Q1 2025 MicroVision Inc Earnings Call

Operator: via a chat. Investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of their viewing Analysts who wish to publish research may ask questions on the phone.

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Analysts who wish to 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. Please note. This event is being recorded I would now like to turn the conference over to drew Markham. Please go ahead.

Operator: For analysts who ask questions on the phone line, please press star 1 on your telephone keypad.

Operator: Please note this event is being recorded.

Drew Markham: I would now like to turn the conference over to Drew Markham. Please go ahead. Thank you, Operator. Good afternoon.

Drew Markham: Thank you operator good afternoon.

Drew Markham: I'm here today with our Chief Executive Officer, Sumit Sharma, and our Chief Financial Officer, Anubhav Verma.

Speaker Change: Here today, with our Chief Executive Officer, Sumit Sharma, and our Chief Financial Officer on about pharma following their prepared remarks, our chief Technology Officer, Glen de Vos will join us and we will open the call to questions. Please.

Drew Markham: Following their prepared remarks, our Chief Technology Officer, Glen DeVos, will join us, and we will open the call to questions.

Drew Markham: Please note that some of the information you will hear in today's discussion will include forward-looking statements, including but not limited to statements regarding status of commercial engagements, business, product, and go-to-market strategies, level of customer and partner engagement, cash, liquidity, and the impacts of recent financing activities, market landscape and opportunities, program volumes and timing, project development, performance of our products and solutions, product sales and future demand, projections of future operations, cash flow and financial results, availability of funds and conditions for capital raising, as well as statements containing words like believe, expect, plan or other similar expressions.

Speaker Change: Please note that some of the information you will hear in todays discussion will include forward looking statements, including but not limited to statements regarding status of commercial engagement business product and go to market strategy level of customer and partner engagement.

Speaker Change: Cash liquidity and the impacts of recent financing activities market landscape and opportunities program volumes and timing of project development.

Speaker Change: Performance of our products and solutions product sales and future demand projections of future operations cash flow and financial results availability of funds and conditions for capital raising as well as statements containing words like believe expect plan or other similar expressions. These states.

Drew Markham: These statements are not guarantees of future performance. Actual results could differ materially from the future results implied or expressed in the forward-looking state.

Speaker Change: <unk> are not guarantees of future performance.

Speaker Change: Actual results could differ materially from the future results implied or expressed in the forward looking statements.

Drew Markham: We encourage you to review our SEC filings, including our most recently filed annual report on Form 10-K and our quarterly reports on Form 10-Q. These filings describe risk factors that could cause our actual results to differ materially from those implied or expressed in our forward-looking statement. All forward looking statements are made as of the date of this call and accept as required by law. We undertake no obligation to update this information.

Speaker Change: We encourage you to review our SEC filings, including our most recently filed annual report on Form 10-K, and our quarterly reports on Form 10-Q. These filings describe risk factors that could cause our actual results to differ materially from those implied or expressed in our forward looking statements all.

Speaker Change: Forward looking statements are made as of the date of this call and except as required by law, we undertake no obligation to update this information.

Drew Markham: In addition, we will present certain financial measures on this call that will be considered non-GAAP under the SEC's Regulation G. For reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure, as well as for all the financial data presented on this call, please refer to the information included in our press release and in our Form 8K dated and submitted to the SEC today, both of which can be found on our corporate website at microvision.com under the SEC Filings tab.

Speaker Change: In addition, we will present certain financial measures on this call that will be considered non-GAAP under the SEC regulation G.

Speaker Change: For reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure as well as for all the financial data presented on this call.

Speaker Change: Please refer to the information included in our press release and in our form 8-K dated and submitted to the SEC today, both of which can be found on our corporate website at Microvision dot com under the SEC filings tab.

Drew Markham: This conference call will be available for audio replay on the Investor Relations section of our website at www.microvision.com.

Speaker Change: This conference call will be available for audio replay on the Investor Relations section of our website at Www Dot Microvision Dot com.

Sumit Sharma: Now, I would like to turn the call over to our Chief Executive Officer, Sumit Sharma. Sumit? Thank you, Drew, and welcome, everyone, to this review of our first quarter 2025 results. I want to thank everyone for joining today's call. I will provide an update on the progress we have made towards commercial agreements in automotive and industrial markets, as well as expansion towards the military market with our existing products. I will also provide context about our already announced Investor Day event being hosted in Redmond.

Speaker Change: Now I would like to turn the call over to our Chief Executive Officer, Sumit Sharma Sumit.

Speaker Change: Thank you drew and welcome everyone to this review of our first quarter 2025 results.

Speaker Change: I want to thank everyone for joining today's call.

Speaker Change: I will provide an update on the progress we have made towards commercial agreements in automotive and industrial markets as well as expansion towards the military market with our existing products.

Speaker Change: I will also provide context about our already announced Investor day event being hosted in Redmond.

Sumit Sharma: First, I would like to begin our update and engagement with automotive RFQ opportunities. We remain engaged in seven RFQs for automotive programs and make incremental progress. This has been really slow going because of OEM's focus shifting to their global plan. Lots of ebbs and flows we continue to deal with. On one hand, it is clear to us that the current global rebalancing of trade is expected to have a huge refocus on automotive-oriented resources on the supply chain issue. Advanced ADAS rollout is expected to be delayed. with only very low volume LiDAR integration so far. On the other hand, we are engaged in new upcoming RFQ and custom development opportunities.

Speaker Change: First I would like to begin our update and engagements with automotive RFP opportunities.

Speaker Change: We remain engaged in seven RF queues for automotive programs and make incremental progress.

Speaker Change: This has been really slow going because of oem's focus shifting their global plants.

Speaker Change: Okay.

Speaker Change: Lots of ebbs and flows we continue to deal with.

Speaker Change: On one hand, it is clear to us that the current global rebalancing of crude is expected to have a huge refocus on automotive Oems resources on the supply chain issues.

Speaker Change: Advanced <unk> rollout is expected to be delayed.

Speaker Change: With only very low volume lidar.

Speaker Change: <unk> so far.

Speaker Change: On the other hand, we are engaged in new upcoming Q1 cost of development opportunities.

Sumit Sharma: We continue to support these potential customers with patience with the quickest path to on-ramp for any type of project. In previous years, we focused on winning programs targeted for production with several years of customization in play. These deals could be described as the ones our competitors signed. In each agreement, the challenge we faced was not our technology or capability, rather than the state of our balance sheet would always cause OEMs to pause.

Speaker Change: We continue to support these potential customers with patients with a <unk>.

Speaker Change: <unk> is proud to on ramp for any type of project.

Speaker Change: In previous years, we focused on winning programs targeted for production with several years of customization and play.

Speaker Change: These deals could described as the ones our competitor side.

Speaker Change: And each agreement.

Speaker Change: Challenge, we face was not our technology or capability, rather than the state of our balance sheet with all this caused Oems a pause.

Sumit Sharma: Let me elaborate a bit. Our competitors who went public as part of a D-SPAC collectively raised more than a billion dollars. OEMs required a strong balance sheet to feel confident that for the initial start, we had enough runway to fund their development. Microvision has been running leaner on capital. So it was a huge challenge to get them comfortable with our cash on Our competition has not fared well even after winning early engagement. We strongly believe it is greenfield in the space where the LIDAR apps are required for advanced ADAS and autonomous. With the strengthening of our balance sheet with the high-trail deal, we are in a stronger position than previously.

Speaker Change: Let me elaborate a bit.

Speaker Change: Okay.

Speaker Change: Our competitors, who went public as part of a destock collectively raised more than $1 billion.

Speaker Change: Oems required a strong balance sheet to feel confident therefore, the initial start we had enough runway to fund their development.

Speaker Change: Microvision has been running leaner on capital. So it was a huge challenge to get them comfortable with our cash on hand.

Speaker Change: Our competition has fair has not fared well even after winning early engagements.

Speaker Change: We strongly believe it is greenfield in this space with a lighter absolute required for advanced Adas and autonomy.

Speaker Change: With the strengthening of our balance sheet with a high yield deal we are in a stronger position than previously so.

Sumit Sharma: So we continue to drive and make progress.

Speaker Change: We continue to drive and make progress.

Sumit Sharma: But I do not expect any substantial projects to be awarded with material production revenues in the near future. We intend to focus on finding custom development opportunities with OEM. Make no mistake with the ebbs and flows of the automotive demand. This will remain the largest opportunity that eventually could deliver millions of units shipped and billions of dollars of revenues generated from this segment. With our MOVIA, MAVEN, and MOVIA-S LiDAR products, we believe we have the entire suite of sensors to address all of your inquiries.

Speaker Change: But I do not expect any substantial projects to be awarded the material production revenues in the near future.

Speaker Change: We intend to focus on finding custom development opportunities with Oems.

Speaker Change: Make no mistake with the ebbs and flows of the automotive demand.

Speaker Change: This will remain the largest opportunity that eventually could deliver millions of units shipped and billions of dollars of revenues generated from this segment.

Speaker Change: With our mobile maven and mortgage slide our products. We believe we have the entire suite of sensors to address all of the increase.

Sumit Sharma: I remain very excited and optimistic about our industrial segment, though. Our in-production MoVL sensor, integrated with onboard perception software, is an advanced solution which is frictionless for our customers to integrate. We have delivered software integrated solutions to multiple potential partners since last year. These evaluations remain in flight. to make progress in this space and I expect these engagements will lead to commercial wins for us. With our partnership with ZF, we have no exposure to China tariffs and remain cost competitive with our economy at scales at Movia L and eventually Movia S. We remain fully engaged with our potential customers as they evaluate their rollout.

Speaker Change: I remain very excited and optimistic about our industrial segment, though.

Speaker Change: Our in production mobile sensor integrated with onboard perception software is an advanced solution, which is frictionless for our customers to integrate it.

Speaker Change: We have delivered software integrated solutions to multiple potential partners since last year.

Speaker Change: These evaluations remained in flight we can see.

We have to make progress in this space and I expect these engagements will lead to commercial wins for us.

Speaker Change: Okay.

Speaker Change: With our partnership with setup, we have no exposure to China tariffs and remain cost competitive with our economy of scales and mortgage and eventually move yes.

Speaker Change: We remain fully engaged with our potential customers as they evaluate their rollout.

Sumit Sharma: Up to this point, none of our potential customers have made us aware of any impact on their timing due to the ongoing global trade rebalancing or tariffs.

Speaker Change: Up to this one none of our potential customers have made us aware of any impact on their timing due to the ongoing global trade rebalancing or tariffs.

Speaker Change: Okay.

Sumit Sharma: As I shared in our last earnings call, another segment we started expanding with engagements in 2024 was mobile autonomous robots, military and commercial vehicles that light our products. We have brought on a defense advisory board that will help us on opportunities to engage with Department of Defense with our software integrated sensor technology. to potentially enable programs with drones and land vehicles as well as help us explore potential opportunities with larger companies in space for a partnership. As I also mentioned previously, with our long history with delivering augmented reality for the military, we remain focused on opportunities to leverage the large body of work.

Speaker Change: As I shared in our last earnings call. Another segment, we started expanding with engagements in 2024 was mobile autonomous robots military and commercial vehicles, the lidar product.

Speaker Change: We have brought on a defense advisory board that will help us on opportunities to engage with department of defense with our software integrated sensor technology.

Speaker Change: To potentially enable programs of drones and land vehicles as well as help us explore potential opportunities with larger companies in space for our partnership.

Speaker Change: Yeah.

Speaker Change: As I also mentioned previously that our long history with delivering augmented reality for military.

Speaker Change: We remain focused on opportunities to leverage the large body of work.

Sumit Sharma: In this space, we expect to leverage our LiDAR products to use with radar and other third-party technologies into our software. We expect to partner with existing military primes to deliver a full sensor intelligence solution. This segment benefits from all the hardware and software building blocks that already exist within MicroVision.

Speaker Change: In this space, we expect to leverage our lidar products fused with radar and other third party technologies into our software.

Speaker Change: We expect to partner with existing military primed to deliver full sensor intelligence solutions.

Speaker Change: This segment benefits from all the hardware and software building blocks that already exist within Microvision.

Sumit Sharma: We expect the first system and product prototypes for this segment to be available in six to nine months.

Speaker Change: We expect the first system and product prototypes for this segment to be available in six to nine months.

Sumit Sharma: Next week, we will host Investor Day in Redmond. We are planning to make this an event in lieu of annual CS Appendix. At this event, investors will get an opportunity to interact with our various technology offerings as well as demos. of how we plan to enable potential customers, including Ride Along in our demo vehicle. Investors could have a deeper discussion with management on all the ups and downs of our journey so far, as well as get confidence on the stronger path we expect moving forward.

Speaker Change: Next week, we will host an investor day in Redmond.

Speaker Change: We are planning to make this an event in lieu of annual C. It dependents.

Speaker Change: At this event investors will get an opportunity to interact with our various technology offerings as well as demos of how we plan to enable potential customers, including right along in our demo vehicles.

Speaker Change: Investors could have a deeper discussion with management on all the ups and downs of our journey, so far as well as get confidence on the stronger path, we expect moving forward.

Sumit Sharma: I'm going to keep my prepared remarks brief today as there are questions from several shareholders and I'd like to address that as the main narrative.

Speaker Change: I'm going to keep my prepared remarks brief today as there are questions from several shareholders.

Speaker Change: I'd like to address that as I've been there.

Anubhav Verma: I would like to turn over the call to Anubhav. Thanks, Sumit. I'd like to begin by reiterating Sumit's comments. We're absolutely aligned with shareholders to quickly demonstrate step-function progress towards our commercial engagements with industrial customers for near-term, high-volume-based revenue. remain deeply engaged with them for testing and integration of our solutions into their fleet.

Speaker Change: Like to turn the call to <unk>.

Speaker Change: Paul.

Speaker Change: Thanks, Amit.

Speaker Change: I'd like to begin by reiterating some of his comments, we're absolutely aligned with shareholders to quickly demonstrate step function progress towards our commercial engagements with industrial customers for near term high volume based revenue.

Speaker Change: We remain deeply engaged with them for testing and integration of our solutions into their fleet.

Anubhav Verma: Next, I'd like to discuss the impact of the recently announced global tariff. While the situation continues to be dynamic and evolving, we believe MicroVision remains well-positioned as we have our manufacturing partner in France. As announced late last year, we secured a production commitment with ZF in France to be able to meet the anticipated high volume demand from customers in the industrial space for our Mobia L product. We believe this does offer yet another pricing advantage to some of our customers, given our minimal exposure to China-based manufacturing. Based on certain triggers, we are planning to bring up another site for Mobya L production later this year to meet the demand.

Speaker Change: Next I'd like to discuss the impact of the recently announced global tariffs.

Speaker Change: While the situation continues to be dynamic and evolving we believe microvision remains well positioned and we have our manufacturing partner in France.

Speaker Change: As announced late last year, we secured a production commitment with <unk> in France to be able to meet the anticipated high volume demand from customers in the industrial space for our <unk> product.

Speaker Change: We believe this does offer yet another pricing and managed in some of our customers given our minimal exposure to China based manufacturers.

Speaker Change: Based on certain triggers.

Speaker Change: We are planning to bring up another site automobile production later this year to meet the demand.

Anubhav Verma: We continue to closely monitor the tariff policy developments and will provide more updates on this later in the year.

Speaker Change: We continue to closely monitor the tariff policy developments and we'll provide more updates on this later in the year.

Anubhav Verma: Now let me provide the progress in each of the verticals we're focused on. Number one, automotive. We continue to be engaged in the seven RFQs with automotive OEMs. However, the automotive industry is navigating a complex landscape shaped by actual and potential new tariffs. Some OEMs have suspended their annual guidance, while some have quantified the potential impact of tariff-related costs. While LiDAR adoption appears to be a lower priority given the macroeconomic landscape, the direct impact of tariffs has pushed OEMs to focus even more on component costs and the origin of subsystems that go into their vehicles.

Speaker Change: Now let me provide the progress in each of the water goes we're focused on.

Speaker Change: Number one automotive.

Speaker Change: We continue to be engaged in the seven rfu's the automotive Oems.

Speaker Change: Over the automotive industry is navigating a complex landscape shaped by actual and potential new tariffs.

Speaker Change: Some Oems have suspended their annual guidance, while somehow quantify the potential impact of tariff related costs.

Speaker Change: While lidar adoption appears to be a lower priority given the macroeconomic landscape.

Speaker Change: Direct impact of tariffs has pushed Oems to focus even more on component cost and the origin of Subsys systems that go into their vehicles.

Anubhav Verma: OEMs will continue to go through the reformulation of existing and upcoming RFQs, looking for cheaper LiDAR solutions that meet the desired performance criteria. Especially with Glen joining us from the automotive industry, we're excited to pursue our continued engagement with automotive OEMs. This vertical, albeit slower, will be the primary driver for high-volume recurring business that gets us to scale.

Speaker Change: Oems will continue to go through the re formulations of existing and upcoming RF queues looking for cheaper Lidar solutions that meet the desired performance criteria.

Speaker Change: Especially with the blend joining us from the automotive industry. We are excited to pursue our continued engagement with the automotive Oems.

Speaker Change: This vertical, albeit slower will it be the Bryan Murray driver for high volume recurring business that gets us to scale.

Anubhav Verma: Number two, industrial with a focus on AGB, AMR, and warehouse and factory automating. With various efforts in flight in the industrial space, our team is focused on deep engagement with customers, including on-site, working closely with their teams to support evaluation and integration of our solution into their fleet. We remain confident in the near-term demand from this vertical, especially after securing production capacity to meet this demand. We're seeing a lot of momentum in the AGV AMR space as these companies continue to embrace autonomy and AI faster than others. With our current Movia technology and secure production capabilities, we're well positioned to grow in this space.

Speaker Change: Number two industrial.

Speaker Change: Industrial with a focus on HIV EMR in their house and factory automation.

Speaker Change: With various efforts in flight in the industrial space. Our team is focused on deep engagements with customers, including onsite working closely with their teams to support evaluation and integration of our solution into their feet.

Speaker Change: We remain confident in the near term demand from this vertical, especially after securing production capacity to meet this demand.

Speaker Change: We're seeing a lot of momentum in the HGV EMR space as these companies continue to embrace autonomy and AI faster than others.

Speaker Change: With our current <unk> technology in particular production capabilities, we are well positioned to grow in this space.

Anubhav Verma: Number three, the defense vertical. In the last few months, we established the Defense Advisory Board to execute our strategy in the defense vertical to map new opportunities for our products globally and pursue monetization of our existing product portfolio through near-term partnerships. leveraging our existing product portfolio or formulating our go-to-market with the support and guidance of our distinguished industry advisors. The current administration has made the advancement of new technologies and defense a central priority, emphasizing rapid innovation through public-private partnerships.

Speaker Change: Number three the defense vertical.

Speaker Change: In the last few months, we established the defense Advisory board to execute our strategy in the defense vertical to map new opportunity for our products globally and pursue monetization of our existing product portfolio through near term partnerships.

Speaker Change: Leveraging our existing product portfolio or formulating our go to market with the support and guidance of our distinguished industry advisers.

Speaker Change: Current the current administration has made the advancement of new technologies and defend our central priority emphasizing rapid innovation through public private partnerships.

Anubhav Verma: We will provide more updates on this at our upcoming Investor Day next week. We're thrilled to see our engineering team working closely with Glen to align our technology portfolio and strategically advance our product roadmap. With a capital raise in the first quarter and a streamlined cash burn, our cash runway has extended into 2026. MicroVision remains well-positioned in the marketplace with diversified near-term revenue opportunities in the industrial and defense sector. The expanded TAMS, streamlined cost structure, and recent financings have solidified our position.

Speaker Change: We'll provide more updates on this at our upcoming Investor Day next week.

Speaker Change: We're proud to see our engineering team working closely with Glen to align our technology portfolio and strategically advance our product roadmap.

Speaker Change: With the capital raise in the first quarter and a streamlined cash burn our cash runway has extended into 2026.

Speaker Change: Provision remains well positioned in the marketplace the diversified near term revenue opportunities in the industrial and defense sectors.

Speaker Change: The expanded Tam streamline cost structure and recent financings have solidified our position.

Anubhav Verma: Now let's review our Q1 financial performance. For the first quarter, we reported revenues of $0.6 million. This quarter's revenue was primarily driven by our sales in the industrial vertical.

Speaker Change: Now, let's review, our Q1 financial performance.

Speaker Change: For the first quarter, we reported revenues of <unk> 6 million. This quarter revenue was primarily driven by a fierce and the industrial verticals.

Anubhav Verma: Expenses. Our first quarter 2025 R&D and SG&A expenses were $14.1 million, including $1.9 million of non-cash charges related to stock-based compensation expense and $1.4 million in non-cash charges related to depreciation and amortization. Backing out these non-cash charges, our R&D and SG&E expenses were only $11 million in the quarter. On a year-to-year, YOY basis, we have reduced our expenses by 45%. We expect the current level to be sustained through the rest of the year. We believe our existing workforce and level of expenses will allow us to execute on the current business strategy. We believe our current engineering teams can support continued engagement with automotive OEMs and simultaneously scale faster with industrial and defense revenue opportunities in the near future.

Speaker Change: Expenses, our first quarter 2025, R&D and SG&A expenses were $14 1 million.

Speaker Change: Including $1 9 million of noncash charges related to stock based compensation expense and $1 4 million in non cash charges related to depreciation and amortization.

Speaker Change: Backing out these noncash charges are.

Speaker Change: R&D and SG&A expenses were only $11 million in the quarter on.

Speaker Change: On a year ago, a y O Y basis, we have reduced our expenses by 45%.

Speaker Change: We expect the current level to be sustained through the rest of the year.

Speaker Change: We believe our existing workforce and level of expenses will allow us to execute on the current business strategy.

Speaker Change: We believe our current engineering teams can support continued engagement with automotive Oems and simultaneously scaled faster with industrial and defense revenue opportunities in the near term.

Anubhav Verma: We believe that the go-forward annual run rate of our cash, R&D and exchange expense will be in line with our existing quarter.

Speaker Change: We believe that the go forward annual run rate of our cash R&D and SG&A expense will be in line with our existing quarter.

Anubhav Verma: Q4 CapEx was 0.1 million in line with our expectations.

Speaker Change: Q4, Capex was <unk> 1 million in line with our expectations.

Anubhav Verma: Now let's talk about our balance sheet. We finished the quarter with $69 million in cash and cash flow equivalents. In addition, the company has availability of $113.4 million under the ATM facility and about $30 million of undrawn capital under the convertible loan facility. Drawing on these facilities to their fullest extent requires additional authorized capital as well as certain favorable market conditions. On the convertible note, we have approximately $33 million outstanding that converts at a fixed price of $1.59 or approximately $1.60. The 30 million second tranche remains undrawn and available for future drawdowns subject to certain limitations.

Speaker Change: Now, let's talk about our balance sheet, we finished the quarter with $69 million in cash and cash equivalents. In addition, the company has availability of $113 4 million under the ATM facility on about $30 million Undrawn capital under the current under the convertible loan facility.

Speaker Change: Drawing on these facilities to their fullest extent required additional authorized capital as well as certain favorable market conditions.

Speaker Change: On the convertible notes, we have approximately $33 million outstanding that converts at a fixed price of one.

Speaker Change: 59, or approximately $2 60.

Speaker Change: The $30 million of second tranche remains undrawn and available for future Dropdowns subject to certain limitations. We're pleased to have found a strategic partner with confidence in microvision future as motivated on alignment of economic interest in step with our management team employees and shareholders.

Anubhav Verma: We're pleased to have found a strategic partner whose confidence in MicroVision's future has motivated an alignment of economic interests in step with our management team, employees, and shareholders.

Anubhav Verma: Well, let's talk about 2025 targets. We remain relentlessly focused on our execution. We continue to have excellent engagement with industrial customers on their technology road. Based on the expected advancement in current customer engagement, along with targeted market opportunities, we believe we have line of sight to 30 to 50 million in revenue over the next 12 to 18 months. Our production commitment from our manufacturing partners that allows us to commit to high volume deliveries to meet the anticipated demand from current customer projects. While we're not providing fiscal year 2025 guidance, this should help investors understand the size and level of engagement with customers for our Movia L-sensors.

Speaker Change: Now, let's talk about 2020 five targets.

Speaker Change: We remain relentlessly focused on our execution, we continue to have excellent engagement with industrial customers on their technology Road maps.

Speaker Change: Based on the expected Masson and current customer engagement, along with targeted market opportunities. We believe we have line of sight to $30 million to $50 million in revenue over the next 12 to 18 months.

Speaker Change: Our production commitments from our manufacturing partners that allows us to commit to high volume deliveries to meet the anticipated demand from current customer projects.

While we're not providing fiscal year 2025 guidance. This should help investors understand it understand the size and level of engagements with customers for our <unk> sensors.

Anubhav Verma: As we expand our time into defense and other related areas and expand our solutions portfolio and accelerate our go-to-market strategy, we will provide more color on financial and business milestones for 2025 and 2026 and upcoming events.

Speaker Change: As we expand our Tam into defense.

Speaker Change: And other related areas.

Speaker Change: And expand our solutions portfolio and accelerate our go to market strategy.

Speaker Change: We will provide more color on financial and business milestones for 2025, and 2026 and upcoming events.

Anubhav Verma: To summarize, we're really excited about 2025 and beyond, as MicroVision drives forward with significantly higher TAMs, including defense and industrial, expansive and broadening solutions advancements. Solid Balance Sheet and Superior Trading Metrics and a well-experienced team to execute the strategy.

Speaker Change: To summarize we're really excited about 2025 and beyond as Microvision to drive forward with significantly higher times, including defense and industrial expansive and broadening solutions advancements solid balance sheet with superior trading metrics and a very experienced team to execute this strategy.

Operator: Operator, I would now like to open the line for questions. Thank you.

Speaker Change: <unk> I would now like to open the line for questions.

Speaker Change: Thank you at this time, we are conducting a question and answer session and.

Operator: 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 their viewing Analysts who publish research may ask questions through the phone line.

Speaker Change: Investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of their viewing screen.

Speaker Change: Analysts, who with analysts who publish research may ask questions through the phone line for analysts to ask questions through the phone line. Please press star one on your telephone keypad.

Operator: For analysts who ask questions through the phone line, please press star 1 on your telephone keypad. One moment, please, while we poll for questions.

Speaker Change: One moment, please while we poll for questions.

Casey Ryan: Your first question for today is from Casey Ryan at West Park Capitol.

Speaker Change: Your first question for today is from Casey Ryan at West Park capital.

Casey Ryan: Good afternoon, everybody. It's a great update. Thank you for taking my questions. So the first question, I think Anubhav, you mentioned the revenue for Q1. was actually from commercial sales. Is this the first quarter we've had? some commercial sales versus, say, NREs or R&D work. No, we have had commercial sales in the fourth quarter as well, Casey, so this just continues. Okay. This is just a continued effort on that part. Okay, let me see something here. Okay, good. And so clearly you all are calling it out as being focused in the industrial vertical, I think is what we're, or at least what I'm up in the messaging.

Speaker Change: Good afternoon, everybody great update.

Speaker Change: Thank you for taking my questions.

Speaker Change: So the first question I think on above you mentioned the revenue for Q1.

Speaker Change: It was actually from commercial sales is this the first quarter we've had.

Speaker Change: Some commercial sales versus say <unk> or R&D work.

Speaker Change: No we've had commercial sales in the fourth quarter as well Casey. So this just continues.

Speaker Change: This is just a continuing effort on that part.

Speaker Change: Okay, Let me see something here.

Speaker Change: Okay. Good and so clearly you all are calling it out as being focused in the industrial vertical I think is what were or at least what I'm after the messaging.

Speaker Change: What what's driving consumption I guess not that you need to know, but youre able to kind of give us the $30 million to $50 million range of.

Casey Ryan: What's driving consumption, I guess, not that you need to know, but you're able to kind of give us this 30 to $50 million range of potential revenues over the next 12 to 18 months. I'm just curious. What is the thing that's controlling the pace of that, I guess? Anubhav Verma, Anubhav Verma, Sumit Sharma, Casey Ryan, Anand Balaji, Glen DeVos, MicroVision You know, of course, you know, all of us have, you know, very high hopes of what we want to achieve, but Q1 kind of froze up for almost everybody, right? There was a lot of indecision.

Speaker Change: Potential revenues over the next 12 to 18 months.

Speaker Change: I'm just curious.

Speaker Change: But maybe.

Speaker Change: What is the thing that's controlling the pace of that I guess.

Speaker Change: Yes.

Those revenues come in.

Speaker Change: I'll take that one out and about maybe you can help a little bit so I think what.

Speaker Change: What will drive that is primarily industrial.

Speaker Change: And industrial space there is.

Speaker Change: Automation activities and there's lots of activities to deploy <unk> with a lidar integrated onto.

Speaker Change: Everything that can get onto the sensor so that's what's driving it but it's primarily in the industrial space.

Right.

Speaker Change: Of course, all of US have very high hopes of what we want to achieve but Q1 kind of froze up for almost everybody right. There was a lot of indecision and we have worked through that now kind of what you want to add something.

Anubhav Verma: And, you know, we have worked through that now. Anubhav, you want to add something? Yeah, and I think maybe, Casey, to add on, the trajectory of this 30 to 50 million revenue is going to be, it's primarily driven by the end customers' deployment and rollout in their internal environments, which is, again, driven by their need to reduce costs and obviously increase productivity, right? So, those are some of the primary driving factors behind our end customers looking for these solutions to achieve these objectives. Yeah, okay, so so it like doesn't, it feels very closely connected to the end customer versus, say, the hardware manufacturer who's consuming your product isn't necessarily building up some large level of inventory or, you know, pre ordering product yet, it doesn't sound like No, yeah, so this is deployment across the customer's facilities and, you know, different environments that we are dealing with different customers in the AGB AMR. Yeah, okay, and then...

Casey: Yes, and I think that I think maybe Casey to add on.

Casey: The trajectory of the $30 million to $50 million revenue is going to be.

Casey: It's primarily driven by the end customer's deployment and rollout and their internal environments, which is again driven by their need to reduce cost and and obviously increased productivity right. So those are some of the.

Casey: Primary driving factors behind our customers looking for these solutions too.

Casey: Achieve these objectives.

Casey: Yeah, Okay. So so.

Casey: At like doesn't.

Casey: It feels very closely connected to the aimco versus say the hardware manufacturer who's consuming your product isn't necessarily building up some large levels of inventory.

Casey: Preordering product yet it doesn't sound like.

Casey: No. Yes. So this is a deployment across the customers.

Casey: Our facilities in different environments that we are dealing with different customers in the <unk> space.

Casey: Yes, the customer and then.

Anubhav Verma: The customer should be classified as OEM. Thank you. That's helpful. And then would you be would you be willing to characterize sort of The number of people you're dealing with, it's sort of more than one and less than ten or would you care to characterize how many potential unique entities you guys are working with? Yeah, less than 10. Yeah, definitely more than one. Okay, okay. That's helpful.

Casey: The classified as Oems.

Casey: And this space dealing with directly Oems that they don't build inventory theyre going to roll it out assuming all Dupont in like real time, yeah, Yeah, that's right I say okay.

Speaker Change: That's helpful. And then would you be would you be willing to characterize sort of.

Speaker Change: The number of people who are dealing with it it's sort of more than one and less can pan or would you care to characterize how many potential unique entities you guys are working well.

Speaker Change: Yes, less than 10, yeah definitely more than one person times.

Speaker Change: Okay. Okay.

Speaker Change:

Speaker Change: That's helpful.

Sumit Sharma: Okay, so, um... A couple other items very quickly, you mentioned military and I think you have some partners for military and you mentioned drones. What scope of the military opportunities as you see them? Is it sort of all vehicles across all branches? Is it potentially specific to like one branch or? Now, we're, you know, think about our product base. Our product is basically a sensor and software. We also have things that we've done in the past, which allow us to sensor fusion with other technologies. But we can provide that. We are not a prime in the military space.

Speaker Change: Okay. So.

Speaker Change: A couple of other items very quickly you mentioned military and I think you have some partners for military.

Speaker Change: And you mentioned drones.

Whats scope of the military opportunities as you see them as it sort of all vehicles across all branches.

Speaker Change: Specific to like one branch or.

Speaker Change: Yes.

Speaker Change: Think about our product base, our product is basically a sensor and software. We also have things that we've done in the past, which allow us to sensor fusion with other.

Speaker Change: Technology.

Speaker Change: But we can provide that we are not a prime in the military space. We're also not bidding for in our planning.

Sumit Sharma: We're also not bidding for, you know, planning to, you know, bid on a billion dollar contract. So we're going to be a technology partner for somebody else that's a prime to deliver something that needs to be solved. This really came back on our. horizon last year, that there was an opportunity where existing things that we have on the shelf. There may be interest for people to evaluate, and we could get to from a standstill to a working demo for them very quickly. So we expanded on the existing set of products to engage as many folks as we can.

Speaker Change: Bid on a $1 billion contracts, so we're going to be a technology.

Partner for somebody else, that's a prime to.

Speaker Change: Could deliver.

Speaker Change: Something that needs to be solved.

Speaker Change: This really came back on our.

Speaker Change: Horizon last year that there was an opportunity where.

Existing things that we have on the shelf.

Speaker Change: There may be interest for people to evaluate.

Speaker Change: We could get to from a standstill to a working Denver for them very quickly.

Speaker Change: So we expanded the existing set of products to engage as many folks as we can.

Sumit Sharma: I think the new part that you would see in the earnings call today talks about drones. I think as we started looking into it, where the Department of Defense is focused on, and of course, the help of our advisory board that just has come online. We're just starting the engagement, and most of them are not even fully familiar with our product portfolio yet. But they're getting us aligned with what the demand is. And one of the things that we will talk about next week and continue to talk about is things that we were doing in the automotive space with perception and sensor fusion can also be expanded to drones with some other mission that are in mind that the – that our potential customer, which is Department of Defense, and other smaller departments are evaluating, and they have engagements for that.

Speaker Change: The new part that you would see in the earnings call today. It talks about growth I think as we started looking into it where the department of defense is focus on now of course with the help of our.

Speaker Change: Advisory Board that just has come on board.

Speaker Change: Just kind of online, but we're just starting to engagement.

Speaker Change: Most of them are not even fully familiar with our product portfolio yet.

Speaker Change: They're getting us aligned with what the demand is and one of the things that we will talk about next week and continue to talk about is.

Speaker Change: Things that we were doing in the.

Speaker Change: Automotive space with perception.

Speaker Change: The sensor fusion can also be extended to drones with some other mission that are in mind.

Speaker Change: Is that the that our potential customer service department of defense and other.

Speaker Change: Smaller departments are evaluating and they have.

Sumit Sharma: So it was – it was something that was natural to us that we could become part of that. And in this environment, you know, where automotive is kind of like dormant or nearly dormant, but expected to come on in the future, industrial is moving along. But again, you know, it's at a pace that, you know, folks would like to want to go fast, but, you know, we have to wait patiently for, you know, the engagements to – get to the right level. This was an opportunity that came along, so it was important for us to get in.

Speaker Change: Engagements for that so it was.

Speaker Change: It was something that was natural to us that we could become part of that and in this environment, where automotive is kind of like dormant or nearly dormant but expect it to come on the future industrial is moving along but again you know it's it's at a pace that we'd like to want to go fast, but we have to wait patiently for the engagement too.

Speaker Change: Get to the right level. This was an opportunity that came along so.

Speaker Change: It was important for us to get into it.

Sumit Sharma: And . .

Speaker Change: And.

Speaker Change: Yes.

Sumit Sharma: How many primes should we think about you working with? Is there one significant prime or do you have one now and you guys are open to working with multiple or are there multiple now that you guys are engaged with? From the amount of work that we've done on this so far, there are multiple primes. We could think about primes differently. I think in the past when we talked about primes, we were talking about Lockheed or Northrop Grumman. Those are different programs. Now the primes are a lot of newer technology companies that are names that are new to the military space as a prime.

Speaker Change: How many prime should we think about you're working with or is there one significant prime or do you or do you have one now and you guys are open to working with multiple or are there multiple that you guys are engaged.

For the amount of work that we've done so far there are multiple primes, we could think about prime differentiator I think in the past when we talk about prime should we're talking about Lockheed or Northrop Grumman.

Speaker Change: Those are different programs now the plans are.

Speaker Change: Lot of newer technology companies that are named.

Speaker Change: Names that.

Speaker Change: Our new to the military space as a prime.

Sumit Sharma: They have a different DNA, so much faster engagement and getting through, I would say, more in line with tech companies, other tech companies, but they address revenues, you know, less than 10 billion, less than a billion sometimes, right. So, and there's multiple of them, actually, not just one. Okay, all right. That's helpful.

Speaker Change: <unk>.

Speaker Change: They have a different.

Speaker Change: Different DNA, so much faster engagement and getting through I.

Speaker Change: I would say more more.

Speaker Change: And a lot of tech companies other tech companies, but they are.

Speaker Change: They address.

Speaker Change: Revenues.

Speaker Change: Less than 10 billion less than $1 billion, sometimes right. So and there is multiple of them actually not just one.

Speaker Change: Okay.

Anubhav Verma: And then sort of last thing for me. I think you mentioned that you guys have have expanded your capacity again. And I think over the last 12 months, maybe the second time you've done that. And so you know, I suppose we're looking sort of compared to the revenue, but tell me why you're doing that. It sounds like your customers are asking you to We haven't expanded the capacity. What I think we're saying is that we expect to expand capacity later on this year based on agreements that we are able to get done. I think what capacity we have with ZF right now is perfectly adequate and sufficient, but we expect that if some agreements go a certain way, we are going to expand our capacity.

Speaker Change: Alright, that's helpful. And then sort of lesson for me I think you mentioned that you guys have expanded your capacity again and I think over the last 12 months made the second time, you've done that and so.

Speaker Change: You know.

I suppose we're looking sort of compared to the revenue, but tell me why youre doing that it sounds like your customers are asking you to.

Speaker Change: Ramp up no we haven't we haven't expanded the capacity.

Think of what I'm, saying is that we expect to expand capacity later on this year based on agreements that we are able to get done and I think what capacity we have it set up right now as per perfectly adequate and sufficient but we expect that.

Speaker Change: If some agreements go a certain way we are going to expand our capacity.

Anubhav Verma: Okay, that's helpful. I suppose one nuance on that is, sort of, you talked about the 30 to 50. If you do need to expand capacity, would it be fair to think that that somehow we're sort of at 50 or above that sort of part of that? opportunity. Yeah, so I do think that yes, if we end up expanding our capacity, we would hit the upper bound of that range, possibly beyond that. Good, good. That's something to look for then.

Speaker Change: Okay. That's.

Speaker Change: That's helpful.

Speaker Change: I suppose one nuance on that is sort of you you talked about the 30 to 50.

Speaker Change: If you do need to expand capacity would it be fair to think that that somehow we're sort of at 50 or above and that's sort of.

Speaker Change: Part of that.

Speaker Change: Opportunity.

Speaker Change: Okay.

Speaker Change: Yes.

Speaker Change: Yeah, So I do think that yes.

Speaker Change: We end up expanding our capacity, we would hit the upper bound of that range, possibly beyond that.

Speaker Change: Good good that's something to look for them well.

Casey Ryan: Well, it's been an exciting update, so thank you for taking all my questions. I appreciate it. Thank you, Casey.

Speaker Change: It's been an exciting update so thank you for taking all my questions I appreciate it.

Speaker Change: Thank you Casey.

Speaker Change: Yeah.

Jesse Sobelson: Your next question is from Jesse Sobelson with the Boral. Hey guys, thanks for the update here. Thanks for taking my questions. You know, it's good to see some progress on expanding the addressable markets. The first question I had was just on this defense piece of the business. Are you guys looking at strategic alliances that could potentially lead to equity investment?

Speaker Change: Your next question is from Jesse Olson with T Bill Roth capital.

Jesse Olson: Hey, guys, it's actually up to hear thanks for taking my questions.

Speaker Change: Good to see some progress on expanding the addressable markets. The first question I had was just on this.

Speaker Change: Defense piece of the business are you guys looking at strategic alliances that could potentially to equity investments or are you currently solely focused on commercial regiments.

Anubhav Verma: Or are you currently solely focused on commercial We're primarily focused on commercial aggregated strike. Yeah, helpful to understand a little bit of detail there. I'm also just kind of curious, you know, we talked 30 to 50 in potential next 12 to 18 months, that's been reiterated here in the Q&A so far, but I am kind of curious, DOD seems to be a little bit more of a focus this quarter than it was in the past when that 30 to 50 number was initially presented. Piggybacking off of that conversation on capacity, is defense work included in this potential 30 to $50 million loose figure, or is it something that's incremental to current expectations for the business?

Speaker Change: We're primarily focused on commercial payer interest right now.

Speaker Change: Okay helpful to understand a little bit of detail. There I'm also just kind of curious we talked 30 to 50 and potential next 12 to 18 months definitely reiterated here in the Q&A, so far but I am kind of curious.

Speaker Change: <unk> seems to be a little bit more of a focus this quarter than it was in the past when that 30 to 50 number was initially presented.

Speaker Change: Are you backing off of that conversation on capacity is defense work included in this potential $30 million to $50 million loose figure or is it something thats.

Speaker Change: In commercial the current expectations for the business.

Anubhav Verma: Yeah, I think that's a great question, Jesse. No, look, I think the $30 to $50 million, we believe, is primarily driven from the industrial vertical. For the defense vertical, it's still early days.

Jesse Olson: I think thats a great question Jesse.

Jesse Olson: Look I think the 30% to $50 million. We believe is primarily driven from the industrial vertical.

The defense vertical it's still early days.

Anubhav Verma: But I think, as Sumit pointed out, we're working to formulate our strategy and have more clarity in the upcoming events where we could provide and upgrade our revenue targets based on quantifying what kind of projects we're going to take part in through these partnerships like Sumit described. And I think one thing I would like to also highlight is, obviously, MicroVision does have an existing intellectual property portfolio related to the ARPs that we have. And obviously, we're at this point looking at all possible options as to how we can partner with other bigger players to accelerate their deployment and go to market as well.

Jesse Olson: But I think as Amit pointed out we're working to.

Jesse Olson: Formulate our strategy and have more clarity in the upcoming events that we would provide.

Jesse Olson: And upgrade our revenue targets based on quantifying what kind of projects, we're going to take part and through these partnerships like some are described.

Jesse Olson: And I think one thing I would like to also highlight that.

Jesse Olson: Obviously microvision does have an existing.

Jesse Olson: Intellectual property portfolio related to the ERP.

Jesse Olson: That would be half and obviously, we're at this point looking at all possible options as to how we can.

Jesse Olson: Partner bid.

Jesse Olson: Other bigger players to accelerate their deployment on go to market as well so that could result in monetization of that two different structures.

Anubhav Verma: So that could result in monetization of that to different structures.

Anubhav Verma: But like I said, at this point, early days, and we would have more clarity on the revenue targets for this in the upcoming years. Right, so it sounds like you're open to things such as co-development agreements and potential technology licensing, in addition to, you know, manufacturing products to be used in and market equipment. Is that fair to say? Right. So I think mostly the way the defense contracts will be expected to work through the partnership structure that I described would be typically in the form of ED&T revenue, which is Engineering Design and Testing Revenue, which is essentially the work, or if I could draw an analogy for you, that's an NRE equivalent to what we have been talking in the automotive world, where the government entities, if we are directly engaged with the government or the prime, as Sumit described, they would pay for the project where we are developing this.

Jesse Olson: But like I said at this point early days and we would have more clarity on the revenue targets for this in the upcoming events.

Speaker Change: Alright, so it sounds like you're open to things such as co development agreements and potential technology licensing. In addition to manufacturing products to be used in end market equipment is that fair to say.

Jesse Olson: Right, So I think mostly the.

Jesse Olson: The way the defense contracts will be expected to work through the partnership.

Jesse Olson: A structure that I described would be typically in the form of <unk>.

Jesse Olson: <unk> revenue.

Jesse Olson: <unk>, which is the engineering design and testing revenue.

Jesse Olson: Which is essentially the work or if I could draw an analogy for you that's INR equivalent.

Jesse Olson: What we have been talking about being in the automotive world where the.

Jesse Olson: The government entity that we are directly engaged with the government or the prime estimate described.

Jesse Olson: They would pay for the.

Jesse Olson: The projects, where we are developing that keep in mind, we already have the building blocks of the technology.

Anubhav Verma: Keep in mind, we already have the building blocks of the technology, so it's really just putting together the solution, like the drone solution that Sumit mentioned, et cetera.

Jesse Olson: So its really just putting together the solution like the drilling solution that sumit mentioned et cetera, but what it essentially translates into is.

Jesse Sobelson: But what it essentially translates into is the ED&T revenue that would start flowing through the system, and that's what I plan to update the numbers with once we have more clarity and more visibility into this sector. Right. Well, I appreciate the call here. And it sounds like it's a little bit of a wait and see approach for the time being. But, you know, excited to see what happens here. So thanks for taking my question. Thank you, Jesse.

Jesse Olson: The <unk> revenue that would start flowing through the system and that's what I plan to update.

Jesse Olson: The numbers with once we have.

Jesse Olson: More clarity and more visibility into this sector.

Jesse Olson: Great well I appreciate the color here and it sounds like it's a little bit of a wait and see approach for the time being but.

Jesse Olson: Excited to see what happens there so thanks for taking my questions.

Jesse Olson: Thank you Jesse.

Anubhav Verma: I will now turn this call back over to Anubhav Verma to read questions submitted through the webcast. Thank you, operator.

Jesse Olson: I will now turn this call back over to an above fair amount to read questions submitted through the webcast. Thank you.

Speaker Change: Thank you operator.

Anubhav Verma: All right, the first question, if we have the best-in-class sensor with the lowest price point, why are we not winning these industrial RFQs? That's a good question. Actually, actually, I think this is a reaction to some of the announcements that are coming from our other customer, our competitors. I can tell you that, you know, we are engaged with multiple customers that are evaluating. One of the challenges that always happens in here is now that you have software, now that you have hardware, you know, I think that our investors, but also a lot of people just think about it as a LIDAR company.

Speaker Change: Alright, the first question.

Speaker Change: If we have the best in class sensor with the lowest price point.

Speaker Change: Why are we not winning these industrial RF skus.

Speaker Change: That's a good question.

Speaker Change: Actually actually I think this is a reaction to some of the announcements that are coming from our other customer or competitors.

Speaker Change: I can tell you that we are engaged with multiple customers that are evaluating.

Speaker Change: One of the challenges that always happens in here is now that your software and now they have hardware.

Speaker Change: I think our investors, but also a lot of people just think about a lidar company.

Anubhav Verma: You know, when you think about automotive, you just output a LIDAR with a point cloud. So in that sense, it's a LIDAR company. And there's a bunch of us competing in that space. In the industrial space, it is LIDAR plus the perception software on board. So there's integration, there's validation, there's, I would say, 90% of all the discussions that we've been part of for the last. eight months with a group of customers. It's all about what the software does and how the software will connect to their software and how the qualification is going to happen.

Speaker Change: When you think about automotive you just offered a lighter over the point clause in that sense, It's a lidar company and there's a bunch of us competing in that space.

Speaker Change: In the industrial space. It is lidar plus perception software onboard so there's integration theres validation, there's I would say 90% of all the discussions that we've been part of for the last <unk>.

Speaker Change: Eight months with a group of customers, it's all about what the Salford us and how the software we're connected their software and how the qualification is going to have some actually more than eight months.

Anubhav Verma: Actually, more than that, it's So if you think about the evaluation part of it, it's not the hardware anymore. It is really how the software solves a specific problem for that. I get it, you know, I think investors are frustrated, but I can assure you nobody's more frustrated than I am about this. But, you know, it takes whatever time it takes, but I don't think it's going to take forever. I think things will converge, you know, sometime soon. So you have to think about it, right? Yeah, you can have the best price point, but you also have to find an opportunity that you can actually find a business that's profitable.

Speaker Change: So if you think about the valuation part of it it's not the hardware anymore. It is really how the software solves a specific problem for them.

Speaker Change: I get it I think investors are frustrated, but I can assure you nobody is more frustrated than I am about this but it takes whatever time it takes but I don't think its going to take forever I think things will converge.

Sometimes soon.

Speaker Change: So you have to think about it right that you can have the best price.

Speaker Change: Price point, but you also have to find an opportunity that you can actually sign a business thats profitable and I'll give you a great example, recently.

Anubhav Verma: And I'll give you a great example. Recently, you know, of more than one, less than 10 customers, there was one that we actually lost. But it was a small project. It was, you know, less than, I would say, 500 sensors is what they wanted. But what it required, what was the requirement for us to win that was to absorb something like almost a million dollars worth of development. And so pretty much at that point, yeah, you can say you can get an announcement done, but it is not a sustainable model where you're actually burning through cash to win these things to just get the share price up.

More than one less than 10 customers that was one that we actually lost.

Speaker Change: But it was a small project it was less than I would say 500 sensors is what they wanted.

Speaker Change: But what is required.

Speaker Change: What was a requirement for us to win that was to absorb something like almost $1 million worth of development.

Speaker Change: So pretty much at that point, yes, you can say you can get announcement done, but it is not a sustainable model, where you're actually burning through cash to win these things just get the share price up so long term it was not the smartest thing to take care of it.

Anubhav Verma: So long term, it was not the smartest thing to take care of. But we're getting closer to the point for the right customer, for the right volume, you know, it is time for us to push our chips in and actually take a risk for the right customer, for the right volume, and we're getting closer to that. And again, you want not just one customer, you want multiple of them. So you have to reserve your capital based on who's the one that you want to make a bet behind. That's going to be advantageous long term. And that could actually turn into a sustainable business, because there'll be others that will come on faster.

Speaker Change: But we're getting closer to the point for the right customer for the right volume.

Speaker Change: It is time for us to push our chips and actually take a risk for the right customer with the right volume and we're getting closer to that and again you want not just one customer you want multiple of them. So you have to reserve your capital based on who is the one that you want to make a bet behind that's going to be.

Speaker Change: Advantageous long term and that could actually turn into a sustainable business.

Speaker Change: Because there will be others that will come on faster. So that's why we focus ourselves I get this thing the best in class sensor, but what's best in class for multi al it's in production.

Sumit Sharma: So that's how we focus ourselves. I get this thing, the best-in-class sensor. Well, what's best-in-class for Movia L? It's in production. It's very robust, solid state.

Speaker Change: Robust solid state.

Sumit Sharma: Movia S, it's a, you know, I think we're going to talk about that in Q3 this year when we're going to announce it publicly. But it's a 180-degree sensor, whereas you have, you know, our competition from China and the U.S. talking about they're making a 180-degree sensor. But if you know anything about physics, you'll know that their sensor, there's no way it can achieve 180 degrees, because it's not, you know, they're just showing some rendering, where we actually have, you know, samples that we will show next week, mechanical samples of what we expect out of that.

Speaker Change: S H.

Speaker Change: I think we're going to talk about that in Q3. This year when we're going to announce it publicly but it's a 180 degree sensor, whereas you have you know our competition from China and the U S talking about Theyre, making 182 sensor, but if you know anything about physics, youll know that their sensor theres no vacancy of 180 degrees because not just showing some rendering where we actually have.

Speaker Change: <unk> that we will show next week mechanical samples, but what we expect out of that so yeah, having a great sensor is the building block that is important now come to software for industrial that how can we actually enable them where they let's say.

Sumit Sharma: So, yeah, having a great sensor is the building block that is important. Now comes the software for industrial, that how can we actually enable them with a, let's say, some of the ADAS features that were developed by our team in Hamburg a long time ago and deploy that into industrial. So, it's going to take a. Some time, but I don't think it's going to take a very long time to get to some conclusion here.

Speaker Change: Some of the Adas features that were developed by our team in Hamburg long time ago, and deploy that into industrial so.

Speaker Change: It's going to take a.

Speaker Change: Some time, but I don't think it's going to take a very long time to get to a conclusion here.

Anubhav Verma: Thank you, Sumit. Of the prospective industrial customers that engage with MicroVision, how many are no longer involved? Have you lost some programs in your pipeline? Why?

Speaker Change: Thank you so much.

Speaker Change: After prospective industrial customers that engage with Microvision. How many are no longer involved have you lost some programs in your pipeline why I guess you.

Anubhav Verma: I guess you partly answered that, so maybe let me skip to the next one. How do you plan to compete with the existing players like Ouster and SICK in the industrial vertical? That's a good question. The two ways that we're going to compete is number one, we're going to sell our sensor with software on board. And since we have spent a lot of capital already developing this. And, you know, the same software is going to go across to multiple customers. As a standard, we're going to offer these features. on there. So no more customers have to worry about custom NREs for some features because the core development is all actually MicroVision's assets.

Speaker Change: Partly answered that so maybe let me skip to the next one.

Speaker Change: How do you plan to compete with the existing players like Alastair and sick.

Speaker Change: The industrial vertical.

Speaker Change: That's a good question.

Speaker Change: Two ways that we're going to compete is number one we're going to sell our sensor with sulfur onboard.

Speaker Change: And since we have spent a lot of capital already developing this.

Speaker Change: And the same software is going to go across multiple customers as a standard.

Speaker Change: We're going to offer these features.

Speaker Change: So no more.

Speaker Change: Customers have to worry about general customer in our east for some features because the core development is all actually my provisions assets. So that's important because what they're getting is not just a sensor that would require a software from us or from them to integrate but they've got a full blown solution. So we have to start engaging with industrial customers that are kind of focused on that.

Anubhav Verma: So that's important because what they're getting is not just a sensor that would require a software team from us or from them to integrate, but they get a full-blown solution. So we have to start engaging with industrial customers that are kind of focused on that, you know, not just a LiDAR, but they want a solution. The other one is economy of scale. We have to start hitting price points that are significantly lower than any other competition, and that means we have to aggregate a lot of volume. We have to be competitive there. I think, you know, I think, you know, other lighter companies are public as well.

Speaker Change: Lidar, but they want a solution.

Speaker Change: The other one is economy of scale.

Speaker Change: To start hitting price points that are significantly lower than any of the competition and that means you have to aggregate a lot of volume.

Speaker Change: Have to be competitive there I think.

Speaker Change: I think other Lidar company public as well as you know their ASP.

Anubhav Verma: You know, they're ASP, and the clear indication from everybody is that those ASPs are not sustainable. I think in the safety sensor space, SIC has got a very unique position. You know, they have deployed that for many, many years, and ultimately, you know, when we described our safety sensor last year, eventually, our intention is to, you know, go after that market as well, but at the moment, we want to just focus on the non-safety industrial market with the software. I'm pretty sure that we can take on Alistair and, you know, I don't think there's any doubt that, you know, we have a better product.

Speaker Change: The clear indication from everybody is that those ASP is not sustainable.

Speaker Change: And the safety sensor space <unk> got a very unique position.

Speaker Change: They have deployed that for many many years and ultimately when we can.

Speaker Change: Described our sage central last year eventually our intention is to go after that market as well, but at the moment you want to just focus on the non safety industrial market with the software.

Speaker Change: I am pretty sure that we can take our.

Speaker Change: Take on Oster and.

Speaker Change: I don't think Theres any doubt that we have a better product I think the spinners argue with spinners. They may have some sort of reliability, but ultimately their mechanical sensors, right and sick of the mechanical sensor but in.

Anubhav Verma: I think the spinners, our spinners, they may have some sort of reliability, but ultimately they're mechanical sensors, right? And SICK is a mechanical sensor. But in, you know, in limited life applications, perhaps they're okay. But if you want something robust that has to go for a long period of time, I think the solid-state sensor would be very competitive. And even Maven, you know, as we start transitioning it towards, you know, while automotive is doing its own thing, finding applications for it in commercial vehicle or military or, you know, agriculture, mining. I think the robustness of the technology, we just have to make competitive, sign smart deals.

Speaker Change: Limited life applications, perhaps there okay.

Speaker Change: But if you want something robust that has to go for a long period of time.

Speaker Change: I think the solid state sensor would be very competitive and even maybe in as we start transitioning it to worst while automotive is doing its own thing finding applications for it in commercial vehicle, our military or agriculture mining.

Speaker Change: Think of the robustness of the technology, we just have to make competitive science smart deals. So we're not starting off in the hole by financing somebody else's development I think long term, we're gonna be OK and be very competitive and probably more profitable because our expenses are going below and our profit margins for projects that can be much more compelling in my opinion.

Anubhav Verma: So we're not, you know, starting off in the hole by financing somebody else's development. I think long-term we're going to be okay and be very competitive and probably more profitable because our expenses are going to be low and the profit margins per project are going to be much more compelling, in my opinion.

Glen DeVos: Glen, would you like to add some color on this? I think you've been on board and you've had a chance to look at this as well. Yeah, thanks, Sumit. I appreciate the opportunity. And I think to build on your comments, one, the sensor being a solid-state sensor, not only does it have greater reliability in other sensing modalities, we got away from electromechanical sensors for just that reason, as well as as you scale, having a solid-state solution gives you better positioning relative to reducing hardware costs while you scale. It's basically a silicon solution, and it really allows you to achieve lower hardware costs than simply scaling up electromechanical solutions.

Glen: Glen would you like to add some color on this I think you've been on board and you've had a chance to look at this as well.

Glen: Yes, Thanks, Amit I appreciate the opportunity and I think to build on your comments.

Glen: One the sensor being a solid state sensors, not only does it have grid reliability and other sensory modalities, we got away from electromechanical sensors for just that reason as well as as you scale, having a solid state solution gives you better positioning relative to <unk>.

Glen: Reducing hardware costs, while you scale.

Glen: So basically it's a <unk> solution and it really allows you to achieve lower hardware costs.

Glen: We are scaling up of electro mechanical solutions. So I think that's an important part of it.

Glen DeVos: So I think that's an important part of it. But as you said, it's not just a LiDAR sensor that delivers a point cloud. It has a significant amount of processing capability on board. And why that's important, it means that we can provide not just the point cloud, but we can provide perception, localization, as well as the, you know, the LCAST or the driver assistance feature. and do that in a way that's essentially a bolt-on solution to the vehicle. So whether it's a forklift or a tugger or some other type of vehicle, you don't have to cut into the vehicle or disturb the vehicle architecture.

Glen: But as you said it is not just a wider sensor that delivers a point cloud.

Glen: It has a significant amount of processing capability on board.

Glen: And why that's important it means that we can provide now.

Glen: Just the point in time, but we can provide perception localization as well as the.

Speaker Change: Okay. So the driver assistance features.

Speaker Change: And and do that in a way that's essentially a bolt on solutions to the vehicle so whether it's through FERC lift or a tiger or some other type of vehicle you don't have to cut into the vehicle or disturbed. The vehicle architecture, you can simply both the solution on and that's tremendously from an ease of implementation stand.

Glen DeVos: You can simply bolt this solution on, and that's tremendous, you know, from an ease of implementation standpoint, that's very good. You don't have to add another ECU, so from a system cost standpoint, it's very good. And then, ultimately, from a TAM perspective, it's great because it means it opens up existing vehicles to your solution, where you can essentially retrofit, all of which means time to revenue is reduced. So, I think the solution that we have with a smart sensor going industrial will be very competitive and very compelling for the OEM.

Speaker Change: That's very good you don't have to.

Speaker Change: Another issue for us from us for system cost standpoint.

Speaker Change: Very good and then ultimately from a Tam perspective.

Speaker Change: Great because it means it opens up existing existing vehicles to your solution, where you can essentially retrofit.

Speaker Change: All of which means time to revenue is reduced so.

Speaker Change: Or are the solution that we have with a smart sensor.

Speaker Change: Sure well can be very competitive and very compelling for the Oems.

Speaker Change: Okay.

Anubhav Verma: Anubhav, I'll turn it back over to you. Thanks, Glen.

Bob: Bob I'll turn it back over to you.

Speaker Change: Thanks Glenn.

Anubhav Verma: Let me take the next question. What are the 2025 milestones that shareholders should track in each market, including industrial, defense, and automotive design wins, custom development agreements, partnership agreements, ideas? Yeah, I think, I think in the industrial space, I think it's all about taking our sensors that we've talked about and signing commercial deals. You know, certainly we make as many sales as possible of the, you know, less than, you know, less than 50, you know, let's call them spot sales. I think that's how we refer to them always. But our focus, of course, is to finding a group of anchor customers that essentially take up all the capacity that we have deployed already.

Speaker Change: Let me take the next question what are the 2025 milestones that shareholders should track in each market, including industrial defense and automotive.

Speaker Change: Design wins custom development agreements partnership agreements ideas.

Yeah.

Speaker Change: I think.

Speaker Change: I think in industrial space I think it's all about taking our <unk>.

Speaker Change: Sensors that we've talked about and signing commercial deals.

Speaker Change: Certainly you would make as many sales as possible of the you know less than.

Speaker Change: Net 50, let's call them spot sales I think thats, how we refer to them all of us.

Speaker Change: But our focus of course is defining a group of.

Speaker Change: Anchor customers that essentially you pick up all the capacity that we have deployed already.

Anubhav Verma: That's primarily the way you can gauge that, you know, industrial market is moving along. So you should be able to announce deals and you'll start seeing backlogs in revenues and normal business on Mobya L. Mobya S, I think we're going to announce it publicly and there's, you know, again, engagement will start. Pilot line will be sometime next year and then some sort of ramp, but we expect to start engaging some customers with that technology, but it's not something that's going to have a material impact on the revenues that I'm about to talk about. On the defense side, I think the best way to imagine is, you know, again, we're going to be a subcontractor to a prime.

Speaker Change: That's primarily the way you can gauge that in the industrial market is moving along so you should be able to announce deals and you'll start seeing backlog and revenues than normal business on mobile.

Speaker Change: Al.

Speaker Change: Yes, I think we're gonna announced that publicly and there's you know again engaging with shark.

Speaker Change: Pilot line will be sometime next year, and then some sort of ramp, but we expect to start engaging some customers.

Speaker Change: Would that technology, but it's not something that's going to have a material impact.

Speaker Change: The revenues that I talked about.

Speaker Change: On the defense side.

Speaker Change: Thank you.

Speaker Change: The best way to imagine as you know again, we're gonna be a subcontractor to a prime.

Anubhav Verma: There will be most likely, as Anubhav has already mentioned, we would engage in some sort of customized development with some partial funding from them while we still maintain all the IP or exploration of our existing portfolio of technologies that we have shipped in the past and some sort of, you know, development agreements of what they want to see, because anybody that wants to work deeply with a technology that's new to them, they always do a small project together to understand the team, understand the technology and the viability before they jump to the next one. So defense would be that.

Speaker Change: There will be most likely as I know it was already mentioned we were engaged in some sort of customized development with some partial funding from them, while we still maintain all the IP or exploration of our existing portfolio of technologies that we have shipped in the past and.

Speaker Change: Some sort of development agreements.

Speaker Change: What they want to see it because anybody that wants to work deeply with the technology, that's new to them they always to a small project together.

Speaker Change: Understand the team understand the technology and the liability before they jump to the next one so defense will be that and longer term I think the opportunity defenses, where there are smaller contracts I'm, saying sub.

Anubhav Verma: And smaller contracts, I'm saying sub 500, maybe sub 200 million dollar contracts, where, you know, maybe a pilot program of maybe several hundred units or something has to be built or several hundred units have to be built. And you're part of those contracts where you have to deliver an integrated piece of hardware and software that kind of plugs into some device. So that's much more intimate. So the best way to engage in defense would be that.

Speaker Change: 500, maybe it's up $200 million contracts.

Speaker Change: Were made.

Speaker Change: Maybe a pilot program with maybe several hundred units or something has to be built ourselves. Several several hundred units have to be built.

Speaker Change: And you're a part of those contracts, where you have to deliver integrated piece of hardware and software that kind of plugs into some device. So that's much more intimate so the best way to engage in defense would be that.

Anubhav Verma: And automotive, I think, I'm going to have Glen actually comment on this, but in automotive the best way to think about it is some sort of development agreement or early advanced prototyping for a future program that's coming, or a, you know, RFQ that, again, will roll on for about a year before they'll award it. So, that's about all we can do, but I don't expect, you know, meaningful revenues coming from it, but certainly some sort of partnership announcements for much smaller size opportunities. Yeah, I can add to that last comment, Sumit. The OEMs, and talking to them as recently as last week, and the OEMs are going through a bit of a reformulation on level three.

Speaker Change: In automotive I think.

Glenn: I'm Gonna have Glenn actually comment on this.

Speaker Change: But.

Speaker Change: Not about the best way to think about it is some sort of development agreement or early advanced prototyping.

Speaker Change: For the future program that's coming.

Speaker Change: Or.

Speaker Change: Our SKU that again will roll on for about a year before them awarded so that's about all we can do it but I don't expect meaningful.

Speaker Change: Our revenues coming from it but certainly some sort of partnership announcements for much smaller size.

Speaker Change: Opportunities.

Speaker Change: Yeah, I can add to that I can add to that.

Speaker Change: Comments on the thank you.

Speaker Change: The Oems and talking to them as recently.

Last week, the Oems are going through a bit of a reformulation.

Speaker Change: Level three and the good news is all level through platforms still need liner. So there's no. There's no change in approach in that regard.

Glen DeVos: And the good news is all level three platforms still need LIDAR. So there's no change in approach in that regard. But really, the first generation had limited success, very low volumes and take rates. And so now there's a bit of a kind of a refocusing on, well, what is that right solution? And I think Pre-development contracts are normally how, you know, the next step in that environment where, you know, they test out and showcase what the solution could look like and validate cost models as well as performance models and really trying to get to a value prop that the end consumer wants.

We're really the first generation had limited success.

Speaker Change: Very low volumes and take rates and so now there's a bit of a kind of a refocusing on what is that right solution and I think.

Speaker Change: Pre development contracts are normally how.

Speaker Change: Your next step in that environment, we're in.

Speaker Change: It turns out and show showcasing what's the solution can look like and validate cost models as well as performance models and really trying to get to a value profit and consumer Woodbine and what's exciting for us is and in those discussions and like I mentioned as recently as last week.

Glen DeVos: And what's exciting for us is in those discussions, and like I mentioned as recently as last week, we have the portfolio that between long range as well as short range. you know, a wide field of view.

Speaker Change: We have the portfolio that.

Speaker Change: And long range is where were short range.

Speaker Change: Wide field of view.

Operator: www.microsoft.com. Thank you. That's exactly where we... Thank you, Glen.

Speaker Change: Extended range field of view, we have the portfolio that can really I think deliver a solution for them. So.

Speaker Change: You've probably seen a pre development contract prior to a big production contracts, but that's exactly where we are today.

Speaker Change: Yeah.

Glenn: Thank you Glenn.

Glen DeVos: All right, next question. Given that MicroVision is engaged in seven automotive RFQs and the typical timeline suggests OEMs might be making decisions for model year 2028 programs around this time, can you provide any update on the status of these engagements and whether there has been any significant progress or indications of timelines accelerating or solidifying during the first quarter this year? Glen, do you want to take that since you have the most contact with the audience now? Yeah, I think timing, timing wise, that's certainly the the target is to be able to have, you know, solutions implemented in the model year or during calendar year 28.

Glenn: Alright next question.

Glenn: Given that Microvision are engaged in seven automotive RF skus and the typical timeline suggests Oems might be making decisions for model year 2028 programs around this time.

Glenn: Can you provide any update on the status of these engagements and whether there has been any significant progress or indications of timelines accelerating or solidify and during the first quarter. This year.

Glenn: Glenn do you want to take that since you have the most contact with the OEM.

Glenn: Yeah.

Speaker Change: Timing wise certainly the target is to be able to have.

Solutions implemented in a model year during calendar 'twenty eight.

Glen DeVos: You know, that that generally speaking is the timing that we've been talking about. And so You know, what that means is, if you think about it, it's already virtually mid-year 25. That means you have to have solutions that are fairly mature and ready to go. And as I mentioned earlier, that's what, you know, that's what's exciting about where we are in terms of the portfolio offering that we have, the software maturity that we have, and the different solutions that we can provide. And I would say, you know, those are active discussions right now. Once the OEMs kind of settle in on the technical solution, then it can move very quickly.

Speaker Change: You know that.

Speaker Change: Generally speaking is the timing that we've been talking about.

Speaker Change: No.

Speaker Change: What that means is if you think about it it's already virtually mid year 'twenty five.

Means you have to have solutions that are.

Speaker Change: Fairly mature and ready to go and as I mentioned earlier, that's why that's what's exciting about.

Speaker Change: Where we are in terms of the portfolio offering that we have the software maturity that we have.

Speaker Change: And the different solutions that we can provide.

Speaker Change: And I would say those are active discussions right now.

Speaker Change: Once the Oems kind of settle in on a tactical solution. Then it can move very quickly 20 model year 'twenty eight.

Glen DeVos: Model year 28, it would, you know, it's still aggressive, but it's still feasible if the OEMs move quickly over the next, really over the next, I would say, three months or so.

Speaker Change: So aggressive.

Speaker Change: But it's so it's still feasible if the Oems.

Speaker Change: Move quickly over the next really over the next I would say three months or so.

Anubhav Verma: Thank you, Glen. All right, next question is defense-related. Why will MicroVision successfully secure business in the defense industry after years of unsuccess in the automotive and industrial market?

Glenn: Thank you Glenn.

Glenn: Alright next question is defense related by.

Speaker Change: Viva microbe against successfully secure business in the defense industry after years of success in the automotive and industrial market.

Anubhav Verma: Yeah, well, maybe I can start. Go ahead. Yeah, maybe, maybe I'll just start and then turn it back over to you. A couple things to highlight. One, these are very different markets. And if you think about automotive, there's really one application for LiDAR at this point in time. It's really level three, you know, driver assistance, and maybe some level two functions, but it's really, really around ADAT. When you look at the defense industry, there's multiple avenues for the application of the technology. There's drones, there's the unmanned autonomous vehicles, there's also AR headsets, there's terrain mapping.

Speaker Change: Yes.

Speaker Change: Right.

Speaker Change: Yeah go ahead go ahead go ahead.

Speaker Change: And maybe I'll, maybe I'll just start and then turn it back over to you.

Speaker Change: A couple of things to highlight one of these are very different markets and if you think about automotive there's really one application for minor at this point in time, it's really mobile screen driver assistance.

Speaker Change: And maybe some level two functions, but it's really really around Adas.

Speaker Change: When you look at the defense industry, there's multiple avenues for the application of the technology.

Speaker Change: Theres drones, there's the.

Speaker Change: Unmanned autonomous vehicles. There is also no.

Speaker Change: Our headsets, there's terrain mapping so you have multiple areas, where the technology is either being applied today in a very limited fashion or.

Anubhav Verma: So you have multiple areas where the technology is either being applied today in a very limited fashion or the defense industry is looking for solutions in a very aggressive fashion. So you have a much greater number of opportunities to apply our portfolio. And what's also really good is it's the same technology that we would be applying, broadly speaking, to automotive or to industrial. It is in a whole different field from a technology standpoint. And for MicroVision, it's really applying those assets that we have effectively across those other verticals.

Speaker Change: Defense industry is looking for solutions.

Speaker Change: And a very aggressive fashion. So you have a <unk>.

Speaker Change: Much greater number of opportunities to apply our portfolio.

Speaker Change: And what's also really good is it's the same technology that we would be applying probably speaking to automotive or industrial.

Speaker Change: As in a whole different field from a technology standpoint for Microvision, it's really applying those assets that we have effectively across other verticals Sumit I'll turn it back to you.

Sumit Sharma: I'll turn it back. Yeah, I think, you know, part of the question is like, you know, why, you know, after years of unsuccess in automotive industrial, I think, I get the frustration, but let's, let's always focus on, you know, the reality of it. Let me be honest about this. Now, last year, we were deep into it with Daimler, as most of you know. And, you know, at that point, we chose to stop at a certain point, because going forward, would have meant more than 20 million of OPEX with them not covering anything, when the economy was going in the wrong direction.

Speaker Change: Yes, I think part of the question is like in Hawaii after years of Unsuccess in automotive and industrial I think I get the frustration, but let's let's always focus on the reality of it let me be honest about this the last year, we were deep into it with diner as most of you know.

Speaker Change: <unk>.

Speaker Change: At that point, we chose to stop at a certain point because going forward would have meant more than $20 million of opex with them not covering anything when the economy was going in the wrong direction and it was clear modeled indication that the Oems by themselves or struggling with the long term timelines to deliver what they have said, okay I would.

Sumit Sharma: And it was clear, small indication that the OEMs by themselves were struggling with the long term timelines to deliver what they had said. Okay. I would argue that if he had actually done that deal, we're not here right now. We would have been in a much worse position, in my opinion. And the example of that, in that example, really, if you look at what happened to SEPTON, I'm pretty sure investors want us to sign the deal. But we also have to evaluate, you know, because some of those investors want to just trade on that information and move on to the next thing.

Speaker Change: Argue that if you had actually done that deal were not here right now.

Speaker Change: I've been in a much worse position in my opinion and the example of that in that example, really if you look at what happened with <unk> and I'm pretty sure investors want us to sign the deal, but we also have to evaluate because some of those investors wanted to trade on that information and move onto the next thing, but we really have to support the thesis that the company is going to be around to finish. These contracts. That's a very important one and diamond for example was not.

Sumit Sharma: But we really have to support the thesis that the company's going to be around to finish these contracts. That's a very important one. And Daimler, for example, was not, you know, the right one for us, right? It was not big enough. And I will tell you that the technical review and acceptance happened the year before in 2023. And I would say Anubhav and I actually were going to these meetings four months into it, four to five months into it, trying to convince them our balance sheet was going to be okay, that the ATM was a medium that was going to allow us to raise, and they wanted more capital because they wanted to make sure that if the ATM was not going to be exercised, that their project would not be in trouble, and they would have to come in and fund it.

Speaker Change: Not the right one for us, but it was not big enough.

Speaker Change: And I will tell you that.

Speaker Change: The technical review and acceptance happened the year before in 2023.

Speaker Change: And I would say on above and I actually we're going to these meetings four months into it four to five months into it trying to convince them of our balance sheet is going to be okay that the ATM was a medium that was going to allow us to raise and they wanted more capital because they wanted to make sure that the ATM was that going to exercise of their project would not be in trouble and they will have to come in and funded.

Sumit Sharma: You know, if you think about all of this, right, I mean, those kind of projects, so you can say I was unsuccessful in automotive, I wouldn't say that. It's just. You want to get a deal done, but it's worse to get a bad deal done that's going to cause you to fail. So, yeah, I, you know.

Speaker Change: If you think about all of this right I mean, those kind of projects. So you can say I was unsuccessful in automotive I wouldn't say that it's just.

Speaker Change: Wanted to get a deal done, but it's worse they get a bad deal done that's going to cause you to fail.

Speaker Change: So yes.

Sumit Sharma: I expect you guys to come in next week and have some very, very direct questions. You're going to get direct answers with me, as always. But just think in these terms. At some point, the company has to survive. It's not just about announce something and trade on it and move on. And if you have a customer that's really giving an indication that they're not so certain about their timeline, but they expect you to put all your money in and all your investors to come along with it. you got to really evaluate, right? So automotive has just been tough.

I expect you guys to come in next week and you'll have some very very direct questions you're going to get direct answers with me as always but just thinking thinking this terms at some point the company has to survive. It's not just about announce something in trade on it and move on and if you have a customer that's really giving an indication that they're not so certain about their timeline, but they expected to put all your money in and all your investors to come along.

Speaker Change: With it.

Speaker Change: You got to really evaluate the automotive has just been a tough industrial market is just going you know I mean, I would say, it's going really really well I think we have.

Sumit Sharma: Industrial market is just going, you know, I mean, I would say it's going really, really well. I think, you know, we have. We started, you know, the acquisition of IBAO Happen. All the asset transfer took a while. Production started late in 2023, in 2024. We did some work, which is anytime you go into industrial space, you know, expect somewhere between 12 to 24 months for adoption. We got the samples out. It was a very mature product. We started working on software, as I said, for the last nine months or more, rather than hardware. So it's moving along.

Speaker Change: Yes.

Speaker Change: We started the acquisition of.

Speaker Change: They happen all the asset transfer it took a while production started late in 2023 and 2024, we did some work which is anytime you go into the industrial space you can expect somewhere between 12 months to 24 months for adoption.

Speaker Change: They got the samples out of very mature product. He started working on software as I said for the last nine months or more rather than hardware. So it's moving along so I would not say that you know industrial you know has not been demonstrated I know everybody in every earnings call. They want something announced if you can go forward and we have tried to navigate but now we're to the point, where we have the group of target customers in it.

Sumit Sharma: So I would not say that, you know, industrial, you know, has not been demonstrated. I know everybody in every earnings call, they want something announced so we can go forward. And, you know, we have tried to navigate, but now we're to the point where we have the group of target customers, and it's time for us to push our chips in and take a risk with the customers that are high enough volume. And they're trustworthy because the things that they're saying, they understand and acknowledge who we are. They see the balance sheet. They see the strength of it.

Speaker Change: Time for us to push our chips in and take a risk with the customers that are high enough volume.

Speaker Change: They're trustworthy because the things that they're saying they understand and acknowledge that we are they see the balance sheet. They see the strength of it and they see that we can solve their problem right now without any investment from them. So so I think keep that in context right I think like so I think that I can know what Glenn is representing is the future of where we're going to take care of things.

Sumit Sharma: And they see that, you know, we can solve their problem right now without any investment from them. So I think, like, keep that in context, right?

Sumit Sharma: I think, like, so I think, like, you know, what Glenn is representing is the future, where we're going to take it. Things, you know, things that we cannot imagine as Microvision by itself, where the product is going to go.

Speaker Change: Things that we cannot imagine as microvision by itself, where the product is going to go I'm happy to answer all the questions about the past about automotive and industrial certainly what our frustration investors happy to cover that but I think the opportunity that we have.

Sumit Sharma: I'm happy to answer all the questions about the past, about automotive and industrial. Certainly whatever frustration investors have, we can cover that. But I think, you know, the opportunity that we have, if we sort of break it out, the defense is not something we just entered into because it was kind of cool. It's, we were given some indications that it was kind of important for us to be in this space because it's opening up. And we had the opportunity with no extra expenses to go address that, of things that we've already created. So certainly, you know, we're expanding rather than just, you know, going towards the success.

Speaker Change: What sort of break it out the defense is not something we just entered into because it was kind of cool.

Speaker Change: As you were given some indications that it was kind of important for us to be in this space because it's opening up and we have the opportunity with no extra expenses to go address that or things that you've already created so certainly we're expanding.

Speaker Change: Rather than just.

Speaker Change: Going towards the success I think in different.

Sumit Sharma: And I think in different. We've done it in the past. We've had success there with multiple projects, multiple announcements. So defense is probably something that we're more confident in. And with Glen's help, of course, we can expand where we can be relevant in defense, specifically in drones and other military vehicles and, of course, AR.

Speaker Change: We've done it in the past we've had success there with multiple project multiple announcements. So defense is probably something that would be more comfortable.

Speaker Change: And with <unk> of course, we can now expand where we can be relevant and defence specifically and.

Speaker Change: Drones and other military vehicles and of course they are.

Anubhav Verma: Thanks, Sumit.

Amit: Thanks, Amit.

Anubhav Verma: Next question. Would you say we are a LiDAR company or have we fully morphed into an autonomous systems company?

Speaker Change: Next question would you save you a lidar company are happy fully morphed into an autonomous systems company.

Anubhav Verma: And if we're now more of a systems company, how has that retooled our approach to securing these new opportunities mentioned, specifically industrial end of I think that's a really good question. If you think about the three segments, I'll start on one end, high volume, automotive, they will think of us as a lighter company for now that provides a clean point cloud and some software support. But really, they want to be the software company they go develop, so we're just a lighter company there. A lot of our competition is in that space as well. In industrial, we have already graduated to the next level where we are gonna be, we are shipping product and eventually we expect to ship it in volume, with software integrated on it.

Speaker Change: And if for no more of a systems company, how has that re tooled our approach to securing these new opportunities mentioned.

Speaker Change: Specifically industrial and defense.

I think that's a really good question.

Speaker Change: If you think about the three segments I will start on one and high volume automotive.

Speaker Change: They will think of us as a lidar company for now that provides a clean point cloud and some software support but really they want to be the software come in they go develop so we're just a lighter computer lot of our competition in that space as well and.

Speaker Change: In industrial we have already graduated to the next level, where we are going to be we are shipping.

Speaker Change: Product and eventually we expect to ship it in volume with software integrated on it. So the lidar is no longer a lidar it as an actual lidar solution software that does something specific.

Anubhav Verma: So the LiDAR is no longer a LiDAR. It is an actual LiDAR solution. Software that does something specific, terms that we talk about like automotive ADAS, think about industrial ADAS. Those kind of features are enabled in this space for our customers. So therefore, they don't have to have huge investments in software development. They get a solution, they plug it, and that solves a specific problem for them. When I think about the industrial space, you know, now we are again, much lower volume. But now we're integrating our LiDAR, radar, other things that Glen will, of course, talk about as we go forward.

Speaker Change: Mike.

Speaker Change: Terms that we're talking about like automotive Adas think about industrial laid out those kind of features are enabled in this space for our customers. So therefore, they don't have to have huge investments in software development, they've got a solution they plug it and thats all the specific problem for them.

Speaker Change: When we think about the industrial space now where again a much lower volume.

Speaker Change: These margins, but now we're integrating our lidar radar other things that Glenn will of course talk about as we go move forward.

Anubhav Verma: And significantly more amount of software, but it's a full-blown solution that you get, you know, strap this thing on to a drone or strap this thing on to a military vehicle and it could do autonomous radar. So we have, in my opinion, you know, broadened through all three segments. In each segment, we are offering higher and higher value proposition. So we are transitioning towards more of a software solutions company based on our hardware from LiDAR, but also the capability of integrating other hardware from radar and other technologies into a few systems that we can provide to the military and to industry.

Speaker Change: And significant more amount of software, but it's a full blown solution.

Speaker Change: If you could stop this thing onto a draw on our <unk> onto our military vehicle and it could do autonomous tradeoffs.

Speaker Change: So we have in my opinion broadened through all three segments in each segment, we are offering higher and higher value proposition. So we are transitioning towards more of a software solutions company based on our hardware.

Speaker Change: From Lidar, but also the capability of integrating other hardware from radar and other technologies into a few system that we can provide to the military and the industry.

Anubhav Verma: So I think our differentiation is naturally happening because the strength of our team in developing software is gonna be highlighted more and more.

Speaker Change: So I think our differentiation is naturally happening because the strength of our team and developing software that was gonna be highlighted more and more we're going to talk about.

Anubhav Verma: We're gonna talk about partnerships that we are enabling. It's not just because of our LIDAR and competitive price. It's our LIDAR competitive price and the software, what it enables for people.

Speaker Change: Partnerships that we are enabling it is not just because of a lighter and competitive price, it's our lidar a competitive price and the software what it enables for folks.

Anubhav Verma: Glen, do you want to add something to this? I think you really said it well, Sumit. Depending on the end market, we have the right solution. We're a high-performance LiDAR sensor for the automotive space, and on the other extreme where we can provide the complete, not just the LiDAR perception, but multimodal perception, the full localization and environmental mapping, as well as features on top. And what's really impressive is that we have those assets across the entire company. And so we're not having to develop that from ground up. We're really just having to integrate and apply it.

Glenn do you want to add something to this.

Speaker Change: Yeah.

Speaker Change: I think you really said it well.

Speaker Change: And depending on the end market.

Speaker Change: Have the resolution.

Speaker Change: Our performance Lidar sensors for the automotive space and on the other extreme where we can provide a complete not just the latter perception, but multimodal perception.

Speaker Change: Yeah.

Speaker Change: Localization and.

Speaker Change: The environmental mapping as well as features on top and it's what's really impressive is that we have those assets.

Speaker Change: Across the entire company as we can we're not having to develop that from ground up we're really just having to integrate and acquire.

Anubhav Verma: And so I'm really excited about what we'll be able to do across all of those verticals with the technology that we have.

Speaker Change: And so I'm really excited about what we'll be able to do across all of those verticals, where the technology that we have.

Anubhav Verma: Thanks, Glen.

Glenn: Thanks Glenn.

Anubhav Verma: Next question. Why is MicroVision asking for more shares? Why are you asking for more shares when approved shares before with the promise that it was needed to show OEMs, we had financial stability, but we never got deals? Why should investors vote to approve another 200 million more shares when no meaningful deal has been announced in the last four years? Yeah, I'll start with that. Anubhav, perhaps you can help me on this one. So I think, you know, There are certain tools that the company needs to be able to work with our partners. And as I've said multiple times, and this is not the first earnings column shared this, that the concern that always keeps coming up is the long-term viability of the company.

Speaker Change: Next question why is microvision asking for more shares.

Speaker Change: Why are you asking for more shares when approved shares before with the promise that it was needed to show Oems, we had financial stability, but we never got deal.

Speaker Change: Why should investors load to approve another 200 million more shares but no meaningful deal had been announced in the last four years.

Speaker Change: Yes, I'll start with that and none of our perhaps you can help me with this one so I think.

Speaker Change: Okay.

Speaker Change: There are certain tools that the company needs to be able to work with our partners and as I've said multiple times is it's not the first earnings call I am sure. This that the concern that obviously, it's coming up as the long term viability of the company now if you go back to my prepared remarks about I try to highlight that in there.

Sumit Sharma: Now, if you go back to my prepared remarks, right, I try to highlight that in there to give context. Our competition, they raised a significant more capital because they went public with a D-SPAC. All along the way, we've been just raising as little as possible as we go forward. So I know like, you know, the investors would love to hear like, you know, how we're being competitive, but capital matters because, you know, most of the customers, especially in the automotive, they expect you to invest 20, $25 million of your money while they have zero risk to get to some level of production and then, you know, have all the risk on top of that.

To give context, our competition they raised a significant more capital because they went public with a D spec all along the way we've been just raising as little as possible as we go forward. So I know like you know the vessels would love to hear like you know, how we're being competitive but capital matters. Because you know most of the customers, especially the automotive they expect you to invest.

Speaker Change: 2000, $25 million of your money, while that zero risk to get to some level of production and then.

Have all the risk on top of that so if you don't have the cash on hand.

Sumit Sharma: So if you don't have the cash on hand, like some of our competition did, it has always been hard for us to convince them that we have viability, that we have the support, that we have an anchor customer. And since our investor base is so diverse, it's really hard for us to point that, you know, yeah, we have an investor that can actually come in and support us, you know, somebody with a high reputation. I think Anubhav has done a great job to like, you know, try to get us to that point, you know, we started with UPS, you know, that did not happen, you know, Deutsche Bank has been helping us a lot.

Speaker Change: Like some of our competition did it has always been hard for us to convince them that we have liability that we have to support have you have an anchor customer and since our investor base is so diverse it's really hard for us to point that we have an investor that can actually come in and support Austria somebody with a high reputation.

Speaker Change: I think I've always done a great job to like try to get us to that point you know we started with UBS.

Speaker Change: That does not happen you know Deutsche Bank has been helping US a lot and now if you think about hydro I think we've done everything humanly possible to give them the confidence that we have anchor customers and investors that can step in at the right moment.

Sumit Sharma: And now if you I think we've done everything humanly possible to give them the confidence that we have anchor customers, anchor investors that can step in at the right moment, you know, for any kind of deal, because to get the deal done, it's not about technology, I can assure you that, you know, it'd be very hard for me to attract somebody like Glen to the company, if it was like a big gap in technology, or what, you know, magical things that can be built on top of what we already have. I think our problem has always been, you know, that they have to have a high confidence the exclude on these and be able to expand the revenue base faster than other lighter companies.

Speaker Change: For any kind of deal because to get the deal done it's not about technology I can assure you that.

Speaker Change: It'd be very hard for me to attract somebody like went to the company. If it was like a big gaps in technology or what.

Speaker Change: Magical things that can be built on top of what we already have.

Speaker Change: I think our problem has always been that they have to have a high confidence that company can survive for a period of time.

Speaker Change: Execute on these and have be able to expand the revenue base faster than other later companies. So <unk>.

Sumit Sharma: So support that company needs certain tools. I think management is, you know, with very close counsel with our board of directors. We've come up with what we believe is what we need as tools to go forward.

Speaker Change: Support that accompany certain tools I think management as you know with the <unk>.

Speaker Change: Very close counsel with our board of directors could come up with what we believe is what we need as tools to go forward.

Anubhav Verma: Anubhav? Yeah, and I think, Sumit, to add to the point, obviously, 200 million more shares doesn't mean that, you know, we're going to use those shares right away. It's more often optics as well, because when you are competing in defense contracts and big, big contracts, people would like to see the authorized capital, the number of outstanding shares as a percentage of your authorized capital, to be some significant numbers. And I think we believe that 200 million would get us there. But I think I would just like to summarize four things that why now 200 million, right?

Speaker Change: And I don't want to but yeah, and I think so much of that to the point, obviously, a 200 million more shares doesn't need that you know we're gonna use door shares right away, it's more often optics as well. Because then you are competing in defense contract and the contract people would like to see the.

Speaker Change: Authorized capital the number of outstanding shares at the percentage of off your authorized capital.

Speaker Change: To be some significant number then I think we believe that 200 million.

Speaker Change: Would get us there.

Speaker Change: But I think I would just like to summarize for things that why now 200 million right I'd like to point out for the last seven eight months look at are consistently heavy trading volume while that signifies is the visibility of microvision on not just retail but institutional.

Anubhav Verma: I'd like to point out for the last seven, eight months, look at our consistently heavy trading volume. What that signifies is the visibility of MicroVision on not just retail, but institutional radar screens. That sort of depicts the momentum that we already have generated, which is the most significant momentum that this company has ever seen in its recent history. Number two, in the last seven months, we had a $19 million investment commitment from one single investor. And I think you can count on fingers how many other companies have been able to do that. Number three, the quality of people who have joined MicroVision's executive team, as well as the defense advisory board, that tells you that this is the time when people are looking to go all chips in and believe in the future of the company.

Speaker Change: Radar screens that sort of the fixed the momentum that we already have generated with it.

Speaker Change: The most significant momentum that this company has ever seen and its recent history number two in the last seven months.

Speaker Change: Had a $19 million of investment commitments on one single investor.

Speaker Change: And I think you can count on the fingers, how many other companies have been able to do that.

Speaker Change: Number three.

Speaker Change: The quality of people, who have joined Microvision executive team as well as the defense Advisory Board that tells you that this is the time when people are looking to go all chips in and believe in the future of the company that itself is very significant of why the 200 billion shares would get us to the stature.

Anubhav Verma: That itself is very significant of why the 200 million shares would get us to the stature of competing with the big boys. And I think the last thing is what I would say is, you know, this is more of an optics which is a direct corollary of the first or the first three factors. What I can just say is the Investor Day event, we had to double our capacity since two years ago. That shows the interest of people interested in MicroVision. And that's just retail. We have the second half of the day lined up with quality financial institutions joining us to know more about MicroVision.

Speaker Change: Competing with the Big Boys.

And I think the last thing is what I would say as you know this is more of an optics it.

Speaker Change: Which is a direct corollary of the first or the first three <unk>.

Speaker Change: Factors that what I can just say at the Investor day event, we have to double our capacity.

Speaker Change: Since two years event since two years ago that shows the interest of people interested in micro vision and Thats just retail we have the second half of the day lined up with quality financial institutions, joining us to know more about micro vision. So that highlights the visibility that microvision has.

Anubhav Verma: So that highlights the visibility that MicroVision has generated and the momentum that we have seen in the past 12 to 15 months, which is incredibly positive. And obviously, given the geopolitics that we're seeing usher in across the globe. So that's why I feel more confident and why this 200 million share authorization would get us in that lead.

Speaker Change: Generated at the momentum that we have seen in the past.

Speaker Change: 12 to 15 months, which are incredibly positive.

Speaker Change: And obviously given the geopolitics that working.

Speaker Change: Sure and across the globe. So that's why I feel more confident and why that's a 200 million share authorization would get us in that league.

Operator: We're running out of time.

Speaker Change: We're running out of time, so maybe one last question what do we expect on the Investor Day next week.

Sumit Sharma: So maybe one last question. Sumit, what to expect on the Investor Day next week? I think, I think it's kind of important that, you know, I think CES has not been really that super expensive, and it's not really been easy for us to connect with our investors and analysts.

Speaker Change: Thank you.

Speaker Change: I think it's an important that.

Speaker Change:

Speaker Change: I can see us there's not been really that super expensive and it's not really been you know easy for us to connect with our investors and analysts. So we've decided that we're going to actually hosted here annually.

Sumit Sharma: So we decided that we're gonna actually host it here annually about the same time. And it's, again, a great opportunity for us to show all the stuff. We spend money, what we have created, and what customers are gonna learn too. So without talking directly about any specific customers we've not announced, you can get a really good idea of where technology is gonna be deployed and ask specific questions so you get confidence in the product portfolio. We certainly are also gonna talk about our future plans with all our products. You know, again, given the context that Anubhav has said that we're not expecting our cash expenses to increase, that, you know, we're gonna run it tight.

Speaker Change: At the same time, and it's again, a great opportunity for us to show all the stuff.

Speaker Change: They spend money, where we have created and what the customers.

Speaker Change: Customers are going to launch <unk>. So you know without talking directly about any specific customers. We've not announced you can get a really good idea of where our technologies can be deployed in a specific question. So you've got confidence in the product portfolio.

Speaker Change: Certainly are also going to talk about our future plans with all our products.

Speaker Change: Again, given the context that I never said that we're not expecting our cash expenses to increase their you know we're going to run a tight it'd be a good opportunity to really understand how we're going to manage that and still create value.

Sumit Sharma: It'd be a good opportunity to really understand how we're gonna manage that and still create value. And of course, you know, longer term, I think we get a lot of questions from our investors all the time. And to be honest, right, even on an earnings call it's very hard to address them because sometimes they're kind of out of context. They're more conversational.

Speaker Change: And of course.

Speaker Change: <unk> term I think.

Speaker Change: I think we get a lot of questions from our investors all the time and to be honest right. Even on an earnings call. It is very hard to address them, because sometimes they're kind of out of context, there more conversational. So our intention is to have a session. Like we did last time, where you know.

Sumit Sharma: So our intention is to have a session like we did last time where, you know, ask us anything and if you can answer it in a public forum that we've covered in previous earnings calls, we will absolutely do it. And so we can have a more direct dialogue so you have a clear understanding of what we're facing and, you know, where we're headed with it. So look forward to meeting you all again next week.

Speaker Change: Ask us anything and if we can answer it in a public forum.

Speaker Change: But we've covered in previous earnings calls, we will absolutely do it and so we're going to have a more direct dialogue. So you have a clear understanding of what we're facing in del.

Speaker Change: Where we're headed with that so look forward to.

Speaker Change: Meeting you all again next week.

Drew Markham: Thank you, Sumit.

Sumit Sharma: Thank you Sumit.

Operator: With this, we'd like to wrap our first quarter earnings call. Thank you again, everybody, for joining us. We look forward to seeing you next. Thank you.

Speaker Change: This would like to wrap our first quarter earnings call. Thank you again, everybody for joining US we look forward to seeing you next week.

Operator: This concludes today's All parties may disconnect and have a great day.

Speaker Change: Thank you. This concludes today's conference all parties may disconnect and have a great day.