Q1 2022 Cepton Inc Earnings Call
Good afternoon, everyone, and welcome to Stepton's first quarter 2022 earnings conference call.
Good afternoon, everyone and welcome to step tons first quarter 2022 earnings conference call.
Today's call is being recorded and we have allocated one hour for prepared remarks and Q&A.
Today's call is being recorded and we've allocated one hour for prepared remarks and Q&A.
At this time, I'd like to turn the conference call over to Hall Hsu, Chief Financial Officer.
At this time I'd like to turn the conference call over to Horseshoe Chief Financial Officer you.
You may begin.
Thank you and welcome, everyone, to StepTown's first quarter 2022 earnings call and business update. With me today is Jun Pei, co-founder and chief executive officer.
Thank you and welcome everyone to step towards first quarter 2022 earnings call and business update with me today is <unk> co founder and Chief Executive Officer.
During the call, we may refer to our unaudited GAAP financials and non-GAAP measures in our earnings release.
During the call we may refer to our unaudited GAAP financials and non-GAAP measures in our earnings release, the non-GAAP financial measures should not be considered as a substitute or superior to the measures of financial performance prepared in accordance with GAAP reconciliation for non-GAAP measures are included in our.
The non-GAAP financial measures should not be considered as a substitute or superior to the measures of financial performance prepared in accordance with GAAP. Reconciliation for non-GAAP measures are included in our earnings release.
Earnings release.
I would like to remind everyone that comments made in this conference call may include forward-looking statements regarding the company's expected operational and financial performance for future periods.
I'd like to remind everyone that comments made in this conference call May include forward looking statements regarding the company's expected operational and financial performance for future periods. These statements are based on the company's current expectations and are subject to the safe Harbor statements relating to forward looking statements.
These statements are based on the company's current expectations and are subject to the safe harbor statements relating to forward-looking statements contained in our earnings release and the slides that accompany this call.
Contained in our earnings release, and the slides that accompany this call.
Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of risks, uncertainties, or other factors, including those discussed in the earnings release or during today's call and those described in our filings with the USSEC.
Actual results for future periods may differ materially from those expressed or implied by these forward looking statements due to a number of risks uncertainties or other factors, including those discussed in the earnings release or during today's call and those described in our filings with the U S. S E C.
We are not undertaking any commitments to update those statements as a result of future events except as required by law.
We are not undertaking any commitment to update those statements as a result of future events, except as required by law.
As a quick reminder, this call is being recorded, and you can find the earnings release and slides that accompany this call, as well as the webcast replay of this call at investors.steptown.com. Now I would like to turn the call.
As a Cook a reminder, this call is being recorded and you can find the earnings release and slides that accompany this call as well as the webcast replay of this call at investors stuff that Tom I'll call.
Now I would like to turn the call over to chip.
Thank you, all, and good afternoon, everyone. Thank you for joining CEPTOM's first quarter earnings call.
Thank you Paul and good afternoon, everyone.
Thank you for joining <unk> first quarter earnings call.
We will provide a business update and review first quarter 2022 financial results with you.
We will provide a business update and review our first quarter 'twenty to 'twenty two financial results with you.
As you may know from our April 5th announcement, today is Hal Xu's first earnings call as our Chief Financial Officer. I look forward to working with Hal in his expanded role as CFO to continue executing our 2022 milestones in this momentous year for CEPTOM.
As you May know from our April 5th announcement today is hall. She was his first earnings call as our Chief Financial Officer.
I look forward to working with Paul and his expanded role as CFO to continue executing our 2022 milestones in this momentous year for <unk>.
Our LIDARs are designed with the philosophy that it must achieve a balance between performance, cost, and reliability.
Alright ours are designed with the philosophy that it must achieve a balance between performance cost and reliability.
Our MMT LiDAR is the direct result of our design philosophy that enabled CEPTOM to win the largest ADAS series production award to date.
Our M. T. Lidar is the direct result of our design philosophy that enabled <unk> to win the largest the EA series production awards to date.
This not only validates the viability of SEPTON's LiDAR for commercial ADAS, but also demonstrates LiDAR-enabled safe autonomy is more than a luxury feature. It is an integral part of automotive safety that should be available for everyone.
This not only validates the viability of sometimes lidar for commercial ate us, but also demonstrates lidar enabled safe autonomy is more than a luxury feature. It is an integral part of automotive safety that should be available for everyone.
I will start off with an update on our Oh, you have a serious production execution I'm happy to report we have started shipping the samples in support of General Motors Ultra cruise program.
I will start off with an update on our OEM series production execution. I'm happy to report we have started shipping D samples in support of General Motors' Ultra Cruise program.
The d-sample units have been shipped to multiple manufacturing sites across the U.S.
But these simple units have been shipped to multiple manufacturing sites across the U S.
As a reminder, D-sample represents the final stage in hardware validation with production intent. In what has been a long process, starting with our initial engagement in 2017, SEPTONG is nearing the final phases of execution, making LIDARs available in consumer vehicles.
As a reminder, these sample represents the final stage in hardware validation with production the intact.
What has been a long process starting with our initial engagement in 2017 Sept hung is nearing the final phases of execution, making light hours available in consumer vehicles.
We expect saleable vehicles to be equipped with SEPTON LiDAR towards the end of this year.
We expect available vehicles to be equipped with some kind of light or towards the end of this year.
By then, we'll be within just a few months from start of production where Ceptan is the sole supplier for the next four years and beyond.
By then we will be within just a few months from start of production, where Samsung is the sole supplier for the next four years and beyond.
We continue to work closely with our Q1 partner, Koito Manufacturing.
We continue to work closely with our tier one partner co eat all manufacturing.
and have started transferring manufacturing processes, equipment, and software in preparation for scale production.
And have started transferring manufacturing processes equivalent and sulfur are in preparation for scale production.
With LiDAR being a critical component of safety for commercial ADAS, it is important to have a Tier 1 supplier as our partner to support scale production.
With slide are being are critical components, all 54 commercial ate us it is important to have a tier one supplier as our partner to support scale production.
Most global OEMs require a Tier 1 supplier who will stand behind the product.
Most of the global Oems require a tier one supplier who will stand behind the product.
We anticipate this partnership will not only drive future series production wins, but also help scale production to meet the growing demand of our product.
We anticipate this partnership will not only drive future series production wins, but also help scale production to meet the growing demand of our products.
Speaking more broadly on automotive, I continue to believe that commercial validation will be the ultimate differentiation. Our series production award not only give us a significant momentum and attention from other OEMs, but also place the increased attention on the importance of LiDAR in automotive safety.
Speaking more broadly on automotive I continue to believe that commercial validation will be the ultimate differentiation at all.
Serious production award not only gave us a significant momentum and attention from other Oems, but also praised the increased attention on the importance of lidar in automotive safety.
We continue to make progress on engagement with other top 10 OEMs and top trucking companies.
We continue to make progress on engagement with other top 10, Oems and top trucking companies we.
We believe that in order for LiDAR to be implemented in everyday consumer vehicles, the price point must start below $1,000 and work its way down to mid-three digits per unit in order to accelerate large-scale adoption.
We believe that in order for lidar to be implemented in everyday consumer vehicles. The price point must start below $1000 and work its way down to mid three digit per unit in order to accelerate large scale adoption.
Our unique MMT technology achieves a balance of performance, cost, and reliability.
Our unique M M T technology achieved a balanced performance cost and reliability.
This balance enables SEPTOM to deliver a high-quality LiDAR that can be placed into everyday consumer vehicles without compromising safety.
This balance enables <unk> to deliver a high quality lidar that can be placed into everyday consumer vehicles without compromising safety.
In addition to our long-range forward-facing LiDAR, which won the largest ADAS series production award, we are also working on a near-range LiDAR product, NOVA.
In addition to our long range forward facing Lidar, which won the largest the EA series production Award.
We are also working on a narrow range lidar product NOLA.
with which we continue to make progress with top automotive and trucking OEMs.
With which we continue to make progress with top automotive and trucking Oems.
We're starting to ship NOVA B samples to OEMs for evaluation this quarter.
We're starting to ship, Nova B signpost to Oems, where evaluation this quarter.
One of our key strengths in our LiDAR product is vehicle integration, such as the ability for the LiDAR to be placed behind the windshield.
One of our key strengths in our Lidar product, it's the vehicle integration such as the ability for the lidar to be placed behind the windshield.
This offers distinct advantages in vehicle design flexibility and product reliability for the OEM and aesthetic benefits for the consumer.
This offers distinct advantages in vehicle design flexibility and product reliability for the OEM and aesthetic benefits for the consumer.
Vehicle integration flexibility stems from the small form factor and low power consumption of our LiDAR that is a benefit of our MMT innovation.
Vehicle integration flexibility stems from the small form factor and low power consumption of our lidar that has the benefit of our M. M T in Malaysia.
We are one of the very few companies in the industry with this capability and the only company with a major series production award.
We're one of the very few companies in the industry with this capability and the only company with a measure of serious production award.
We have received many calls from other interested automotive OEMs on this feature alone.
We have received many calls from other interested the automotive Oems on this feature alone.
We have seen accelerated enthusiasm from consumers on vehicles that have been awarded to us across multiple platforms, and consumer automotive demand is off to a strong start in 2022.
We have seen accelerated enthusiasm from consumers on vehicles that have been awarded to us across multiple platforms and consumer automotive demand is off to a strong start in 2020 two.
Our LiDAR product was created with consumer ADAS in mind, and we will be one of the first LiDAR companies to capture this rising demand.
Our lidar product was created it was consumer eight us in mind, and we will be one of the first lidar companies to capture this rising demand.
In the coming decade, we expect ADAS to be the application that represents over 80% of the LiDAR addressable market and will provide the largest return on investment.
In the coming decade, we expect to aid us to be the application that represent over 80% of the light our addressable market and will provide the largest return on investment.
We have applied many of the learnings from the automotive market, particularly its stringent requirements for performance and cost, to our smart infrastructure customers.
We have applied many of the learning from the automotive market, particularly stringent requirements for performance and cost to our smart infrastructure customers.
There is a growing demand for both our LiDAR sensors and our LiDAR perception software, where we are beginning to see our engagement mature beyond the proof-of-concept phase and leading to meaningful purchase order volumes.
There is a growing demand for both our lidar sensors and our Lidar perception software, where we are beginning to see our engagement mature beyond the proof of concept phase and leading to meaningful purchase order volumes.
Moving up the software stack has helped us reach many customers who demand a complete perception solution.
Moving off the software stack has helped us to reach many customers who demand a complete perception solution.
On the horizon.
We have completed design milestones of our second ASIC, which will drive further performance enhancement and cost reduction. We look forward to sharing more news with you in the coming quarter.
We have completed design milestones of our seven Essex, which will drive further performance enhancement and cost reduction we look forward to sharing more news with you in the coming quarters.
In the near term, our focus remains on OEM series production execution, and we're looking forward to building our momentum for the rest of the year. I will now turn the call over to our CFO , Hao Xu.
In the near term our focus remains on Oh, Yeah in series production execution, and we're looking forward to building our momentum for the rest of the year.
I will now turn the call over to our CFO policy.
Thank you Jim.
In February , we closed our business combination with Growth Capital Acquisition Corp. and renamed the surviving entity Septon, Inc.
In February we closed our business combination with growth capital acquisition Corp, and renamed the surviving entity stepped down Inc.
Concurrent with the transaction, we closed the pipe investment anchored by COITO in the total amount of 59.5 million.
Concurrent with the transaction, we closed the pipe investment anchored by Quito, and the total amount of $59 5 million.
we received approximately $48 million net of fees. Moving on to our first quarter results, total revenue for the quarter was $1.5 million, up 239% year over year, and 16% sequentially, and consists of 100% product revenue.
We received approximately $48 million net of fees.
Moving on to our first quarter results total revenue for the quarter was $1 5 million up 239% year over year, and 16% sequentially and consist of 100% product revenue.
GAF net income was $41.2 million, or $0.36 per share, and $0.32 per.
GAAP net income was $41 2 million or 36 cents per share.
And 32 cents per diluted share.
non-GAF net loss was $12.2 million, or 11 cents per share, both basic and diluted.
non-GAAP net loss was $12 2 million or 11 cents per share both basic and diluted.
Weighted average basic shares outstanding for the first quarter was 115.9 million and on a diluted basis, it's 127.1 million shares.
Weighted average basic shares outstanding for the first quarter was $115 9 million and on a diluted basis, it's the $127 1 million shares.
non-GAAP adjustments include a $56.7 million gain on re-measurement of burnout share liability.
non-GAAP adjustments include a $56 7 million gang.
Remeasurement of earn out share liability.
2.7 million non-recurring transaction costs related to our SPAC transaction.
$2 7 million nonrecurring transaction costs related to our spec transaction.
stock-based compensation of $1.3 million and a $0.8 million gain on re-measurement of our warrant liabilities.
Stock based compensation of $1 3 million.
And 0.8 million gain on Remeasurement of our warrant liabilities.
Yeah.
non-GAAP adjusted EBITDA was negative 11.4 million.
non-GAAP adjusted EBITDA was negative $11 4 million.
As of March 31st, 2022, we had available liquidity of approximately $160 million.
As of March 31, 2022, we had available liquidity of approximately $160 million.
Total available liquidity consists of approximately $45 million in cash and short-term investments, $15 million remaining on the Trinity Loan Facility, and a commitment to purchase up to $100 million in equity from Lincoln Park Capital.
Total available liquidity consists of approximately $45 million in cash and short term investments.
2 million remaining on the Trinity loan facility and a commitment to purchase up to 100 million in equity from Lincoln Park capital.
As we said in our FY 2021 earnings call, we expect 2022 revenue to be back half-weighted as our development programs achieve their remaining milestones.
As we said in our FY 2021 earnings call. We expect 2022 revenue to be back half weighted as our development programs achieve their remaining milestones.
Starting off with Automotives.
We remain on track to complete the desample phase by the end of the year and have saleable vehicles equipped with Setsound LiDAR. We expect to ship several thousand units this year, equipping multiple vehicle models manufactured in multiple assembly plants across the United States in preparation for scale production.
We remain on track to complete the B sample phase by the end of the year and have scalable vehicles equipped with steps on Lidar, we expect to ship several thousand units. This year equipping multiple vehicle models manufactured multiple assembly plants across the United States in preparation for scale production.
On smart infrastructure, we are seeing robust demand for our VISTA-P and SORA-P LiDAR as well as our Helios software product from our customers around the world. And this will drive meaningful volume as projects mature throughout the year.
All smart infrastructure, we are seeing robust demand for our Vista P and Sabra P lidar as well as ours Healy our software product from our customers around the world.
And this will drive meaningful volume as projects mature throughout the year.
We remain extremely focused on execution of the industry's largest ADAS series production award to date and on winning additional awards. We are confident in our long-term growth plan and our path to be a market share leader. Now I'd like to open
We remain extremely focused on execution of the industry's largest aid a series production award to date and on winning additional awards. We are confident in our long term growth plan and our path to be a market share leader.
Now I'd like to open the call for questions.
Ladies and gentlemen, we will now begin the question and answer session.
Ladies and gentlemen, we will now begin the question and answer session. To ask a question, you may press star and then one on a touch-tone telephone. If you are using a speakerphone, we ask that you please pick up your handset before pressing the keys to ensure the best sound quality.
I ask a question you May press Star and then one on your Touchtone telephone if you are using a speaker phone and we ask that you. Please pick up your handset before pressing the keys to ensure the best sound quality.
If at any time your question has been addressed and you would like to withdraw your question, you may press star and two.
But any time your question has been addressed and you'd like to withdraw. Your question you May Press star two.
Once again that is star and then one to join the question queue.
Once again that is star and then one to join the question queue.
We will pause momentarily to assemble the roster.
Yeah.
Our first question today comes from Matthew Galinko from Maxim Group. Please go ahead with your question.
Our first question today comes from Matthew <unk> from Maxim Group. Please go ahead with your question.
Hey, good afternoon. Thanks for taking my questions. Can you give us an update on what you're seeing in the supply chain? And if that if you're from your point of view, if there's any elevated risk and how you're.
Hey, good afternoon. Thanks for taking my questions can you give us an update on what you're seeing in supply chain and that's that.
If you're if you're from your point of view, there's any elevated.
Risk.
And how you're managing that.
Thank you very much for the question, Junpei here, CEO of Ceptang. For the Q&A session, I also have our Senior Vice President of Business Development, Mitch Hortini, joining us in answering the questions. Specifically, coming to the supply chain.
Oh, Thank you very much for the question Oh, Jim pay here, you all stepped down and for the Q&A session. I also have our senior Vice President of business development. Dr. Mid 14 year, joining us in answering the questions specific they are coming to their supply chain.
<unk>.
There are certainly very much awareness of the issues with the supply chain. Very fortunately for us, we are actually into the A, B, C, right now, D sample stage with limited volume requirement. We are being alerted for all the supply chain issues, but we're not hitting a huge obstacle with the current quantity needed to supply samples for the General Motors Autocruise program. Frankly, it's not actually affecting our execution at all at this point, but we're very much vigilant making a lot of preparation for this coming year, 2023, where the SOP will actually start.
There are certainly very much awareness of the issue is always the supply chain very Fortunately for us, though we are actually into you know the a b C. Right now the sample stage job with limited volume requirements are we are you know being alerted them for all the supply chain issues, but we're not getting a huge.
Obstacle with the current quantity needed to supply samples for the General Motors Ultra cruise program are frankly is not actually affecting our execution at all at this point, but we're very much vigilant up making a lot of preparation for this coming year 2023, where the S. L. P will actually start.
Yeah, thanks, June . This is Mitch Hortini. I'll just add, you know, when you're working with Coedo and General Motors, they have tremendous risk mitigation processes that help us with this issue. And they've been working with us as needed to address any concerns.
Yeah. Thanks Joon. This is mature teeny I'll just add you know when you're working with Quito and general motors, they have tremendous risk mitigation processes that help us with with this issue and they've been working with us as needed to address any concerns there on the smart infrastructure side that the law.
On the smart infrastructure side, that's a little bit more lower volume. Yes, it's become a little bit harder and more expensive to get some key components, but we've been able to procure those and, for the most part, pass on that cost increase.
Little bit more of lower volume.
Yes, it's become a little bit harder and more expensive to get some key components.
But we've been able to procure those and for the most part pass on that cost increase to our customers.
Got it Okay. That's helpful and then I guess as a follow up I'm not sure if I missed it in your prepared remarks, I apologize, but if you mentioned this but.
Got it. Okay, that's helpful. And then I guess the follow-up, I'm not sure if I missed it in your prepared remarks, so I apologize if you mentioned this, but are you standing by the guidance you previously provided or did you provide an update to that?
Are you standing by the guidance you previously provided or did you provide an update to that.
Okay.
Yes, we are actually standing by our current guidance. Specifically, we have the execution of the GM program, the Ultracruise program, all on schedule. We started, this is a very early process from 2017 until we got a design win in 2019. At the time we were awarded the design win, the schedule was a SOP of 2023. After almost three years of hard work until now, the SOP time is still 2023. So yeah, we stick to our.
Yes, so we are actually spending by our current guidance I you know specifically we have the execution of the GM program Ultra cruise program are all on schedule. You know we started this is a very already a process from 2017 until we got a design win in 2019 at the time, we were awarded the design win.
The schedule was say S. O P of 2023 after almost three years of hard work until now the S. O P time, it's still a 'twenty 'twenty three so yeah, we stick to our guidance and Matt. This is Paul I, just wanted to add a little bit more color. So for 2022 as we mentioned that revenue is going to be back.
I just want to add a little bit more color. So for 2022, as we mentioned, the revenue is going to be back half-weighted. Right now we're not seeing any constraints on the demand side. And you mentioned the – you asked about the supply constraints. If it becomes worse toward the end of the year, that we may have some
Half weighted.
Right now, we're not seeing any constraints on the demand side.
And you mentioned the you asked about the the supply constraints if it.
Cause a worse towards the end of the year that we may have some issues meeting those units, but we're not seeing that right now so we're standing by our full year guidance.
Thank you. And one last question, then I'll jump back in the queue. I guess it's been, well, as you approach
Thank you and one last question then I'll jump back in the queue I guess, it's been.
Well as you approach production with with T M.
with GM, and I guess it's been a couple of quarters now that you've sort of been public with, you know, who you're working with. Just, I guess, give us an update on how other OEMs are responding to that development, and as you move closer to production with GM, are you seeing, you know, some of the fast follower type OEMs?
And then I guess, it's been a couple of quarters now that you've sort of been public with you know who you're working with I guess give us an update on how other Oems are responding to that development and as I do move closer to production with Jam are you seeing you know some of the fast follower typo Oh yeah.
Hum moved through the pipeline or or you know move more quickly through the pipeline or how has that changed over the last couple of quarters. Thank you.
move through the pipeline or you know move more quickly through the pipeline or how has that changed over the last couple of quarters? Thank you.
Yeah, that's a great question. Certainly, with the GM announcement up to today for the past couple of quarters, we're getting a lot more attention from other OEMs. I'll let Mitch actually elaborate a little bit more on that.
Yeah, that's a great question.
Certainly it was the C. M announcement, the op to today for the past couple of war quarters, all we're getting a lot more attention from other Oems. So I'll, let Mitch I tried to elaborate a little bit more on the yeah.
Yeah, Matthew, this is Mitch. We're still currently engaged with all 10 of the top 10 global auto OEMs.
Yeah, Matthew this is Mitch.
We're still currently engaged with all of the all 10 of the top 10 global Auto Oems.
More than half of those were in at least the RFI phase.
More than half of those were in the at least the RFID phase. The Rsi phase can can vary from a few months to in excess of a year depending on the OEM.
uh... the rfi faith can can very from a few months to in excess of a year depending on the olympia
So we have gained a lot more interest from additional top 10 OEMs because it adds more details about the GM Alter Cruise Program come out. I would say
So we have gained a lot more interest from additional top 10 Oems because of as more details about the GM Ultra cruise program come out.
I would say.
The interest is more about vehicle integration, performance, and cost, and solidifying those three, and keeping an eye on our development milestones. So, yes, you know, to summarize.
The interest is more about vehicle integration performance in cost in solidifying those those three and keeping an eye on our development milestones. So yes.
Now to summarize it is definitely accelerating.
Thank you.
Once again, if you would like to ask a question, please press star and then 1.
Once again, if he would like to ask a question. Please press star and then one.
Our next question comes from Sam Peterman from Craig Hallam Capital Group. Please go ahead with your question.
Our next question comes from Sam Peter Mann from Craig Hallum Capital Group. Please go ahead with your question.
Hi, guys. Thanks for taking my questions.
Hi guys. Thanks for taking my question. I want to ask on NOVA. It's pretty interesting that you're starting to ship that B-sample, and I was just curious, how broad is the interest you're seeing for NOVA relative to kind of what you've seen and what you are seeing for your long-range LiDAR products?
Want to ask on Nova it's pretty interesting that you're starting to ship that'd be sample and I was just curious how broad is the interest you're seeing for novo relative to kind of what you've seen and what you are seeing for your long range Lidar products.
Well, again, thanks for asking that question. In general, the entire automotive industry, with the GM design win and with the latest progress from many other fronts, there is a
Well again.
Again, thanks for asking that question in general the entire automotive industry with the G. M design win and all with the latest progress.
And many other fronts.
There's a gravity towards a lidar is going to be used for the automotive safety in the future. This will include both the long range Lidar and short range Lidar NOLA is in your range Lidar, we have developed a it's really getting a lot of attraction, So Michigan aphelion Oh on the.
Gravity towards a LIDAR is going to be used for the automotive safety in the future This will include both the long-range LIDARs and short-range LIDARs Nova is the near-range LIDAR we have developed. It's really getting a lot of attraction so Mish can fill in on the enthusiasm for this product
And for this product.
Yeah, definitely. As June indicated, the automotive space, especially the OEMs that have already announced adoption of LiDAR, are already beginning to look at additional applications for LiDAR, which includes near-range, short-range, medium-range applications.
Yeah definitely is June indicated.
The automotive space, especially the Oems that have already announced adoption of Lidar are already beginning to look at additional applications for Lidar, which includes near range short range medium range applications. I think if you look at our Nova product what's interesting for potential customers is it's reuse.
I think if you look at our Nova product, what's interesting for potential customers is it's reusing the MMT technology, which we're validating for General Motors. So we're simply scaling that technology down. So the maturity, the cost projections, the reliability is all proven.
<unk> V M M T technology, which we're validating for general Motors. So we're simply scaling that technology down. So you know the maturity the cost projections. The reliability is all proven relative to our other solutions on the market. So so that's the inter.
relative to other solutions on the market. So that's the interest. In terms of applications and use cases, I would say it's an order of magnitude higher than long-range LiDAR and expands even well beyond automotive. So there's just a tremendous amount of interest.
Chris in terms of applications and use cases, I would say, it's an order of magnitude higher than long range, Lidar and expands even well beyond automotive. So there's just a tremendous amount of interest in our Nova product.
Oh, Thanks for that detail second question, you talked on the last call about it.
Thanks for that detail. Second question you talked on the last call about.
a pretty good engagement in China with OEMs there. I was curious if recent events have changed OEMs outlooks or plans or timing for deployment at all and if you could talk to that that'd be great.
I'm pretty good engagement in China.
Oems there I was curious if recent events have changed.
Oh ends outlooks or plans or timing for it.
Appointment at all and if you could talk to that that'd be great.
Hey Sam, this is Hall. So our China progress is continuing, so...
Hey, Sam This is hall, so our China progress is continuing so part of our plan.
plan is to bring up the China team in terms of technology and
Plan is to bring up the China team in terms of technology and application.
expertise. We're also trying to find a Tier 1 that we have the confidence to work with and address the challenges.
Expertise. We're also trying to find a tier one that we that we have a confidence to work with and our dress the China opportunity together the China market is as you know overall is it 40% of the global automotive market. So it is a large one that we are a focused.
The China market is, as you know, is, you know, overall is at 40% of the global automotive market. So it is a large one that we are focused on.
Don.
In China, the speed of technology innovation is actually quite fast. If you follow the development of their EVs, they're actually putting
And China the speed of Tech technology innovation is actually quite fast if you follow the development of their evs are they're actually putting a lie ours are in a in a somewhat near term right. When we think about near term. It's you know two years out.
So look, pay attention to future announcements from us.
So the pay attention to our future announcements from us. So we do expect to have some program wins.
This year.
Okay. That's great and then last one kind of a simple question, but not knowing anything about how this works figured I'd ask it on on.
Okay, that's great. And then last one, kind of a simple question, but not knowing anything about how this works, I figured I'd ask it. On the process transfer and the equipment transfer to Coedo that's ongoing, when do you expect that to complete, and is that a pretty simple
The process transfer in the equipment transfer to come you know that's that's ongoing when do you expect that to complete them is there.
Is that a pretty simple.
process or there are many risks to that transfer going smoothly and production ramping. Any detail around that would be great.
Process or there are many risks are to that transfer going smoothly in production ramping any detail around that would be great.
Yeah, that process is not a simple process. It started well over a year ago, you know, whether it's actually the technology transfer or actually the tooling, the software control part of every component. So all of the things are being transferred, you know, throughout the last year. Now, it's actually at its final stage. In fact, you know, I myself have seen the production line in action that was very rewarding to see. Finally, there's a volume production process in place. The risk of that is actually pretty much retired.
Yeah that process, it's not a simple process it started well over a year ago, you know what.
There is actually a the technology transfer or actually the tooling the sulfur control part of every component and so all of the teams are are being transferred to you know throughout the last year now is actually at its final stage are in fact, you know I am myself I have seen the production.
My an action that was a very rewarding to see finally, there is a volume production process are in place.
The risk of that is actually a pretty much retired at this point.
Yeah.
Okay, that's great. That's all for me. Thanks, guys.
Okay. That's great. That's all for me thanks, guys.
And ladies and gentlemen, with that, we'll be concluding today's question and answer session. I'd like to turn the floor back over to management for any closing remarks.
And ladies and gentlemen, with that we will be concluding today's question and answer session I'd like to turn the floor back over to management for any closing remarks.
Yeah, thank you again for joining this conference call. Steptown is at a very enviable position of supplying Ultracruise and being sole source for the Ultracruise program into many platforms of cars in this very competitive marketplace that really differentiate us. And this year and the coming years will be the years of execution. Please pay attention to us as we execute this program, and you'll see cars with our LiDAR on the road.
Thank you again for joining this conference call Sept hung Ah is a very enviable position also supplying ultra cruise and being sole source for the ultra cruise program into many platforms of cars in this very competitive marketplace that really differentiate us and.
This year and the coming years will be the yourself execution. Please pay attention to us as we execute this program and you'll see cars with our lidar on the road.
Ladies and gentlemen, with that, we'll conclude today's conference calling and presentation. We do thank you for joining. You may now disconnect your lines.
Ladies and gentlemen, with that we'll conclude today's conference call and presentation. We do thank you for joining you may now disconnect your lines.
Yeah.