Q4 2024 Faraday Future Intelligent Electric Inc Earnings Call
Question and answer session will follow the formal presentation. As a reminder, this conference call is being recorded it is now my pleasure to introduce to June tongue.
Janssen: Investor Relations. Thank you you may begin welcome everyone to Friday futures fourth quarter and full year 2024 earnings call. My name is Janssen Saturday Futures head of Investor Relations I am joined by our Global C. O Mathias eight C F O Coty Metcom our president.
Speaker Change: Gerry Wang and maximize the global CEO of Saturday Act also known as FX, which is our new subsidiary as well as taqlid onshore right from the intelligence autonomous driving and Internet Department.
Speaker Change: Today, we will be sharing details from our fourth quarter and full year 2024 results. The press release as well as todays presentation will be available in the Investor Relations section of our website at investors thought F. S. Dot com a replay of this call will also be posted here later today.
Speaker Change: Please note that on the call we will be making forward looking statements based on current expectations and assumptions, which are subject to risks and uncertainties.
Speaker Change: These statements reflect our views only as of today should not be relied upon as it representative of views.
Speaker Change: Any subsequent date and we undertake no obligation to revise or publicly release the results of any revisions to these forward looking statements in light of new information or future events.
Speaker Change: These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations.
Speaker Change: For further discussion of the material risks and other important factors that could affect our financial results. Please refer to our filings with the SEC with that I'll turn the call over to our CEO Mathias site.
Speaker Change: Thank you June and thank you everyone for joining our earnings call.
Mathias site: I'm excited to walk you through our progress on per treatment from Q4, and full year 2024, as well as some key points with milestones for 2025.
Today's presentation will cover the following key areas an overview of 2024 developments together with 2025 outlook, along with our financials and our Q4 key accomplishments.
Speaker Change: Full year accomplishments by sectors and finally, our 2025 focus in AI technology and project planning first let's have a brief overview of Florida founded in 2014 by White teacher serial entrepreneur and the originator of smart TV in China market.
Speaker Change: So the future is a California based global shared mobility.
Speaker Change: Mobility ecosystem company.
Speaker Change: Aim to disrupt the automotive industry with our next generation intelligent connected electric vehicles.
Speaker Change: Currently in the <unk>.
Speaker Change: <unk> time.
Speaker Change: Currently leveraging our strength and exploring additional measures to enhance operating cash flow.
Speaker Change: To this end we are undergoing strategic upgrades for the business with the main emphasis on launching the new FX breath.
Speaker Change: Lawrence will capitalize on FX deep rooted internet and technology expertise to deliver a more accessible and user friendly and cost effective intelligent TV offering.
Speaker Change: The excess designed to welcome a broader audience to the FSA ecosystem, delivering our advanced human machine interface.
Speaker Change: The elevated driving experience enabled by our propriety technologies. This FX brand as part of a bigger company strategy that includes efforts global automotive industry brick strategy with this strategy.
Speaker Change: We will seek to bring global components and supply chain into the U S to invigorate the.
Speaker Change: U S EV industry and provide consumers with more diverse and better product options.
Speaker Change: Mobile automotive brick strategy also persist.
Speaker Change: To leverage our cutting edge AI and software technologies across multiple market segments potentially accelerating all mass market entry, while maintaining our ultra luxury offering.
Speaker Change: Our bridge strategy aims to introduce performance capable EV at the fraction of the price.
Speaker Change: Powering our second brand with much of the core technology used on the $300000 <unk> 91.
Speaker Change: Market second brand could make the AI car of the future of the people.
Speaker Change: Our strategy aims to establish a second mass market focused brand by collaborating with China based Oems and part suppliers focusing on the $20000 to $80000 price segment.
Speaker Change: Hello DFS brand.
Speaker Change: <unk> plans to upgrade to source components by integrating its own proprietary AI and vehicle software.
Speaker Change: Combined with mechanical platform support and supply chain collaboration from China's automotive industry. This creates a strong value proposition for scaling into.
Speaker Change: AI driven EV mass market.
Speaker Change: With our dual brand strategy, we are already to deliver exceptional products and drive long term success.
Speaker Change: In 2024 rebuilt delight Swift.
Speaker Change: Swift and empowering model.
Speaker Change: This isn't just a slogan.
Speaker Change: Blueprint for how we operate being light means we are resource efficient keeping our assets capital and marketing lean. So we can adapt quickly and.
Speaker Change: In a competitive market.
Speaker Change: Being swift means we move fast whether its decision making execution of our production. We stay ahead of the curve.
Speaker Change: And empowering this is about creating value empowering our product our teams our users and our global striking strategy.
Speaker Change: This model has been the driving force behind our success this year and it will continue to guide us as we grow let me take a moment to highlight some of our key operational achievements this year.
Speaker Change: Statelets strategic partnerships with major Oems, we have played a crucial role in accelerating the development and testing of our potential SaaS product line, a clear reflection of the industry's growing confidence in NSS.
Speaker Change: On the product front the in house development of the <unk> has been successful with a total of nearly 1600 software updates this flagship model showcases our proprietary technology.
Speaker Change: Including advanced AI driven operating system.
Speaker Change: Paving the way for the future of the FX line.
Speaker Change: By delivering the ISF nine one to talk to you users we've not only proven the strength of our technology, but also build momentum for the FX commercial rollout.
Speaker Change: <unk> reflect a relentless drive and dedication of the entire <unk> team financially 2024 has been a year of significant improvement.
Speaker Change: Operating loss dropped to <unk>.
Speaker Change: $149 7 billion.
Speaker Change: 47, 7% improvement from 2023. This is a clear indication that we are becoming more efficient and focused it's also important to note that 58% of our full year net loss was driven by a non operating losses and non cash expenses not all core business performance.
Speaker Change: This shows that our core operations are strong and moving in the right direction.
Speaker Change: We are building a sustainable financial foundation that will support our long term growth and the capital markets. We have seen a fundamental transformation. This year, we have regained full NASDAQ compliance, which is a major milestone. We have also seen tremendous growth in retail investors. Our nobuto base has grown by one.
Speaker Change: 63% since mid 2023.
Speaker Change: This is a clear sign that more and more people believe in our vision.
Speaker Change: And we successfully received $76 7 million cash funding throughout the year to support our growth and innovation initiatives.
Speaker Change: This funding is critical as we continue to push forward with our plans for the FX line that beyond.
Speaker Change: The capital markets are recognizing all potential and we are just getting started.
Speaker Change: As we look to the future. Our focus is clear first we're on track for FX is first vehicle to roll off the line by the end of 2025, and we expect to hold our first vehicle launch event and start to collect paid reservations. In Q2 2025. This is a pivotal moment for <unk> and we are ready to.
Speaker Change: It is a reality in the meantime, we will continue to deliver S 91 at a steady pace to soft aspire to as a co creator.
Speaker Change: On the operation side, we also anticipate being able to announce a second product category defining high volume electric SUV among our AI EV 70, such product development will kick off in Q2. We will also continue S. S AI technology development, including AI powered smart cabin.
Speaker Change: Hybrid system semi autonomous driving and U S regulatory compliance in Q2 and throughout the year.
Speaker Change: With the FX strategy, we are set to make high performance vehicles more accessible and affordable.
Speaker Change: Actually our goals are clear we're targeting to have the first FX vehicles start to generate revenue in 2025. Meanwhile, achieved positive gross margins for FX models as quickly as possible with upcoming funding secured to support development and production. This is a critical step towards sustainable profitability.
Speaker Change: Additionally, we are focused on optimizing funding costs, ensuring we secure the capital we need without excessive dilution when possible. We are also committed to maintain NASDAQ compliance we've worked hard to meet nasdaq's requirements.
Speaker Change: And we'll continue to do so well, Chris building shareholder value and above all we're fighting to enhance stockholder value. In 2025, we are planning higher frequency engagement activities keep you informed and involved one of the highlights will be launching our annual general meeting with an investor community day dynamic event with more interac.
Speaker Change: This session is an opportunities to connect with the <unk> team.
Speaker Change: Your feedback and support are invaluable and we want to make sure you as all stockholders become part of this journey every step of the way.
Speaker Change: I'll hand, it to <unk>, our CFO for the financials.
Speaker Change: Thank you Mathias, let's start with our 2020 for fourth quarter financial results we.
Speaker Change: We reported a net loss from operations.
Speaker Change: $33 million at 55, 3% improvement compared to a loss of $67 $8 million in Q4 of 2023. This reflects the ongoing progress in cost efficiency and operational streamlining.
Speaker Change: Operating cash flow showed continued improvement during the quarter.
Speaker Change: Operating cash outflows decreased by 51, 3% to $18 4 million compared.
Speaker Change: Compared to $37 $8 million in Q4 of 'twenty to 'twenty three.
Speaker Change: Financing cash inflows totaled $25 million in Q4 2024, nearly matching the $26 6 million raised in Q3 2024 in both quarters financing inflows exceeded operating cash outflows supporting.
Speaker Change: The company's liquidity and growth initiatives.
Speaker Change: For the full year 'twenty 'twenty four we reported a net loss of $355 $8 million, primarily driven by nonoperating and noncash items, rather than the underlying performance of our core business loss from operations totaled $149 7 million.
Speaker Change: A significant improvement from $286 1 million.
Speaker Change: In 2023. This reflects our continued focus on disciplined cost control, particularly in R&D and G&A spending.
The majority of the bottom line loss approximately $206 million was attributable to non operating and noncash expense items.
Speaker Change: Largely tied to the.
Speaker Change: $188 $3 million valuation true up of existing and settle the convertible notes and warrants specifically.
Speaker Change: Specifically, we recorded a $176 million loss on the settlement of notes payable and a $12 $3 million loss related to the fair value change in convertible notes payable warrant and an incremental warrants.
Speaker Change: On the cash side, we are seeing meaningful progress.
Speaker Change: Operating cash outflow for the full year was $70 2, million% to 75% improvement compared to $278 $2 million in 2023. This highlights the effectiveness of our cost discipline and the improvements we've made in operational efficiency.
Speaker Change: Turning to our cost and expense profile.
Speaker Change: Cost of revenue increased by 41 $4 million year over year, primarily due to higher depreciation expenses as we brought more equipment online to strengthen production, particularly in our paint and body shop operations.
Speaker Change: R&D expenses decreased significantly by $106 $8 million driven by two main factors.
Speaker Change: $53 $6 million reduction related to lower salary and head count as many R&D personnel transitioning into production roles and a $35 $2 million reduction in engineering design and testing costs.
Speaker Change: Additionally, we recognized a $14 $9 million gain from the settlement of previously accrued R&D expenses with Palin tier.
Speaker Change: And the marketing expenses were down by $13 $6 million, primarily due to three sectors, a $7 7 million drop in compensation, a $3 $6 million reduction in general expenses, largely due to lease terminations Richard.
Speaker Change: <unk> in 2023, and a $1 $7 million a decrease in advertising spend.
Speaker Change: General and administrative expenses also came down by $39 $7 million largely due to a $23 $2 million reduction in professional service fees, a $10 $7 million drop in insurance costs, mainly related to DNO cover.
Speaker Change: Rich.
Speaker Change: A $5 $8 million reduction in general overhead again, reflecting lease terminations that are recorded in the prior year.
Speaker Change: Overall, we're seeing a clear trend of improving financial stability.
Speaker Change: In both Q3, and Q4 financing cash inflows exceeded operating cash outflows.
Speaker Change: This positive cash flow dynamic combined with a 75% year over year reduction in operating cash burn and meaningful cost reductions across R&D and SG&A reflects the tangible progress we have made in aligning our cost structure with operational priorities.
Mathias: While positioning the company for long term scalability and financial resilience with that I will hand, it back to Mathias.
Mathias: Now, let's dive into our Q4 performance highlights.
Mathias: Let's first look at vehicle delivery, we've taken important steps to establish our presence in the market. We delivered the S. S 91 to influence a fashion model and designer Suede Brooks further pushing our presence in the luxury consumer market.
Mathias: Another F F nine one user Luke.
Mathias: And entrepreneur and community leader also announced in manufacturing we have taken several steps to in Haynesville production capabilities and efficiency, we secured Fuji vehicles body parts to support the manufacturing of the Fas 91 with delivery starting in March 2025.
Mathias: We also improved manufacturing efficiency by insourcing.
Mathias: Seats for the first nine one ensuring the higher quality control and cost effectiveness.
Mathias: On the software front.
Mathias: Leased new in car software updates.
Mathias: T E over the air.
Mathias: <unk> technology for these 91.
Mathias: In Haynesville, the user experience and keeping all of the vehicle at the cutting edge of technology.
Mathias: Furthermore, we entered into a nonbinding Mou with JC spotlight to showcase the Fas 91 within Hain Smiths and to explore future partnerships.
Mathias: This collaboration has the potential to improve honest amortization capabilities.
The next set of updates on our FX business development, we've made significant progress on our FX models, which are designed to target. The mass market on September 19, 2024, we announced two potential FX models. The <unk> five <unk> six featuring both range extended battery life.
Mathias: Could call trends with FX, five having a target price between 20 to 30000 and FX six having a target price between 30000 to 50000 in November 2020 for the first FX prototype mules were shipped to the Fas.
Mathias: Headquarters for product development and testing.
Mathias: With delivery completed in January 2025. Additionally, we are collaborating with Oems for potential FX models kicking off the product research phase on the fundraising front, we have secured critical funding to support our growth and strategic initiatives, we secured 30 million in funding commitments.
Mathias: September 2024 to strengthen our core business and support the rollout of the fiber to the X FX strategy.
Mathias: We also signed a co investment agreement with Boston investment group or imply shakeup Doula Qassimi a member of the <unk> 70 with respect to an office building development in the UAE.
Mathias: Finally, we received an additional $30 million in previously committed to December financing around further bolstering our financial position as we continue to execute our long term strategy.
Mathias: Let's now turn to our operational progress.
Mathias: Where we have made several strategic moves to precision is F. For long term success first we changed our stock ticker symbol from F. F. R. E. S. S AI, reflecting our commitment to advancing our AI strategy and <unk>.
Mathias: Lining our brand with our vision for the future of intelligent electric mobility.
Mathias: We've also made progress on our future headquarters in north of her mouth.
Mathias: E a key milestone in our global expansion.
Mathias: Elaboration is on track and the handover is expected at the end of 2025 or early 2026.
Mathias: Throughout Q4.
Mathias: Actively engaged with our community and industry peers through several key events.
Mathias: We participated in the 22nd song to me thousands people picnic hosted by the Chinese University of Aluminum Association Alliance of Southern California.
Mathias: Enforcing our commitment to fostering connections and collaborations during the 2020 for specialty equipment market Association show, we showcased two customized F F 912.0 futurist alliances.
Mathias: Also try empty annual Toya drive event hosted by Sean Lee, demonstrating our dedication to giving back to the community.
Mathias: Moreover, we announced the a I open day.
Mathias: And to further solidifying our determination on AI application to our products.
Mathias: And leadership, we have strengthened our foundation and demonstrates our commitment to <unk> success.
Speaker Change: Our founder why T jaw made a significant contribution by donating 60% of his personal shares and grow fund or a global IP commercialization company, two <unk>, representing 10% of growth vendors total shares we are fortunate.
Speaker Change: Lucid strategic licensing agreement. This licensing agreement has the potential to create a new growth driver for F.
Speaker Change: Additionally, why T andi demonstrated our confidence in <unk> by purchasing <unk> class a common stock starting September 2024, we've also made key personnel appointments to drive our company and the FX strategy in coming year.
Speaker Change: Nevertheless joined as executive launch director, bringing extensive experience in product launches.
Speaker Change: Mark was appointed as head of S. S UAE overseeing our operations in the region.
Speaker Change: <unk> was named Chief Financial Officer, and Aaron Pas became acting head of E V. R&D Brookdale Ecu was named as President of the FX Global EV R&D Center and Shah.
Speaker Change: Maxmara was named as CEO for FX. These leaders bring deep expertise and division to their roles, ensuring we execute our strategy with precision and innovation.
Speaker Change: Let's go.
Speaker Change: On to review of our 2020 for full year performance by sector.
Speaker Change: 2024, we adopted the deliberate and responsible approach to vehicle delivery prioritizing quality control system stability and.
Speaker Change: The inherent value of DSS 910 go rapid scaling.
Speaker Change: While we delivered a total of six vehicles. These numbers reflect our commitment to ensuring that every S. S 91 meets the highest standards of craftsmanship performance and user experience.
Speaker Change: We believe that delivering a truly exceptional product is more important than rushing to meet arbitrary delivery targets.
Speaker Change: And last year, our new users into the fallen leaves US Entertainment a Hollywood based production company Motors, a b to B co creation partner funded by Robert gas killed at Morgan Freeman.
Speaker Change: <unk> modeled into sign ups, we Brooks.
Speaker Change: These early adopters represent the elite tier of innovators and Influencers, who recognize the unparalleled value of DSS 91, yes.
Speaker Change: Their feedback has been instrumental in refining our product and ensuring its lewis on its promise of ultimate AI Tech luxury.
Speaker Change: Our co creation office of program has been a key driver for innovation and refinement for the excess nine one we added four co creation offices, who bring diverse expertise and industry influence on the F. S brand.
Speaker Change: Contribution that strengthen our brand identity and industry connections, but feedback has directly led to continuous product improvements, including the introduction of a sporting event replay feature and the addition of synchronized video playback across three screens at.
Speaker Change: At different seat locations enhancing the in car entertainment experience is updates underscore our commitment to deliver premium user centric product that evolves with all customer needs in manufacturing, we have made significant strides in improving efficiency quality and scalability.
Speaker Change: Thousand 24, we used two newly manufactured vehicles cresta.
Speaker Change: Validate our self produced body in white.
Speaker Change: The successful testing not just validated all self manufacturing ability, but also helped us to ensure the safety durability and performance of our vehicles at our Haynesville plant, we achieved several key improvements.
Speaker Change: Reduced production cycle time by 40% improved customer craftsmanship audit scores by 50% and enhanced quality control within process quality gates, increasing quality checks by 200%. This advancement reflect our unwavering focus on quality over quantity.
Speaker Change: Ensuring that every asset that's nine one meets the highest standards of excellence.
Speaker Change: Our UAE factory progress is another critical milestone in 2024, as we expand our global footprint and prepare for future growth.
Speaker Change: Reserved a 108000 square feet manufacturing facility in the Russell Hi, Mark Economic zone.
Speaker Change: Making a significant step in our international strategy.
Speaker Change: We also held our first of multiple face to face meetings with Ruckus.
Speaker Change: Advanced completion of manufacturing facility, ensuring alignment with local stakeholders.
Speaker Change: We have also completed the equipment supplier selection phase awarded phase one equipment procurement.
Speaker Change: <unk> based supplier and introduce program management tools and project charter securing stakeholder approval for the estimated U.
Speaker Change: E program schedule this progress in 2024.
Speaker Change: That's fundamental for our development in Q1 2025.
Speaker Change: During which we completed the first lease of an S. S. Nine one and the New York market the steps lay the foundation for facility.
Speaker Change: Will support our long term growth and global ambitious next I will let anshul Ray the tech lead from our I Department. We go through the details of our technology development that paves the way for better user experience and AI applications.
Anshul Ray: Thank you Matthias let.
Speaker Change: Let me provide you with our updates on the technology side.
Speaker Change: In 2024, we made significant strides in enhancing the technological capabilities of Dsm's nine one.
Speaker Change: Ensuring that it remains at the forefront of innovation in the EV industry.
Speaker Change: We delivered nearly 1600 upgrades via several over the air update.
Speaker Change: <unk> see improving the vehicles performance features and user experience.
Speaker Change: These updates reflect our commitment to providing customers with a cutting edge product that evolves over time.
Speaker Change: We've also made it easier for users to share their insights and suggestions through.
Speaker Change: Through the S. S. AI voice assistant users can now submit feedback directly.
Speaker Change: Streamlining the process and allowing us to respond more effectively to their needs.
Speaker Change: This feedback loop is critical to our mission of delivering a user centric mobility experience.
Speaker Change: On the navigation front, we've upgraded the mindset to provide clearer turn by turn guidance, ensuring a more intuitive and stress free driving experience.
Speaker Change: For Entertainment, we've introduced streaming video playback on the center display when the vehicle is part.
Users can now access major sporting events, including NFL, MLB, NHL NBA and more.
Transforming the Fas 91 into a mobile entertainment.
Speaker Change: We've also made several control and interface enhancement.
Speaker Change: Improve usability and comfort.
Speaker Change: The door panel interface has been revamped for easier seed adjustments in that.
Speaker Change: <unk> AI assistant can now be activated via the rear seat controls.
Speaker Change: Seat comfort has been enhanced with smoother leg support an adjustment mechanism.
Speaker Change: The pillar screen controls now offer interactive features for flexible control of all doors.
Speaker Change: The center display has been updated with a dragon dropout customization or fees.
Speaker Change: <unk> color contrast, and better readability.
Speaker Change: The rear display now shows Bluetooth connection status, simplifying headphone pairing and management.
Speaker Change: These upgrades ensure that every interaction with DFS 91 is seamless intuitive and luxurious.
Speaker Change: In terms of Internet connectivity.
Speaker Change: <unk> introduced a clearer signal strength display and support for wireless carrier named to be visible ensuring better connectivity management.
Speaker Change: Throughout 2024, we've made significant improvements in overall build quality and system stability.
Speaker Change: Levering, a more reliable and refine driving and rider experience.
Speaker Change: Finally, our AI driven advancements have been a cornerstone of our innovation strategy in 2024.
Speaker Change: We've developed a next generation in car interaction system powered by large AI models also referred to as an AI AOS.
Speaker Change: Powered by AI agents.
Speaker Change: This system redefine how users interact with their vehicles.
Speaker Change: Offering a more personalized and intelligent experience.
Speaker Change: We're also conducting research on end to end pure vision advanced autonomous driving solutions.
Speaker Change: Leveraging cutting edge AI to push the boundaries of autonomous mobility.
Speaker Change: Additionally, we're exploring AI applications and vehicle control and traditional driving including projects like AI range extension.
Speaker Change: Which aim to optimize performance and efficiency.
Speaker Change: Yeah.
Speaker Change: To continue our refinement in Q1 of 2025.
Speaker Change: We have made progress across several key areas demonstrating.
Speaker Change: Demonstrating our commitment to innovation quality and market readiness.
Speaker Change: On the FX line, one front, we successfully completed the first external release of the version 57 vehicles software and finalize the added of the upcoming version 58, which is now in the internal testing phase.
Speaker Change: These updates have significantly enhanced the user experience and product performance.
Speaker Change: Ensuring that the Fas 91 continues to deliver a truly exceptional driving experience.
Speaker Change: In terms of our AI product strategy be.
Speaker Change: We completed the strategic planning for upcoming AI products.
Speaker Change: Setting a clear roadmap for future development.
Speaker Change: We also delivered the first internal development version of an AI powered system.
Speaker Change: Making a critical step forward in our AI driven innovation.
Speaker Change: Additionally, at the first FX open AI D b.
Speaker Change: We launched future <unk>, the world's first AI hybrid extended range electric powertrain system company.
Speaker Change: Finally on the FX product compliance front, we conducted a thorough compliance analysis for the U S market in collaboration with multiple potential FX partners.
Speaker Change: We also delivered change proposals to ensure compliance with the U S market regulation.
Speaker Change: Now I want to turn it over to Gerry Wang our president to.
Gerry Wang: To provide updates on the capital market side.
Speaker Change: Thank you actual for the detailed summary.
Gerry Wang: On the capital market side in 2024.
Speaker Change: We saw significant progress.
Speaker Change: <unk>, our financial position Bush.
Bush has been critical to advancing our strategic goals.
Speaker Change: On September four 2020 for NASDAQ or officially confirm further future was in full compliance with all of these team requirements.
Speaker Change: Lisa Chief men, followed a series of strategic actions to address previously identified efficiencies.
Speaker Change: Including delays in siding or all the reports and the mean and beat price requirement.
Speaker Change: Restoring compliance reflects the resilience and determination of our team.
Speaker Change: Along with our.
Speaker Change: Unwavering commitment.
Speaker Change: Currency and strong gardeners, we have seen a significant growth in all of our retail shareholder base, which based on the noble list.
Speaker Change: <unk> by approximately 163% from <unk> 23 to January 20th 95.
Speaker Change: We also finished a significant amount of financing, although facing tough market capital market conditions.
Speaker Change: Mainly driven by the already successful E F secure share of FX strategy and access unique competitiveness.
Speaker Change: In the first half of the year with secured $26 7 million in financing.
Speaker Change: Providing essential support for our operations.
Speaker Change: Building on this momentum.
Speaker Change: We received an additional 50 million in the second half of 'twenty 'twenty four.
Speaker Change: Making up 87% increase from the first half.
Speaker Change: We also successfully hosted an Investor Committee a day on July 2074.
Speaker Change: In Q1 and is 95, we continue to perform.
Speaker Change: On the Investor side in February we.
Speaker Change: We hosted private investor events in New York City.
Speaker Change: Engaging with stakeholders and showcasing our progress and vision for the future.
To more clearly communicate our strategies T J focus.
Speaker Change: We changed our chief our symbol <unk> AI <unk>.
Speaker Change: In March.
Speaker Change: Andrew scoring our commitment to the AI driven technologies and alignment on our brand with the future of intelligent mobility.
Speaker Change: We also successfully secured 41 media in financing in March 2025.
Speaker Change: Subject to closing conditions.
Speaker Change: There are strengthening our financial position as supporting our ongoing initiatives.
Speaker Change: Well founding sustains with Lou.
Speaker Change: Luke to keep improving our operational efficiency.
In 'twenty is only for <unk>.
We demonstrated remarkable operational resilience.
Speaker Change: <unk> supply chain disruptions and tariff challenges.
Speaker Change: With this 10 <unk> deliveries.
Speaker Change: Ensuring that our flagship product continued to reach customers and strengthen our brand presence.
Speaker Change: As a pivotal moment.
Speaker Change: We successfully launched our second brand fair to ask.
Speaker Change: And they introduced the British strategy, which has been instrumental in expanding our potential market rich.
Speaker Change: Additionally, we strengthened our market presence through strategic arrangements with key Chinese industrial players further solidifying our position in the global EV market.
Speaker Change: One of our key achievements in 294 was the significant progress we made in cost reduction.
Speaker Change: We achieved substantial savings across several key areas, including personnel costs profession.
Speaker Change: Professional services and general expenses, such as rent and insurance.
Speaker Change: The disciplined approach results in a 72, 9% reduction in operating expenses compared to a tiny tiny three.
Speaker Change: Well maintaining operational effectiveness.
Speaker Change: Our cost management efforts have not only improved our financial health, but also position the company for sustainable growth in the years to come.
Speaker Change: So he has operational efficiency, we launched the P. P T I a system.
Speaker Change: Which stands for a policy process tools.
Speaker Change: In AI.
Speaker Change: The systems guys, our daily operations and incorporates AI driven solutions to improve data analysis and operational performance by integrating AI into our workflows.
Speaker Change: Being able to streamline processes.
Speaker Change: Hence the decision making.
Speaker Change: And drive greater efficiency across the organization.
Speaker Change: In 2024, we also strengthened our risk management framework to support financial stability and regulatory compliance.
Speaker Change: By proactively addressing potential risks and implementing robust controls.
Speaker Change: <unk> created a more resilient organization capable of navigating challenges as seizing opportunities.
Speaker Change: NAMIC market environment.
Speaker Change: And asking it stated we made several key appointments to strengthen our leadership team Andrew.
Speaker Change: And drive our strategic initiatives.
Speaker Change: Looking ahead.
Speaker Change: Our operational focus remains on continuous improvement and strategic execution.
Speaker Change: In Q1 2095, we have further enhanced our five star system buildup methodology and the P. P. T I assist hub to optimize daily operations.
Speaker Change: We also collaborate with top Oems will advance the breadth strategy strengthen our supply chain.
Speaker Change: Well the FF brand.
Speaker Change: <unk> highest vehicle delivery and user experience. He has been and use the continued delivery of cells of the asset in Iowa as a foundation for launching the adoption vehicles off our second Brad FX.
Speaker Change: So the second Brian we're collaborating with major top tier Oems, we ensure the successful launch and delivery of <unk>.
Speaker Change: Mass market FX vehicles.
Speaker Change: Now I'll turn it over to the next month.
Speaker Change: Provide more specific details our FX and global strategies.
Speaker Change: Thanks, Jerry in 'twenty, one and four we made significant progress in advancing our fairly ex FX strategy, which is central to our mass market ambitions.
Speaker Change: We established fairly X AI.
Speaker Change: E V Inc. In early September to 104 to operate the alpha strategy and products.
Speaker Change: Ensuring focus execution and scalability.
Speaker Change: We also signed framework agreements or M will use with several Chinese Oems and finalized product development and delivery agreements with two top Oems.
Speaker Change: Each with annual sales exceeding 1 million vehicles.
Speaker Change: These agreements focus on development testing regulation supply chain planning and production execution.
Speaker Change: A key milestone was reached on November 22 hunting for when the first ethics prototype news were shipped to F. S. U S headquarters.
Speaker Change: Marking the start of the product development and testing phase.
Speaker Change: We also made significant progress on our global strategy.
Speaker Change: In China, we focused on strengthening our supply and our collaborations and global supply chain to support our international operations for both FX and FX.
Speaker Change: We maintained and expanded relationships with Chinese suppliers, securing collaborations with a top tier suppliers to the mens the ethics strategy.
Speaker Change: Does that first not only strengthened our first global supply chain, but also enable the international expansion.
Speaker Change: The Chinese suppliers via our regional strategy.
Speaker Change: By building a bridge between the automotive industries of China, and the U S. We solidified <unk> global footprint and competitive edge positioning ourselves to leverage the strength of.
Speaker Change: Both markets.
Speaker Change: Additionally, we achieved a significant milestone and now third pole strategy by establishing a presence in the United Arab Emirates through fairly future in middle East as the L. C. We secured a 108000 square feet facility in sarcoma to be used as out.
Speaker Change: Were you a headquarters.
Speaker Change: And a potential manufacturing facility.
Speaker Change: Also a co investment agreement with Master investment group, a real estate investment and construction company was signed primarily for collaborating on the establishment of the abovementioned headquarters.
Speaker Change: Following these fundamentals build in 2024 in Q1 to 105, we continue to build momentum with several key achievements.
Speaker Change: We revealed ethics, AI MPD product strategy and presented camouflaged prototype mules during an event in Las Vegas, Nevada in January 2025, generating excitement amount and stakeholders and customers.
Speaker Change: We signed a strategic co operation agreement with another top OEM in China on February 22, 75.
Speaker Change: And with a core suppliers of the new energy industry on February 26 to 105.
Speaker Change: By March 19, two.
Speaker Change: <unk> five.
Speaker Change: The first FX six prototype mills arrived at our Los Angeles headquarters.
Speaker Change: Well they will begin U S product development and testing with a focus on advanced driver assistance systems in.
Speaker Change: In China, we engaged top Oems as previously mentioned to develop test and plan the production of two potential FX models.
Speaker Change: These achievements and that has strategy execution, China collaborations and UAE development underscore our progress and commitment to long term success.
Matthias: Now I will hand over to Matthias.
Matthias: Thank you Max.
Matthias: As we look ahead to the remainder of 2025, our focus remains on delivering higher performance intelligent electric vehicles.
Matthias: Oh.
Matthias: Excellent.
Matthias: Our manufacturing capabilities, advancing our technology, and AI initiatives and enhancing financial stability.
Matthias: Now I'd like to conclude the earnings call with an overview of our technology and AI focused for 2025.
Matthias: Which solidifies our determination to rollout yeah FX models.
Matthias: And.
Matthias: 2025, we will see the completion of our first generation smart Kevin powered by AI agent technology, which will be fully deployed.
Matthias: The <unk> 91, and prepared for integration into our upcoming <unk> X series.
Matthias: Another major in the innovation is our hybrid extended range system.
Matthias: We will look to finalize the detailed product definition and complete the core R&D work setting the stage for future electrification advancement.
Matthias: In the meantime, we are taking a forward looking approach to self driving technology focusing on preliminary research into end to end autonomous driving using large scale AI models.
Matthias: Defining the autonomous driving technology road map for the FX series into next generation models.
Matthias: We are also developing a phased implementation plan to ensure compliance with U S regulatory standards for our smart, Kevin and autonomous driving technologies.
Matthias: In summary, 2025 will be a pivotal year for our company.
With a strong focus on driving technological innovation and maintaining financial discipline, we are positioning ourselves for long term growth and success in the EV market.
Speaker Change: With that I'll turn it back over to the operator.
Speaker Change: Thank you, Matt and thank you to everyone who presented today as.
Speaker Change: As we wrap up I'd like to briefly highlight the materials included in appendix of today's presentation.
Speaker Change: Appendix Youll find our audited balance sheet and financial statements, providing additional detail on our year end financial position and a major recap of some of our key milestones from 2020 for showcasing important part that technology and operational achievements. These materials offer helpful context to support everything.
Speaker Change: We've shared today with that we'd now like to open the floor for Q&A, ladies and gentlemen, we will now begin the next segment of our call where Brad Cohen from further interest external Investor relations team will moderate and QA session addressing questions submitted by investors parallel to todays call.
ashish: Ashish. Please go ahead.
ashish: Thank you operator, we've received numerous questions from our investors do the hashtag ask F. F campaign and I'll be directing these questions to fair days management team, let's begin with our first question.
ashish: It was mentioned.
ashish: FX production is on track for 2025.
Speaker Change: Can you provide more details on the timeline for preorders and how you plan to ensure production stays on schedule.
Speaker Change: Great question we.
Speaker Change: We are planning to open preorders for the FX in Q2 2025 ahead of production.
Speaker Change: As for the timeline, we've built a robust production plan with clear milestones in contingencies.
Speaker Change: Our collaborations with leading Oems and suppliers combined with our in house expertise give us confidence in meeting our targets.
Speaker Change: For that answer.
Speaker Change: Moving on to our next question what do you see as the biggest risk or challenges in achieving your 2025 golf and how are you preparing to address them.
Speaker Change: Transparency is key.
Speaker Change: So I appreciate this Christian the biggest risks include supply chain disruptions market competition and regulatory changes.
Speaker Change: To mitigate these we've diversified our supplier base strengthened our relationships and build a flexible product model.
Speaker Change: Also closely monitoring market trends and regulatory developments to stay ahead of the curve while challenges are inevitable and we are confident in our ability to navigate them and deliver on our promises.
Mikael: Thank you Mikael.
Speaker Change: On to another question you mentioned targeting positive gross margins for FX models, how do you plan to achieve that.
Speaker Change: Given the competitive nature of the EV market.
Speaker Change: Great question, achieving positive gross margins as we ramp up production is a top priority and we are approaching it through several key levers.
Speaker Change: Number one cost efficiency.
Speaker Change: We're reducing production cost by leveraging strategic OEM relationships and integrating proprietary in house technologies over time.
Speaker Change: Number two scale.
Speaker Change: The FX strategy is built for high volume production, enabling us to significantly lower per unit costs over time.
Speaker Change: And number three smart pricing.
Speaker Change: FX is positioned as a premium offering with broad appeal.
Speaker Change: Balancing strong customer demand with gross margins.
Speaker Change: Importantly, the FX platform has been planned from day, one with mass market economics in mind, utilizing an asset light model and our strategic manufacturing collaborations are dual powertrain architecture also supports flexible margin profiles with potential <unk>.
Speaker Change: <unk> extended variant lately offering higher contribution margins as we scale several drivers will further support margin expansion manufacturing.
Speaker Change: Manufacturing efficiencies through increased volume in our China Bridge.
Speaker Change: Amortization of fixed costs over a larger production base.
Speaker Change: Supply chain optimization, and the introduction of higher margin variance, we're confident that our business model enables attractive unit economics at scale.
Speaker Change: Yeah.
Speaker Change: Right well continue with the next question.
Speaker Change: Turning NASDAQ compliance without a reverse stock split is an impressive feat how do you plan to sustain this while also enhancing shareholder value.
Speaker Change: Yeah.
Speaker Change: Thank you.
Speaker Change: Maintaining NASDAQ compliance is a testament to the strength of our business.
Speaker Change: We're focused on executing our growth strategy, which includes delivering the FX products advancing our AI technologies and expanding our market presence.
Speaker Change: As we achieved these milestones it will support sustained growth delivering long term value to our shareholders without the need for a reverse stock split.
Speaker Change: Great and moving on to the next question.
Speaker Change: We are very excited about the idea of an investor community day could.
Speaker Change: Could you share more about what this stay will look like and how it will benefit investors.
Yeah.
Speaker Change: Absolutely we have hosted an investor community day in 2024 and received great market appreciation it.
Speaker Change: It will be a dynamic interactive event.
Speaker Change: Where investors can engage directly with our leadership team to our facilities and experienced our products firsthand, it's about creating a deeper connection with our investors and giving you a front row seat to F. S journey.
Speaker Change: We will also host breakout sessions Q&A panels and networking opportunities to ensure your voices are heard and your questions are answered.
Speaker Change: Great. Thank you for that response, let's move on to the next question. How does FX is global automobile motive bridging strategy benefit Faraday future.
Speaker Change: Good question.
Speaker Change: We launched the FX global automotive bridge strategy in 2024.
Speaker Change: Cough. This registry is the integration of strength integration of the core advantages of the smart mobility industry in China, and the United States into exports.
Speaker Change: Let's start by looking at why extra that she'll have a chance to succeed first of all opportunity.
Speaker Change: We are in an era of explosive growth in AI, which presents a huge opportunity for the smart mobility industry.
Speaker Change: Seized this opportunity integrate existing advances resources quickly launched attractive mass mobility products, which is what we are doing now.
Speaker Change: Second the capability.
Speaker Change: E F X strategy is built on FFS the accumulated experience over the past 10 years. So far <unk> has invested heavily to establish and Richard core technology platform.
Speaker Change: <unk> the AI powered operating system.
Speaker Change: These platforms can be efficiently applied to different vehicle models. Additionally, F has a dual home advantage in both China, and the United States, enabling us to identify high quality resources that deadline with FX strategy in both countries.
Speaker Change: Third the <unk>.
Speaker Change: Product.
Speaker Change: We will test and optimize the mature mechanical design platform and equip it with the <unk> technology platform that can be continuously integrated in the future.
Speaker Change: We want to be if X to be both trendy mature combining the versatility.
Speaker Change: And trend of the features with the maturity and stability of the hardware, which is what makes the FX model attractive.
Speaker Change: Currently FX has a planned three potential models, including an MPV product.
Speaker Change: Yes X five target price of 20 to 30000.
Speaker Change: <unk> six target price of 30 to 50000.
Speaker Change: As you can see unlike the positioning of the <unk> nine one.
Speaker Change: F X models are aimed at the mass market. This will help us increase market share gain continuous user operation scenarios improve revenue and thereby and hanes the company's value.
Speaker Change: And our final question.
Speaker Change: It sounds like FX products will lose the use a lot of Chinese parts and supply chain to build supply chain and cost advantages.
Speaker Change: Do a series of import tariffs have an impact on FX as strategy.
Tariff policies affect not just one company.
Speaker Change: But the entire industry.
Speaker Change: We plan to manufacture and sell FX products in the United States as well.
Speaker Change: Long as there is a cost advantage and performance advantage over other similar products in the United States is X product.
Speaker Change: Yeah.
Speaker Change: FX products will have the advantage of smart mobility in China, and the United States and I believe they will be competitive.
Speaker Change: Thank you MS task that concludes the hashtag ask FF investor Q&A session fair.
Speaker Change: Fair that future I appreciate all the questions submitted.
Speaker Change: And apologize if if we were not able to get to your question today.
Speaker Change: The company remains committed to maintaining open communications with investors.
Speaker Change: With that we'll turn the call back to the operator for closing remarks.
Speaker Change: Thank you Brad that concludes today's conference call. Thank you for your participation you may now disconnect your lines.
Speaker Change: Yeah.