Q1 2025 EVgo Inc Earnings Call
Andres Sheppard, Paul Dobson,
Thank you.
Speaker Change: Hello and welcome to the Evgo Inc Q1 2025 earnings call. All lines have been placed on you to prevent any background noise. After the speakers remarks, there will be a question and answer session. And if you would like to ask a question during this time, please press star one on your telephone keypad.
Speaker Change: I would now like to turn the conference over to Heather Davis, vice president of investor relations. You may begin.
Speaker Change: Good morning. This is Evgo's first quarter, 2025, her name's Paul. My name is Heather Davis, and I'm the Vice President of Investory Relations at Evgo.
Joining me on today's call, are Badar Khan.
Speaker Change: Davido's Chief Executive Officer, and Stephanie Lee, Executive Vice-President Accounting and Finance.
Speaker Change: RCFO Paul Dobson is out this week due to a loss in the family a few days ago. Today, we will be discussing Evgo's first quarter, 2025 Financial Results followed by a Q&A session.
Speaker Change: Today's call is being webcast and to be accessed on the Investor section of our website at investors.evgo.com
Speaker Change: The call will be archived and available there, along with the company's earnings release and investor presentation after the conclusion of this call.
Speaker Change: During the call, management will be making foreign-looking statements that are subject to risks and uncertainties, including expectations about future performance.
Speaker Change: Factors that could cause actual results to differ materially from our expectations are detailed in our SEC filing, including the risk factors section of our most recent annual report on Form 10K, and quarterly reports on Form 10K.
Speaker Change: The company's SEC filings are available on the investor's section of our website.
Speaker Change: These four looking statements apply as of today, and we undertake no obligation to update these statements after the call.
Speaker Change: Also, please note that we will be referring to certain non-GAB financial measures on this call.
Speaker Change: Information about these non-GAF measures, including a reconciliation to the course by the GAF measures can be found in the earnings material available on the infrastructure section of our website.
Speaker Change: With that, I'll turn the call over to Badar Khan, EDGO's CEO.
Speaker Change: Evgo had yet another record quarter of strong results. Customer consumption on our network continues to rise when average daily throughput per public stall rising by 36% versus the same quarter last year and up more than fivefolds in three years.
Speaker Change: The combination of higher throughput per stall and more stalls resulted in an overall public network throughput growth of 60% versus last year, with Q1 representing the 13th consecutive quarter of double-digit year-only year growth in charging revenues.
which is every single quarter since we've been a public company.
Speaker Change: Total revenue grew 36% Europe a year, and a near tenfold growth in three years.
Speaker Change: We added over 180 new operational stalls this quarter, including extend stalls, and now have over 4,200 operational stalls.
Speaker Change: And finally, we began the year with a strong cash balance and prospects. We ended the quarter with 171 million cash, cash equivalents and restricted cash, and at the start of April we received the next quarter of the advance from the TOE load as expected.
Speaker Change: As you all know, in December 2024, after an 18-month process, we close at a $1.25 billion loan guarantee with the Department of Energy Loan Programs Office.
Speaker Change: That's the Cures Financing for our trajectory, past and just the need for top-rate even this year, leverage free cash flow breaking the next year, and more than triples are installed based, open the next five years throughout the United States.
Speaker Change: This puts us in a particularly strong competitive position within the EV Fast Charging Advocate.
Speaker Change: Looking at the macro-environment, the impact of tariffs on Evgo posed directly and indirectly is expected to be relatively minimal.
Speaker Change: That's because only approximately 25% of the total CAPEX cost per stall is subject to tariffs. The remainder being domestically sourced equipment and raw materials and construction costs.
Speaker Change: Our fiscal 2025 net cap-backs estimate includes the cap-backs for 2025 vintage stalls as well as standard incurred in 2025 for 2026 vintage stalls.
Speaker Change: And fiscal 25, we expected to incur around 45 to $50 million on imported chargers.
Speaker Change: However, we already have either inventory or on shipping containers just under half of that spend for important equipment.
Speaker Change: Therefore, we expect an impact of around $45 million, depending on what the final tariff rate might be for these imports. What we negotiate with our suppliers, and whether we're able to expand our existing U.S. horse production.
Speaker Change: In addition, we expect to deliver 10 million dollars in CapEx efficiencies this year that more than offset the estimated impact of tariffs in 2025.
Speaker Change: because we are an owner of operator and not an equipment seller. None of this is expected to impact adjust the either job for our charging business.
Speaker Change: This past quarter is more particularly strong growth in non-Testla EV sales, which grew over 35% compared to Q1 last year.
Speaker Change: Chevy Equinox EV, Honda Prologue, and Hyundai Ionic 5 are among some of the best selling non-custom models. It's especially encouraging to see this as the MSRP for the Equinox starts at around $35,000.
Speaker Change: Importantly, our business is increasingly not reliant on new ED sales in any one year, and is instead reliant on the overall number of evening's on the road.
Speaker Change: We estimate less than 10% of 2025 revenue to come from new EVs purchased this year. That percentage will shrink, going forward at the EV Car Park Rose.
Speaker Change: In addition, EVs sold in the US appear to have more domestic content on average versus ICE vehicles. Therefore, Tarris may have a figure impact on ICE vehicles than EVs in the US.
Speaker Change: Gordon's the DOE, the nationwide growth of DC fast charging stations has in fact been flat for the past seven quarters, with Q1 actually showing a 16% decline from the prior quarter.
Speaker Change: In a higher tireless environment, we expect a supply of new fast charging will continue to fall. That is because, roughly half, of new fast charging deployed are sold to site hosts by companies like ChargePoint.
Speaker Change: which will likely see slower growth as sight hosts, poles, or reconsider what they may view as discretionary investments outside of their core business.
Speaker Change: Especially if these companies were relying on federal incentives that may also be on hold.
Speaker Change: 7% of new fast charters that are funded by automotive OEMs, other than Tesla, are also likely to see slower growth, as OEMs allocate capital to other priorities.
Speaker Change: Tesla's share of new fast charging has declined from around 70% in 2022 to less than 20% in the most recent quarter, unlike other OEMs.
Speaker Change: It's unclear whether Tesla remains committed to the growth of fast charging given their other priorities.
Speaker Change: Bowling Gout Company's funding DCFC Charters made up only 1% of new chargers this past quarter according to DOE, and have already announced changes to the capital allocation priorities.
Speaker Change: That leaves 14% of new chargers funded by a large number of small private companies that we expect will struggle to attract financing in this environment, especially because of their small scale.
Speaker Change: Unlike almost every other fast charging owner and operator, Evgo is singularly focused on fast charging and has a financing in place allowing us to continue to grow.
Speaker Change: As a result, demand for fast charging, represented by the growth in EVVIO, far exceeds the supply of fast charging stations nationwide.
Speaker Change: This supply-demand imbalance has been one of the factors driving the five-fold growth in Evgo's throughput for public stall over the past three years, and will continue to drive growth in throughput per stall for the foreseeable future.
Speaker Change: F&B Global's most recent base case forecast from March this year that takes into account the new administration's policies and electric vehicles, suggests 31% of new car sales being fully electric by 2030.
Slavery above, we're China already is today.
Speaker Change: The downside forecast is 21% of e-car sales, the low where China is today, translating to between 19 and 26 million EVs on the road by 2030.
Speaker Change: This is half of the target established by the Biden administration of 50% of new car sales by 2030.
Speaker Change: from around 50,000 at the end of 2024, in order to maintain the current ratio of EV to DCFC.
Speaker Change: The industry would need to deploy 40,000 fast chargers a year, which is over three times what was built in 2024.
Speaker Change: Given that we've now had seven flats to declining quarters of growth in DCSC supply, a flat growth scenario of no faster growth than today may even be too optimistic in a higher
Speaker Change: The result is a growing ratio of EVVIO to DCSC, which has driven the growth in EVGO throughput historically and a significantly higher ratio in both S&P's base and downside forecasts.
Speaker Change: which we expect to drive ongoing growth and need to go through putting utilization per stall in addition to growth due to network expansion for the foreseeable future.
Speaker Change: In a higher tariff environment, we make the impacts to both the numerator and the denominator in this ratio, leaving the overall supply and demand picture potentially even more attractive for Evgo than without the impact of tariffs.
It's time to turn to progress on our four key priorities.
Speaker Change: Improving our customer experience, operating in CAPEX efficiencies, capturing and retaining high value customers, and securing additional complimentary non-deluted financing to accelerate growth.
Speaker Change: As always, improving our customer experience remains our number one priority, and our strong momentum from last year has continued its quarter.
Speaker Change: Customers want a charter to be available when they pull up to an Evgo station, and we are deploying larger sites, where our standard configuration is now six to eight stalls per site. At the end of the first quarter, 21% of our sites had six stalls or more.
Speaker Change: We continue to deploy ultra fast, high powered chargers. The number of stores served by a 350 kilowatt charger is now 52% up from 38% a year ago.
Speaker Change: Water Charge Plus, our seamless plug and charge capability, continue to gain significant traction in Q1 with auto enrollments from OEM partners. Water Charge Plus counting for 27% of sessions initiated.
Speaker Change: And finally, our key customer's success metric, or what I've done, increased 4 percentage points this quarter versus last year, with 95% of sessions resulting in a successful charge on the first try. In summary, another great quarter of achievement in improving our customer experience.
Speaker Change: We've also made excellent progress on our efficiency priorities. Most notably, we took the MOU with Delta Electronics, signed last October and converted it into a signed joint development agreement to co-develop the next generation of charge in architecture.
Speaker Change: Evgo and Delta are making meaningful progress in this initiative that's expected to lower aggro's cat-backs per stall by 30%. We anticipate production of these stalls to begin in the second half of 2026. And we plan to have a prototype for the second quarter of this year.
Speaker Change: The coal-centric costs for coal declining, 37% in Q1 versus last year.
Speaker Change: Our 2025 vintage capex per stall is expected to be roughly $135,000, which is an 8% reduction from 2024 for vintage stalls, including the impact tariffs.
Speaker Change: Evgo's operations team has been diligently working to lower CAPEX and we're delivering savings from lower contractor construction pricing, material sourcing, and increased use of pre-fabricated
Speaker Change: We expect further improvements in GNA as a percentage of revenue for 2025 while investing in the growth of our business.
Speaker Change: We also continue to make great progress on our growth priority of capturing and retaining high-backed customers.
Speaker Change: 55% of Evgo's throughput came from right share, OEM charging credit, and subscription accounts in Q1.
Speaker Change: This provides Evgo with a relatively predictable, fast-loaded level of demand on our network.
Speaker Change: In order to drive overall utilization up while mitigating the effect of congestion.
Speaker Change: Thanks to the investments we have made in our customer marketing platform and dynamic pricing, we are now averaging double digit utilization in the overnight hours, effectively opening up capacity for more drivers during the peak hours.
Speaker Change: We'll send the next major uptake to our dynamic pricing algorithms in the fourth quarter of this year.
Speaker Change: We launched native max connectors at our first site in February . In the pilot, the technology validation is going well. We anticipate adding more max connectors to sites over the course of 2025.
Speaker Change: Laylanders here, we plan to launch the first of 400 new flagship stalls in partnership with GM with the goal of delivering an elevated customer experience.
Speaker Change: As a reminder, these sites will feature up to 20 souls.
Speaker Change: We come with ultra fast, 350 kilowatt chargers, charities, ample lighting, pull through stations and security cameras, and like all Evgo sites, we'll be located near a diverse set of amenities that customers can take to find control while charging.
Speaker Change: Finally, we expect to expand the number of dedicated tools serving autonomous vehicle partners which could represent a very attractive source of potential growth for EVGO given we estimate we have a 20% share of operational sites serving the segment today.
Speaker Change: As for financing the growth of the business, we have now received both the first and second quarterly advances on our 1.25 billion dollar loan guarantee with the DOE LTO.
Speaker Change: Slow and short, we got fully funded to add at least seven and a half thousand stalls, more tripling our installed base over the next five years.
Speaker Change: Looking ahead to the rest of the year, we expect a complete transfer of our 2024 vintage 30-seat income tax credits.
Speaker Change: Over the course of this year we expect around 30% of our 2025 vintage capex to be all set from state, local, and federal grants, utility incentives, OEM payments and 30C.
Speaker Change: Federal Incentives in the form of the technology-neutral 30-C alternative fuels credit, and NAMI represent approximately 10% of our 2025 vintage cap-backs.
Speaker Change: As we said before, we are not particularly reliant on federal incentives, and our next generation architecture program is targeting at least a 30% reduction in gross tax per stall, significantly more than the value of the federal incentives.
Speaker Change: Finally, given the very strong cash flows from our operating assets, we continue to receive inbound interest and evaluate additional complimentary non-delutive finance and opportunities.
Speaker Change: that would help fund the growth of any charging stations not included in the DOE loan funding to accelerate our growth and to provide diversity in our funding sources.
Andres Sheppard,
Speaker Change: Stephanie Lee will not cover the natural performance for Q1 together with our outlook for 2025.
Badar Khan: Thank you, Badar. Over the last three years, we have grown our operational stall base by two and a half times, while our revenues have grown over 12 times.
Speaker Change: Increasing our scale and maintaining our focus on cost allows us to deliver improving bottom-line performance. We continue to expect to achieve our target of adjusted even the break even in 2025.
Speaker Change: Our public network throughput per stall has grown over three times in the last two years. Significant mail pacing are charging stall growth.
Speaker Change: The accelerated performance is driven by multiple factors we previously discussed, namely, EDD vehicle miles traveled to Paris with ICE.
Speaker Change: Significant growth in ride share. Increased multi-family dwellers among EV drivers, increasing vehicle charge rates, and larger the sufficient EVs coming to market.
Speaker Change: Truplex for public stall was 266 kilowatt hours per stall per day in Q1, compared to 196 a year ago, and roughly flat sequentially, which reflects the seasonal shifts from Q4 to Q1 as we saw last year.
Speaker Change: In the first quarter, total public network utilization increased to 24%, us from 19% a year ago.
Speaker Change: Sixty-seven percent of our public soul had utilization greater than 15 percent.
Speaker Change: 54% of our public stalls had utilization greater than 20%.
Speaker Change: And 32% of our public souls had dualization greater than 30%. Each of these dualization categories have grown significantly over the last two years as the entire dualization curve is shifting to the right.
Speaker Change: Total throughput on the public network during the first quarter was 83 gigawatt hours, a 60% increase compared to last year.
Speaker Change: Revenue for Q1 was $75 million, which represents a 36% year-over-year increase.
Speaker Change: This growth will be primarily driven by charging network and extend revenue.
Speaker Change: Total charging network revenues, the $47.1 million, grew from $31.6 million, exhibiting a 49% year-old year increase.
Speaker Change: Extend revenue of $23.5 million, increased from $19.2 million in the prior year, delivering growth of 23%.
Speaker Change: Charging network growth margin in the first quarter was 37.1%, down 370 basis points from the prior year.
Speaker Change: The prior year quarter included $2.5 million of breakage revenue from one of our OEM charging credit programs, which is winding down and similar levels of breakage were therefore not expected to recur.
Speaker Change: Excluding the impact of breakage revenue, our charging network growth margin would have grown 130 basis points zero over year.
Speaker Change: Compared to the fourth quarter of 2024, charging network growth margin declines primarily due to higher maintenance costs and current to improve reliability of our charging experience and higher property taxes, which typically increased on January 1st of each year.
Speaker Change: Our extend revenue for the first quarter was up from the prior year due to more construction projects and process or completed and the recognition of certain construction change order costs that were incurred in the prior year.
Speaker Change: Now, Jessica's profit was $25.4 million in the first quarter of 2025, plus from $17.3 million in the first quarter of 2024. Now, Jessica's margin was 33.7% into 1, an increase of 240 basis points compared to last year.
Speaker Change: A dose of GNA, as a percentage of revenue, also improved from 44.4% in the first quarter of 2024 to 41.6% into one of this year, demonstrating the operating leverage effect.
Speaker Change: Adjusted EBITDA was negative $5.9 million in first quarter of 2025, a $1.3 million improvement versus negative $7.2 million in first quarter of 2024.
Now, turning to our 2025 guidance.
Speaker Change: Edigo continues her top-line growth and past profitability in 2025.
Speaker Change: Our install note outlook for the year remains the same, with 1200 to over 1400 new installs comprising of 750 to 815 public network installs, 450 to 85 dedicated network installs, and 450 to 560 EGO extend installs.
Speaker Change: We continue to expect total revenues in the range of $340 million to $380 million. As a reminder, we estimate only 10% of our total 2025 revenues are tied to your EB sale.
Speaker Change: We continue to expect charging network revenue to be two-thirds of full-year revenue.
Speaker Change: We anticipate sequential quarterly growth in our target network ground news as we continue to expect quarter over quarter and year over year through foot growth.
Speaker Change: Similar to last year, we expect to see higher summer electricity costs impacting two-three charging network growth margins.
Speaker Change: We continue to expect full-year extended revenue to be broadly flat to last year, with slightly lower revenues in the second half of 2025. We expect growth in full-year ancillary revenue, with most of that growth in Q4 driven by the dedicated fleet business.
Speaker Change: We've expected just the DNA to increase modestly throughout 2025 as we continue to make investments in areas such as our next generation charging infrastructure.
Speaker Change: We continue to expect improvements in charging network growth margin and adjusted GNA as a percentage of revenue striving bottom line adjusted EBITDA improvement. We therefore continue to target adjusted EBITDA breakeven in 2025 with a range of negative five million dollars to positive ten million dollars.
Speaker Change: We continue to expect fiscal cat-backed debt-of-all theft to be in the range of $160 million to $180 million.
Speaker Change: We are ramping up our mobilization with approximately 75% of our 2025 vintage public network so expectance to operationalize in the second half of 2025.
Speaker Change: Q4 is expected to account for approximately 50% of total of 2025 public network sales.
Operator, we can now open the call for Q&A.
Speaker Change: Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you would like to withdraw your question, simply press star one again.
Speaker Change: Please ensure you are not on speakerphone and that your phone is not on mute when called upon. Thank you. Your first question comes from Andrea Sheppard with Cantor Fitzgerald. Your line is open.
Thank you.
Andreas Shepard: Good morning. Good morning. Good morning. Congratulations for another great quarter. And thank you so much for taking our questions.
Speaker Change: Um, maybe just to start, you touched on this briefly in your prepare remarks.
Andreas Shepard: Hoping for maybe a bit more color. I'm wondering if you can maybe just give us a bit more cadence in terms of you know guidance for for the rest of of the year particularly around cost of energy, ASP you mentioned Q3 I think will be the the weakest. Yes.
Andreas Shepard: But basically, you know, BSP, Scross Margin, and how we should think about the ramp up of the DOE loan stalls throughout the rest of the year. Thank you.
Andreas Shepard: Andres, yeah. Yeah, we provided guidance. It hasn't changed since the last quarter on the ramp up of the loan. We provided a stall built schedule on the last quarter to call and that remains the same.
Andreas Shepard: So that's 750 to 850 stores, public network stores for the four year, together with about 50 to 85 dedicated stores, 450 to 550 stores to our extended program, so that hasn't changed.
Andreas Shepard: As also hasn't changed, so we expect about 75% of the public stalls to be in the second half of the year, about 50% in Q4, so you can...
Andreas Shepard: You can kind of work out Q2, given we've got Q1. In terms of the rest of the year, Q...
Andreas Shepard: Three is typically the quarter, as we saw last year, where we've got higher energy costs. That'll already be the same shape for this year. In terms of average selling price, I'd expect us to see, you know...
Price is where they are today, maybe slightly expanding.
Speaker Change: I mean, Heather, I mean, Stephanie, any other comments in terms of guidance? Which, you know, I think that's what governs it?
Thank you.
Speaker Change: Got it. Okay. That's super helpful. Appreciate all that color. And maybe just a bit of an odd question. But.
Speaker Change: As we are seeing an acceleration in autonomous vehicles and self-driving technology
Speaker Change: Can you maybe remind us, what are Evgo's strategy to try to capture some of this market and how you might address autonomous vehicles charging in the future? Thank you.
Speaker Change: Yeah, look, as we said last quarter, we broke out the number of stalls that are serving, that are dedicated stalls serving.
Speaker Change: The kind of autonomous vehicle segment. And so that separated out in our store account from last quarter. And we more than doubled in 2024, the number of stalls that we currently already have in place serving that segment.
Speaker Change: You know, we estimate, there's not great data on this, but we estimate we've got about a 20% share, so a pretty good share of dedicated tools serving the segment, and so we're quite excited by these tools, have a different cash flow profile, they're contracted cash flows.
Speaker Change: versus our public stalls, which rely on charging revenue, of course.
Speaker Change: And so we're quite excited by it. We do think it could be a source of interesting upside for the business given the regulations around the space seems to be a little bit easier than where we had them in the past.
Speaker Change: Wonderful. Thank you so much, really appreciate it, and congratulations on the quarter again. Well,
Speaker Change: The next question comes from Chris Dendrinos with RBC Capital Market. Your line is open.
Yeah, good morning, and thanks for taking the question. [inaudible]
Speaker Change: I guess maybe on the financing side of things, and it was good to see that you all got that second advance from the DOE. I guess maybe on the private side.
Speaker Change: You mentioned you're exploring some funding options. Can you provide an update on timing around that and maybe what specifically are you all kind of looking at as far as options go? Thanks.
Speaker Change: Yeah, I mean just, you know, just on the first point, you know, we are obviously very happy with where we are in financing. We expect quarterly advances.
Speaker Change: in line with the agreement that we signed with the DOE in December . And this second quarter of events was, you know, in line with how we're asking our plans.
Speaker Change: In terms of additional financing, we do continue to get these cash flows to generate such strong cash flows.
Speaker Change: We continue to get quite a lot of interest from others. We're looking to finance, further accelerate the growth of the business.
Speaker Change: And so that's where any of the conversation is, are there souls that are not eligible to be funded by DOE, for instance, the AV space but potentially others.
Speaker Change: But also just a diamond that makes good business sense to diversify your sources of funding. In terms of timing, we know we're in the dialogue today with folks if we find something that is attractive for ourselves and kind of parties.
Speaker Change: Then Little Ops, who look to execute. And I expect that that might take place some point during the course of this year.
Speaker Change: I guess are you indicating that you would look to potentially accelerate activity if you find an attractive, I guess, arm of financing? Is that correct? Thanks.
Speaker Change: Yeah, I've been over the course of the five years, the schedule that we've laid out in the last two calls.
Speaker Change: Showed us, Showed What The Store Schedule, Bill Schedule, which looked like under DOE.
Speaker Change: Loan Financing, and so what we're looking at is both from a...
Speaker Change: A balance sheet and operational perspective, what would it take to increase?
Speaker Change: That level of stall dulled out. What we've got today gets us to about 11,000 stalls in about five years time. We provided those economics in the last two calls. We know what we're asking ourselves is, what would it take to accelerate that schedule, build that over the next five years.
Got it. Thank you. Go.
Speaker Change: The next question comes from Chris McNally with Evercore ISI. Your line is open.
Thank you.
Chris Mcnally: Thank you so much team, and thank you for taking up the call. I appreciate all of the 2030 comments. I think we all see the huge growth in the car parts that will eventually come.
Speaker Change: I think, you know, our question is around maybe your views on the potential changes of, you know, revoking IRA and or the EV EPA mandates which may come.
Speaker Change: And sort of, our thought is, you know, what if we get sort of that worst-case scenario in the upcoming tax bill in the second half where incentives are removed and 2030 targets are removed.
Speaker Change: You know, my question is, how does Evgo potentially change their roll-out strategy geographically within U.S.? You know, places like California to come.
Speaker Change: You know, even more valuable given easy density, whereas maybe expansion states, you know, there's a change in the math as a result of regulation changes. So big picture question, but would appreciate you as well.
Speaker Change: Yeah, Chris, I mean, I think taking a step back as a reminder, our business is not.
We're not selling cars.
We're selling kilowatt hours.
And so what drives our business is both.
Speaker Change: The demand for kilowatt hours, which is represented by the growth in CIO.
Speaker Change: Electric Vehicle VIO, as well as the supply of industry-wide DC fast chargers, and that's the sort of sub-demand supply that in fact impacts the sale of kilowatt hours.
Speaker Change: And so what we see as we played out on that slide is, even in the most conservative forecasts which takes into account, you know, sort of a shift in federal policies with respect to,
Speaker Change: Salem Electric Vehicles. We would expect to see the ratio of cars to nationwide industry by fast chargers to still almost double.
Speaker Change: And so that supply-demand picture remains very attractive for us, given that it's only grown by about a third in the last three years, and yet in that same time period, our throughput per stole has grown fivefold.
Speaker Change: And so I think that that is how we think about the
Speaker Change: The situation, this is a pretty resilient. The owner operator of fast charging business model is actually quite a resilient business model. With respect to your specific questions.
Speaker Change: Sure, if we find that states continue to offer incentives for electric vehicles and other states aren't offering such a track of incentives, then we would of course expect to see.
Speaker Change: More EV sales and individual states. Our network plan that we update Continuously takes into account all of these sorts of forecasts and we adjust.
Speaker Change: At any one point in time, we are looking at a network plan that goes out two or three years that gives us quite a lot of optionality. We've got about 30,000 stalls that we've already identified across the United States.
Speaker Change: that meet our return expectations and the kind of returns that we're demonstrating today. So we feel we've got tons of flexibility and optionality to be able to shift to wherever demand is.
Chris Mcnally: And do you have a sense in those medium-term geographic plans, I mean, if we're talking about EV the I.O. to your point, the range of 20 to 26 in your forecast, it'll sort of 7 to 10% penetration of the, of the Clark Park, you know.
Chris Mcnally: Where do you see sort of the most attractive markets, meaning where the return is the highest? I'm going to think about California, probably where it's sort of approaching Europe-like penetration ratio.
Chris Mcnally: You know, any rules of thumb that help us when we think about, you know, where a market becomes the most attractive, once it hits the penetration level of the car park of X.
Chris Mcnally: Yeah, I mean, look, for us, when we think about return, we're obviously thinking about the productivity of the stalls, so the kilowatt hours, the throughput per stall per day, but we're also taking into account the cost of the stalls to the cat bags.
Chris Mcnally: The cost of construction might vary across the United States, the availability of incentives. I will tell you that overall utilization, as we showed today, is 24%. We actually have higher utilization outside California.
We've got more throughput in aggregate outside California.
Chris Mcnally: Some of our fastest and top states today are places like Texas, Florida, Arizona, Michigan. And none of these states are in the clean cars to a program that California has adopted.
Chris Mcnally: You know, I expect these, you know, I expect to see the growth in those states continue if they have done in the last couple of years.
Speaker Change: That's really great, that awful info on the sort of the micro markets, the example to get. Thank you so much, Kate. Absolutely.
Thank you.
Speaker Change: The next question comes from Bill Peterson with JP Morgan. Your line is open.
Speaker Change: Bonnie Bell. Yeah, hi, good morning, thanks for, good morning, thanks for taking the questions and, you know, a nice job in the court of the execution and it's nice to see the reiteration of the financial and other factors.
Speaker Change: He'd sound them alone, it seems like all systems are go, but just to remove any data, are there if any remaining items that you and the team are working through, I guess just want to try to understand how the current engagements are, are they constructive, are they still probe around the edges, or are doing further investigations, and...
Speaker Change: You know, we understand that a lot of people with the LPO left are being forced out, or, you know, they're leaving at their own will, whatever, just what's your current level of engagements with the LPR.
Speaker Change: Yeah, I mean, those are very productive engagements with the LPO team.
Speaker Change: I already can't comment on their overall staffing levels so that they decide that the folks that we're working with are the same folks that we're working with.
over the last several months.
Speaker Change: You know, our quarterly advance, both the first and second, and the monthly, we have monthly controls and reimbursements in line with our agreement. They're all progressing in the way that we expect it. And so, you know, I
Speaker Change: You could call this sort of business as usual activity. We're several months into this at this point and we're pleased with how it's going.
Andres Sheppard,
Speaker Change: That's great. Just wanted to make sure. And then I had some clarifying questions on the terrace. And thanks for the caller on that. Thank you.
Speaker Change: You know, what are the assumptions around the tariff rate to get to this for 4 to 5 million? You know, I guess I think that's 32% on Taiwan as an example. Is that the right way? And
And I guess...
Speaker Change: Ms. 10 million in efficiencies. Can you provide any additional call on that? It sounds like you're getting that anyway, regardless of where the caravan environment still stands. And then maybe looking in the next year.
Speaker Change: Sound like you reiterated this sort of 30% capex reduction with the program you have with Delta, but is that reduction still assuming the same terror environment we have today? And if so, how do you get there?
Yeah, so Bill.
Speaker Change: The 45 million, that's a fiscal year, not vintage year, so that is...
Speaker Change: The impact on the calendar year capital spend that we incur in 2025, and that's based off about $45 to $50 million of imports of, you know, imported equipment.
Speaker Change: Where we already got about half of that, either already here in the States, or on a shopping container, so there's no tariff on that. We expect about a 10% tariff on a quarter of what we is not already here, and about a 32% tariff on the other quarter, and that's really how you get to the 4 to 5 million.
Speaker Change: In terms of the efficiencies, you got these efficiencies, you know, we had a, as we said last quarter, and we reported a 9 percent.
Speaker Change: Improvement Reduction in our vintage 2024 tap-packs pre-stole, versus what we were expecting, we were expecting about 160.
Speaker Change: We took about 9% off that in 2024. This year, we're expecting about 8% on versus where we ended in 2024. And that's just our operations team just going about business. Construction, pricing, material sourcing, prefab skids.
Speaker Change: We expect to do it. We have 40% of our mix this year. It's going to be a little higher. The cost for skin is going to be a little lower, so it's just business as usual activity.
Speaker Change: For FY26, we haven't provided guidance specifically for vintage FY26 cap-axe.
Speaker Change: But, you know, you'd expect to include, you know, the benefits from all the savings that we captured so far. In addition, by the second half of 26, we'll start to roll out our new charging architecture through the...
the development with Delta Electronics.
Speaker Change: That's a 30% improvement on that 160 that we began, that we were expecting until again 2024 so...
Speaker Change: You know, where, you know, this is just business institutional, we think that this is a real source of competitive advantage, free to go versus the, you know, dozens of, dozens of other.
Speaker Change: Fast charging companies that you're all aware of, where we've got scale, we're able to partner with a global leader, and really drive down, you know, efficiencies in the cat-back. So we're really pleased with where we are.
Thank you.
Speaker Change: Thanks for all the details, Barrett. It's terrific to hear that and get Gabriel at some of the quarter. Thanks a lot.
Chris Pierce: The next question comes from Chris Pierce with Needham & Company. Your line is open.
Hey, my friend's learning everyone. Learning.
Chris Pierce: Can you just walk me through, you know, when I think about dynamic pricing, and you hit on on the call about driving utilization in the overnight hours, I think about, you know, cost savings to the driver.
Speaker Change: But you guys glue ASP per watt, you know, mid-tingle digits year over year. I just want to get a sense of pricing power on the network you have or how you're able to, like, how those two sort of bounce out.
Yeah, look, with dynamic pricing, what we're doing is...
Speaker Change: that we make see ourselves increase price and other places we make see ourselves reduce price.
But with the goal of maximizing margin.
Speaker Change: I would say that again, this is another one of our sources of real competitive advantage versus these dozens of others more.
Speaker Change: companies in the fast charging space, or companies that just aren't focused on on utilization for whatever reason.
Speaker Change: You know, we are through both the investments we've made in our marketing, our understanding of customers, our reach out to customers, the dynamic pricing, which is effectively pricing signals. We are shifting.
Who is charging at what time of the day?
Speaker Change: Where we are trying to open up hours of the day, that might be peak hours of the day, where we may have your price.
you know, sort of inelastic customers.
Speaker Change: And that really is serving us very well. We expect the next round, all.
Speaker Change: The algorithms in this dynamic pricing to go live the fourth quarter where I'm looking for the next level of sophistication here. And we're not talking about something we invented here where we're taking concepts that have been very successfully executed in other parts of the economy into the space.
Speaker Change: Okay, and is it safe to say you haven't seen anything, any demands, if there's anything that would cause you to back off the, you know, the love of oppression that you think you have on that at work?
Thank you.
Speaker Change: You don't know if I didn't fully capture the question, but I think the answer isn't. We've seen anything that would close the tobacco off the answers now.
Speaker Change: Okay, and then just lastly, housekeeping. Can you remind me like on the typical seasonality? I know this is sort of a young business and you've had the growth you've had, so it's sort of hard to pick out the seasonality. But, you know, networks to put down modestly sequentially, but how should we think about seasonality the rest of the year and then when you layer on thug growth too? Like how should we think about the cadence of network to put? Yeah, yeah, yeah, yeah, yeah, yeah.
Speaker Change: Yeah, me look, so, so network throughput is, it was actually kind of flat, to be honest, we had some rounding, so...
Speaker Change: Last quarter we rounded up, this quarter rounding down, so network throughput is kind of broadly flat which is pretty much where it was almost exactly last year between Q4 and Q1 and so we we expected that certainly. Thank you very much.
We'd expect to see network throughput almost to grow in Q2.
Speaker Change: Q3 and Q4, as we same shape we saw last year, it's a quantity from Q4 to Q1. That really aligns with sort of VMT, field commons traveled for EVs and across that state. So that means that's really how we think about the profile.
Okay. Thank you. Yeah.
Thank you very much. Thank you.
Speaker Change: Again, ladies and gentlemen, if you have a question, it is star one on your telephone keypad.
Speaker Change: Your next question comes from Craig Irwin with Ross Capital Partners. Your line is open. Good morning, Craig. Good morning.
Craig Irwin: Good morning, everybody. Thanks for taking my questions. So I wanted to ask about the progress with the Tesla connectors, the next connectors you mentioned earlier in your prepared remarks.
Craig Irwin: Can you maybe frame out for us where you're at with this? Are you really just in testing?
Craig Irwin: Or will we potentially see dozens or more stations retrofit over the course of the year?
Craig Irwin: And, you know, if it's fair for us to start asking about the new customers added that are Tesla customers, I know you had another strong quarter with 119,000 new customers.
Craig Irwin: But, you know, is the Tesla fleet starting to layer in and help you on the demand side?
Craig Irwin: I mean, yeah, Craig, so we're clearly with such a high percentage of...
and well over half for more alls.
overall.
Craig Irwin: EV, VIO, being Tesla drivers, and the fact that our charging stations are faster at 350 kilowatt, and they tend to be closer to where all drivers, including Tesla drivers, live, work and run errands versus.
Craig Irwin: Piway stations. We are very infracted to capturing this segment.
Craig Irwin: We need to do two things. We need to make sure that the system, they work. And so what we've been doing this past quarter is going through that technology validation. That's both in terms of the connection, but also the speed.
Craig Irwin: You don't want a 350 kilowatt, we need to have, we don't have to make sure we've got the right cables that can accommodate a higher speed.
and then a task for supercharger.
Um.
Craig Irwin: And, you know, the second thing that we need to make sure that we're paying very close attention to is if we take out a CCS connector, we don't end up killing demand for some period of time before the next cable catches up to where the demand was the CCS cable.
And so...
Craig Irwin: That's pretty what we're talking about, like everything at Evgo, which is very data-driven.
So we are looking at...
Sides Across the Country
Craig Irwin: That perhaps have opportunities for us to swap out a lower performing CCS cable with a max cable that is also located close to where test drivers are based, which is, you know, frankly everywhere. So it's quite data intensive. We do expect to start rolling out these cables, but it's probably going to be on a retrofit basis, maybe in the 100 to 150, you know. [inaudible]
Craig Irwin: He'll potentially give or take around those sorts of numbers over the course of this year. I explore our next generation charging architecture, which will be a second half of next year. We expect there'll be all next cables from the outset, if not before that, with the current generation of chargers.
Speaker Change: Excellent. Thank you for that update. So my next question is on the extend revenue. So again, this quarter was pretty strong, and it's nice to see you, the building network out there with partners and, you know,
Incremental profits, incremental...
Driver Service, always a good thing.
Speaker Change: Do you have potential for other extent customers that could come in over the course of the next year, and how should we think about the shape of extent growth, the revenue contribution?
Speaker Change: in this here. Is it going to be as backhand loaded as the stall buildout or is it something that's going to be a little bit more linear as we look at the year?
Speaker Change: Yeah, so just two things there on the on the extend business. We are not looking at, we're not actively pursuing.
More Extend Partners. Craig, we've got a great relationship with you.
Speaker Change: P.F.J., the pilot company, and we're deploying, you know, throughout the course of this relationship, two thousand stalls. The bill's schedule there, we gave an illustrative view on the last quarter, so if you look at the last quarter slides, there's a little bar, that's...
Speaker Change: So semi-chainted, that gives a sense of what that schedule could look like through 2028.
This year, the Extend Business is broadly half.
Sorry, the mordally flat.
Speaker Change: In terms of revenue versus last year, slightly lower in the second half versus the first half. And remember the revenues from Extend are both equipment sale as well as construction revenues, so...
Speaker Change: Sometimes I feel a little lumpy, but it's, uh, we expected to grow only several, several, several last year, a little less, a second half versus a second, versus the first half.
Speaker Change: Thank you for that. I'll take the rest of my questions offline. Absolutely, yeah.
Thanks, Ray. This concludes.
Speaker Change: This concludes the question and answer session. I'll turn the call to Badar Khan for closing remarks.
Badar Khan: Well, thank you everyone. We had yet another strong quarter. With strong balance sheet, we are in a particularly strong competitive position.
Thank you.
Badar Khan: This concludes today's conference call. Thank you for joining. You may now disconnect.