Q1 2025 Ideal Power Inc Earnings Call
Operator: Good morning, ladies and gentlemen, and welcome to the Ideal Power First Quarter 2025 Results Conference Call. All participants are on a listen-only mode. At the end of management's remarks, there will be a question and answer session. Investors can submit their questions anytime within the meeting webcast by typing them into the Q&A button on the left side of your viewing screen. Analysts who publish research may ask questions on the phone line. For analysts who ask questions on the phone line, please press star 1 on your telephone keypad. As a reminder, this event is being recorded.
Good morning, ladies and gentlemen, and welcome to the ideal power first quarter 2025 results conference call. All participants are on a listen only mode. At the end of managements remarks, there will be a question and answer session investors can submit their questions any time.
Within the meeting webcast by typing them into the Q&A button on the left side of your viewing screen.
Speaker Change: Analysts, who publish research may ask questions on the phone line for analysts to ask questions on the phone line. Please press star one on your telephone keypad. As a reminder, this event is being recorded I would now like to turn the conference over to Jeff Christiansen. Please go ahead.
Jeff Christensen: I would now like to turn the conference over to Jeff Christensen. Please go ahead. Thank you, Holly. And good morning, everyone.
Jeff Christiansen: Thank you Holly and good morning, everyone. Thank you for joining ideal powers first quarter 2025 results conference call.
Jeff Christensen: Thank you for joining Ideal Power's first quarter 2025 results conference call. With me on the call are Dan Berdard, President and Chief Executive Officer, and Tim Burns, Chief Financial Officer. Ideal Power's first quarter 2025 financial results press release is available on the company's website at IdealPower.com.
Speaker Change: With me on the call are <unk>, President and Chief Executive Officer, and Jim Burns Chief Financial Officer, Idaho, Power's first quarter 2025 financial results press release is available on the company's website at ideal power Dot com.
Jeff Christensen: Before we begin, I'd like to remind everyone that statements made on the call and webcast, including those regarding future financial results and companies' prospects, are forward-looking and may be subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SSE filings for a list of associated risks. We would also refer you to the company's website for more supporting company information.
Speaker Change: Before we begin I'd like to remind everyone that statements made on the call and webcast, including those regarding future financial results. The companys prospects are forward looking and maybe subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SEC filings for a list of associated risks.
Speaker Change: I'd also refer you to the company's website for more supporting company information.
Dan Bergar: Now I'd like to turn the call over to Ideal Power's President and CEO, Dan Bergar. Thank you, Jeff. I appreciate everyone joining us today. I'm looking forward to updating everyone on our progress since the start of the first quarter. I'll briefly cover the key highlights from the start of the first quarter and discuss the most significant developments in a little bit more depth and provide some context for their importance.
Dan: To turn the call over to ideal powers, President and CEO, Dan <unk> Dan.
Dan: Thank you Jeff I appreciate everyone joining us today and look forward to updating everyone on our progress since starting the first quarter.
Dan: I'll briefly cover the key highlights from the start of the first quarter and discuss the most significant developments in a little bit more depth and provide some context for their importance now I'll turn things over to Jeremy to discuss our financial results will be pleased to answer your questions. After our prepared remarks.
Dan Bergar: I'll turn things over to Tim to discuss our financial results. We'll be pleased to answer your questions after our prepared remarks.
Dan Bergar: First, we completed the Solid State Circuit Breaker prototypes related to our first design win three months ahead of schedule. The customer completed their initial testing of these prototypes last month, and we continue collaborating with them on their first vTrain-enabled Solid State Circuit Breaker product ahead of its introduction to the marketplace in the coming months. Second, the potential new EV compactor program with Stellantis that we discussed in our year-end call in late February was given internal approval at Stellantis and is advancing through their internal purchase order approval process. This would be our second program with Stellantis in addition to the drivetrain inverted program.
Jeremy: We completed the solid state circuit breaker prototypes related to our first design win three months ahead of schedule. The customer completed their initial testing of these prototypes last month and we continue collaborating with them on their first B Tran enabled solid state circuit breaker product ahead of its introduction to the marketplace in the coming months.
Jeremy: Second the potential new EV Contactor program was to Lantus that we discussed in our year end call in late February was given internal approval. Its Atlantis and is advancing through their internal purchase order approval process. This will be our second program was the Lantus. In addition to the drivetrain inverted program.
Dan Bergar: Third, as we announced in our quarterly results press release earlier today, we secured an order from a third Forbes Global 500 power management market leader interested in our technology for solid state circuit breakers for power distribution systems. They're evaluating our technology for circuit protection, for power distribution systems, with a focus on DC microgrids for solar and wind. With the addition of this customer, we're now engaged with three Global 500 power management market leaders.
Jeremy: Third as we announced in our quarterly results press release earlier today, we secured an order from a third Forbes Global 500 power management market leader interested in our technology for solid state circuit Breakers for power distribution systems. They are evaluating our technology for circuit protection for power distribution systems with a focus on D C micro grids.
Jeremy: For solar and wind with the addition of this customer we are now engaged with three global 500 power management market leaders.
Dan Bergar: Design wins with any of these companies could lead to several million dollars or more of annual revenue for us. Fourth, C-CORM, one of our demand creation distributors, secured an order for discrete B-TRAN devices, SIM-cooled power modules, and solid-state circuit breaker evaluation boards from a new customer focused on solid-state circuit breaker applications. Fifth, we ship solid-state circuit breaker evaluation boards with BTRAN discrete devices to several potential DesignWing customers as we continue to gain significant momentum for our technology in industrial and utility circuit protection applications.
Jeremy: And wins with any of these companies could lead to several million dollars or more of annual revenue for us.
Jeremy: <unk> one of our demand creation distributors secured an order for discrete B Tran devices simple power modules and solid state circuit breaker evaluation boards from a new customer focused on solid state circuit breaker applications.
Jeremy: We shipped solid state circuit breaker evaluation boards with B Tran discrete devices.
Jeremy: Potential design win customers as we continue to gain significant momentum for our technology and industrial and utility circuit protection applications.
Dan Bergar: And sixth, as we also announced in our press release earlier today, we secured a sales representative partnership with Queensland Semiconductor Technologies, also known as Quest Semi, which expands our reach into key markets in Europe and Asia. Quest Semi stands out for its silicon and high-voltage silicon carbide power semiconductor product offerings, serving markets such as electric vehicles, electric vehicle charging, renewable energy, and industrial motor drives. Our products will be a complementary offering for Quest Semi to sell into their existing and prospective customer base, along with their own product portfolio. Quest Semi partners with leading technology corporations and top tier universities for transformative applications.
Jeremy: And sixth as we also announced in our press release earlier today, we secured a sales representative partnership with Queensland Semiconductor technologies also known as quest semi which expands our reach into key markets in Europe and Asia.
Jeremy: <unk> semi stands out for its silicon and high voltage silicon carbide power semiconductor product offerings, serving markets such as electric vehicles, what the vehicle charging renewable energy and industrial motor drives our products will be a complementary offering for quest semi to sell into their existing and prospective customer base along with their own product portfolio.
Jeremy: Semi partners with leading technology corporations and top tier universities for transformative applications.
Dan Bergar: Let's briefly turn to what we are repeatedly hearing and seeing from customers, including prospective customers we talked to at the Applied Power Electronics Conference in Atlanta and the PCIM Expo and Conference in Nuremberg, Germany in recent weeks. There's clearly growing awareness and interest in our technology for solid-state circuit protection, both for industrial and utility applications and EV contactors. We expect solid-state circuit breaker customers, including our first design wing customer, to drive our initial revenue ramp starting in the second half of this year. The market has wanted to move to solid-state circuit protection due to the rapid growth in distributed energy, such as renewables and batteries, and its benefits relative to slower-acting electromechanical breakers, but there was not a solution that provided low enough conduction losses to make solid-state circuit breakers a practical solution.
Jeremy: Let's briefly turn to what we are repeatedly hearing and seeing from customers, including prospective customers, we talked to at the applied power Electronics conference in Atlanta in the PCI and Expo and conference in Nuremberg, Germany in recent weeks.
Jeremy: There is clearly growing awareness and interest in our technology for solid state circuit protection, both for industrial and utility applications and EV contractors, we expect solid state circuit breaker customers, including our first design win customer to drive our initial revenue ramp starting in the second half of this year.
Jeremy: The market is wanted to move to solid state circuit protection due to the rapid growth in distributed energy, such as renewables and batteries and its benefits relative to slower acting electromechanical breakers, but there was not a solution that provided low enough conduction losses to make solid state circuit breakers, a practical solution.
Dan Bergar: Due to its ultra-low conduction losses, we believe vTRAN is the enabling technology that could result in widespread adoption of solid-state circuit breakers for many applications and markets. With the continued growth of renewables, energy storage, and EV charging globally, there's a growing and increasingly urgent need to upgrade grid infrastructure to handle these distributed loads and new generation sources to avoid significant grid failures such as wide-scale blackouts. To compound the problem, there's been a lack of investment in updating the grid infrastructure over recent decades with significantly outdated grid infrastructure in many places, particularly in the US and the European Union.
Jeremy: Due to its ultra low conduction losses, we believe the trend is in the enabling technology that could result in widespread adoption of solid state circuit breakers for many applications in markets.
Jeremy: With the continued growth of renewables energy storage and EV charging globally, there is a growing and increasingly urgent need to upgrade grid infrastructure to handle these distributed loads and lead generation sources to avoid significant grid failures, such as Widescale blackouts. The compound the problem there has been a lack of investment and.
Jeremy: Adding the grid infrastructure over recent decades with significantly outdated grid infrastructure in many places, particularly in the U S and the European Union.
Dan Bergar: As an example, a recent article from Reuters stated while the global investment in renewables has doubled over the last 15 years, the investment in the grid infrastructure has remained relatively flat at $300 billion a year. The same article went on to say that the European Union has estimated that Europe needs to invest over $2 trillion in its grid in the next 25 years. These great investments will require fast acting, solid state circuit protection, creating an enormous opportunity for our technology in both the short and long term.
Jeremy: As an example, a recent article from Reuters stated, while the global investment in renewables has doubled over the last 15 years the investment in the grid infrastructure has remained relatively flat at 300 billion a year.
Jeremy: The same article went on to say that the European Union has estimated that Europe needs to invest over two trillion dollars and its grid in the next 25 years.
Jeremy: These grid investments will require a fast acting solid state circuit protection, creating an enormous opportunity for our technology in both the short and long term.
Dan Bergar: The situation in the U.S. is similar, as much of our grid is even older than Europe. It is this need for major investments and upgrades in the world's electricity transmission and distribution systems that is driving the interest of our target customers to develop low-cost, fast-acting, low-loss solutions for circuit protection equipment, such as circuit breakers and protective relays. Our target customers are looking for a better semiconductor solution that doesn't rely on silicon carbide if they need to reduce cost and improve solid state circuit breaker performance. Silicon carbide MOSFETs can't match BTRAN's ultra-low conduction losses, which is critical to performance in continuously conducting applications like circuit breakers.
The situation in the U S is similar as much of our grid is even older than Europe.
Jeremy: It is this need for major investments and upgrades in the world's electricity transmission and distribution systems that is driving the interest of our target customers to develop low cost fast acting low loss solutions for circuit protection equipment, such as circuit breakers and protective relays.
Jeremy: Our target customers are looking for a better semiconductor solution that doesn't rely on silicon carbide, if they need to reduce cost and improve solid state circuit breaker performance.
Jeremy: Silicon carbide MOSFET can't match B Trans ultra low conduction losses, which is critical to performance and continuously conducting applications like circuit breakers, we're repeatedly seeing customers that have already started evaluating silicon carbide, sometimes as part of formal programs looking for another solution. These prospective customers are starting to evaluate.
Dan Bergar: We're repeatedly seeing customers that have already started evaluating silicon carbide, sometimes as part of formal programs, looking for another solution. These prospective customers are starting to evaluate our technology because they see an opportunity to utilize BTRAN to simultaneously lower costs and improve performance in their planned solid state circuit breaker product offering.
Jeremy: Our technology, because we see an opportunity to utilize b tran to simultaneously lower costs and improved performance in their planned solid state circuit breaker product offerings.
Dan Bergar: Recent example of that is our first design wing customer. The customer that awarded us this design win is one of the largest circuit protection equipment manufacturers in Asia, targeting industrial and utility markets, data centers, and renewable energy applications. This customer previously developed a solid state circuit breaker prototype with silicon carbide devices. The prototypes did not meet their performance or cost requirements. They had us replace the silicon carbide devices and controls in the prototypes. We inserted our B-Train devices and controls in place of the existing silicon carbide MOSFETs and driver circuitry. The DETRAN-enabled prototypes reduced the total conduction losses versus the silicon carbide prototypes by 60%.
Jeremy: Recent example of that is our first design win customer.
Jeremy: The customer they reward us. This design win is one of the largest circuit protection equipment manufacturers in Asia targeting industrial and utility markets Datacenters and renewal renewable energy applications. This customer previously developed a solid state circuit breaker prototypes with silicon carbide devices. The prototypes did not meet their pro forma.
Jeremy: Our cost requirements, they had us replace the silicon carbide devices and controls and the prototypes.
Jeremy: We inserted a b tran devices and controls in place of the existing silicon carbide, MOSFET and driver circuitry with.
Jeremy: With <unk> enabled prototypes reduced the total collapse conduction losses versus the silicon carbide prototypes by 60%.
Dan Bergar: We completed these BTRAN-enabled circuit breaker prototypes three months ahead of schedule. The customer completed their initial testing of the prototype circuit breakers, which went well. We've been asked to incorporate some additional capability into the device drivers to accommodate some of the innovative ideas on the capability they want in the circuit breaker. That work will be done shortly, and the updated breakers will continue customer testing later this month. We're expecting commercial sales from that product later this year. As we've previously mentioned, and based on the customer's projections, for Ideal Power, the initial product from this customer could translate to revenue of several hundred thousand dollars to us in the first year of sales, with the opportunity to exceed a million dollars in revenue for us in the second year of sales.
Jeremy: We completed these be trained enabled circuit breaker prototypes three months ahead of schedule.
Jeremy: As the customer completed their initial testing of the prototype circuit breakers, which what well we've been asked to incorporate some additional capability into the device drivers to accommodate some of the innovative ideas on the capability. They want in the circuit breaker at work will be done shortly and the updated breakers will continue customer testing later this month, we're expecting commercial.
Jeremy: Sales from that product later this year.
Jeremy: As we previously mentioned and based on the customer's projections for ideal power. The initial product from this customer could translate to revenue of several hundred thousand dollars to us in the first year of sales with the opportunity to exceed $1 billion in revenue for us in the second year of sales.
Dan Bergar: But again, that's just the first product. This is expected to be the first of several products from this customer incorporating vTran into Solid State Circuit Breaker. This customer offers a variety of Circuit Breaker products at different ratings. They're eager to bring innovative products to market, and we represent a fast path for them to bring a really differentiated, highly competitive solution to the marketplace.
Jeremy: But again, that's just the first product. This is expected to be the first of several products from this customer incorporating <unk> into solid state circuit Breakers. This customer offers a variety of circuit breaker products at different ratings. They are eager to bring innovative products to market and we represent a fast path for them to bring a really differentiated highly competitive <unk>.
Jeremy: <unk> to the marketplace.
Dan Bergar: And our development agreement with this customer does not constrain us in any way from working with other companies interested in our technology for Circuit Breaker solutions. In fact, we can leverage the work we've done with this customer with current and future customers looking to provide the market with Circuit Breaker products. Now that we've captured our first design win for Solid State Circuit Breakers, we expect this win to help us secure additional design wins with other Circuit Breaker customers. We've got multiple large global customers that we're working with who have our technology in their lab now and represent what could be significant design wins for us.
Jeremy: And our development agreement with this customer does not constrain us in any way from working with other companies interested in our technology for circuit breaker solutions.
Jeremy: We can leverage the work we've done with this customer with current and future customers looking to provide the market with circuit breaker products.
Jeremy: Now that we captured our first design win for solid State Circuit Breakers. We expect this one to help us secure additional design wins with other circuit breaker customers. We've got multiple large global customers that were working with who have our technology in their lab now and represent what can be significant design wins for us we will only take a few key design win.
Dan Bergar: We'd only take a few key design wins to get us to profitability. Similar to the customer we just discussed, we're seeing customers looking for alternatives to silicon carbide devices, particularly for applications requiring very low conduction losses, such as solid state circuit breakers, protective relays, and electric vehicle contact. Silicon carbide devices typically cost three to five times the cost of silicon devices. For high-power applications that require very fast switching, silicon carbide devices can be a good but somewhat costly solution. For other applications, we believe that our lower cost, paired with the ultra-low conduction losses for our technology, provide us with a significant and sustainable competitive advantage to silicon carbide and circuit protection applications.
Jeremy: To get us to profitability.
Jeremy: Similar to the customer we just discussed we're seeing customers looking for alternatives to silicon carbide devices, particularly for applications, requiring very low production losses, such as solid state circuit breakers protective relays and electric vehicle contractors.
Jeremy: Silicon carbide devices typically costs, 3% to five times the cost of silicon devices for high power applications that require very fast switching silicon carbide devices can be a good but somewhat costly solution.
Jeremy: For other applications, we believe that our lower cost paired with the ultra low conduction losses for our technology provide us with a significant and sustainable competitive advantage to silicon carbide and circuit protection applications.
Dan Bergar: In addition, due to lower losses, vTRAN-enabled solid-state circuit breakers require a smaller surface area or less complex thermal management systems to dissipate the heat, resulting in smaller, lighter, lower cost OEM solid-state circuit breaker solutions.
Jeremy: In addition, due to lower losses, B Tran enabled solid state circuit breakers require a smaller surface area or less complex thermal management systems to dissipate the heat, resulting in smaller lighter lower cost OEM solid state circuit breaker solutions.
Dan Bergar: Moving on to another exciting market for V-Tran, electric vehicles. V-Tran can be used for circuit protection in EV contractors, contractors in the drivetrain for inverters, in the EV charging infrastructure. Electric vehicles utilize a lot of power semiconductors. We're seeing a need to bring more cost effective, more efficient solutions to address the today's challenges for electric vehicles, including safety, cost and range anxiety. Our technology directly helps in all three of these areas. Many OEMs and Tier 1s we're working with are interested in how our technology can be used for contactors that protect the batteries by providing fast-acting control of power to and from the battery and EV subsystem.
Jeremy: Moving on to another exciting market for B Tran electric vehicles <unk> can be used for circuit protection and EEV contractors contractors and the drivetrain trend burgers and the EV charging infrastructure.
Jeremy: Electric vehicles utilize a lot of power semiconductors, we're seeing a need to bring more cost effective more efficient solutions to address the.
Jeremy: Today's challenges for electric vehicles, including safety cost and range anxiety, our technology directly helps in all three of these areas.
Jeremy: Many Oems and tier ones, we're working with are interested in how our technology can be used for contractors that protect the batteries by providing fast acting control of power to it from the battery and EV subsystems since.
Dan Bergar: Since contactors are continuously conducting devices, they need a very low-loss, fast-acting semiconductor solution to protect the battery system from rising faults that can damage the battery and electronics in the vehicle. They're looking for better solutions that don't rely on silicon carbide because they need to improve performance and tackle cost at the same time, as cost remains a major challenge for broad-scale electric vehicle adoption. Stellantis was involved in a program evaluating silicon carbide devices for EV contactors to protect the vehicle's batteries. When we met with Stellantis management, engineering, and production teams back in February, we learned about this program from them and were told that the silicon carbide devices were not meeting their performance and cost requirements.
Jeremy: Since <unk> are continuously conducting devices they need at very low loss fast acting semiconductor solution to protect the battery system from rising faults that can damage the battery and electronics in the vehicle, they're looking for better solutions that don't rely on silicon carbide, because they need to improve performance and tackle cost at the same time.
Jeremy: As cost remains a major challenge for broad scale electric vehicle adoption.
Jeremy: So lantus was involved in our program evaluating silicon carbide devices for EV contactor is to protect the battery.
Jeremy: Vehicles batteries.
Speaker Change: When we met with the length of his management engineering and production teams back in February we learned about this program from them and were told that the silicon carbide devices were not meeting their performance and cost requirements.
Dan Bergar: We provided material to the Scilantis U.S. and European teams on how V-Tran can provide the EV contactor solution they're looking for with better performance and lower cost devices than their prototype silicon carbide based contactors. This immediately led to discussions with Stellantis about a potential program for vTran-enabled EV contactors, providing us with a potential second program with one of the world's largest automakers. based on positive feedback from Stellantis on our technology and its applications. In the success of the first two phases of our drivetrain inverter program, we expect to not only continue advancing the custom B-Tram module for their EV drivetrain inverter, but also add a new high-priority program for EV contact.
Speaker Change: We provided material to the Lantus U S and European teams on how <unk> can provide the <unk> contactor solution, they're looking for with better performance and lower cost devices, they're prototypes silicon carbide based contactor.
Speaker Change: This immediately led to discussions with the Atlantis about a potential program for <unk> enabled <unk>, providing us with a potential second program with one of the world's largest automakers.
Speaker Change: Based on positive feedback from still Lantus on our technology and its applications and the success of the first two phases of our drivetrain inverter program, we expect to not only continue advancing the custom <unk> module for their EV drivetrain, a burger, but also add a new high priority program for easy contact us.
Dan Bergar: We're pleased to announce that the EV Contactor program has been approved internally at Stellantis, up through and including their chief technology officer. We've already provided them a scope and cost for the program for review. Our focus is to finalize the deliverables and schedule for the program and provide any additional information they need as they go through their formal purchase order approval process for this high visibility program. While they have identified the contactor program as a high priority, we continue to work with them on the timing and scope of work for the third phase of the inverter program.
Speaker Change: We're pleased to announce that the <unk> program has been approved internally, it's the lantus up through and including their Chief Technology Officer, We've already provided them scope and cost for the program for review our focus is to finalize the deliverables and schedule for the program and provide any additional information they need as they go through their formal perched.
Speaker Change: This order approval process for this high visibility program.
Speaker Change: While they have identified the contact of program is a high priority. We continue to work with them on the timing and scope of work for the third phase of the inverter program the <unk>.
Dan Bergar: The contactor program with Stellantis is expected to move faster than the drivetrain program because VTRAN value proposition for EV contactors is similar to that of solid state circuit breakers. Very fast acting, safer and more reliable with programmability and diagnostic capability. VTRAN is an enabling technology for the application. We're extremely excited about this new program as the implementation of EV contactors is not nearly as complex as undertaking and implementing a new EV drivetrain platform. This program would meaningfully accelerate our timeline to substantial product revenue from our relationship with Stellantis.
Speaker Change: Contactor program was to Lantus is expected to move faster than the drivetrain program because the <unk> value proposition for <unk> is similar to that of solid state circuit breakers, very fast acting safer and more reliable with programmability and diagnostic capability and B Tran is an enabling technology for the application.
Speaker Change: We're extremely excited about this new program as the implementation of <unk> is not nearly as complex is undertaking and implementing a new EV drivetrain platform. This program would meaningfully accelerate our timeline to substantial product revenue from our relationship with Lantus.
Dan Bergar: In addition to our work with Stellantis, we're also progressing with other prospective automotive customers.
Speaker Change: In addition to our work with the Lantus. We're also progressing with other prospective automotive customers. As an example, we're collaborating and recently shared initial test results with a global tier one automotive supplier.
Dan Bergar: As an example, we're collaborating and recently shared initial test results with a global Tier 1 automotive supplier on an alternative solid-state circuit breaker design that they conceived to lower cost and potentially simplify their breaker design compared to the standard approach for a solid-state circuit breaker. This Tier 1 automotive supplier has a broad product portfolio and sells into not only automotive, but industrial markets as well. There are likely several potential opportunities with this customer, including opportunities for both solid state circuit breakers and EV contactor products.
Speaker Change: On an alternative solid state circuit breaker design, the vacancies to lower cost and potentially simplify their breaker design compared to the standard approach for solid state circuit breakers.
Speaker Change: This tier one automotive supplier has a broad product portfolio and sales into not only automotive, but industrial markets as well there are likely several potential opportunities with this customer including opportunities for both solid state circuit breakers, and EEV contactor products.
Dan Bergar: Moving on to the macro level, some investors have expressed concern related to the recently enacted tariffs and shifting trade policy. While the trade situation is very fluid, we expect minimal impact from tariffs in place today. Power semiconductors are exempt from most tariffs currently in effect, including those applicable to the countries where we fabricate wafers and package B-Trend dye. This limits the potential impact on us. There's also been no slowdown whatsoever in terms of customer engagement and customers' interest in our technology for their future products. Although the situation remains dynamic, an example being the significant reductions in tariffs with China in recent days, we're well positioned to mitigate the impact of future changes in tariffs and trade policies and other supply chain risks.
Speaker Change: Moving on to the macro level. Some investors have expressed concern related to the recently enacted tariffs and shifting trade policies while.
Speaker Change: While the trade situation is very fluid, we expect minimal impact from tariffs in place today.
Speaker Change: Power semiconductors are exempt from most tariffs currently in effect, including those applicable to the countries, where we fabricate wafers and package B Tran die this limits the potential impact on us.
Speaker Change: <unk> also been no slowdown whatsoever in terms of customer engagement and customers interest in our technology for their future products. Although the situation remains dynamic and example, being the significant reductions in tariffs with China. In recent days, we are well positioned to mitigate the impact of future changes in tariffs and trade policies and other supply chain risks.
Dan Bergar: Ideal Power utilizes an asset-light business model, leveraging the large investment already made in silicon wafer processing and packaging. We are dual sourced for essential supply chain activities such as wafer fabrication and packaging in different parts of the world with ample capacity to support anticipated customer demand over the next few years. Our dual sourcing strategy in disparate geographies has no exposure to China. In this environment, we remain focused on our execution. We continue to have excellent engagement with our customers on their technology roadmaps, and we're actively working to ensure our supply chain is geographically diverse down to the component level to mitigate cost and revenue impacts of tariffs and minimize the impact of any future supply chain disruption.
Speaker Change: Ideal power utilizes an asset light business model leveraging the large investment already made in silicon wafer processing and packaging.
Speaker Change: We are dual source for essential supply chain activities, such as wafer fab fabrication and packaging in different parts of the world with ample capacity to support anticipated customer demand over the next few years.
Speaker Change: Our dual sourcing strategy and disparate geographies has no exposure to China.
Speaker Change: In this environment, we remain focused on our execution, we continue to have excellent engagement with our customers on their technology Roadmaps and we're actively working to ensure our supply chain is geographically diverse after the component level to mitigate cost and revenue impacts of tariffs and minimize the impact of any future supply chain disruptions.
Dan Bergar: Looking briefly at innovation, the first engineering run of our next generation B-Tran die was successfully completed. And we currently have multiple engineering runs in fabrication for our next generation design. As you may recall, this die will be roughly half the size of the current die, translating to more than twice as many die per wafer, while providing the same voltage and current rating capability as our current device.
Speaker Change: Looking briefly at innovation, the first engineering run.
Speaker Change: Next generation <unk> was successfully completed and we currently have multiple engineering runs in fabrication for our next generation design.
Speaker Change: As you May recall this <unk> will be roughly half the size of the current die translating to more than twice as many die per wafer while providing the same voltage and current rating capability is our current device. This next generation <unk> design.
Dan Bergar: This next generation B-Tran die design is part of our long-term cost reduction roadmap. Implementation of the next generation die design will effectively double the available capacity of dies from our wafer fabrication partners, thereby supporting our planned sales ramp and large volume target customers for the industrial and automotive market. Looking at our expanding B-Tran Patent Estate, we currently have 94 issued B-Tran patents with 45 of those outside of the United States. Our current geographic coverage for our patents includes North America, China, Taiwan, Japan, South Korea, India, and Europe, all representing our high-priority patent coverage geography. As a result of our continuous innovation, our list of pending patents is now at 70.
Speaker Change: Design as part of our long term cost reduction roadmap implementation of next generation <unk> design will effectively double the available capacity of dies from our wafer fabrication partners, thereby supporting our planned sales ramp and large volume target customers for the industrial and automotive markets.
Speaker Change: Looking at our expanding nutrient patent estate. We currently have 94 issued B Tran patents with 45 of those outside of the United States. Our current geographic coverage for our patents includes North America, China, Taiwan, Japan, South Korea, India, and Europe, all representing our high priority.
Speaker Change: 80 patent coverage geographies.
Speaker Change: As a result of our continuous innovation our list of pending patents is now at 70.
Speaker Change: To further protect our intellectual property, we treat the proven double sided wafer process flow, we developed to make our devices to the trade secrets and do not disclose the identity of work hundreds and we work under strict confidentiality with our wafer fabrication partners. So even if a competitor studied our patents they wouldn't have the no.
Dan Bergar: For more information, please visit www.IdealPower.com In summary, we're excited about the opportunity for BTRAN as enabling technology for solid-state circuit breakers and EV contactors, and that our relationship with Stellantis continues to expand.
Speaker Change: How to fabricate the device.
Speaker Change: In summary, we are excited about the opportunity for B Tran is enabling technology for solid state circuit breakers, and EDI contractors and that our relationship with the Atlantis continues to expand we think 2025 is shaping up to be a pretty exciting year for us with additional design wins in the coming months and our initial revenue ramp beginning in the second half of this year, we've got several.
Dan Bergar: We think 2025 is shaping up to be a pretty exciting year for us with additional design wins in the coming months and our initial revenue ramp beginning in the second half of this year. We've got several things in the works that I think are going to be some great commercial announcements. So please keep an eye on the news flow that's going to be coming out from us in the coming months.
Speaker Change: Things in the work that I think youre going to be some great commercial announcements. So please keep an eye on the news flow that's going to be coming out from us in the coming months now I'd like to turn the call over to Tim Burns to review our financials.
Tim Burns: Now, I'd like to turn the call over to Tim Burns to review our financials. Thank you, Dan, and good morning, everyone. Our first quarter 2025 cash burn was $2.1 million, up from $2 million in the first quarter of 2024, and down significantly from the $2.6 million cash burn in the fourth quarter of 2024. Our Q1 cash burn was below our guidance of $2.2 to $2.4 million due to the timing of spending and related payments. We continue to manage expenses prudently and aggressively. We expect second quarter 2025 cash burn to increase to approximately $2.5 to $2.7 million with a full year 2025 cash burn over $10 million, with the increase primarily due to 2024 in plan 2025 hiring.
Tim Burns: Thank you Dan and good morning, everyone.
Tim Burns: Our first quarter 2025, cash burn was $2 1 million up from $2 million in the first quarter of 2024 and down significantly from the $2 $6 million cash burn in the fourth quarter of 2024.
Tim Burns: Our Q1 cash burn was below our guidance of $2 two to $2 $4 million.
Tim Burns: Due to the timing of spending and related payments.
Tim Burns: We continued to manage expenses prudently and aggressively b.
Tim Burns: We expect second quarter 2025, cash burn to increase to approximately two five to $2 $7 million with the full year 2025 cash burn over $10 million with the increase primarily due to 2024 and planned 2025 hiring this.
Tim Burns: This compares to a 2024 cash burn of $9.2 million, excluding the benefit of warrant process. Cash and cash equivalents totaled $13.7 million at March 31st, 2025. We have no debt in a clean capital structure. We recorded modest revenue for the first quarter of 2025 as customers continue to evaluate our technology. While initial orders from the large companies evaluating our products for potential inclusion in their OEM products will be small, we expect order sizes to increase as customers start to prototype their OEM products and progress through their design cycles and roll out vTran-based products. Looking at the second quarter of 2025, we expect to see modest volume in commercial revenue from product sales with our revenue ramp starting in the second half of Operating expenses were $2.8 million in the first quarter of 2025 compared to $2.5 million in the first quarter of 2024.
Tim Burns: This compares to a 2020 for cash burn of $9 2 million, excluding the benefit of warrant proceeds.
Tim Burns: Cash and cash equivalents totaled $13 7 million at March 31, 2025, we have no debt and a clean capital structure.
Tim Burns: We recorded modest revenue for the first quarter of 2025 as customers continue to evaluate our technology.
Tim Burns: While initial orders from the large companies evaluating our products for potential inclusion in their OEM products will be small.
Tim Burns: We expect order sizes to increase as customers start to prototype there are OEM products and progress through their design cycles in rollout B Tran based products.
Tim Burns: Looking at the second quarter of 2025, we expect to see modest volume and commercial revenue from product sales with our revenue ramp starting in the second half of 2025.
Tim Burns: Operating expenses were $2 8 million in the first quarter of 2025 compared to $2 5 million in the first quarter of 2024.
Tim Burns: We expect both research and development and sales and marketing spending to increase modestly in the coming quarters due to recent and future hiring and costs associated with our development and commercialization efforts. We also continue to expect some quarter-to-quarter variability in operating expenses, particularly our research and development spending, due to the timing of semiconductor fabrication runs, product development, other research and development activities, and hiring. The timing of equity grants and related stock-based compensation expense recognition will also cause variability in our quarterly operating results.
Tim Burns: We expect both research and development and sales and marketing spending to increase modestly in the coming quarters due to recent and future hiring costs associated with our development and commercialization efforts.
Tim Burns: We also continue to expect some quarter to quarter variability in operating expenses, particularly in our research and development spending due to the timing of semiconductor fabrication runs product development other research and development activities and hiring.
Tim Burns: The timing of equity grants and related stock based compensation expense recognition will also cause variability in our quarterly operating results.
Tim Burns: Net loss in the first quarter of 2025 was $2.7 million compared to $2.5 million in the first quarter of 2025. At the end of March 2025, we had 8,347,970 shares outstanding. 988,140 options and stock units outstanding. 763,827 pre-funded warrants outstanding. and 342,240 warrants outstanding. The remaining warrants have an exercise price of $8.90 and are set to expire in August of this year. If exercised in full, the exercise of these warrants would result in $3 million in proceeds to the company. At March 31st, 2025, our fully diluted share count was 10,442,177 shares.
Tim Burns: Net loss in the first quarter of 2025 was $2 $7 million compared to $2 5 million in the first quarter of 2024.
Tim Burns: At the end of March 2025, we had $8 million 347970 shares outstanding now.
Tim Burns: 988140 options and stock units outstanding.
Tim Burns: 763827 pre funded warrants outstanding.
Tim Burns: 342240 warrants outstanding.
Tim Burns: The remaining warrants have an exercise price of $8 90.
Tim Burns: And are set to expire in August of this year.
Tim Burns: If exercised in full the exercise of these warrants resulted in $3 million of proceeds to the company.
Tim Burns: At March 31, 2025, our fully diluted share count was $10 million and 442177 shares.
Operator: At this time, I would like to open up the call for questions. Operator. Thank you. At this time, we are conducting a question and answer Investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of your viewing screen. Analysts who publish research may ask questions on the phone line. For analysts who ask questions on the phone line, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. If you would like to remove yourself from the question queue, please press star 2.
Tim Burns: At this time I'd like to open up the call for questions.
Tim Burns: Operator.
Tim Burns: Thank you at this time, we are conducting a question and answer session investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of your viewing screen.
Speaker Change: Analysts, who wish to publishing analysts who publish research may ask questions on the phone line for analysts to ask questions on the phone lines. Please press star one on your telephone keypad.
Tim Burns: A confirmation tone will indicate your line is in the question queue.
Speaker Change: I would like to remove yourself from the question queue. Please press star two.
Operator: for participants using speaker equipment. It may be necessary to pick up your handset before pressing the start.
Speaker Change: For participants using speaker equipment and may be necessary to pick up your handset before pressing the star keys, one moment, please while we poll for questions.
Operator: One moment, please, while we poll for questions.
Casey Ryan: Your first question for today is from Casey Ryan with West Park Capital. Good morning, gentlemen. This is an exciting report and update. I just had a couple of questions.
Speaker Change: Your first question for today is from Casey Ryan with West Park capital.
Casey Ryan: Good morning, gentlemen, that's exciting.
Speaker Change: Report and update.
Speaker Change: A couple of questions.
Dan Bergar: Can you talk a little bit about the C-CORM advanced technology bullet point that you provided? It sounds like they've secured an order, but are you able to talk about when you ship against it, I guess, and then when the corresponding revenues would already occur in Q1, or if that's something that's coming over the course of FY25? Yeah, so that order, we just started shipping. It's partially fulfilled right now. It's a good opportunity for us, obviously, in the market. It's another one of these transactions that could result in a design win here later on in the year.
Speaker Change: Can you talk a little bit about the C Corp.
Speaker Change: Advanced technology point that you provided.
Speaker Change: It sounds like they've secured an order, but have you are you able to talk about when you ship against that I guess and then when the corresponding revenues would occur already occurred in Q1 or is that something that's coming over the course of FY 'twenty five.
Speaker Change: Yes, so that order.
Speaker Change: Just started shipping is partially fulfilled right now.
Speaker Change: Good opportunity for us obviously, the PC market.
Speaker Change: It's another one of these transactions.
Speaker Change: Transactions that could result in a design win here later on later on in the year. So we're getting real good traction from our our distribution partners and it's really on the demand creation side in terms of introducing us to new customers that want to evaluate our technology. While they are involved in order taking for some it's just really the introduction and we kind of run.
Dan Bergar: So we're getting real good traction from our distribution partners, and it's really on the demand creation side in terms of introducing us to new customers that want to evaluate our technology. While they are involved in order-taking, for some it's just really the introduction, and we kind of run with it from there. So it really does create a lot of opportunities for us.
Speaker Change: With it from there so it really does create a lot of opportunities for us.
Casey Ryan: Okay. All right. Terrific. And so some of the shipments were in Q1. Is that what you're saying? And then some are coming in Q2, Q3. Okay.
Speaker Change: Okay, Alright, terrific and so some of the shipments were in Q1 is that what Youre, saying and then summer coming in in Q2 Q3, okay.
Casey Ryan: Okay, terrific.
Casey Ryan: And then all the progress with Stellantis is very encouraging. I think you mentioned that you're moving to the P.O. process at Solantis.
Speaker Change: Okay terrific.
Speaker Change: And then all the progress with the Linzess is very encouraging.
Speaker Change: I think you mentioned.
Speaker Change: But you are moving through the process.
Speaker Change: That's the Atlanta.
Dan Bergar: For those of us who are unfamiliar, including myself, what is that? What does that mean in terms of time, you know, not that you exactly, but what are your expectations for that process? to sort of take it that sort of a multi-quarter thing or something that can move rapidly or maybe longer than what I'm thinking.
Speaker Change: For those of us who aren't familiar including myself what is that.
Speaker Change: What does that mean in terms of time not that exactly but what are your expectations for that process.
Speaker Change: To sort of take it that's sort of a multi quarter thing or something that can move rapidly or maybe longer than what I'm thinking.
Dan Bergar: Yeah, you know, Stellantis, because they've come together as a result of all these acquisitions and mergers, they are a big company with a lot of bureaucracy. But what they've emphasized to us repeatedly is because they already had a program underway and are kind of having to shift directions, this is a high priority program for them. So I think we're going to see this in a relatively short time period compared to what things normally happen in Stellantis. It'll probably take several weeks to get through that process. But it's not something that we're going to be looking at a couple of quarters from now still waiting for.
Speaker Change: Yes.
Speaker Change: Because they've come together as a result of all these acquisitions and mergers they are a big company with a lot of bureaucracy, but what they've emphasized to us repeatedly is because they already had a program underway and are kind of having to shift directions. This is a high priority program for them. So I think we're going to see this in a relatively.
Speaker Change: Short time period compared to what things normally happens to lantus.
Speaker Change: It will probably take several weeks to get through that process.
Speaker Change: But it's not something that we're going to be looking at a couple of quarters from now still waiting for we think it's going to be delayed and the Atlantis timeline relatively near term.
Dan Bergar: We think it's going to be in the Stellantis timeline relatively near term.
Casey Ryan: Okay.
Dan Bergar: And then, and then when that process is over, what, what is able to happen there actually to pull in, I guess, live samples at that point? Or is that indicating something more? There's actually a program that has been laid out that has us working with a company that's working on the controls for the contactor. There's a scope on design, there's a scope on testing, there's scope that includes shipping devices that get tested in their labs. What we don't know yet is are they going to structure it as like a multi-phase program like they did with the inverter program, or is it going to be all in one phase?
Speaker Change: Okay, and then and then when that process is over what what is able to happen, they're actually to Poland. I guess lives samples at that point or is that indicating something more.
Brian: Hey, Brian.
Speaker Change: It's actually a program.
Speaker Change: As bill laid out that has us working with a company thats working on the controls for the contactor.
Speaker Change: There is a scope on design there is a scope on testing.
Speaker Change: Nope that includes shipping devices that get tested in their labs.
Speaker Change: We don't know yet is are they going to structure. It as like a multi phased program like they did with the Alberta program or is it going to be all in one phase.
Casey Ryan: Because they sound like because of the priority of the program, it might just be a release for the full program, particularly since the contactors are less complicated than an EV drivetrain. Right. Okay.
Speaker Change: They sound like because of the priority of the program and let me just be a release for the full program, particularly sensitive contractors or less complicated than anybody drivetrain. So.
Speaker Change: Okay.
Dan Bergar: And then, um... If you can, where do these opportunities with Stellantis end, you know, say, five years down the road? Does it end with Ideal Power sort of, you know, providing contactors and maybe EV drivetrains to sort of all Stellantis vehicles or sort of a subset of, and EVs is what I'm focused on at this point, but I mean, do we still have to get designed into certain vehicles, even if we're sort of approved and sort of accepted by Stellantis corporate essentially? What's kind of the end game here in terms of the opportunity? I feel like it's big, but I'm just, how do we sort of describe it?
Speaker Change: And then.
Speaker Change:
Speaker Change: If you can where do these opportunities was the lantus and <unk>.
Speaker Change: So.
Speaker Change: Five years down the road.
Speaker Change: Does it end with with ideal power sort of providing contactor, then maybe he'd be drivetrain to sort of all.
Speaker Change: <unk> vehicles are sort of a subset of in Evs is what I'm focused on at this point, but I mean.
Speaker Change: Do we still have to get designed into certain vehicles, even if we're sort of approved and towards accepted by store and the corporate essentially.
Speaker Change: What's kind of the endgame here in terms of the opportunity I feel like it's big but I'm just.
Speaker Change: Are we sort of described it.
Dan Bergar: Yeah, just so everybody understands, we won't be providing the contactor or the drivetrain, we'll be providing the semiconnectors to go into those, but the way Stellantis is approaching this, which is the way we see most of the established automakers doing it, is they're looking to create a platform that they can take across multiple models and multiple brands, because they don't want to have each one be different. So for example, the work we're doing with them on a drivetrain will address vehicles that will be in, you know, a variety of the brands that are similar sized vehicles across multiple markets.
Speaker Change: Down the road.
Speaker Change: So everybody understands we won't be providing the contractor or the drivetrain will be providing the semiconductors that go into those but wait until this is approaching this which is the way we see most of the established automakers doing it as they are looking to create a platform that they can take across multiple models and multiple brands because they don't want to have each one be different so.
Speaker Change: For example, the work we're doing with them on a drivetrain will address vehicles that will be.
Speaker Change: A.
Speaker Change: A variety of the brands that are of similar sized vehicles across multiple markets. So they're trying to really make sure that they are being as efficient and getting as much leverage out of the design work that if they can so that they are literally is a platform that they work for them so for us.
Casey Ryan: So they're trying to really make sure that they're being as efficient and getting as much leverage out of the design work that they can, so that there's a, there literally is a platform that they work from. So for us, you know, the wind gets you into multiple vehicles and multiple brands in Stellantis. Okay. All right. Terrific.
Speaker Change: When it gets you into multiple vehicles in multiple brands since to Lantus.
Speaker Change: Okay, all right terrific.
Casey Ryan: Um, pardon me. That's really encouraging actually, really sort of a good vision for where this can go.
Speaker Change: Pardon me.
Speaker Change: That's really encouraging actually really sort of a.
Speaker Change: Good vision for this can go.
Dan Bergar: And then you mentioned I think you mentioned opportunity with another OEM for auto. Is that accurate? And then Would we get any maybe clarification on which product that was for? They said it was it was for EV contactor, but I just wanted to double check that. Yeah, so there's a second opportunity with a world of large global automaker that's specific to EV contactors. So we're still deeply engaged with with that automaker.
Speaker Change: And then you mentioned I think you mentioned opportunity with another OEM.
Speaker Change: For auto is that accurate and then.
Speaker Change: Would we get any.
Speaker Change: Maybe clarification on which product that was worthy said it was it was pretty easy contactor, but I just wanted to double check.
Speaker Change: Yes, so there is a second opportunity with the world.
Speaker Change: Large global automaker.
Speaker Change: Specific to EV contactor is.
Speaker Change: So we're still deeply engaged with that automaker.
Dan Bergar: And then there is a third automaker that we are still engaged with, had they have not made a decision internally, where they would like to apply the device. We've talked to them about both the EV contactor opportunity and the drivetrain inverter program. That's another top 10 global automaker. And then we're engaged with several tier one automotive suppliers. So I think some of the EV manufacturers rely on their tier ones to bring in those subsystems. So we would sell, you know, our technology to the tier one, they would put it into, for instance, you know, drivetrain inverter that they would then ultimately sell to the EV or automotive manufacturer themselves.
Speaker Change: And then there is a third automaker that we are still engaged with.
Speaker Change: They have not made a decision internally, where they would like to apply the device we talk to them about both the contactor opportunity and the drivetrain inverter program.
Speaker Change: That's another top 10 global automaker and then we're engaged with several tier one automotive suppliers and I think some of the EV manufacturers rely on their tier ones to bring in those sub systems. So we would sell.
Speaker Change: Our technology to the tier one they would put it into for instance, the drivetrain inverter that they would then ultimately sell T.
Speaker Change: <unk> automotive manufacturer themselves.
Casey Ryan: Right. Okay.
Speaker Change: Right Okay.
Casey Ryan: Well, I think those are really helpful answers. And I think the opportunities look significant. So this is a great update. And thank you for taking my question. Our pleasure, Casey. Good talking to you.
Speaker Change: Okay, well I think those are really helpful answers and I think.
Speaker Change: The opportunity it looks like that quick. So this is a great update and thank you for taking my questions.
Jeff Christiansen: Our pleasure Casey good talking to you.
Speaker Change: Yeah.
Jeff Christensen: I will now turn the call over to Jeff Christensen to read questions submitted through the webcast. Thank you. Thanks, Holly.
Speaker Change: I will now turn the call over to Jeff Christianson to read questions submitted through the webcast. Thank you.
Jeff Christianson: Thanks Ali.
Dan Bergar: Gentlemen, the first question is, do you have any comments on Wolfspeed's financial challenges as they are the leader in the development and manufacture of silicon carbide devices? Yeah, good question. It's really kind of unfortunate what's happened there. I mean, WillSpeed has spent decades developing silicon carbide and getting it commercialized.
Speaker Change: Gentlemen, the first question is do you have any comments on what speeds financial challenges as they are the leader in the development and manufacturer of Silicon carbide devices.
Speaker Change: Yeah. Good question, it's really kind of unfortunate what's happened there I mean, we will speed has spent decades developing silicon carbide and getting a commercialized.
Dan Bergar: But it really highlights why we are so focused on an asset-light business model. WillSpeed's challenge is they've got $1.3 billion in cash. They've got $6.5 billion in debt because it's an asset-heavy model. I mean, they own the fabs for the things that they're doing. You know, the debt that they've got coming due will probably be restructured. They're going to have to find a longer-term solution, though, because the asset-light business model is a very challenging one. It takes a lot of capital, and it requires a really high level of asset utilization.
Speaker Change: But it really highlights why we are so focused on an asset light business model will speeds challenges they've got only got $1 3 million and CAD, one 3 billion in cash they've got $6 5 billion in debt.
Speaker Change: Because it's an asset heavy model.
Speaker Change: One the fabs for the things that they're doing.
Speaker Change: Think honestly the.
Speaker Change: The the debt that they've got coming new will probably be restructured theyre going to have to find a longer term solution out because the asset light business model is a very challenging while it takes a lot of capital and it's <unk>.
Speaker Change: Requires really high level of asset utilization. So I think it really the end of the day highlights why we are sticking so closely to the model that we have and why.
Dan Bergar: So I think it really, at the end of the day, highlights why we are sticking so closely to the model that we have and why, you know, on our presentation, we say that, you know, not only are we fabless, we'll never own a fab, we're really leveraging that enormous investment that's already been made in wafer fabrication and packaging for silicon devices.
Speaker Change: Presentation, we say that not only are we fabless, we'll never own fab.
Speaker Change: We are really leveraging that enormous investment that's already been made and wafer fabrication and packaging for silicon devices.
Dan Bergar: Thank you.
Jeff Christensen: Yeah, we have several questions have been submitted by our shareholders, and we look forward to answering your questions. Please continue to post them.
Thank you yeah, we have several questions have been submitted by our shareholders and we look forward to answering your questions. Please continue to post them. Our next question is in light of the recent tariff wars are there any plans to certify any domestic chip manufacturers to make your product.
Dan Bergar: Our next question is, in light of the recent tariff wars, are there any plans to certify any domestic chip manufacturers to make your product? Right now, we don't need to do that. The tariffs really aren't impacting us. As I've mentioned in my earlier remarks, since power semiconductors are exempt from the tariffs, it gives us plenty of capacity. But if we do need to go to a U.S. fab, we know kind of where we would go. We did our development work actually here in the U.S. at a fab owned by Teledyne, and we know what fab in the U.S.
Speaker Change: Right now, we don't need to do that the tariffs really aren't impacting us as Ive mentioned in my earlier remarks since power semiconductors are exempt from the tariffs. It gives us plenty of capacity, but if we if we do need to go to U S fab.
Speaker Change: We know kind of where we would go we did our development. We're actually here in the U S. At Avalon by Teledyne, and we know what fab in the U S would be a good fit for us, but right now I'd say, there's really no tariff impact for us that would require us to go do anything here domestically.
Dan Bergar: would be a good fit for us. But right now, folks say there's really no tariff impact for us that would require us to go do anything here domestically.
Dan Bergar: Thank you.
Speaker Change: Thank you.
Dan Bergar: Please provide color on the SimCool Pipeline. Yeah, so SimCool is actually a vast majority of our pipeline. When we talk about engagements, when we talk about, you know, Forbes Global 500 power management market leaders, they're typically looking at the SimCool power module. They could potentially use discrete devices for smaller breakers. But I would say overwhelmingly the interest is in SimCool. We expect design wins here that we'll be announcing to incorporate that SimCool product. So the market reception has been great. And I think the yeah, just to reiterate it for except for the smaller commercial and industrial breakers, SimCool will be the product of choice for those applications.
Speaker Change: Please provide color on the same core pipeline.
Speaker Change: Yes, so as simple as actually the vast majority of our pipeline when we talk about engagements when we talk about.
Speaker Change: Forbes Global 500 power management market leaders, they're typically looking at the Sim cool power module.
Speaker Change: You could potentially use discrete devices for smaller breakers.
Speaker Change: I'd say overwhelmingly the interest is in the same cool, we expect design wins here that we'll be announcing to incorporate that Sim cool products. So the market reception has been great and I think the.
Speaker Change: Yes, just to reiterate in four except for the smaller commercial and industrial Breakers Simcoe, we'll be.
Speaker Change: Product of choice for.
Speaker Change: For those and application.
Dan Bergar: Our next, our next submitted question is of the prospective customers that engaged with Ideal Power. How many are no longer involved? And have you lost some programs in your pipeline? And why? We haven't lost anybody that we've been working with, you know. challenging at times when you're working with these very large companies, because they do move very slowly, but we haven't lost anybody that's engaged with us.
Speaker Change: Thank you. Our next our next submitted question is of the prospective customers that are engaged with ideal power. How many are no longer involved and have you lost some programs in your pipeline and why.
Speaker Change: We havent lost anybody that we've been working with.
Speaker Change: It's challenging at times when Youre working with these very large companies because they do move very slowly, but we haven't lost anybody thats engage with us.
Dan Bergar: Thank you.
Dan Bergar: What will it take for you to get to cash flow break even? Yeah, for us, it depends on the mix, but it's really just a few key design wins. I mean, these are very large companies. A design win could be millions or even in excess of $10 million in terms of what the annual revenue could be to Ideal Power. So it would just really take a few key design wins to get us there.
Speaker Change: Thank you what will it take for you to get to cash flow breakeven.
Speaker Change: Yeah for us it depends on the mix, but it's really just a few key design wins I mean these.
Speaker Change: Our very large companies a design win could be.
Speaker Change: Or even.
Speaker Change: In excess of $10 million in terms of what the annual revenue could be to ideal powers. So it was just really take a few key design wins to get us there.
Dan Bergar: Okay, thanks.
Dan Bergar: Our next question is, how long is the sales cycle for your product? So it varies completely by customer. I mean, the typical process goes from educating the customer on the technology, then we go through. and actually provide them with product. They typically order products. Sometimes we provide them with solid-state circuit breaker reference design, if that's their application of choice. They go through testing. We provide testing data that they always request from us, so that's part of the process. And then it gets into them deciding kind of on the product that they're looking for, what they potentially want to prototype, and it gets all the way through, obviously, design win, and then rollout of the product, which, I mean, they have some work to do between when they decide on proceeding and actually getting it ready for production.
Speaker Change: Okay. Thanks. Our next question is how long is the sales cycle for your products.
Speaker Change: So it varies completely by customer I mean is it typical process.
Speaker Change: It goes from educating the customer.
Speaker Change: Elsewhere on the technology and we go through.
Speaker Change: And actually provide them with products. They typically order product, sometimes you provide provide them as I'll say certain rig a reference design if thats their application of choice.
Speaker Change: Through testing, we provide testing data that they always request.
Speaker Change: From us so that's part of the process and then it gets into them to signing kind of on the product that they're looking for what they potentially wanted to prototype.
Speaker Change: And it gets all the way through obviously design win and then rollout of the product, which they have some work to do between when they decided on proceeding and actually getting it ready for production. So I would say for industrial customers.
Dan Bergar: So I would say for industrial customers, you know, ignoring that front-end education piece, it's about roughly 12 months, but it can vary widely by customer. Some customers are aggressive, like our first design win customer is moving at a very fast clip, with some of these large companies, it's, you know, it's taking a little bit longer.
Speaker Change: During that front end education piece, it's about roughly 12 months, but it can vary widely by customers. Some customers are aggressive like our first design win customer is moving at a very fast clip.
Speaker Change: With some of these large companies, it's it's taken a little bit longer.
Dan Bergar: Thank you.
Dan Bergar: Our next submitted question is, why is now a great time for the company? Yeah, I would say it's because we're really on the cusp of having some significant commercial announcements. I mean, we're making great progress with Stellantis. We've announced our first design win, but we expect to have more to follow some of them with very large companies. It could be really large revenue opportunities for us. So, I mean, we spent a decent amount of time developing this technology. It's very novel, but it really has some significant competitive advantages and we expect to be able to show that to people in the form of commercial announcements here as we progress.
Speaker Change: Thank you.
Speaker Change: Our next submitted question is why why is now a great time for the company.
Speaker Change: Yes, I would say, it's because we're really only costs was having some significant commercial announcements, we're making great progress was to lantus.
Speaker Change: We've announced our first design win but we expect to have more to follow some some of them with very large companies that could be really large revenue opportunities for us. So I mean, we spent a decent amount of time developing this technology is very novel, but it really has some significant competitive advantages and we expect to be able to show that to people in the former commercial.
Speaker Change: Smets here as we progress.
Dan Bergar: Thank you.
Speaker Change: Thank you.
Dan Bergar: The next question is, what is the expected value of ideal power technology in electric vehicles? Yeah, that's in our presentation. So it's about, we still estimate it's roughly $1,100 per vehicle, and that includes multiple applications within the EV. So, within the drive train, EV contactors on the circuit protection side, the onboard charger, the EV contactor alone is probably $200 to $300 per vehicle.
Speaker Change: The next question is what is the expected value of ideal power technology and electric vehicles.
Speaker Change: And that's in our presentation. So it's about we still estimate is roughly $100.
Speaker Change: Per vehicle and that includes multiple applications within the.
Speaker Change: Within the drivetrain EV contactor, and the circuit protection side.
Speaker Change: Onboard charger.
Speaker Change: The EEV contactor alone is probably two to $300 per vehicle.
Dan Bergar: So, it's a great opportunity for us, and that opportunity is really exciting for us because, one, we have a significant competitive advantage over silicon carbide MOSFETs or IGBTs, and the second thing is implementing EV contactors is just a much simpler process, a much shorter process than being part of an entirely new drive train.
Speaker Change: So it's a great opportunity for us and that opportunity is really exciting for us because one we have a significant competitive advantage over silicon carbide MOSFET <unk>.
Speaker Change: And the second thing is implementing <unk> contacts or is it just a much simpler.
Speaker Change: Process, a much shorter process then being hardware.
Speaker Change: Hardware entirely new drivetrain.
Dan Bergar: Thank you.
Dan Bergar: Our next measured question is, when will auto certification be completed? We're targeting the end of this year, sometime in the fourth quarter, to get it done. That process has actually been going very well. We've gone through several of the key parts of that certification process already without any dive failures. Part of why it takes so long is there are a whole variety of tests you have to go through, including some that, for example, take tens of thousands of power cycles, lots of exposure to heat and humidity cycles and so forth. But we're still on target to get that done this year.
Thank you.
Speaker Change: My second question is when will auto certification to be completed.
Speaker Change: We're targeting the end of this year.
Speaker Change: Sometime in the fourth quarter to get it done that process has actually been going very well we've gone through several of the key parts of that certification process already without any die failures part of why it takes so long as there are a whole variety of <unk>.
Speaker Change: So you have to go through including some that for example, take tens of thousands of power cycles.
Speaker Change: Lots of exposure to heat and humidity cycles, and so forth, but we're still on target to get that done. This year. It is one of our milestones and we're happy with the way, it's going and it's not a gating item for any of the electric vehicle opportunities and we really think it has the opportunity to accelerate the pace of adoption of our technology and industrial applications.
Dan Bergar: It is one of our milestones, and we're happy with the way it's going. And it's not a gating item for any of the electric vehicle opportunities.
Dan Bergar: And we really think it has the opportunity to accelerate the pace of adoption of our technology in industrial applications, just because it's a much higher standard, different extremes in terms of humidity and temperature, things like shock and vibration that aren't even tested in industrial standards. So we really think it will get, you know, it can be conservative industrial customers. It can help with those customers in terms of getting them over the finish line. So we're excited for that to happen here later this year.
Speaker Change: Just because it's a much higher standard.
Speaker Change: Different extremes in terms of humidity and temperature things like shock and vibration that arent even tested in industrial standards. So we really think it will get it can't be conservative industrial customers.
Speaker Change: Can't help with those customers in terms of getting over the finish line. So we're excited for that to happen here later this year.
Dan Bergar: The next submitted question is, any conversation with Slate, the new Bezos pickup truck company? Yeah, so generally when we're engaged with customers, they don't want their competitors to know what they're doing. So they generally request even for initial conversations, an NDA be put in place.
Speaker Change: Thank you the.
Speaker Change: The next many question is any conversation was slate the new bezos pickup truck company.
Speaker Change: Yes, so generally when we're engaged with customers. They don't want their competitors to know what they're doing so they generally request even for initial conversations.
Speaker Change: An NDA be put in place. So we can't speak specifically to any the only customer that has allowed us to name them to date is still at this so as it relates to specific opportunities with specific companies. Unfortunately, we really we can't really share any detail on that.
Dan Bergar: So we can't speak specifically to any, the only customer that's allowed us to name them to date is Stellantis. So as it relates to specific opportunities with specific companies, unfortunately, we can't really share any detail on that.
Dan Bergar: Thank you. The next question is in your press release with the first design when deliverables, it was mentioned that it included lighting and air conditioning system. Is this a new market that you have not mentioned before? Also, do you know what Ideal Power's serviceable addressable market would be if you were selling B-Trans devices into those markets? Yeah, it's actually part of what we generally consider the industrial market for circuit breakers. So, you know, utility breakers tend to be very large, but there's a lot, in fact, if you look at the total number of breakers that are sold, there are more that are actually sold in the industrial size that tends to be smaller.
Speaker Change: Thank you.
Speaker Change: The next question is in your press release with our first design win deliverables. It was mentioned that it included lighting and air conditioning systems.
Speaker Change: Is this a new market that you have not mentioned before also do you do you know what Idaho Power's serviceable addressable market would be if you were selling <unk> devices into those markets.
Speaker Change: Yes. It is actually part of what we generally considered the industrial market offer circuit breakers.
The breakfast tend to be very large, but there is a lot.
Speaker Change: In fact, if you look at the total number of breakers that are sold there are more that are actually sold in the industrial side that tends to be smaller.
Dan Bergar: So we've actually already kind of taken a good look at where the opportunities are, and it's not just lighting and air conditioning. It's just power coming into manufacturing facilities. It's providing circuit protection for sensitive equipment.
Speaker Change: So we've actually already kind of taken a good look at where the opportunities are and it's not just lighting and air conditioning. It's just power coming into manufacturing facilities is providing circuit protection for sensitive equipment. So we view that as part of that overall industrial breaker market that we referred to and it's about $1 billion market on the breaker side for us.
Dan Bergar: So we view that as part of that overall industrial breaker market that we refer to, and it's about a billion dollar market on the breaker side for us.
Dan Bergar: Thank you. Next question is, is the company aggressively promoting solid state contactors, that opportunity to all EV manufacturers?
Speaker Change: Thank you.
Speaker Change: Next question is is the company aggressively promoting solid state contactor.
Speaker Change: That opportunity to all EV manufacturers.
Dan Bergar: It really kind of is mission number one here because now that we're, you know, particularly once we are able to formally announce the purchase order with Stellantis, we really have already started going out to all the tier ones and to the folks that are in the EV business, part of why we put relationships in place with folks like Quest Semi that have their own auto relationships, because we view that as just such a big opportunity where we can really leverage everything we're doing and learning from Stellantis and don't have to start from scratch with coming up with designs that fit the application.
Speaker Change: It really kind of his mission number one here because now that were particularly once we are able to formally announce the purchase order was to Lantus. We really have already started going out to all the tier ones and to the folks that are in the EV business part of why we put relationships in place with folks like semi that have their own <unk>.
Speaker Change: Auto relationships, because we view that as just such a big opportunity, where we can really leverage everything we're doing and learning from the lantus.
Speaker Change: Don't have to start from scratch with coming up with designs that fit the application. So it's a pretty high priority for us as well as the solid state circuit breakers for industrial and utility applications as well.
Dan Bergar: So it's a pretty high priority for us, as well as the just solid state circuit breakers for industrial and utility applications as well. Okay, thank you. Yeah, lots of questions and please continue to submit your questions.
Speaker Change: Okay. Thank you.
Speaker Change: Lots of questions and please continue to submit your questions. The next submitted question is what.
Dan Bergar: The next submitted question is, what kind of impact do you think the auto qualification will have in the, as it relates to, you know, customers outside the auto industry? It's a pretty positive impact. You know, if you're an industrial customer, if you can buy a part that's actually been through auto certification, it speaks really highly to the robustness of the product. Because, you know, industrial applications, you think about a breaker sitting at a utility substation, if the devices that are in it have already been through shock and vibration testing and extremes of environment testing, it can certainly do well in the environment where the conditions are less demanding.
Speaker Change: What kind of impact do you think the auto qualification we will have.
Speaker Change: As it relates to <unk>.
Speaker Change: Customers outside of the auto industry.
It's a pretty positive impact if you're an industrial customer if you can buy a part that's actually been through auto certification. It speaks really highly to the robustness of the product because industrial applications do you think about a breaker sitting at a utility substation. If the devices that are in it have already been through shock and vibe.
Speaker Change: <unk> testing in extremes in the environment testing it can certainly do well in the environment, where the conditions are less demanding so it sends a very positive message broadly to any potential industrial users.
Dan Bergar: So, it sends a very positive message broadly to any potential industrial users.
Dan Bergar: Thank you.
Speaker Change: Thank you.
Dan Bergar: What are the power what's the what's the power rating increases you're working on and and the significance of them? Yeah, so we haven't announced the specific rating increases yet. Obviously, that's when we're at 2025 milestones, so that'll happen here later this year. But, I mean, it's really a win for both us and the customers. So when we're increasing our rating, this is not due to a design change. It's not a new product necessarily. It's really us getting comfortable. We intentionally set the bar kind of well in terms of what we rated our products at. And that was because you don't want to have challenges early on with customers where you over-promise and under-deliver.
Speaker Change: What are the power what's the what's the power rating increases you are working on and.
Speaker Change: And the significance of them.
Speaker Change: Yes, so we haven't announced the specific rate increases yet obviously, that's when we were in 2025 milestones. So that'll happen here later this year, but it's really a win for both us and the customers. So when we're increasing our rating. This is not due to a design change it's not a not a new product necessarily it's really us getting comfortable.
Speaker Change: We intentionally set the bar kind of low in terms of what we rented our product set.
Speaker Change: And that was because you don't want to have challenges early on with customers, where you over promise and under deliver so.
Dan Bergar: So we've, for instance, on the SimCool, we've already increased here last year the rating from 150 amps to 200 amps. We're expecting to increase it again. And what that means for a customer, if you're building a larger breaker and you're using, you know, 250 or 300-amp devices rather than 200-amp devices, you need less of them for your OEM product, right? So it's a cost benefit to them. It allows us to get a little bit more of a premium because generally the cost of a device is connected, or the selling price of the device is connected to the power rating of the device.
Speaker Change: For instance on the Sim cool, we've already increased here last year. The ratings from 150 amps to 200 amps, we're expecting to increase it again and what that means for a customer if you're building a larger breaker and youre using $250 300 amp.
Speaker Change: Rice's rather than 200 amp devices, you need less of them for your OEM product right. So it's a cost benefit.
Speaker Change: To them it allows us to get a little bit more of a premium because generally the cost of the devices connected to the selling price of the devices connected to.
Speaker Change: The power power rating of the device. So it's really a win win for us and we will be providing more detailed here later this year when we formally rollout the new ratings.
Dan Bergar: So it's really a win-win for us.
Dan Bergar: And we'll be providing more detail here later this year when we formally roll out the new ratings.
Dan Bergar: Thank you. That concludes our question and answer session.
Speaker Change: Thank you.
Dan: That concludes our question and answer session I would like to now turn the call over to Dan <unk> for closing remarks.
Dan Bergar: I would like to now turn the call over to Dan Bergar for closing remarks. I just want to thank everyone who joined us on the call today and for all the really good questions. Our news flow before our next update call, we'll continue to focus on commercialization and customer engagement activities. And we look forward to updating you on our progress.
Dan: I just want to thank everyone, who joined us on the call today and for all the really good questions. Our news flow before our next update call will continue to focus on commercialization and customer engagement activities and we look forward to updating you on our progress.
Operator: Operator, you may end the call. Thank you.
Dan: Operator, you may end the call.
Operator: This concludes today's conference. All parties may disconnect and have a great day.
Dan: Thank you. This concludes today's conference all parties may disconnect and have a great day.