Q4 2023 Aurora Innovation Inc Earnings Call
Greetings and welcome to the Aurora innovation fourth quarter 2023 business review call.
Operator: Greetings and welcome to the Aurora Innovation fourth quarter 2023 business review call. At this time, all participants are in a listen-only mode.
At this time all participants are in a listen only mode. A brief question and answer session will follow the formal presentation.
Operator: A brief 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. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Stacy Seitz, Vice President, Investor Relations. Thank you. You may begin. Thanks, Diego.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host Stacy Feit, Vice President Investor Relations. Thank you you may begin.
Thanks, Diego good afternoon, everyone and welcome to our fourth quarter 2023 business review call, we announced our results earlier. This afternoon, our shareholder letter and a presentation to accompany this call are available on our Investor Relations website, IR Dot Aurora Dot Tech. The shareholder letter was also furnished with our form 8-K filed today with the I T.
Stacy Seitz: Good afternoon, everyone, and welcome to our fourth quarter 2023 business review call. We announced our results earlier this afternoon. Our shareholder letter and a presentation to accompany this call are available on our investor relations website at ir.aurora.tech. The shareholder letter was also attached to our Form 8K filed today with the SEC.
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Stacy Seitz: On the call with me today are Chris Urmson, co-founder and CEO, and David Madej, CFO. Chris will provide an update on the projects we have made across the key pillars of our business, and David will recap our fourth quarter and full year financial results. We'll then open the call to Q&A.
On the call with me today are Chris Armstrong co founder and CEO.
And David Day, CFO, Chris will provide an update on the progress we have made across the key pillars of our business and David will recap, our fourth quarter and full year financial results. We'll then open the call to Q&A.
Stacy Seitz: A recording of this conference call will be available on our investor relations website at ir.aurora.tech shortly after this call is over. I'd like to take this opportunity to remind you that during this call, we'll be making forward-looking statements. This includes statements relating to the achievement of certain milestones around and realization of the potential benefits of the development, manufacturing, scaling, and commercialization of the Aurora driver and related services, our anticipated timeframe, the expected performance of our business and potential opportunities with partners and customers, expected contract commitments from customers for our products and services, regulatory tailwinds and the framework in which we operate, expected cash runway, and our ability to complete any opportunistic fundraising opportunities, These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those projected or implied during this call.
Recording of this conference call will be available on our Investor Relations website at IR Gotta wear a Doc tech shortly after this call has ended.
I'd like to take this opportunity to remind you that during this call we'll be making forward looking statements.
Statements relating to the achievement of certain milestones around and realization of the potential benefits of the development manufacturing scaling and commercialization that there were a driver and related services. Our anticipated timeframe do you expect the performance of our business and potential opportunities with partners and customers expected contract commitments from customers for our products and services regulatory tell.
All lines and framework in which we operate expected cash runway and our ability to complete any opportunistic fund at fund raising opportunities and overall future prospects.
These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those projected or implied during this call. In particular those described nervous factors included in our quarterly form report on Form 10-Q for the quarter ended September 32023, and filed with the SEC as well as the current uncertainty and unpredictability in our.
Stacy Seitz: In particular, those describing our risk factors included in our quarterly form report on Form 10-Q for the quarter ended September 30, 2023 filed with the SEC, as well as the current uncertainty and unpredictability in our business, the markets, and the economy. Additional information will also be set forth in our annual report on Form 10-K for the year ended December 31, 2023. You should not rely on our forward-looking statements as predictions of future events.
Business the markets in economy.
Additional information will also be set forth in our annual report on Form 10-K for the year ended December 31 2023, you.
You should not rely on our forward looking statements as predictions of future events.
Stacy Seitz: All forward-looking statements that we make on this call are based on assumptions and beliefs as of the date hereof, and Aurora disclaims any obligation to update any forward-looking statements, except as required by law. Our discussion today may include non-GAAP financial measures. These non-GAAP measures should be considered in addition to, and not as a substitute for, or in isolation from, our GAAP results.
Forward looking statements that we make on this call are based on assumptions and beliefs as of the date hereof and Aurora disclaims any obligation to update any forward looking statements, except as required by law.
Our discussion today may include non-GAAP financial measures. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results information regarding our non-GAAP financial results, including a reconciliation of our historical GAAP to non-GAAP results may be found in our shareholder letter, which was furnished with our form 8-K filed today with the SEC and May also be.
Stacy Seitz: Information regarding our non-GAAP financial results, including a reconciliation of our historical GAAP to non-GAAP results, may be found in our shareholder letter, which was filed with our Form 8K, filed today with the SEC, and may also be found on our Investor Relations website. With that, I'll now turn the call over to... Thank you, Stacey. 2023 was a pivotal year for Aurora as we put in place many of the final pieces to support our planned commercial launch and operations at scale. We continue to lead in autonomous trucking by executing a focused strategy centered on technological, commercial, and financial progress. For example, from a technology perspective, the Aurora driver became feature complete at the end of the first quarter of 2023.
Found on our Investor Relations website with that I'll now turn the call over to Chris. Thank you Stacey.
2023 was a pivotal year for <unk> as we put into place many of the final pieces to support our planned commercial launch and operations at scale.
We continue to lead in autonomous trucking by executing a focused strategy centers centered on technological commercial and financial progress.
From a technology perspective, the Aurora driver became feature complete at the end of the first quarter of 2023. Since then we've meaningfully advanced the Aurora drivers of autonomy performance.
Chris Urmson: Since then, we've meaningfully advanced the Aurora driver's autonomy performance. Commercially, we established the first commercial-ready autonomous trucking lane in the U.S., while deepening and expanding our customer base. We now consistently schedule over 100 loads per week and are in the process of contracting our launch and 2025 capacity.
Commercially we established the first commercial ready autonomy as trucking lane in the U S. While deepening and expanding our customer base. We now consistently schedule over 100 loads per week and are in the process of contracting or a launch in 2025 capacity.
We've made great progress with our OEM partners, Volvo trucks, and pack or on our co developed economy enabled truck platforms with delivery of late stage prototypes into our fleet.
Chris Urmson: We've made great progress with our OEM partners, Volvo Trucks and PACCAR, on our co-developed autonomy-enabled truck platforms with delivery of late-stage prototypes into our fleet. And with the addition of our industry-first partnership with Continental, we've built an autonomous trucking partnership ecosystem that is unmatched by any of our competitors. We are confident that this holistic partnership approach is the right one for the future of self-driving trucking as a business and believe it positions Aurora as the only company capable of driverless commercial operations at scale. We accomplished all of this while maintaining financial discipline, spending well below our quarterly target, and we strengthened our liquidity position with a meaningful capital raise last summer.
And with the addition of our industry first partnership with Continental we've built an autonomous trucking partnership ecosystem that is unmatched by any of our competitors. We are confident that this holistic partnership approach is the right one for the future of self driving trucking as a business and believe it positions Aurora as the only company capable of driverless commercial operations at <unk>.
Scale.
We accomplished all of this while maintaining financial discipline spending well below our quarterly target and we strengthened our liquidity position with a meaningful capital raise last summer.
You can't bring a commercially viable driverless trucking product to market without a deep integration with Oems and suppliers.
Chris Urmson: You can't bring a commercially viable driverless trucking product to market without deep integration with OEMs and suppliers. Our work with partners supports our path to a driverless launch on an OEM and supplier-approved platform and also sets the stage for long-term deployment at true commercial scale. In the fourth quarter, Volvo completed the bring-up of the first hardware-complete Volvo trucks capable of fully autonomous operations and began track-testing these trucks in autonomy. In January, Volvo Trucks unveiled the all-new Volvo VNL, which will serve as the platform for Volvo Autonomous Solutions' trucking product, powered by the Aurora driver.
Our work with partners supports our path toward driverless launch on an OEM and supplier approved platform and.
It also sets the stage for long term deployment of true commercial scale.
In the fourth quarter, we completed the bring up of the first hardware complete Volvo trucks capable of fully autonomous operations and began track testing these trucks in economy in.
In January Volvo trucks unveiled the new all new Volvo P&L, which will serve as the platform for fall of autonomous solutions trucking product powered by the euro or driver.
Chris Urmson: We also continued the introduction of our new fleet of Packard's Peterbilt 579 trucks, upfitted with the latest generation of the Aurora driver kit. This truck platform is equipped with prototype systems that will be necessary for driverless operations, including redundant braking, steering, and power, which we are actively testing, and PACCAR has continued to highlight our progress together, including our joint showcase at their exhibit at the 2024 Consumer Electronics Show. Volvo and PACCAR's shared commitment to safety makes them excellent partners as we continue the co-development of these autonomous ready truck platforms. Our mission is to deliver the benefits of self-driving technology safely, quickly, and broadly. Safety is our first commitment and is the guiding principle at the core of everything we do at Aurora.
We also continued to bring up of our new fleet of <unk> Peterbilt 579 trucks updated with the latest generation of the Aurora driver Kit. This truck platform is equipped with prototype systems that will be necessary for driverless operations, including redundant braking steering and power, which we are actively testing and <unk> has continued to.
Highlight our progress together, including our joint showcase at their exhibit at the 2020 for consumer Electronics show.
Volvo and pack our shared commitment to safety makes them excellent partners as we continue the co development of these autonomy autonomous ready truck platforms.
Our mission is to deliver the benefits of self driving technology safely quickly and broadly.
Safety is our first commitment is the guiding principle at the core of everything we do at Aurora.
In order to prove the safety of our product and earn public trust, we utilize a safety case framework.
Chris Urmson: In order to prove the safety of our product and earn public trust, we utilize a safety case framework. We quantify our progress toward closing our launch lane safety case via our Autonomy Readiness Measure, or ARM, which is a weighted measure of completeness across all claims in the safety case for our launch. We are the only company in the industry who provides this level of transparency. When we introduced the arm 18 months ago, we estimated Aurora Driver Ready would correspond with an arm of approximately 95 percent and that we would be ready for commercial launch when the remaining approximately 5 percent of the safety case claims corresponding to the vehicle were complete. As of mid-January of this year, we achieved an enrollment rate of 93%.
We quantify our progress toward closing our launch lanes safety case via our autonomy redness measure or arm, which is a weighted measure of completeness across all claims of the safety case for our launch Lane. We are the only company in the industry, who provides this level of transparency.
When we introduced the arm 18 months ago, we estimated Aurora driver ready would correspond with an arm of approximately 95% and that we would be ready for commercial launch when the remaining approximately 5% of the safety case claims corresponding to the vehicle we're complete.
As of mid January of this year, we achieved an arm of 93%.
Chris Urmson: Our focus on the Aurora Driver Ready Milestone enabled this rapid progress as we worked with our OEM partners to prepare their autonomy-enabled trucks for integration. With prototypes of our intended launch truck in hand, our focus now turns toward closing the final 7% of our safety case jointly between the Aurora driver and the truck platform to enable our planned commercial launch at the end of the year. This alignment of our Aurora driver ready and commercial launch milestones and timeline allows us to most efficiently allocate resources to final preparation of our complete product. We will continue to report progress as we work toward closing the safety case for the launch. At the same time, the Aurora driver continues to get more capable and requires less support. The Autonomy Performance Indicator, or API, serves as a key metric for assessing the Aurora driver's performance. The indicator penalizes the use of onsite support, which will be the most expensive support provided.
Our focus on the Aurora driver ready milestone enabled this rapid progress as we work with our OEM partners to prepare their autonomy enabled trucks for integration.
With prototypes of our intended truck launch trucking hand, our focus now turns toward closing the final 7% of our safety case jointly between the Aurora driver in the truck platform to enable our planned commercial launch at the end of the year.
This alignment of our Aurora driver ready and commercial launch milestones and timeline allows us to most efficiently allocate resources to final preparation of our complete product. We will continue to report the arm as we work towards closing the safety case to go watch line.
At the same time, the raw driver continues to get more capable and requires less support the.
The autonomy performance indicator or API, which is a key metric for assessing the Aurora drivers performance.
I indicated penalizes the use of onsite support which will be the most expensive support provided for the fourth quarter of 2023, the API was 99% demonstrating another quarter over quarter increase.
Chris Urmson: For the fourth quarter of 2023, the API was 99 percent, demonstrating another quarter over quarter increase across the commercially representative loads completed in pilot operations on our launch lane in the fourth quarter, 62% at 100% API. Throughout 2024, we will focus on driving up the percentage of 100% API loads, and we'll continue to support the report on this metric, which we believe will be a strong indicator of our progress toward commercial lines. However, as a reminder, we do not anticipate aggregate API will ever reach 100%, even at launch, because certain situations, like flat tires, always require on-site support.
Across the commercially representative fluids completed in pilot operations on our launch late in the fourth quarter, 62% at 100% API.
Throughout 2024, we will focus on driving up the percentage of 100% API loads and we'll continue to support it to report on this metric, which we believe will be a strong indicator of our progress towards commercial launch. However, as a reminder, we do not anticipate aggregate API will ever reach 100% even at launch.
Because certain situations like flat tires always require onsite support.
In our presentation on page eight we've shared some recent examples of the Aurora drivers excellent performance in some very challenging situations.
Chris Urmson: In our presentation on page 8, we've shared some recent examples of the Aurora driver's excellent performance in some very challenging situations. In the first video, the Aurora driver is approaching an intersection on the surface streets near our Houston terminal and has a green light. However, because the Aurora driver predicts that the red pickup truck will run their red light, it slows to avoid a collision instead of proceeding at speed through the green light. However, other vehicles are not as quick to react, so they proceed through the intersection and get hit by the red pickup.
And the first video the Aurora drivers approaching an intersection on the surface streets near our Houston terminal and has a green light. However, because your driver predicts that the red pickup truck will run their red light it slows to avoid a collision instead of preceding its speed through the green light.
Other vehicles are not as quick to react. So they proceed through the intersection and get hit by the Red pickup you.
Chris Urmson: You may notice that our vehicle operator disengaged autonomy when the other vehicles collided. This is a protocol we have in place until our system is fully validated and the safety case is closed, as we are steadfastly committed to our safety-first approach to development and deployment. In the second video, the Aurora driver is traveling southbound on the surface streets near our Houston terminal. It is patiently waiting at a red light in the left turn only lane for an intersection.
You may notice that our vehicle operator disengaged autonomy when the other vehicles collided. This is a protocol we have in place until our system is fully validated and the safety case is closed as we as we are steadfastly committed to our safety first approach to development and deployment.
And the second video the road drivers traveling south bound on the surface streets.
Houston terminal.
Patiently waiting at a red light in a left turn only lane for an intersection.
Chris Urmson: You then see the Aurora driver's left turn light turn green, but a passenger vehicle traveling westbound runs their red light. The Aurora driver detects the red light runner and waits until the coast is clear before safely proceeding into the intersection to make its turn. Just seconds later, the Aurora driver then detects yet another unpredictable vehicle, this one suddenly weaving into its lane. The Aurora driver brakes to avoid a collision with this vehicle, which is making an illegal left turn from an outside lane.
And then see the road drivers less turn light turned green, but a passenger vehicle traveling westbound runs their red light.
The Aurora driver detects the Red light runner and wait until the coast is clear before safely proceeding into the intersection to make its turn.
Just seconds later the road driver then detects yet another unpredictable vehicle. This one is suddenly weaving into its lane the Aurora driver brakes to avoid a collision with this vehicle, which is making in our legal left turn from an outside lane.
Chris Urmson: After successfully avoiding these two consecutive potential collisions at the same intersection, the Aurora driver proceeds on its way to our Houston Terminal. Seeing the Aurora driver's performance in scenarios like these further reinforces the conviction we have in the safety benefits our technology can deliver to our customers. As we continue to work toward closing our safety gates for our planned commercial launch, we have made solid commercial progress with several of our customers. We have secured contractual commitments on volume and pricing for a portion of our 2024 and 2025 capacity, and we have several additional contracts nearing execution. We continue to demonstrate to our customers the value the Aurora driver can deliver to their networks through our active pilots. During the fourth quarter, we deepened and expanded our customer relationship. We began autonomously hauling intermodal trailers for an existing customer, and we also launched a new commercial pilot on the Dallas to Houston lane. We now consistently schedule over 100 loads per week with our customers and are logging approximately 25,000 commercial miles per week.
After successfully avoiding these two consecutive potential collisions at the same intersection Euro driver proceeds on its way to our Houston terminal.
Seeing the ROI drivers performance in scenarios like these further reinforces the conviction we have in our safety benefits our technology can deliver to our customers.
As we continue to work toward closing our safety gates for our planned commercial launch we have made solid commercial progress with several of our customers. We have secured contractual commitments on volume and pricing for a portion of our 2024 and 2025 capacity and we have several additional contracts nearing execution.
We continue to demonstrate to our customers the value of the Roar driver can deliver to their networks through our active pilots during the fourth quarter, we deepened and expanded our customer relationships. We began autonomously hauling intermodal trailers for an existing customer and we also launched a new commercial pilot on the Dallas to Houston Lane.
We now consistently schedule over 100 loads per week with our customers and our logging approximately 25000 commercial mouse weekly.
Cumulative to date through January 31, we've autonomously delivered under the supervision of vehicle operators 4300 loads.
Chris Urmson: Kilometer to date, through January 31st, we've autonomously delivered 4,300 loads under the supervision of vehicle operators more than a million commercial miles, with nearly 100% on-time performance for our pilot customers, including FedEx, Forerunner, Schneider, Hirschbach, and Uber Freights, among others. Our proactive partnership approach also extends to lawmakers, regulators, and law enforcement, who have a vested interest in the potential for safer and more efficient In the fourth quarter, we worked with the Frisco Police Department in Texas to conduct mock traffic stops on I-45 to simulate how autonomous trucks can recognize and respond to emergency vehicles.
We're driving more than 1 million commercial miles with nearly 100% on time performance for our pilot customers, including Fedex Warner Schneider, Hirshberg, and Uber freight among others.
Our proactive partnership approach also extends to lawmakers regulators and law enforcement, who have a vested interest in the potential for safer more efficient transportation.
In the fourth quarter, we worked with the Frisco Police Department in Texas to conduct Mark traffic stops on I 45 to stimulate how autonomous trucks can recognize and respond to emergency vehicles. We appreciate their partnership and working towards making Texas roads safer for everyone and will use their feedback to further hone the Aurora drivers' interactions with emergency vehicles.
Chris Urmson: We appreciate their partnership in working toward making Texas roads safer for everyone and will use their feedback to further hone the Aurora driver's interactions with emergency vehicles. We endeavor to launch the Aurora driver in close partnership with our public safety officers, who will be on the road with our vehicles on a daily basis. We believe this collaborative approach will continue to foster goodwill in Texas, which is a supportive environment for our commercial launch lane, and we expect to replicate this same model in our lane expansion across the country. Transparency and proactive external engagement are paramount in a safety-critical industry. At a time when reputations in the autonomous vehicle industry have been tested, we're particularly proud of the culture we've built around safety and integrity, which we believe has positioned Aurora as a trusted partner and thought leader in the space. To that end, we're delighted to share that our Chief Safety Officer, Nat Buse, has been selected to join the newly formed Transforming Transportation Advisory Committee of the U.S. Department of Transportation.
We endeavor to launch the raw driver in close partnership with our public safety officers, who will be on the road with our vehicles on a daily basis. We believe this collaborative approach we will continue to foster goodwill in Texas, which is a supportive environment for our commercial launch lane and we expect to replicate the same model in our lane expansion across the country.
Transparency and proactive external engagement are paramount and a safety critical industry.
When reputations in the autonomous vehicle industry has been tested we're particularly proud of the culture, we've built around safety and integrity, which we believe has positioned <unk> as a trusted partner and thought leader in the space.
To that end, we're delighted to share that our chief safety Officer Nat views has been selected to join the newly formed transforming transportation Advisory Committee of the U S Department of transportation.
Chris Urmson: We expect this committee to play a meaningful role in shaping the future of transportation. Nat's inclusion underscores Aurora's commitment to responsible innovation and self-driving, and we are honored to have such a prominent voice at the federal level. We're also proud to share that a member of our government relations team, Melissa Wade, will serve as the chair of the Autonomous Vehicle Industry Association's Board of Directors. AVA is the unified voice of the autonomous vehicle industry, working with lawmakers, regulators, and the public to realize the technology's safety, mobility, and economic benefits.
We expect this committee to play a meaningful role in shaping the future of transportation.
That's inclusion underscores <unk> commitment to responsible innovation and self driving and we are honored to have such a prominent voice at the federal level.
We're also proud to share that a member of our government relations team Melissa Wade will serve as the chair of the autonomous vehicle industry associations Board of directors. Eva is the unified voice of the autonomous vehicle industry, working with lawmakers regulators and the public to realize the technologies.
Safety mobility, and economic benefits as chair Melissa will have an even stronger platform as a champion for the safe commercialization of this critical technology.
Chris Urmson: As chairperson, Melissa will have an even stronger platform as a champion for the safe commercialization of this critical technology. As we look beyond commercial launch, we're charting our path to scale and profitability. In addition to the work we're doing with our OEM partners to support the manufacturing of economy-enabled trucks at scale, we also have a long-term exclusive partnership with Continental to jointly develop, manufacture, and service future generations of the Aurora driver hardware. This partnership gives us a path to deploy autonomous trucks at scale, with a cost structure in place intended to support our long-term profitability objectives. In January, Continental and Aurora achieved a key development milestone. We announced the finalization of the design and architecture of the future Aurora driver hardware generation, inclusive of a new fallback system that Continental plans to start producing in 2021. 2027
As we look beyond commercial launch we're charting our path to scale and profitability. In addition to the work we're doing with our OEM partners to support the manufacturing of economy enabled trucks at scale. We also have a long term exclusive partnership with continental to jointly develop manufacture and service future generations of the Aurora driver hardware.
This partnership gives us a path to deploy autonomous trucks at scale with our cost structure in place intended to support our long term profitability objectives.
In January Continental and Aurora achieved a key development milestone, we announced the finalization of the design and architecture of the future or driver hardware generation inclusive of new fallback system. The continental plans to start producing in 2000 22027.
We further jointly showcased our work together with on road truck on display of Continental's exhibit at the consumer electronics show.
The system architecture, and hand Continental will build initial versions of the hardware for testing at its new facility in new Braunfels, Texas and across its global manufacturing footprint.
Chris Urmson: We further jointly showcased our work together with an Aurora truck on display at Continental's exhibit at the Consumer Electronics Show. With the system architecture in hand, Continental will build initial versions of the hardware for testing at its new facility in New Braunfels, Texas, and across its global manufacturing footprint. With Continental's automotive development and manufacturing expertise, the future Aurora driver will be designed to deliver customer value. And under the hardware as a service business model, we'll pay for that hardware on a per mile basis. That means we expect the cost to the customer to purchase an autonomous truck will be relatively in line with that of a traditional truck, thereby limiting the capital investment necessary to adopt autonomy in their operation.
With continental's automotive development and manufacturing expertise the future ROI driver will be designed to deliver customer value.
And Marx.
And under the hardware as a service business model will pay for that hardware on a per mile basis that means we expect the cost to the customer to purchase an autonomous truck will be relatively in line with that of a traditional truck, thereby limiting the capital investment necessary to adopt autonomy in their operations.
In closing the tremendous progress we made in our second full year as a public company, we would not have been possible without a world class team partners and investors. Thank you for your continued support we will continue to responsibly drive toward our planned commercial launch at the end of 2024 and look forward to sharing more with you at our upcoming analyst and Investor Day next month.
Chris Urmson: In closing, the tremendous progress we made in our second full year as a public company would not have been possible without our world-class team, partners, and investors. Thank you for your continued support. We will continue to responsibly drive toward our planned commercial launch at the end of 2024 and look forward to sharing more with you at our upcoming Analyst and Investor Day next month. With that, I'll now pass it to Dave, who will review our financial results. Thank you, Chris.
I'll now pass it to Dave who will review our financial results.
Thank you, Chris let's discuss our financial results. We have provided a summary on page 11 of the slide deck for reference.
During the fourth quarter of 2023, we continue to demonstrate strong fiscal discipline, while executing towards commercial launch.
Fourth quarter 2023, operating expenses, including stock based compensation totaled $198 million, excluding stock based compensation operating expenses were $161 million.
David Madej: Let's discuss our financial results. We have provided a summary on page 11 of the slide deck for reference. During the fourth quarter of 2023, we continue to demonstrate strong physical discipline while executing towards commercial law. Fourth quarter 2023 operating expenses, including stock-based compensation, totaled $198 million. Excluding stock-based compensation, operating expenses were $161 million. Within operating expenses, our R&D expenses, excluding stock-based compensation, totaled $138 million. This amount reflects $640,000 in pilot revenue, which more than doubled year over year, and which we record as a contra R&D agreement. SG&A expenses, excluding stock-based compensation, were $23 million.
Within operating expenses, our R&D expenses, excluding stock based compensation totaled totaled $138 million.
This amount reflects $640000 in pilot revenue, which more than doubled year over year, and which we recorded as a contra R&D expense.
SG&A expenses, excluding stock based compensation were $23 million.
During the full year of 2023, we used approximately $598 million in operating cash and capital expenditures totaled $15 million.
During the fourth quarter, we used approximately $133 million in operating cash capital expenditures totaled $4 million.
David Madej: During the full year of 2023, we used approximately $598 million in operating cash, and capital expenditures totaled $15 million. During the fourth quarter, we used approximately $133 million in operating cash. Capital expenditures totaled $4 million. This fourth quarter cash spend was significantly below our target of $175 to $185 million per quarter on average, reflecting one less payroll cycle in the quarter and our continued commitment to financial. To that end, we need to continuously adapt to meet the evolving needs of our business. As we move towards commercial launch, we recently reviewed the entire organization to ensure we are working as effectively as possible and with the velocity required to achieve our ambitious goals. Through this process, a limited number of roles were eliminated, which impacted 3% of our total workforce.
This fourth quarter cash spend was significantly below our target of $175 million to $185 million per quarter on average.
Affecting one less payroll cycle in the quarter and our continued commitment to financial discipline.
To that end, we need to continuously adapt to meet evolving needs of our business as we move towards commercial launch. We recently reviewed the entire organization to ensure we are working as effectively as possible and with the velocity required to achieve our ambitious goals through this process are limited.
Number of roles were eliminated which impacted 3% of our total workforce.
These changes are difficult they are necessary steps it set aurora up to achieve our mission, while operating efficiently and effectively entity.
In 2024, we continue to expect quarterly cash use of $175 million to $185 million on average this reflects savings from the workforce alignment actions as well as approximately $12 million in non personnel cost savings offset by an expected increase in capital expenditures relative to <unk>.
David Madej: While these changes are difficult, they are necessary steps that set Aurora up to achieve our mission while operating efficiently and effectively at. In 2024, we continue to expect quarterly cash use of $175 to $185 million. This reflects savings from the workforce alignment action, as well as approximately 12 million in non-personnel costs, offset by an expected increase in capital expenditures relative to 2023 as we prepare for commercial. We ended 2023 with a very strong balance sheet, We continue to expect this liquidity to support our planned commercial launch and fund our operations into the second half of 2020. With that, we'll now open the call to Q&A. Thank you. And ladies and gentlemen, at this time, we'll conduct our Q&A session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in question. You may press star 2 if you would like to remove your question.
'twenty three as we prepare for commercial launch.
We ended 2023 with a very strong balance sheet, including over $1 3 billion in cash and short term and long term investments. We continue to expect this liquidity to support our planned commercial launch and fund our operations into the second half of 2025.
With that we'll now open the call to Q&A.
Thank you.
Ladies and gentlemen at this time, we will conduct a Q&A session. If you would like to ask a question. Please press star one on your telephone keypad.
<unk> tone will indicate that your line is in the question queue.
You May press Star two if you would like to remove your question from the queue for participants using speaker equipment and may be necessary to pick up your handset before pressing the star keys.
Our first question comes from George <unk> with Canaccord Genuity. Please state your question.
Hey, everyone. Thank you for taking my questions.
Operator: If participants are using speaker equipment, it may be necessary to pick up your handset before pressing. Our first question comes from George Genarikas with Canaccord Genuity. Hey, everyone.
I'd like to dig into first flight some merchant suppliers have made some recent inroads at.
Your competitors do you see a point in the future where it's possible that the advantages you have in light are overwhelmed by progress in the merchant market or is that still a ways off.
George Genarikas: Thank you for taking my questions. Um, I'd like to dig into first light the fact that some merchant suppliers have made some recent inroads into some of your competitors. Do you see a point in the future where it's possible that the advantages you have in LiDAR are overwhelmed by progress in the merchant market, or is that still a ways off? Can you say the I'm not familiar with the term merchant market. In other words, merchant suppliers of LiDAR equipment.
Can you say.
Not familiar with the term merchant market.
In other words merchant suppliers of Lidar Lidar.
Glad our companies.
So.
We feel very strongly about the advantage we have with first flight. This is technology that the team when we acquired them.
Chris Urmson: Okay, sorry, LiDAR companies. Yeah, so...uh, we feel very strongly about the advantage we have with FirstLight. This is technology that the team, when we acquired them a few years ago, had already been working on for between 10 and 15 years. We feel like we have fairly strong intellectual property protections around that technology. And by having that team in-house, we've been able to share very tightly between what the needs are from our perception system with what we can deliver through the hardware solution. And we see that that tight integration allows us to turn the innovation crank more quickly than folks on the outside would be able to. So would it ever be a very long time, but in a practical sense, no.
A few years back had already been working on it for between 10 and 15 years.
We feel like we have fairly strong intellectual property protections around that technology and by having that team in house, we've been able to shared very tightly between what the needs are from our perception system with what we can deliver through the hardware solution and we see that.
<unk>.
That tight integration allows us to turn the innovation Frank more quickly than folks on the outside would be able to so so.
Would it ever is a very long time put through in a practical sense. No. We think this is a material strategic advantage for us.
Chris Urmson: We think this is a material strategic advantage. Maybe just as a follow-up, there have been some very recent, I don't know if they're failings quite yet, but there's a lot of tumult on the passenger side of the autonomous marketplace. Does that create a potential opening for Aurora Connect? Have you had any incoming inquiries on partnering? Are you continuing to test it?
Maybe just as a follow up.
There have been some very recent I don't know if they're failing quite yet, but there's a lot of.
<unk> on the passenger side of the autonomous marketplace does that create a potential opening for Aurora connectivity have you had any incoming.
<unk> on partnering are you continuing to test and can you remind us again of the synergies between the <unk> connect in the trucking side. Thank you yeah, absolutely we still very strongly believe the right first application for automated vehicles and trucking, we see that because of the size of the markets the development of the market.
Chris Urmson: I mean, can you remind us again of the synergies between Aurora Connect and the trucking side? Thank you. Yeah, absolutely. We still very strongly believe the first right application for automated vehicles is in trucking.
Chris Urmson: We see that because of the size of the markets and the development of the market. We see that because of unit economics and the ability for that to support early stage products where the costs will be higher. We see that because of the self-similarity of the freeway network and thus the ability to scale more rapidly.
But we see that because of the unit economics.
And the ability for that to support early stage products, where the Cogs will be higher.
We see that because of the self similarities the freeway network and thats the ability to scale more rapidly.
And we see it partly because the customers will be really driven by the $1 <unk> since the <unk> and deliver the value we can create for them in a much less emotional way.
Chris Urmson: And we see it partly because the customers will be really driven by the dollars and cents, the TCO and delivery, the value we can create for them in a much less emotional way than what's associated with moving people through the world. But all said, we do strongly believe in and are committed to, in the long term, delivering a product into the personal mobility space. The fact that we've architected the Aurora driver to work both for heavy-duty trucks and light vehicles and the fact that today we are currently operating our fleet of Toyota Siennas with the same hardware and software that we operate our trucks really gives credence to this expectation design that we've made around transferability and a common core of hardware and software.
Ed.
Whats.
Associated with moving people through the world.
That all said.
We do strongly believe and are committed to in the long term delivering a product to the personal mobility space.
Fact that we've architected the Aurora driver to work both for heavy duty trucks and light vehicles and the fact that today we are currently.
Operating our fleet of Toyota Sienna is with the same hardware and software that we operate our trucks.
Really gives credence to this.
Expectation and design that we've made around transferability and common.
Core of hardware and software.
Chris Urmson: And so when it makes economic sense, and there's a strong business case, then we look forward to introducing the technology in that space and working with the great partners we have there in Toyota and Uber. Thank you. Pleasure. Thanks for the great questions, George. Thank you. And just a reminder, to ask a question, press star 1 on your remote control. Our next question comes from David Vernon with Bernstein Police. Hi, everyone.
So when it makes economic sense.
And there is a strong business case, and we look forward to introducing the technology in that space and working with Great partners. We have there is Toyota Uber.
Thank you.
Pleasure, Thanks for great questions George.
Thank you and just a reminder to ask a question press star one on your phone.
Our next question comes from David Vernon with Bernstein. Please state your question.
Hi, everyone. This is Justin allow for speaking on behalf of David Vernon. Thanks for taking my question.
Justine Laufer: This is Justine Laufer speaking on behalf of David Vernon. Thanks for taking my question. So first, I'd just like to ask about the 4Q cash spend of $133 million. So it was well below that target of $175 to $185 million, which I know you attributed to one less payroll cycle and also to financial discipline. So I'm wondering how much of that is actually coming from the payroll cycle impact and how much is actually attributed to financial discipline.
So first I'd just like to ask about.
The <unk> cash spend of $133 million was well below that target of $175 285 now.
Which I know you attributed to one less payroll cycle also the financial discipline. So.
So I'm wondering how much of that is actually coming from their payroll cycle impact and how much is actually attributed to financial discipline.
Okay.
David Madej: So I would say, and thanks for the question, I think it's kind of an equal mix of what we did. I mean, we found and identified a lot of efficiencies that we started putting in place probably about six months ago where we were really active in looking at the overall organization, and you know, they all bear fruit at different times in terms of how they spend. So you know, we had substantial savings that, if you look at an annualized basis, will continue to pull forward, so we were able to bring in 10 to 15 million of just, You know, pure financial discipline savings that we're able to carry forward on a regular basis. There are some things that we did in terms of spending, like, reducing future expenses, like, a, you know, we, you know, our expenses and, you And so we had a, we paid all that up front. So that was in the Q3 number, and then it, and then it flows through and flows out of that. So you'll start to see some of those benefits as well.
So I would say.
And thanks for the question.
I think it's I think it's kind of an equal mix of what we did and we found and identified a lot of efficiencies that we started putting in place probably about six months ago, where we were really active in looking at the overall organization and they all bear fruit at different times in terms of how they.
Spend so.
We had substantial savings if you look at an annualized basis, we will continue to pull forward. So we were able to bring in $10 million to $15 million of gist.
Pure financial discipline savings.
We're able to carry forward on a regular basis. There are some things that we did in terms of spending for lake.
Reducing future expenses like D&O.
Our expenses and D&O.
And so we had a.
We pay all that upfront so that was in it was in the Q3 number and then and then it flows through and flows out of that so youll start to see some of those benefits as well I think we need to create enough of these positive momentum as we think about moving forward for next year, because our capital expenses will increase as we prepare for commercial.
David Madej: I think we need to create enough positive momentum as we think about moving forward for next year because our capital expenses will increase as we prepare for commercial launch. And so we're trying to develop enough of these in there so that we are committed to our plan that we've mentioned before, which is how much capital we need to achieve or how much additional capital we'll need before we get to free cash flow positive. So we're still committed to that plan and what we've communicated with investors. Great, thank you. And one other question related to Continental.
Launch and so we're trying to develop enough of these in there. So that we are committed to our plan.
We've mentioned before which is how much capital we need to achieve or how much additional capital will need before we get to free cash flow positive. So we're still committed to that plan plan and what we've communicated with investors in the past.
Yes.
Great. Thank you and one other question unrelated to continental.
Justine Laufer: So I'm just wondering how the progress on the development of a fallback system with Continental is going. Kind of like, what does the progress look like? What's the timeline for completing that development? Yeah, so we can't get in too much detail, obviously, given the nature of the relationship.
So I'm just wondering how is the progress on development of a fall back testing with continental going.
On kind of like what is the progress look like what's the timeline for completing that development.
Yes, so the.
We can't get into too much details, obviously, given the proprietary nature of the relationship.
Chris Urmson: But it's moving along, we internally have a series of milestone gates that we've moved through with them, and the team is making great progress towards them. We are still working towards that 2027 launch of the hardware kits. And, you know, we were excited about the progress we're making. Great. Thank you. Yeah.
But it's moving along we internally have a series of milestone gates that we move through with them and and the team is making great progress towards them.
We are still working towards that 2027.
Launch of the hardware kits.
And we.
We're excited about the progress we're making.
Okay.
Yeah.
Great. Thanks.
Yes.
Yes, I think the other thing to point out and here is that we have.
David Madej: Yeah, I think the other thing to point out here is that we have, you know, again, it's a new fallback system; we have an existing fallback system. And that's going to be the default if this one ends up if we have any potential issues and things like that, where it's a little bit delayed. So it's not going to prohibit our overall launch, but this is where we all in the progress thus far is going very well. But we're not going to be bound by that in terms of introducing our new hardware solution. We have a fallback system for a fallback system, so to speak.
Again, it's a new fallback system, we have an existing fallback system.
And thats going to be the default. If this one ends up if we have into any potential issues and things like that where it's a little bit delayed so it's not going to prohibit our overall launch.
Where are we.
And the progress thus far.
It is going very well, but we're not going to be bound by that in terms of introducing our new hardware solutions. We have a fall back for a fallback system. So it is correct.
Justine Laufer: Thank you. And a reminder to the audience, press star one to ask a question, and you can press star two on your phone to remove your... Our next question comes from Mark Delaney with Goldman Sachs. Yes, good afternoon.
Thank you.
And a reminder to the audience press star one to ask a question and you can press star two on your phone to remove yourself from the queue.
Our next question comes from Mark Delaney with Goldman Sachs. Please state your question.
Yes. Good afternoon, thanks, very much for taking my questions. I guess first now that you have some contracts in place can you share any details or context on what margins and cash flow may do compared to the current baseline as the companies start to its commercial launch at the end of 2024 and ramps in 2025.
Mark Trevor Delaney: Thanks very much for taking my questions. I guess first, now that you have some contracts in place, can you share any details or context on what margins and cash flow may do compared to the current baseline as the company starts its commercial launch at the end of 2024 and ramps up in 2025? Yeah, hey, Mark, how are you doing?
Yes.
Hey, Mark how are you doing.
I think right now obviously these are all.
David Madej: And I think right now, obviously, these are all commitments that are confidential. So I can't really share any of the details on them. I can tell you that we've been fairly consistent about pricing this product similar to what the market has overall, in terms of like a price per mile, and it varies by the lanes that we operate in. And so we have a consistent framework with that for our contracts that we're signing today. The other thing, you know, in terms of like a margin basis, like we're still, as we've said before, we're starting out with up to a fleet of 20 vehicles. So it's going to be pretty modest when we first launch. And so you're not going to see a substantial amount of change in terms of revenue.
Commitments that are confidential, so I can't really share any of the details on them I can tell you that where we've been fairly consistent about.
Pricing this product similar to what the market has overall in terms of like a price per mile and it varies by the lanes that we operate in and so we have a consistent framework with that for our contracts that we're signing today.
The other thing in terms of like a margin basis, we're going to still as we've said before we're starting out with up to a fleet of 20 vehicles. So it's going to be pretty modest right. When we first launch and so youre not going to see a substantial amount of change right in terms of the revenue.
David Madej: We're going to provide a little bit more context for Analyst Day, our Investor Analyst Day coming up in March in terms of how to think about this on a forward-looking basis. I'll stay tuned for more details on that one in March and thanks for the color you're able to share. My other question was around closing the software safety case. I think the company had a target to complete the software safety case and do that around the end of 1Q24.
We're going to provide a little bit more context at analyst day, our investor Analyst day coming up in March in terms of how to think about this on a on a forward looking basis.
I'll stay tuned for more details on that one in March and then thanks for the color you're able to share. My other question was around closing this awkward atk's I think the company had a target.
Typically the software safety case, and do that around the end of <unk> 'twenty four I apologize if I missed it but are you able to share an update on when you plan to complete that.
Mark Trevor Delaney: I apologize if I missed it, but are you able to share an update on when you plan to complete that? Thanks. Yeah, no, great question.
Yes, no great question, so we've been making really strong progress in that and it's reflected where.
Chris Urmson: So we've been making really strong progress on that, and it's reflected in where, if you look at it, we're about 93% closed on the safety case. When we set the roadmap for the company about 18 months ago, we laid out three major milestones to get to feature complete, where all the parts were in place to get to Aurora driver ready, where we had closed the loop, convinced ourselves that the parts that Aurora controlled were safe, and then get to commercial launch, where we are then taking a closer look at the safety case for our system, integrating with the vehicle, and getting it on the road serving customers. As we' At the end of the year, we ended up about 93% at the end of January or mid January.
If you look at we're about 93% closed of the safety case, when we set the roadmap for the company about 18 months ago, we laid out three major milestones to get to feature complete where all the parts were in place to get to Aurora driver ready, where we had closed we convinced ourselves that the PA.
<unk> set a world control to safe and then get to commercial launch where we are then taking a closest the safety case for our system integrated with the vehicle.
Getting it on the road serving customers.
As we've made the progress through that we expect it to get to about 95%.
At the end of the year, we ended at about 93% at the end of.
At the end of January mid January.
Chris Urmson: As we look forward to this year, we've come to the conclusion that the right step forward for us is instead of sequencing these sequentially, to be working on them in parallel. And we talked last time about how we began moving some of our resources off of closing the safety case and working on the next generation work and expanding the performance of the system. As it moves past, the safety case closed.
We look forward for this year, we've come to the conclusions of the right step forward for US is instead of sequencing. The sequentially is to be working on them in parallel and we talked last time about how we began moving some of our resources off of.
The closing the safety case and working on the next generation work in expanding the performance of the system as it moves past.
Chris Urmson: You can think of this as continuous improvement so that, at this point, we're really focused on how we get the quality and performance of the product to a point where it's going to deliver for our customers in the ways that they need it. Okay. Thank you. Our next question is from Andres Shepard with Cantor Fitzgerald.
Safety case closed.
You can think of this as the continuous improvements. So that we are at this point, we're really focused on how do we get the quality and performance of the product to a point, where it's going to deliver for our customers and the ways that they needed to.
Understood. Thank you.
Yes.
Our next question comes from Andres Sheppard with Cantor Fitzgerald. Please state your question.
Hi, good afternoon, and thanks for taking my question and congrats on the quarter and all of the recent developments I.
Andres Shepard: Hi, good afternoon, and thanks for taking our question and congratulations on the quarter and all of the recent developments. I guess our first question is, how should we think about future routes following the Sun Belt, trying to get a sense, you know, maybe a high level medium to longer term? What are some target routes that would make sense in addition to what you have currently targeting?
I guess, our first question is.
How should we think about future routes following.
Some bill trying to get a sense, maybe at a high level of medium to longer term.
Target routes that that would make sense. In addition to what you have currently targeting thank you.
Chris Urmson: Thank you. I'm happy to start and then we'll we'll hand over to Dave to add a little more color So as we think about it, it's very much going to be driven by demand Once we we kind of unlock the initial routes as we've talked about we see small incremental work For whatever the new feature is that's on lanes that that we go to After that, you know, we've talked about between Fort Worth and El Paso the big difference is We have to be able to drive down a hill and we have to be able to deal with a custom border patrol station And we do both those things today we need to expand we'll need to validate that, as we move to other lanes, it'll be okay, there's a whatever the new thing is, if there is anything that we have to add. For us, we see the as you mentioned, the the opening expansion will become along the Sun Belt. And then it's going to be really just tracing the corridors of demand and economic opportunity for us from there as we move up across the Midwest and up both coasts. Dave, I don't know if you had more to add.
I'm happy to start and then we will we will.
And over to Dave to add a little more color. So as we think about it it's very much going to be driven by demand once we kind of unlock the initial routes.
As we've talked about we see small incremental work for whatever the new feature is thats on lanes that we go to <unk>.
After that we've talked about between Fort worth El Paso, the big differences, we have to be able to drive down a hill and we have to be able to deal with the customer border patrol station and we do both of those things today, we need to expand we will need to validate that work.
As we move to other lanes it will be okay.
The new thing is if there is anything there.
We have to add for us we see the as you mentioned that the opening.
Spansion will become along the Sunbelt and then it's going to be really just tracing the corridors demand and economic opportunity for us from there as we move up across.
The Midwest and up both coasts, Dave I don't know if you'd add.
David Madej: Yeah, I think that's right. Like, we look at, you know, the commercial, the regulatory, and the technology, and we look at them together. Our customers are a really good guide to their priority for the lane expansion, but I think Chris hit it well. We'll go, and we'll provide a little bit more context on this also at our Investor Analyst Day, but I mean, you think about it, it's Sunbelt, then it's starting to head north and continuing to head north, and we'll prioritize the higher-demand lanes for our particular customers. I think it's a balance between operating between our terminals but also starting to unlock endpoints for specific customers, and we're going to let the customer help drive the demand. Because of the self-similarity of the highway systems, we can pick one or another, and it's roughly the same technology-wise, as long as there are no regulatory hurdles, which on our roadmap, there aren't any today. We'll really let demand be Got it. No, that's super helpful and insightful. I really appreciate all that color.
That's right like we look at the.
The commercial the regulatory and technology and we.
Look at them together, our customers are a really good guide on their priority for the Wayne expansion, but I think Chris.
<unk> will go and we will provide a little bit more context on this also at our Investor Analyst day, but I mean do you think about it Sunbelt then it's starting to head north and continuing to head north and we will prioritize the higher demand lanes for our particular customers I think it's a balance between both operating between our terminals, but also starting to unlock endpoint.
For specific customers and we're going to let the customer helped drive the demand because because of the self similarity of the highway systems, we can pick one or another and it's.
Roughly the same technology wise as long as there is no regulatory hurdles, which in our roadmap there arent any today.
We'll really let demand be the driver.
Got it.
Super helpful and insightful I really appreciate all that color.
Maybe as a follow up.
Andres Shepard: Maybe as a follow-up, following maybe Mark's conversation and understanding, there'll be more details on this at the Analyst and Investor Day, but maybe, at a high level, what is the best way to think about price per mile, understanding that obviously next year will be up to 20 initial units, but as you begin to ramp up and given all the recent exits in the industry, is there any... www.reinventtech.com Yeah, so let I think, think about the comparison of like. We're trying to offer a product that creates additional value for our customers. And the value is in the safety, it's in the total cost of ownership, it's in the fuel savings, which falls under total cost of ownership.
Following my remarks conversation and understanding there'll be more details on this on the analyst and Investor day, but maybe at a high level.
Is there.
What is the best way to think about price per mile.
Standing that obviously next year will be up to or up to 20 initial units, but as we begin to ramp up and given all the recent exit.
The industry is there any.
Color, maybe at a high level equal kind of give us on what price per mile or what's the best way to think about that thank you.
Yes, So let me start I think and we will provide a bit more context on this at our upcoming events.
I think think about the comparison of lake we're trying to offer.
That creates additional value for our customers and the value is in the safety. It's in the total cost of ownership. It's in the fuel savings, which falls under the total cost of ownership. So theres a lot of there's a lot of increments to that we expect to price <unk>.
David Madej: So there's a lot of increments to that we expect to price when we first launch prior to when we're a driver as a service business model. So we expect a price when we first launch, roughly similar to what a traditional line rate would be. So if you look at DAT pricing, as an example, for lanes, you'll get a pretty good guide to what each lane is.
When we first launch prior to.
Driver as a service business models.
Expect a price when we first launch roughly similar to what a traditional line rate would be so if you look at pricing as an example for range Youll get a pretty good guide of what each lane is.
David Madej: And so that'll kind of be our boundary of where we're thinking about it. When we move to driver as a service, which is our long-term asset-light business model, we will be pricing roughly similar to, you know, what a human driver equivalent would be, you know, doing some adjustments for the value creation out there. So ATRI provides a really good example of what the cost of a human driver is today for carriers and private fleets, and that's a really good source to kind of benchmark.
And so that will kind of be our boundary of where we're thinking about it when we moved to driver as a service, which is our long term asset light business model, we will be pricing roughly similar too.
What a human driver equivalent would be.
Doing some adjustments for the value creation out there so.
ATI doesn't really good example of what the cost of the human driver is today for carriers and private fleets and Thats, a really good source to kind of benchmark against.
Okay.
Chris Urmson: Beautiful. Thank you, Bill. Oh, go ahead. Yeah, I was just gonna add a little bit like that I think at the heart of our price strategy is that we see this great pricing umbrella with humans driving trucks, right? And for a long time, that's going to be the dominant form of transportation of freight. And so as we think about pricing, we think we see that as really the competition. And we see that, ultimately, we'd be offering a product that is safer, that can move freight more quickly. And we see it as really, you know, is that the way to think about where to set the Excellent.
Okay.
Okay.
Oh got it.
I was just going to look like.
I think that the.
The heart of our price strategy is that.
That we see this great pricing umbrella with humans driving trucks right.
And for a long time, that's going to be the dominant form.
Transportation or freight.
And so as we think about pricing, we think see that as really the competition.
We see that ultimately will be offering a product that is safer that could move freight more quickly and we see it as really.
Is that the way to think about where to set the price point.
Excellent. Thank you very much again very helpful. I'll pass it on thank you.
Andres Shepard: Thank you very much again. Very helpful. I'll pass it on. Thank you. Thank you. Thank you. And ladies and gentlemen, we do not have any further questions at this time. That concludes today's conference call. All parties may now disconnect. Have a good day.
Thank you.
Thank you and ladies and gentlemen, we do not have any further questions. At this time that concludes today's conference call. All parties may now disconnect have a great day.