and believe that EVgo is well positioned to capitalize.

Speaker Change: Thank you for your time this morning. I would like to turn it over to the operator for questions.

You for your time this morning, I would like to turn it over to the operator for questions.

Thank you and at this time, we'll be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad.

A confirmation tone will indicate your line is in the question queue.

Press Star two if you would like to remove your question from the queue.

For participants using speaker equipment, it may be necessary to pick up your handset before Christmas turkeys.

So in the interest of time, we do effort each person in the queue limit themselves to only one question.

One moment, please while we poll for questions.

And our first question comes from the line of Gabe Daoud with Cowen. Please proceed with your question.

Hey, good morning, everyone. Thanks, Cathy and I will go for all of the prepared remarks Super helpful to maybe start with slide 17, and 18, maybe auger give us a little more meat on the bone so to speak I guess I'm thinking about long term.

Speaker Change: Hey, good morning, everyone. Thanks, Kathy and Olga, for all the prepared remarks. Super helpful. Can we maybe...

Speaker Change: start with slides 17 and 18. Maybe Olga, give us a little more meat on the bone, so to speak. Like if I'm thinking about long-term, the operating leverage here. What kind of underpins some of these assumptions? If you could just talk to utilization or stalls in the ground, that'd be helpful.

The operating leverage here, what kind of underpins some of these assumptions if you could.

Just talk to utilization or stores in the ground that would be helpful. And then also.

Olga Shevarenkova: And then also, to what extent does LCFS credits play into slide 17, like what percentage of that San Francisco cash flow comes from LCFS credits?

To what extent those credits are playing to our slide 17, like what percentage of that San Francisco cash flow comes from Lcs That's credit.

Speaker Change: Hi, Gabe. Thanks for the question. So 17, so just to kind of clarify first, page 17, that's an actual number, right? So there are no assumptions which are going into that, just the numbers we're observing. LCFS is, of course, an important part of our cash flow. But even if you remove LCFS.

Hi, Gabe Thanks for the question. So 17, so just to kind of quantify first page 17, that's an actual number right. So there are no no assumptions, which will go in into that drove the numbers. We're observing elsewhere first is of course, an important part of our cash flow, but even if you remove them.

Your first.

Speaker Change: cash flows from San Francisco, you'd still see a positive cash flow margin. I wouldn't disclose the exact number. I would like not to disclose the exact number, but I will assure you that that remains positive in a San Francisco market.

Cash flow from San Francisco, you'd still see a positive cash flow margin I wouldn't disclose the exact number I would like not to disclose the exact number but I will assure you that that remains positive in the San Francisco market.

Speaker Change: So on kind of like what drives performance of San Francisco market today. First of all, it's.

So.

And it kind of like what drives our performance.

Performance of San Francisco market today first of all it's.

They're attractive and it's because it's it's that the tariffs would have in the Genie is is quite attractive and that's what you observe here in a cash flow margin, we have a quite a substantial presence of dedicated fleet take or pay contract, which is baked into this number that plays into this and this.

Speaker Change: The attractive energy costs, the tariff we have in PG&E is quite attractive, and that's what you observe here in the cash flow margin. We have quite a substantial presence of dedicated fleet take-or-pay contracts, which is baked into this number. That plays into this. And the third and most important is that one of the highest TV adoption rates in the country, as you can see, is 3 percent, and that bakes into pretty decent utilization of 8.5 percent and so that's a utilization we deem decent as of today with the current adoption level. So, of course, expect that the definition of decency will change over time, but for today's standards, that's pretty good.

Third and most important is one of the highest of the adoption rates in the country as you could see it's cheaper sand and that bakes into pretty decent utilization of eight and a half per cent. So that that's it that's the utilization we deem decent as of today was the current adoption levels are of course, it's thought that the dose.

The definition of decency, what will change over time, but for today's standards that's pretty good.

Speaker Change: So when we talk about the page 18, so there's a lot of assumptions playing into here. And one of them, you asked about the stalls. We're not changing our overall target, which we.

So when a when we talk about the page 18.

So the there there's a lot of assumptions playing into here and one of the one of them you asked about the stores, we're not changing our overall targets, which we.

Speaker Change: manifested during our SPARC process of 16,000 stalls by 2027, and that's roughly what we're assuming underpinning these various forecasts.

Mine too fast and you and I always thought process of 16000 installed by 20% to seven and that's roughly what we assume and and opinion. There's this there's forecast so.

Speaker Change: We, again, we wouldn't probably disclose exactly what it will be at 5%, 10%, and 15%, but when we run our forecast, we make sure that the CapEx investments and the amount of stocks we're deploying to support the EBITDA and revenue generation make sense and fairly prudent and conservative.

We again, we wouldn't probably disclose exactly what it will be a 5%, 10% instead of 10%, but when you look on all four of US will make sure that the capex investments in the amount of those were deploying to support the EBITDA and revenue generation makes sense and and and fairly prudent and conservative yeah. If I could just jump in and add a little bit gave us.

Speaker Change: Yeah, if I could just jump in and add a little bit, Gabe. I love the reason we included San Francisco as a market spotlight is that, as we all know, California is an early bellwether to what happens in many things, and in particular, electrification. California has more EVs than the rest of the country, et cetera, early adopter. California's been an early adopter in autonomous vehicles. California's been an early adopter in rideshare. All of those macro trends are going to spread across the country. So when we take a good look at our business model, we look first at California. Is it working in California? And it's working in San Francisco. It's working in LA. And what's really interesting is that, as Olga points out, it's also working very, very well even in the next stage of markets, which are like Portland and Phoenix.

Love Love. It. That's the reason we included our son, San Francisco as a market spotlight isn't as as we all know California's an early belt bellwether to what happens on in many things and in particular electrification, California has more evs and spend the rest of the country etcetera early adopter California's been an early adopter in autonomous vehicles, California's been an early adopter and rideshare.

All of those macro trends are going to spread across the country. So when we take a good look at our business model. We look first to California is it working in California, and it's working in San Francisco Whats working in L. A and what's really interesting is it is it all the points out is also working very very well even in the next stage of markets, which are like Portland, and Phoenix. So so we just feel.

Speaker Change: So we just feel confident that we're capitalizing on, investing in charging assets in a way that's going to ride the wave of electrification or transportation across America.

I'm confident that we're on to the where we're capitalizing on investing in charging assets in a way that's going to ride the wave of electrification of transportation across America.

Speaker Change: Awesome, that's really helpful. There's just a follow-up, I guess. Just on this new business line, Cathie Xtend, could you just talk a little bit about maybe the economics there and are any stalls that are in queue for this year under this business model? Just how do we think about balancing that long-term potential that you highlighted on slide 18 versus the Xtend business model?

Awesome, that's really helpful.

A follow up I guess just on this new business line Kathy extend could you talk a little bit about maybe the economics, there and are any stalls other.

In Q4 this year under under this business model just how do we think about balancing the long term potential are highlighted on slide 18 versus the extend business model.

Speaker Change: Yeah, so the EVgo Xtend is an and for us. It's like we are really what we're already a market leader in siting, building, owning, operating. And we essentially do the EVgo Xtend white label with a few customers now. The incoming that we're seeing, particularly as a corridor,

Yeah. So what was the E dingo extend is in it and for US. It's like we are really what we're already a market leader in and inciting building owning operating what what we and we do essentially do the E. V go extend white label with a few customers now the incoming that we're seeing particularly as a corridor in.

Speaker Change: interest in building in corridors grows is that those corridors don't tend to meet our traditional hurdle rates.

Interested in building and corridors grows is that those corridor don't tend to meet our traditional hurdle rates them to own the assets. However, there's a there's a wonderful way for us to participate in that extension of our networks are we to go extend by providing the network planning siting construction and then an O&M that come.

Speaker Change: to own the assets. However, there's a wonderful way for us to participate in that extension of our network through EDGO Extend by providing the network planning, siting, construction, and then an O&M that comes with having those locations be part of our network that's accretive.

With them, having those locations will be part of our networks. That's accretive. We are we are so excited to tell you about what we've got cooking in the oven as soon as we can soon as it comes out of the oven. So stay tuned it's a it's a really really exciting addition to E V go solution set.

Speaker Change: We are so excited to tell you about what we've got cooking in the oven as soon as it comes out of the oven, so stay tuned. It's a really, really exciting addition to EVgo's solution set.

Awesome. Thanks, guys.

And again as a reminder, we do with them.

I mean, everyone to one question only.

Our next question comes from the line of my mind.

Please proceed.

Yes.

Speaker Change: Thanks for taking the questions and congratulations on the quarter.

Yeah, Hi, Yeah, Mohit Blender here from good suites are thanks for taking the questions and congratulations on the quarter.

Maybe a question for you if you could just kind of break down the guidance for our southern do you understand the revenue guidance a little bit was driven by the rideshare.

Speaker Change: kind of break down the guidance for us as we understand the Revenue Guidance Missile a little bit was driven by the ride share recovery slightly weaker than expected but you could just talk about like in the gross margin and operating expenses are you seeing any changes versus what the expectations were going into the year previously and especially trying to understand the

Recovery start to weaker than expected, but could you just talk about like on the gross margin and operating expenses are you seeing any changes where it says what the expectations were going into the ear previously, especially trying to understand the.

Speaker Change: impact of any rising electric bills later this year due to higher energy prices.

The impact of any rising electric boat.

Later this year due to higher energy prices.

Speaker Change: And secondly, I just wanted to touch base on EV charging hardware availability. Some of your peers have been talking about delays on that. So any color on that would be appreciated. Thanks.

And secondly.

Just wanted to touch base on EV charging hardware availability some of your peers have been talking about deal isn't done.

And he called it runs out for me appreciate it thanks.

Speaker Change: So, on energy costs, just to remind everybody that we are not trading wholesale power and we're not exposed to short-term volatilities and power. We're a C&I customer of utilities, so we, on a short-term, on a short horizon, we know exactly what our energy costs will be. Now, obviously, the macro environment is such that the power...

Sure. So on energy cost just to remind everybody that the we are not trading in wholesale power and we're not exposed to short term volatility in power was C&I Costa Mogae too. It is so are we in on a short term on the short horizon, we know exactly what our energy cost will be now almost as a microenvironment is this.

Such that the power prices are rising and then you too this will probably start passing them on onboard we'll know in advance and that doesn't happen to happen overnight. So we don't foresee that specifically with even though we'll feel the effect of rising energy costs in 'twenty to 'twenty two so on the gross margin expected to be well.

Speaker Change: Prices are rising and then you choose this will probably start passing them on us But we'll know in advance and that doesn't happen happen overnight, so we don't foresee that

Speaker Change: Specifically, we at EVGO will feel the effect of rising energy costs in 2022, so on a gross margin, expect it to be where it is or improving with an improvement in throughput, so our gross margin.

It is or improve it was that was an improvement in throughput so our gross margin.

Speaker Change: is a reflection of a leveraging of operational fixed costs. That's why you saw it improving. And in addition, the growth of our high margin data-driven ancillary services. So both of those trends are expected to continue to be favorable next year. So you'll see margin.

Is it a flaxen off leveraging of fixed operational fixed costs. That's why you saw it improving and in addition, the growth of our high margin. They did you have an ancillary services. So both of those trends I expect it to be to continue to be favorable next year, so you'll see margin.

Speaker Change: slightly better or at the same level. We're not guiding the gross margin, so I won't disclose specific expectation, but that's some light I can give to you.

Slightly better at the same level, we're not guiding so gross margin so I wont disclose specific expectation, but but that's some way. They can I can I can give to you and then on the hardware. So we were the opposite I know acceptance of anybody else, we're extremely focused on secure hardware supply.

Speaker Change: And then on hardware, so we're obviously, and no exceptions to anybody else, we're extremely focused.

Speaker Change: on securing hardware supply and managing our supply chain. As of now, all of our vendors have expressed confidence that they would be able to deliver the equipment we need this year at the pre-agreed price.

And managing our supply chain as of now all of our vendors had impressed expressed confidence that they would be able to deliver the equipment. We need this year at the pre agreed price and we we have certain contractual agreements, which gave us again quite a different confidence.

Speaker Change: uh... and we uh... we have been contractual agreement which giveth uh... again quite a bit incompetent that that will be the case

That will be the case and I I I I emphasize enough conversations with investors before and I'll emphasize again, our main concern regarding supply chain for this year is the ability for Oems to manufacture and get access to various raw materials and components and gift cards to American roads that the zinc.

Speaker Change: And I emphasize it in multiple conversations with investors before and I'll emphasize it again. Our main concern regarding supply chain for this year is the ability for OEMs to manufacture and get access to various raw materials and components and get cars to American roads. That's, I think, where our main...

We're our main concern is centered around that are outside of our control, but with children for everybody in the market to leave a curse because again as we emphasized multiple times Java script, our business is tied to the adoption more evs most throughput more revenue for us.

Speaker Change: concern is centered around that's outside of our control, but we're cheering for everybody in the market to deliver cars, because again, as we emphasize multiple times throughout our script, our business is tied to EV adoption. More EVs, more throughput, more revenue for us. Gotcha. No, thanks. And I'll jump back in the queue here.

Gotcha, no, thanks, and I'll jump back in with Korea.

Thank you.

Our next question comes from the line of Craig Irwin with Roth Capital. Please proceed with your question.

Good morning, and thanks for thanks for taking my questions. So I'm quite curious about the C V go extend model.

Speaker Change: So, I'm quite curious about the cbgo extend model, you know, it seems your more recent implementation skew towards using equipment from two vendors, you know, one of them is used by a number of other.

It seems your more recent implementation skew towards using equipment from two vendors.

One of them is used by a number of other fast charging network operators, but the other happens to be the world's largest larger.

Speaker Change: fast charging network operators. But the other happens to be the world's largest.

Speaker Change: largest power supply producer and well-known as a low-cost, high-quality producer with very little representation in North America.

Just power supply producer and a.

Well known as a low cost high quality producer with very little representation in North America.

Speaker Change: Do you expect to maybe have some sort of an alliance or strategic agreement that would allow you assuredness?

Do you expect to maybe have some sort of an alliance or strategic agreement that would allow you assured supply or a different type of access for this equipment given that it looks like you might be blazing some trails for them, where they traditionally not had some they've not been very good at marketing global.

Speaker Change: different type of access for this equipment given that it looks like you might be blazing some trails for them where they traditionally not had some they've not been very good at marketing globally outside of you know the monster EMS companies and very large tech companies.

I'll try to you know the monster M S companies I'm very long for companies.

Speaker Change: Yeah, well, Craig, thanks for the question. On the hardware supply, as I think we've talked about before, our engineering team is.

Craig Thanks for the question on the on the hardware supply as I think we've talked about before our our engineering team is has it as a pretty.

Speaker Change: has an extremely rigorous process for qualifying any hardware that we put into the field that we put onto our network. And that'll be true for the EVgo Xtend customers as well as the assets that we retain ownership of. At the moment, we've got two preferred vendors for our fast charging equipment that are capable of supplying 350 kilowatt chargers, which is our standard ultra-fast configuration now. We have a couple of other vendors that we've used in the past, but the team is continuing to qualify others that are capable. Again, our exacting specifications for ultra-fast.

An extremely rigorous process for qualifying any hardware that we put into the field that we put onto our network and that'll that'll be true for the E. V go extend customers as well as what is the assets that we retain ownership of all at the moment. We've got we've got to preferred vendors for our fast charging equipment. We that that that are that are capable of supplying.

350 kilowatt charters, which is our standard cause ultrafast configuration now we.

We have a couple of other vendors that we've used in the past, but the team is continuing to qualify others that are capable again. They are exacting specifications for ultrafast frankly, the vendors had to catch up to what we wanted and to be able to do power sharing empower routing the vendors had to catch up so our team is continuing to look at.

Speaker Change: Frankly, the vendors had to catch up to what we wanted. And to be able to do power sharing and power routing, the vendors had to catch up. So our team is continuing to look at suppliers that will be able to meet those exacting standards that are essentially what we expect, and what drivers will expect, and what OEMs expect, which is the ability to ultra-fast charge reliably. So we wouldn't rule out any special sort of alliances with vendors in the future. But there's nothing more I can tell you at this point.

Or is that we'll be able to meet those exacting standards that are that are essentially what we expect and what drivers will expect them with Oems expect which is the ability to ultra fast charge reliably so.

So we we wouldn't rule out any special I'm sort of alliances with vendors in the future, but there's nothing more I can tell you at this point.

Speaker Change: Okay, and then just just as a follow up citing of charges can often be challenging for local site capacity for for electricity. Right? So a lot of a lot of conversation out there about.

Okay, and then just just as a follow up sighting of Chargers can often be challenging for our local site capacity for for electricity right. So a lot of a lot of conversation out there about co implementing with batteries for energy storage can you update us where you stand.

Speaker Change: co-implementing with batteries, with energy storage. Can you update us where you stand on this? Do you see this as strategically important over the next couple of years or is the format that you're using the format of choice and what you expect to pursue?

On this do you see this as strategically important over the next couple of years, whereas the format that you're using the format of choice and what you expect to pursue.

Yeah, well, we have we have probably a dozen stations in California that have onsite batteries and that was the we put them in years ago and that was again.

Speaker Change: Yeah, well, we have probably a dozen stations in California that have on-site batteries, and we put them in years ago, and that was, again, a good economic decision to avoid punitive demand charges. We are quite open to that.

Good economic decision to avoid punitive demand charges, we are quite open to it frankly, it wherever it wherever it will pencil economically it makes good sense and in some cases the utilities there'll be excited about it at the utilities modernize and go to more distributed energy sources and two way power flows I think there's going to be more interested in that and the prairie practical.

Speaker Change: frankly, wherever it will pencil economically, it makes good sense. And in some cases, the utilities will be excited about it. If utilities modernize and go to more distributed energy sources and two-way power flows, I think there's going to be more interest in that. The very practical question for us is, does the location have the footprint to have on-site storage?

Question for US is it does it does the location have the footprint to have onsite storage. What we're you know we're we're pretty excited about some of our larger projects under development, you know mega hubs Giga hubs charging hubs, where there will be <unk>.

Speaker Change: What we're, you know, we're pretty excited about some of our larger projects under development, you know, mega hubs, giga hubs, charging hubs, where there will be...

Speaker Change: room in a parking lot or in the location for onsite storage, but again, it all has to pencil for us. Our financial discipline is unwavering. It's got to pencil the double-digit return. So if it makes financial sense, we're open to it, and there's a lot of different ways, a lot of different people that can come to the party to help that pencil for us. But yeah, we've got the team that knows how to do it, and it's a possibility for the future. Excellent. Thanks for taking my questions.

Room in a parking lot or in the in the location for onsite George but again it all has to pencil for US we hit our financial discipline is unwavering, it's got a pencil to double digit returns. So if it makes financial sense, we're open to it.

And that's because there's a lot of different ways a lot of different people that can come to the party to help that pencil for us, but yeah. We got the team that knows how to do it and it's a possibility for the future.

Excellent thanks for taking my questions.

Yeah.

Our next question comes from the line of Ryan Greenwald with Bank of America. Please proceed with your question.

Hey, good morning, everyone.

Grabs starting with 22 guidance can we just help reconcile that in terms of the throughput being down 20%.

Speaker Change: It just helped reconcile a bit in terms of the throughput being down 20% and significant price deflation to LCFS credits, more modest.

And significant price deflation, but also your best credits more modest 5%.

Speaker Change: to revenue. Obviously you have the full year of contribution from Ricardo, but can you just talk a bit about other key offsets there?

Increase to revenue obviously, you have the four year of contribution from our cargo, but can you just talk a bit about other key offsets there.

Sure. So the first one for my son and network throughput. The main difference well, we haven't provided the formal guidance before just to send to everybody, but but from my understanding you either referenced in the stock back or your own forecast, but the the delta here is the deal.

Speaker Change: So the first and foremost, on the network throughput, the main difference.

Speaker Change: Well, we haven't provided the formal guidance before, just to send to everybody, but from my understanding, you are referencing the SPAC deck or your own forecast, but the delta here is the delay in the right-share recovery, so we continue with the good news that we have.

And rideshare recoveries. So we continue with the good news that we start to observe the rebound of rideshare and generally the industry well. We now are seeing is that there was not enough cars for older Rideshare operators.

Speaker Change: start to observe the rebound of ride-share in general as an industry, but what we now are seeing is that there is not enough cars for all the ride-share operators.

Speaker Change: to get and electrify their fleets. And that is delayed and that's a fact of a post-COVID Hanover and supply chain challenges. So that's the main driver of why the network throughput is probably below somebody's or everybody's expectation.

To get and electrify their fleets and that is delayed and that's a fact of our post call the turnover and supply chain challenges, but that's the main driver of why I'm. The network throughput is probably below somebody's everybody's expectation on the revenue side or on the revenue side, you're absolutely right they'll stay a fastest below one.

Speaker Change: On the revenue side, you're absolutely right, LCFS is below what we owe.

We all.

Speaker Change: thought even a few months ago and that is baked into a certain extent in our forecast but we're observing the situation of course the situation is dynamic

Thought even a few months ago and that is baked into a certain extent in all four of constable were observing the situation of course the situation is dynamic.

Speaker Change: Some of the offsets are our take-or-pay fleet contracts, which we see quite a strong pipeline on and making certain assumptions on when those projects will hit operation. And those are independent of throughput. Just to remind everybody, take-or-pay fleet dedicated contracts, it's a fixed amount of dollars paid to us a month, independent of…

Some of the offsets are our take or pay fleet concept, which was quite a strong pipeline on and making certain assumptions on when those projects will hit a duration and those are independent of throughput just to remind everybody to take or pay fleet dedicated construct it's a fixed amount of dollars paid to us in the months independent of <unk>.

Speaker Change: of the throughput, and we have quite a strong view on that for this year. And we didn't, on an extent side, we have, as Cassie mentioned, we have something vacant. We haven't included a full effect of that.

Oh, the throughput and we have quite a strong view on that for this year and we didn't on a on an expense side. We would have as Kathy mentioned, we have some but sometimes in bacon, we havent, but we haven't included a full effect of that here because most most of what's being baked in a well.

Speaker Change: here, because most of what's being baked in will manifest itself in 2023 and beyond. But there are certain modest inclusions on the second half of the year where we might see those effects, and they have been included here.

Manifest itself in 'twenty to 'twenty, three and beyond but there are certain modest conclusions on the second half of the year, where we might see those to Fox and they have been included here.

Great. Thank you and what is the embedded else here best credit pricing assumption that you guys are assuming that in 'twenty two and how are you thinking about timing of cash flow inflection. If these levels are sustained.

Speaker Change: Great, thank you. What is the embedded LCFS credit pricing assumption that you guys are assuming now in 2022, and how are you thinking about timing a cash flow inflection if these levels are sustained? So we're assuming 150 for the full year.

So we're assuming a 154.

For the full year.

And on cash flow inflection.

How would that kind of impact are you guys were thinking about things.

I'm not sure I fully understand your question and the cash flow inflection.

Speaker Change: I'm not sure I fully understand your question, and the cash flow inflection?

Speaker Change: in terms of which year you would expect to inflect positive.

In terms of which year.

You would expect to inflect positive.

Speaker Change: So we wouldn't provide that guidance, but I'd like to reiterate some of the messages I was giving in the script. We expect to be adjusted EBITDA positive at a moment in time when EV adoption is going to be around 2 and 1?2%. So it's 0 and 1?2% now. We, again, our businesses.

So what we wanted to provide that guidance, but I'd like to reiterate some of the messages I was given in the script, we expect to be adjusted EBITDA positive at a moment in time when EV adoption is going to be around two and a half for sensor to zero on a half percent now we again our business is very much tied to E. On.

Speaker Change: very much tied to easy adoption levels. If that 2.5% will hit earlier, then we'll be a bit more positive earlier, later, later. So that's how we think about our business, but we're not given a specific year guidance for that.

The option levels, if not two and a half per sand will heed earlier, then we'll will be EBITDA positive early or late or later, so that's how we think about our business, but we're not giving specific guidance for that.

Okay, great appreciate it thanks for the time.

Our next question comes from the line of Vikram you.

Please proceed with your question.

Good morning, everyone.

Speaker Change: Good morning, everyone. I have a multi-part question on California's federal.

Question on California study are you sure that you'd be too easy I see the issue, it's pretty hard to get the utilization is under 9%. How do you see that situation evolving over time, whereas keto more <unk> being installed do you see utilization coming down or do you see utilization green power here.

Speaker Change: You show that EV to EVS ratio is pretty high and yet the utilization is under 90.

Speaker Change: How do you see that situation evolving over time with more EBSDs being installed? Do you see utilization coming down, or do you see utilization going higher and EBSDs?

Speaker Change: And then, I think, Olga, you mentioned 6% of throughput is represented by Tesla charging.

You'd be up on D V. S C. They should stay where it is and then I think Oh, because you mentioned, 6% approved or even two quarters represent goodbye Tesla Chargers could you compare that to what percentage of connectors are there smoking the foods I believe that percentage is higher and how do you plan to sort of close that gap.

Speaker Change: Could you compare that to what percentage of connectors are Tesla connectors? I believe that percentage is higher and how do you plan to sort of close that gap?

Speaker Change: between the throughput and the percentage of connectors allocated to test.

Between the throughput and the percentage of connectors on the 52 decimal.

Speaker Change: And the third question I had was, Olga, you mentioned in your remarks that you pass on the higher cost of electricity because you get a heads up from utilities months in advance. You've had two price increases in California and multiple across the country so far this year. What percentage of the

The third question I had was already you mentioned in your remarks that to your boss wouldn't be hard cost of electricity because you get a heads up from your utilities months in advance you've had two price increases in California, and our multiple across the country or so far this year worked with certainty.

The revenue particular ward.

Speaker Change: year-on-year in 2022 is just being driven by higher energy costs that you are passing on to the customers.

These year on year in 2020 , two it's just being driven by higher energy costs that you are passing on to the customers.

Yeah, so the pause.

The first one.

We do expect utilization to go up over time, and let me kind of go back to the basics they cause the basics of discharge and utilization in D. C charging business, so that the utilization and just see children infrastructure is not only driven.

Speaker Change: We do expect utilization to go up over time. And let me kind of go back to the basics of DC charging utilization and DC charging business. So the utilization and DC charging infrastructure is not only driven.

Speaker Change: by EV to stall ratio. It also is driven by

By E V to stole ratio. It also is driven by energy density and what percentage of charging needs of this specific population is being met by D. C. So it was going to be very different in San Francisco versus the Santa Monica versus a place in the country, where people live and single homes and yeah. Just M. U D density is multi.

Speaker Change: MUD density and what percentage of charging needs of this specific population is being met by D.C.? So it's going to be very different in San Francisco versus Santa Monica versus a place in the country where people live in single homes. And on... Yeah, just MUD density is multi-unit, it's apartments. Apartments. Sorry. It's our internal jargon and I kind of assume everybody knows, but it's how many people live in apartments versus how many people live in single family homes. That's a very important driver because if you have a charger at home...

It's all departments Department, sorry, it's it's an hour and terminals are going and I kind of assume everybody knows what it is how many people live in apartments versus how many people live in single family homes. That's a very important driver because if you have a charge at home we have no illusions about it in the data confirms that you will use your charge at home and.

Speaker Change: We have no illusions about it and the data confirms that you will use your charger at home.

Speaker Change: And another very important factor here is electrification of fleets. Right now, San Francisco is quite an advanced market regarding fleets, but it's still not at its final endgame point. And with the expectation of more electrification of rideshare, and just as a reminder, we discussed this during our previous earnings call, an average commuter drives 11,000 miles a year, an average rideshare driver drives 40,000 to 60,000 miles a year, and on top of it, uses DC charging for 70% to 75% of their charging needs. So that's a massive...

Another very important factor here is electrification of fleets right now San Francisco is quite an advanced markets regarding fleets, but it's still not at its final end game point and what's the expectation of more electrification of rideshare and just as a reminder, would discuss that during our previous earnings calls and average.

Utah drives 11000 miles a year, an average ride share driver drive 40 to 60000 miles a year and on top of it uses the C charging for sand into the 75% of the charge and meet so that's a massive.

Speaker Change: that's a massive contribution to utilization. And so with that in mind, that kind of like just thinking about utilization as a function of a V2Stores ratio for the years to come is not fully correct. We do think that utilization for the network in five to six years on average will probably be around 18%. That's our best guess as of now. And that's how we run our models. We think it's fairly conservative as well, but we expect utilization to go up over time for the network.

Oh, that's a massive contribution so utilization and I'm. Just so was that in mind that kind of like just thinking about utilization as a function of them would be just those ratios for the years to come is not fully correct would do things that utilization wasn't that work in the five to six years on average will probably be.

[noise] around 18%, that's our best guess as of now and that's how we run our models, we think its fairly conservative as well, but we expect utilization to go up over time within that book.

Speaker Change: So that's answering your first question. The second question about the Tesla, I'm not sure I follow what the question is about. Can I ask if you? Are you asking, Vic, are you asking how many of our Tesla connectors are, to what extent the Tesla connectors on our EVgo chargers are reflecting that uptick of Tesla usage on our network? I'm just trying to get, I don't quite understand your question either. I was trying to understand what percentage of your total connected.

So that's that's answering your first question. The second question about the Tesla I am not sure I follow what the question was about kind of if you are you are you asking like are you asking how many of our of our Tesla connectors are how to what extent the Tesla connectors on the R. E. V go charters are reflecting that uptick of Testelin test.

While usage on our network up I'm, just trying to get I don't quite understand your question either.

Oh I'm trying to understand what percentage of your daughter's connectors audio network, our Tesla connectors and I believe that percentage is higher maybe.

Speaker Change: And I believe that percentage is higher, maybe, you know, 10 or 15% of your connectors are Tesla connectors, but the throughput allocated to Tesla vehicles is only 6%. And I was wondering, like, is it a factor of, you know, pricing not being competitive?

15% of your connectors are Tesla connectors would be throughput allocated to Tesla when he comes with only 6% and I was wondering like is it. The fact that off you know pricing not being competitive.

Speaker Change: Tesla drivers preferring Tesla connectors only, how do you sort of like close that gap where you're installing slightly higher percentage of connectors are allocated to Tesla, but the throughput percentage allocated to Tesla?

First of all our drivers, preferring a tesla connectors on the how do you sort of close that gap, where you're installing spiking hard percentage of connectors on undergraduate to desktop with the Cooper percentage allocated to pass laws, you're seeing as Louisville.

Speaker Change: I think I see what you say. We so we ramping up Tesla connectors and we were ramping them up throughout 2022. So that just.

I I think I see what you say, we so we were ramping up just looking at the sum of a ramping them up throughout 'twenty one to two so that just.

Speaker Change: extreme beginning of Tesla usage on our network.

It didn't even beginning of Tesla usage now in that book and it's it's a 6% of total retail uses across the country, we have geographies, where it's much much higher and it goes to a double digit.

Speaker Change: And it's 6% of total retail users across the country. We have geographies where it's much, much higher, and it goes to double digits.

Speaker Change: percentage, and the ratio gets reversed, that usage is very much dependent from what we've seen from early data on availability. So, geography by geography, you'll see very different ratios, very different percentages. Six percent is a blended number. But that is mostly driven by lack of Tesla infrastructure in a specific geography. So, for those geographies where the ratio of Tesla EVs versus Tesla superchargers is very different. So, that's a big difference. So, that's a big difference.

Percentage and the the ratio gets reversed that data usage is very much dependent from what we're seeing from early data on availability. So geography by geography, you'll see very different or it was just about a different person to just 6% of the blended number but that is mostly driven by lack of Tesla interests.

Structure in a specific geography, so for those geographies, where the ratio of Tesla Evs. There's this test will supercharge us is skewed and there is not enough infrastructure with some very high usage of Tesla or now now it's looking for the places where we're it's the first time there is a bundled service disasterous, there's not that many but they exist we don't see such high percentages.

Speaker Change: It's skewed, and there is not enough infrastructure. We see very high usage.

Speaker Change: of Tesla on our network, and for the places where it's reversed, and there's abundance of infrastructure, which is not that many, but they exist. We don't see such high percentages because, of course, Tesla drivers will use a Tesla supercharger before they come to us, but that's okay. That's what we plan for, and that's how our business model works. So that 6% number, which is very early in, and as I also mentioned in my script, that 15% of all new customers which sign up with EVgo are Tesla.

Because of course Tesla drivers will use it sounds, though supercharger before they come to us, but that's okay. That's what we planned for and that's how our business model works. So that 6% number which is very early evening and as I also mentioned in my script, you know in my script that at 15% of all new customers, which sign up was even go a tesla so.

Speaker Change: So which shows us that that 6% is positioned to grow further. We're quite happy about those results. So just to reinterpret, it's good news. It's not bad.

Which shows us that 6% is positioned to grow further we're quite happy about those results. So I'll just throw it in there, but it's a good news bad news.

Speaker Change: And then I think there's another question about electricity pricing, our pricing and electricity pricing. Do you want to talk a little bit about that? Right. So conceptually, we're not in the business of determining retail prices as a pure spread. And it's not necessarily that we are going to pass on consumers every single increase of tariffs. Because if we look at it...

And then I think there was another question about about electricity pricing our pricing in electricity prices or do you want to talk a little bit about that right. So conceptually, we're not were not as a business of determining retail prices as a pure spread and it's it's not necessarily that we're going to.

Pass on consumers every single increase of tariffs because if you look at it from a network perspective and in certain places, yes, you get indexation or you got the inflation or some tariff adjustments up and certain other ways. This was the great efforts of our market development team will get done.

Speaker Change: from a network perspective. And in certain places, yes, you get indexation, or you get the inflation or some tariff adjustments up. In certain other

Speaker Change: places with the great efforts of our market development team, we're getting access to much better tariffs and much better...

Access to much better tariffs and much better.

Speaker Change: per kilowatt-hour energy cost, and on top of it, with the increasing utilization and increasing throughput, demand charges, which still exist in our network, get amortized, which again translates into a lower per kilowatt-hour energy cost. So you have all these different, multiple...

Per kilowatt hour of energy costs and on top of it was the increasing utilization and increase in throughput demand charges, which still exists now and that will get amortized, which again translates into lower per kilowatt hour and they'll just go. So you have all the different multiple.

Speaker Change: factors and vectors of events happening on the network. And we, again, we're not passing a single cent back on a consumer. We're going back and estimating the whole network, or maybe like a market by market, and trying to see if that still makes sense, if economic.

Factors and factors of events happening on the network and we again, we're not we're not passenger single send back on a consumer where we're going back and estimating the whole network or maybe like a market by market and trying to see.

Does that still make sense, if economics still works and the other thing I would add is that what you've seen in California. Vic is it that we introduced first we went to kilowatt hour pricing from permanent pricing second we introduced time of use pricing at the behest of the utilities and the California Public utility Commission and we're being just watching about how what different types of consumer response.

Speaker Change: The other thing I would add is that what you've seen in California, Vic, is that we introduced – first, we went to kilowatt-hour pricing from per-minute pricing. Second, we introduced time-of-use pricing at the behest of the utilities and the California Public Utility Commission. And we've been just watching about what different types of consumer responses, driver responses there have been to cheaper early-bird pricing, higher on-peak pricing. And so what we do – and I think I might have said this before – we have a software backbone that will allow us to do customized pricing based on location, and we also introduced location-based pricing.

This driver responses there have been there's been two cheaper early bird pricing higher on peak pricing and so we do and I think I Might've said this before we have a software backbone that will allow us to do customized pricing based on location and we also introduced location based pricing. So our pricing is not inextricably linked to the.

Speaker Change: So our pricing is not inextricably linked to the electricity cost. There are a multitude of attributes that we use to determine what pricing will make the most sense that will deliver value to drivers and will maximize income to us. Understood. Thank you. And our next question comes from the line of Bill Peterson with JPMorgan.

Because there are a multitude of attributes that we use to determine what pricing will make the most sense that will deliver value to drivers and will maximize income to us.

Yes. Thank you.

And our next question comes from the line of Bill Peterson with Jpmorgan. Please proceed with the one question.

Hi, this is calling in for bill and thanks. So much for taking my question. So just really quickly have you seen any impact from any permitting delays and if so has it been prevalent in any particular geographies and then maybe could you give us the latest timing from order to up and running essentially from site selection.

Bill Peterson: geographies and then maybe could you give us the latest timing from order to up and running

Two installation.

Speaker Change: Yeah, yeah, yeah. You know I love this question. This is like my favorite topic, is creating the flywheel so that we can deploy more fast chargers more quickly. So I will start off with, our pipeline continues to grow. Site hosts continue to be really excited about having charging infrastructure on their parking lots.

Yeah, Yeah, yeah yeah.

You know I Love. This question. This is like my favorite topic is creating the flywheel. So that we can deploy more five star just more quickly. So I will start off with you know our pipeline continues to grow site has continued to be really excited about having charging infrastructure in their parking lot still takes us four to eight weeks to actually like start digging and then get the get the station built.

Speaker Change: It still takes us four to eight weeks to actually start digging and then get the station built.

Speaker Change: What we're seeing is, you know, and again, last year I talked about going from 18 months on average down to six months. We are still nowhere close to six months. That's still my dream, but we've got a long way to go. As we go into new jurisdictions, it is often the first time a local government has, like, had to approve a charging station. The variability around that timing, it can be as short as one week, and it can be as long as 12 months for the local government permit, and I kid you not.

What we're seeing is them you know and and again last year I talked about going from 18 months on average down to down to six months. We are still nowhere close to six months, that's still my dream, but we've got a long way to go as we go into new jurisdictions. It is often the first time a local government has like had to approve a charging station the variability.

Around that timing it it can be as short as one week and it can be as long as 12 months for the local government permanent and I Kid you not similarly weight with utilities approving designs and getting easements with the landlord again it can be as quick probably as four to six weeks and as long as 12 months and then and then the final energized.

Speaker Change: Similarly, with utilities approving designs and getting easements with the landlord, again, it can be as quick, probably as four to six weeks, and as long as 12 months. And then the final energization process that the utilities have to do for inspection, again, that can be like next day, or that can be probably six to eight weeks.

Asian process that the utilities have to do for inspection again that can be that can be like next day or that can be probably a six to eight weeks. We had a whole bunch of stalled is done at the end of 2021 like dozens and dozens and dozens that we're that we're completely ready for drivers except that utility had to come along and do the final inspection. So.

Speaker Change: We had a whole bunch of stalls done at the end of 2021, like dozens and dozens and dozens, that were completely ready for drivers, except the utility had to come along and do the final inspection. So we've got Connect the Watts that we're pushing on, like to continue to like share best practice.

We've got connect to watch that we're pushing on like to continue to like share best practice, the more activity in the sector. The quicker we assume it'll go it's like early days of solar.

Speaker Change: The more activity in the sector, the quicker we assume it'll go. It's like early days of solar. But it is something that we're continuing to work on. And as I say, making progress. But I think I can't give you a number, because variability is still we've got super fast players, and then we've got super slow-mo. And I don't know that the latest is probably on the distribution around that, but it's a pretty wide distribution. Hope that helps. Yes.

But it is it is something that we're continuing to work on and like as I say, making progress, but I think I can't give you a number because the variability is still we've got we've got superfast players and then we've got Super slow Mo and I don't know the latest is probably on the on the on the distribution around that but it's a pretty wide distribution hope that helps.

Yes, thanks, so much for the color.

Okay.

Yeah.

And our next question comes from the line of Andre Shepard with Cantor Fitzgerald. Please proceed with your question.

Speaker Change: Hey guys, thanks for taking my question. Congrats on the quarter and thanks again for running a few minutes over and taking all of our questions. Maybe just to quickly follow up from the last question there. Are you able to give us any sort of breakdown in terms of how quickly you can convert those over 3000 stalls?

Hey, guys. Thanks for taking my question Congrats on the quarter end and thanks again for running a few minutes over and taking all of our questions. Maybe just to quickly follow up from the last question. There are you able to give us any sort of a breakdown in terms of how quickly you can convert those.

You know over 3000 stores that are in the pipeline are into operational and and maybe in addition to that and he any plans of expanding you know abroad. You know I know some of your peers have been increasing their footprint in Europe . For example, so I'm just wondering if that's something that's a.

Speaker Change: that are in the pipeline into operational, and maybe in addition to that, any plans of expanding abroad? I know some of your peers have been increasing their footprint in Europe , for example, so I'm just wondering if that's something that's being thought of. Thank you.

That's the total.

Speaker Change: Yeah, so on the timing look, I think that like.

Yeah. So on the on the timing look I think that like the what we're what we're now doing is sort of counting on at least 12 months from idea to energize Asian right not not wishing for six months or counting on 12 months and we're working really hard on that and again you know so that's that's what we're doing right now like there's three.

Speaker Change: What we're now doing is sort of counting on at least 12 months from idea to energization.

Speaker Change: Not wishing for six months or counting on 12 months and we're working really hard on that. So what we're doing right now, there's 3,000 to 3,300. Those are going to get energized. There's going to be dogs that take longer and then there's going to be super quickie ones. But generally speaking, those are going to be sites that are going to go. The 3,000 to 3,300 have been in planning for a while that are going to go live. But then we're building the pipeline for even bigger numbers for 23, 24, 25. So that's kind of what our site host development team is working on.

The 3300 those are gonna get energized you know there's going to be there's going to be dogs that are take longer and then there's going to be super quickie ones, but generally speaking when those are going to be sites that are gonna go the three that substitute.

<unk> 3003, 3300 I've been in planning for a while that are going to go live but then we're building the pipeline for even bigger numbers for 'twenty three 'twenty four 'twenty five right. So that's kind of what our what our site hosts development team is working on them. So it and that's just that's just sort of learning it like will be delighted if it starts to go faster it will be done.

Speaker Change: So, and that's just sort of learning it, like we'll be delighted if it starts to go faster. Like, we'll be delighted. On the overseas planning, we'll, look, we've got our hands full, we're really busy, we're actively doing all kinds of things in the United States. With that said, we'll be opportunistic. If there's an opportunity to naturally sort of extend our expertise, our skill, and our returns, you know, and bring in, you know, bring in, grow the business overseas, we wouldn't be closed to it, but it's not something that we're actively pursuing at this point.

Hum on the on our overseas planning well well look we've got our hands full we're really busy were actively doing all kinds of things in the United States with that said, where we will be opportunistic if there's an opportunity to naturally sort of extend our expertise our skill and our and our returns you know bring in it you know bring in.

Throw the business overseas, we wouldn't be closer, but it's not something that we're actively pursuing at this point.

Speaker Change: Got it. Very helpful. Thanks again.

Got it very helpful. Thanks, again and again congrats on the court.

I appreciate it thank you.

And ladies and gentlemen, we have reached the end of the question and answer session.

This concludes today's conference as well you may disconnect your lines at this time. Thank you.

Thanks for your participation.

Yeah.

Okay.

Speaker Change: © transcript Emily Beynon

Hum.

Okay.

Okay.

Okay.

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Okay.

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