Q2 2026 Eve Holding Inc Earnings Call

August 4, 2026

Speaker #1: Greetings, and welcome to the Eve Holding's second quarter 2026 earnings call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation.

Operator: Greetings, welcome to the Eve Holding Second Quarter 2026 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Lucio Aldworth. Please go ahead.

Speaker #1: If anyone should require operator assistance during the conference, please press *0 on your telephone keypad. Please note, this conference is being recorded. I will now turn the conference over to your host, Lucio Aldworth.

Speaker #1: Please go ahead.

Speaker #2: Thank you, operator. Good morning, everyone. This is Lucio Aldworth, the director of investor relations at Eve. And I wanted to welcome everyone to our second quarter 2026 earnings conference call.

Lucio Aldworth: Thank you, operator. Good morning, everyone. This is Lucio Aldworth, the Director of Investor Relations at Eve, I want to welcome everyone to our Q2 2026 earnings conference call. Our CEO, Johann Bordais, and CFO, Eduardo Couto, are joining me on the call today. After their prepared remarks, we're going to open the call for questions, at which point Marcelo Basile, our Chief Flight Prototype Engineer, will also join us to address more technical questions. We have a deck with a few slides and additional pictures that showcase our achievements in the quarter, including, of course, the more recent stages of the test flight of our full-scale prototype. The deck is available on our site at ir.eveairmobility.com. Please feel free to download and follow along.

Speaker #2: Our CEO, Johann Bordais, and CFO, Eduardo Couto, are joining me on the call today. After their prepared remarks, we're going to open the call for questions, at which point Marcelo Basile, our chief flight prototype engineer, will also join us to address more technical questions.

Speaker #2: We have a deck with a few slides and additional pictures that showcase our achievements in the quarter, including of course the more recent stages of the test flight of our full-scale prototype.

Lucio Aldworth: We have a deck with a few slides and additional pictures that showcase our achievements in the quarter, including, of course, the more recent stages of the test flight of our full-scale prototype. The deck is available on our site at ir.eveairmobility.com. Please feel free to download and follow along. In fact, we just published on our investor relations website a video of our most recent transition flight, we encourage all investors and analysts to watch it. Let me first mention that today's conference call includes statements about events or circumstances that have not yet occurred.

Speaker #2: The deck is available on our site at ir dot eveairmobility dot com. Please feel free to download and follow along. And in fact, we just published on our investor relations website a video of our most recent transition flight, and we encourage all investors and analysts to watch it.

Lucio Aldworth: In fact, we just published on our investor relations website a video of our most recent transition flight, we encourage all investors and analysts to watch it. Let me first mention that today's conference call includes statements about events or circumstances that have not yet occurred. These are primarily based on our current expectations and projections regarding future events and financial trends that will affect our business and future economic performance. These forward-looking statements are based on current expectations and involve risks and uncertainties that could cause financial results to differ substantially from those expressed or implied in this conference call. We undertake no obligation to update publicly or revise any forward-looking statements because of new information, future events, or other factors. For a more detailed list of these risks and uncertainties, please refer to our SEC filings, which are available on our website.

Speaker #2: Let me first mention that today’s conference call includes statements about events or circumstances that have not yet occurred. These are primarily based on our current expectations and projections regarding future events and financial trends that will affect our business and future economic performance.

Lucio Aldworth: These are primarily based on our current expectations and projections regarding future events and financial trends that will affect our business and future economic performance. These forward-looking statements are based on current expectations and involve risks and uncertainties that could cause financial results to differ substantially from those expressed or implied in this conference call. We undertake no obligation to update publicly or revise any forward-looking statements because of new information, future events, or other factors.

Speaker #2: These forward-looking statements are based on current expectations and involve risks and uncertainties that could cause financial results to differ substantially from those expressed or implied in this conference call.

Speaker #2: When there take no obligation to update publicly or revise any forward-looking statements because of new information, future events, or other factors. For a more detailed list of these risks and uncertainties, please refer to our SEC filings, which are available on our website.

Lucio Aldworth: For a more detailed list of these risks and uncertainties, please refer to our SEC filings, which are available on our website. Now, I'll turn it over to our CEO, Johann Bordais.

Speaker #2: Now, I'll turn it over to our CEO, Johann Bordais.

Lucio Aldworth: Now, I'll turn it over to our CEO, Johann Bordais.

Speaker #3: Thank you, Lucio. Good morning, everyone, and welcome to our second quarter 2026 conference call. We had a good quarter, with several milestones demonstrating steady progress.

Johann Bordais: Thank you, Lucio. Good morning, everyone, and welcome to our Q2 2026 conference call. We had a good quarter with several milestones demonstrating steady progress. After the inaugural flight of our engineering prototype last December, we went through a series of hover flights. We concluded a planned ground test period of 3 months of software upgrade, which led to us to resume our flight campaign towards full transition by the end of this year. These three major phases validate not only our building block concept by extensively testing every part, but also the integration of critical systems, such as fly-by-wire and fixed pitch lifter rotors. In parallel, we continue our rig testing of different components for our commercial aircraft and interact with certification authorities and partners. Lastly, we will go through the new LOI agreements announced at the Farnborough Airshow.

Speaker #3: After the inaugural flight of our engineering prototype last December, we went through a series of hover flights. We concluded a planned ground test period of three months for software upgrades, which led us to resume our flight campaign towards full transition by the end of this year.

Speaker #3: This three major phases validate not only our building block concept but extensively testing every part, but also the integration of critical systems such as fly-by-wire and fixed pitch lifter rotors.

Johann Bordais: These three major phases validate not only our building block concept by extensively testing every part, but also the integration of critical systems, such as fly-by-wire and fixed pitch lifter rotors. In parallel, we continue our rig testing of different components for our commercial aircraft and interact with certification authorities and partners. Lastly, we will go through the new LOI agreements announced at the Farnborough Airshow. The slide 3 details some of the tests we performed between May and July in preparation for transition.

Speaker #3: In parallel, we continue our rig testing of different components for our commercial aircraft and interact with certification authorities and partners. Lastly, we will go through the new LOI agreements announced at the Farnborough Airshow.

Speaker #3: The slide three details some of the tests we performed between May and July in preparation for transition. As I mentioned previously, we uploaded new software to optimize the synchronization between the lifters and the pusher to sustain lift during all the phase of the flight.

Johann Bordais: The slide 3 details some of the tests we performed between May and July in preparation for transition. As I mentioned previously, we uploaded new software to optimize the synchronization between the lifters and the pusher to sustain lift during all the phases of flight. We also made sure that pusher, avionics, actuators, flight control, and other systems were tested again on the ground, this time with motors powered on and the aircraft anchored on the ground. On slide 4, we wanted to show you some additional details of the vibration test we perform on the ground. Because of wing-borne flights bring to the aircraft different pressure points, vibration, or aerodynamic loads, we attach a shaker device to the lifters to simulate and assess resulting oscillation in the entire aircraft. Slide 5 shows the progress of our accumulated flights.

Johann Bordais: As I mentioned previously, we uploaded new software to optimize the synchronization between the lifters and the pusher to sustain lift during all the phases of flight. We also made sure that pusher, avionics, actuators, flight control, and other systems were tested again on the ground, this time with motors powered on and the aircraft anchored on the ground. On slide 4, we wanted to show you some additional details of the vibration test we perform on the ground.

Speaker #3: We also made sure that pusher avionics actuators flight control and other systems were tested again on the ground. This time with motors powered on and the aircraft anchored on the ground.

Speaker #3: On slide four, we wanted to show you some additional details of the vibration test we perform on the ground. Because wing-borne flights bring to the aircraft different pressure points, vibration, or aerodynamic loads, we attach a shaker device to the lifters to simulate and assess resulting oscillation in the entire aircraft.

Johann Bordais: Because of wing-borne flights bring to the aircraft different pressure points, vibration, or aerodynamic loads, we attach a shaker device to the lifters to simulate and assess resulting oscillation in the entire aircraft. Slide 5 shows the progress of our accumulated flights. With successful completion of our ground test, we cleared the prototype to get back in the air and start transition flights. In total, our prototype flew 66 times and logged 2 hours, 46 minutes of air time. Importantly, the prototype now enters a new phase with partial transition.

Speaker #3: Slide five shows the progress of our accumulated flights. With successful completion of our ground test, we cleared the prototype to get back in the air and start transition flights.

Johann Bordais: With successful completion of our ground test, we cleared the prototype to get back in the air and start transition flights. In total, our prototype flew 66 times and logged 2 hours, 46 minutes of air time. Importantly, the prototype now enters a new phase with partial transition. This is when we gradually accelerate the aircraft by engaging the pusher, but still maintain the lifters powered on for the lift. The pusher was engaged at first with low RPMs and then powered up to around 1,200 RPMs, allowing the aircraft to fly forward at 30-knot speed, which is about 35 miles per hour. In the coming weeks, speed will progressively increase to 60 knots and then to 80, 90 knots to complete the full transition. At that moment, the lifters will be powered off and all lift will come from air passing through the wing, flying like an airplane.

Speaker #3: In total, our prototype flew 66 times and logged 2 hours and 46 minutes of air time. Importantly, the prototype now enters a new phase with partial transition.

Speaker #3: This is when we gradually accelerate the aircraft by engaging the pusher but still maintain the lifters powered on for the lift. The pusher was engaged at first with low RPMs and then powered up to around 1,200 RPMs, allowing the aircraft to fly forward at 30 knots speed.

Johann Bordais: This is when we gradually accelerate the aircraft by engaging the pusher, but still maintain the lifters powered on for the lift. The pusher was engaged at first with low RPMs and then powered up to around 1,200 RPMs, allowing the aircraft to fly forward at 30-knot speed, which is about 35 miles per hour. In the coming weeks, speed will progressively increase to 60 knots and then to 80, 90 knots to complete the full transition. At that moment, the lifters will be powered off and all lift will come from air passing through the wing, flying like an airplane.

Speaker #3: Which is about 35 miles per hour. In the coming weeks, speed will progressively increase to 60 knots and then to 80, 90 knots to complete the full transition.

Speaker #3: At that moment, the lifters will be powered off and all lift will come from air passing through the wing, flying like an airplane. This is the aircraft's ultimate mission.

Johann Bordais: This is the aircraft's ultimate mission, take off vertically, transition to wing-borne flight, then transition back to vertical flight for landing procedures. Slide 6 shows some pictures and has a link of a video of one of the latest transition flights. The video is also on our website and social media platform. More than quantity, our flight campaign also demonstrates quality. Every flight is diligently planned to test and validate specific aircraft components or flight metrics, in total, we have validated 150 test points. It is precisely these validations that allow us to move ahead with confidence. Moving to slide 7. We can see here part of our physical infrastructure that supports our entire program development with more than 15,000 accumulated hours of testing.

Speaker #3: Takeoff vertically, transition to wing-borne flight, and then transition back to vertical flight for landing procedures. Slide six shows some pictures and has a link of a video of one of the latest transition flights.

Speaker #3: The video is also on our website and social media platform. Now, more than quantity, our flight campaign also demonstrates quality. Every flight is digitally planned to test and validate specific aircraft component or flight metrics and in total we have validated 150 test points.

Speaker #3: It is precisely these validation that allow us to move ahead with confidence. Moving to slide seven, we can see here part of our physical infrastructure that supports our entire program development with more than 15,000 accumulated hours of testing.

Johann Bordais: Moving to slide 7. We can see here part of our physical infrastructure that supports our entire program development with more than 15,000 accumulated hours of testing. We continue testing different components separately in specific rigs to continue optimizing their individual performance and have now deployed a second Iron Bird dedicated to flight control system integration. As a reminder, our first Iron Bird is a deconstructed eVTOL in which we integrate all the different actual components of an eVTOL into a physical system to make sure all the systems work properly together.

Speaker #3: We continue testing different components separately in specific rigs to continue optimizing their individual performance and have now deployed a second Iron Bird dedicated to flight control system integration.

Johann Bordais: We continue testing different components separately in specific rigs to continue optimizing their individual performance and have now deployed a second Iron Bird dedicated to flight control system integration. As a reminder, our first Iron Bird is a deconstructed eVTOL in which we integrate all the different actual components of an eVTOL into a physical system to make sure all the systems work properly together. This is part of our testing process that should expedite the testing and the certification efforts, which also reduce the program cost. In parallel, on slide eight, we continue to advance our certification process with Brazilian certification authority, ANAC. The means of compliance are almost completed with ANAC. These are the tests that need to be successfully performed on different components to certify the aircraft. Interestingly, few suppliers have already started testing some of the components that have means of compliance aligned already with ANAC.

Speaker #3: As a reminder, our first Iron Bird is a deconstructed eVTOL in which we integrate all the different actual components of an eVTOL into a physical system to make sure all the systems work properly together.

Speaker #3: This is part of our testing process that should expedite the testing and certification efforts, which also reduces the program cost. In parallel, on slide eight, we continue to advance our certification process with the Brazilian certification authority, ANAC.

Johann Bordais: This is part of our testing process that should expedite the testing and the certification efforts, which also reduce the program cost. In parallel, on slide eight, we continue to advance our certification process with Brazilian certification authority, ANAC. The means of compliance are almost completed with ANAC. These are the tests that need to be successfully performed on different components to certify the aircraft. Interestingly, few suppliers have already started testing some of the components that have means of compliance aligned already with ANAC.

Speaker #3: The means of compliance are almost completed with ANAC. These are the tests that need to be successfully performed on different components to certify the aircraft.

Speaker #3: Interestingly, few suppliers have already started testing some of the component that have means of compliance align already with ANAC. Separately, ANAC opened a new consultation with industry stakeholders on updated airworthiness certification base, reflecting the requirements alignment with FAA.

Johann Bordais: Separately, ANAC opened a new consultation with industry stakeholders on updated airworthiness certification base, reflecting the requirements alignment with FAA. This is another important step in the Eve 100 certification process and contributes to the development of a robust regulatory framework for eVTOLs. Following the consultation period, which ends on 18 August, ANAC will review the comments received and assess the potential refinements on the criteria. In addition, ANAC published a proposed noise certification criteria for the Eve 100, which is the result of an extensive engagement between Eve and ANAC, drawing on existing aviation noise regulations. Lastly, we applied through ANAC for type certification validation by EASA, and it is expected to certify our aircraft for European markets 12 to 15 months after ANAC and FAA. On slide nine, we continue to prepare readiness of necessary infrastructure for safe operation and eVTOLs.

Speaker #3: This is another important step in the E100 certification process and contributes to the development of a robust regulatory framework for eVTOLs. Following the consultation period, which ends on August 18, ANAC will review the comments received and assess potential refinements to the criteria.

Speaker #3: In addition, ANAC published a proposed noise certification criteria for the E100, which is the result of an extensive engagement between Eve and ANAC, drawing on existing aviation noise regulations.

Johann Bordais: In addition, ANAC published a proposed noise certification criteria for the Eve 100, which is the result of an extensive engagement between Eve and ANAC, drawing on existing aviation noise regulations. Lastly, we applied through ANAC for type certification validation by EASA, and it is expected to certify our aircraft for European markets 12 to 15 months after ANAC and FAA. On slide nine, we continue to prepare readiness of necessary infrastructure for safe operation and eVTOLs.

Speaker #3: Lastly, we applied through ANAC for type certification validation by IASA. And it is expected to certify our aircraft for European markets 12 to 15 months after ANAC and FAA.

Speaker #3: On slide nine, we continue to prepare readiness of necessary infrastructure for safe operation and eVTOLs. We have partnered with Hitachi, a global technology leader in electrification, to ensure the vertical ports can be reliably connected to a power grid and equipped to handle the high-demand, high-frequency operations.

Johann Bordais: We have partnered with Hitachi, a global technology leader in electrification, to ensure the vertiports can be reliably connected to a power grid and equipped to handle the high-demand, high-frequency operations. This includes enabling a sufficient power capacity, managing fast charging cycle, and integrating new demand in existing energy system. In Florida, we also partnered with Florida Department of Transportation, focused on delivering insight in the infrastructure, operational procedures, and airspace navigation procedures needed to enable the safe and efficient integration of UAM into Florida's transportation network. On slide 10, you can see the timeline to certification. As I mentioned previously, we are now in the transition phase. We are around 30 flights away to full transition. Meanwhile, we are conducting a critical design review with our suppliers for each system and component that will be featured in our coming conforming prototype.

Speaker #3: This includes enabling and sufficient power capacity managing fast charging cycle and integrating new demand in existing energy system. In Florida, we also partnered with Florida Department of Transportation focused on delivering insight in the infrastructure operational procedures and airspace navigation procedures needed to enable the safe and efficient integration of UAM into Florida's transportation network.

Johann Bordais: In Florida, we also partnered with Florida Department of Transportation, focused on delivering insight in the infrastructure, operational procedures, and airspace navigation procedures needed to enable the safe and efficient integration of UAM into Florida's transportation network. On slide 10, you can see the timeline to certification. As I mentioned previously, we are now in the transition phase. We are around 30 flights away to full transition. Meanwhile, we are conducting a critical design review with our suppliers for each system and component that will be featured in our coming conforming prototype.

Speaker #3: On slide 10, you can see the timeline to certification. As I mentioned previously, we are now in a transition phase. We are around 30 flights away from full transition.

Speaker #3: Meanwhile, we are conducting the critical design review with our suppliers for each system and component that will be featured in our upcoming conforming prototype.

Speaker #3: This will allow us to release drawings and continue manufacturing components within the required specs to produce and test our conforming vehicle in 2027. With that, certification and entry into service is expected for 2028.

Johann Bordais: This will allow us to release drawings and continue manufacturing components within the required specs to produce and test our conforming vehicle in 2027. With that certification and enter the service is expected for 2028. Considering that we will need to fly our conforming prototype for around 12 months after the first crewed conforming prototype flight planned for H2 2027. Slide 11, we had a successful outcome at the Farnborough Airshow. We met with several industry leaders, customers, and partners, and we met several investors at the show. We also announced the two new LOI for a total of 46 aircraft from Move for operations in Cape Verde and Shearwater Global Capital of Bay Point Capital Company, a new lessor in our backlog.

Speaker #3: Considering that we will need to fly our conforming prototype for around 12 months after the first crewed, conforming prototype flight planned for the second half of 2027.

Speaker #3: Slide 11: We had a successful outcome at the Farnborough Airshow. We met with several industry leaders, customers, and partners, and we met several investors at the show.

Speaker #3: We also announced the two new LOI for a total of 46 aircraft, from MOVE for operations in Capo Verde and Shearwaters of Bay Point Capital Company a new lesser in our backlog.

Johann Bordais: We also announced the two new LOI for a total of 46 aircraft from Move for operations in Cape Verde and Shearwater Global Capital of Bay Point Capital Company, a new lessor in our backlog. This is a good segue into slide 12, which shows a total pre-order backlog of approximately 2,700 aircraft valued at about $13.5 billion at list price, including the two new LOIs signed this quarter and announced at the Farnborough Airshow. Now I hand it over to our CFO, Edu, for the Q2 2026 financial review.

Speaker #3: This is a good segue into slide 12, which shows a total pre-order backlog of approximately 2,700 aircraft valued at about $13.5 billion at list price, including the two new LOIs signed this quarter and announced at the Farnborough Airshow.

Johann Bordais: This is a good segue into slide 12, which shows a total pre-order backlog of approximately 2,700 aircraft valued at about $13.5 billion at list price, including the two new LOIs signed this quarter and announced at the Farnborough Airshow. Now I hand it over to our CFO, Edu, for the Q2 2026 financial review.

Speaker #3: And now, I hand it over to our CFO, Edu, for the second quarter 2026 financial review.

Speaker #1: Thanks, Johann. On slide 13, EVE ended the second quarter of 2026 with $403 million in cash and total liquidity of $531 million, which includes $128 million in non-draw credit facilities.

Eduardo Couto: Thanks, Johann. On slide 13, Eve ended Q2 2026 with $403 million in cash and total liquidity of $531 million, which includes $128 million in undrawn credit facilities. We believe the current level of liquidity is enough to support operations through 2028 without new funding. Importantly, we have already started to capture some of the synergies and cost avoidance we had identified and announced it in the Q1. Again, we have worked extensively with Embraer to find new ways to reduce our cash burn until certification. Our initial review indicates we can achieve $100 to 150 million in potential synergies in the next three years, supporting our cash runway. In the H1 2026, total cash burn was $118 million, and our total consumption for the year should remain close to the midpoint of our guidance between $225 to 275 million.

Speaker #1: We believe the current level of liquidity is enough to support operations through 2028 without new funding. Importantly, we have already started to capture some of the synergies and cost avoidance we had identified and announced in the first quarter.

Speaker #1: Again, we have worked extensively with Embraer to find new ways to reduce our cash burn until certification. And our initial review indicates we can achieve $100 to $150 million in potential synergies in the next three years.

Eduardo Couto: Our initial review indicates we can achieve $100 to 150 million in potential synergies in the next three years, supporting our cash runway. In the H1 2026, total cash burn was $118 million, and our total consumption for the year should remain close to the midpoint of our guidance between $225 to 275 million. Now moving to slide 14, just to highlight some of our numbers. Research and development in the Q2 2026 was $29 million. This is lower than around $55 million in previous quarters, and it reflects better than initially expected agreements with some of our suppliers and program development updates.

Speaker #1: Supporting our cash runway. In the first semester of 2026, total cash burn was $118 million, and our total consumption for the year should remain close to the midpoint of our guidance, between $225 million and $275 million.

Speaker #1: Now, moving to slide 14, just to highlight some of our numbers—research and development in the second quarter of '26 was $29 million. This is lower than around $55 million in previous quarters, and it reflects better-than-initially-expected agreements with some of our suppliers and program development updates.

Eduardo Couto: Now moving to slide 14, just to highlight some of our numbers. Research and development in the Q2 2026 was $29 million. This is lower than around $55 million in previous quarters, and it reflects better than initially expected agreements with some of our suppliers and program development updates. Going forward, we expect R&D levels to return to around $50 million per quarter. SG&A has been mostly stable at $8 million, as we continue to capture synergies and control costs on general and administrative expenses. Including R&D and SG&A, net loss was $34 million in the Q2 2026. Finally, as mentioned previously, we ended the quarter with $403 million in cash and $531 million in total liquidity. Cash consumption in the Q2 was $49 million, and in the H1 of the year was $118 million.

Speaker #1: Going forward, we expect R&D levels to return to around $50 million per quarter. As for G&A, it has been mostly stable at $8 million as we continue to capture synergies and control costs on general and administrative expenses.

Eduardo Couto: Going forward, we expect R&D levels to return to around $50 million per quarter. SG&A has been mostly stable at $8 million, as we continue to capture synergies and control costs on general and administrative expenses. Including R&D and SG&A, net loss was $34 million in the Q2 2026. Finally, as mentioned previously, we ended the quarter with $403 million in cash and $531 million in total liquidity. Cash consumption in the Q2 was $49 million, and in the H1 of the year was $118 million.

Speaker #1: Including R&D and SGNA, net loss was 34 million in the second quarter 2026. Finally, as mentioned previously, we ended the quarter with 403 million in cash and 531 million in total liquidity.

Speaker #1: Cash consumption in the second quarter was 49 million and in the first six months of the year was 118 million This shows some of the yearly benefits of synergies with Embraer and reinforces our confidence that our current financial position is sufficient to fund our operations until 2028.

Eduardo Couto: This shows some of the early benefits of synergies with Embraer and reinforces our confidence that our current financial position is sufficient to fund our operations until 2028. With that, we conclude our remarks. I would like to open the call for questions. Operator, please proceed.

Speaker #1: With that, we conclude our remarks and I would like to open the call for questions. Operator, please proceed.

Speaker #2: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question will come from Savanthi Syth with Raymond James.

Speaker #2: A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue.

[Analyst]: This meeting is being recorded. This meeting is being transcribed.

Speaker #4: This meeting is being recorded.

Speaker #5: This meeting is being transcribed.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question will come from Savanthi Syth with Raymond James.

Speaker #2: Using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question will come from Savi Seth with Raymond James.

Speaker #6: Hey, good morning everyone. Maybe Edu, you know, it was really helpful to get some of the kind of the forward color on R&D. I was curious if you could share how we should think about kind of CAPEX into the second half as well and how much if any of the kind of 100 to 150 million synergies have been kind of realized or are in the kind of a run rate for this year.

Savanthi Syth: Hey, good morning, everyone. It was really helpful to get some of the forward color on R&D. I was curious if you could share how we should think about CapEx into H2 as well, how much, if any, of the kind of $100 to 150 million synergies have been realized or are in a run rate for this year.

Savi Syth: Hey, good morning, everyone. It was really helpful to get some of the forward color on R&D. I was curious if you could share how we should think about CapEx into H2 as well, how much, if any, of the kind of $100 to 150 million synergies have been realized or are in a run rate for this year.

Speaker #1: Yes. Hi, Savi. Good talk to you. So the synergies we're implementing right, we did a lot of workshops to make sure we are as efficient as possible in terms of cash burn until certification.

Eduardo Couto: Yes. Hi, Savi. Good to talk to you. The synergies we're implementing, we did a lot of workshops to make sure we are as efficient as possible in terms of cash burn until certification, and make sure we keep our cash burn, not only this year, but until certification in 2027 and 2028, as efficient as possible. We identified this $100 to $150 million in synergies for these three years. We are already capturing that. I think when we say we are confident to stay in the mid-range of our guidance, it's already capturing part of those synergies. I believe a little less than one-third of those synergies come this year, and the rest comes in 2027 and 2028. Regarding CapEx for the manufacturing, that's another area that we have been doing a lot of studies how to be more efficient.

Speaker #1: And make sure we keep our cash burn not only this year but until certification, right, in 2027 and 2028 as efficient as possible. We identified these 100 to 150 million in synergies for these three years.

Speaker #1: We are already capturing that. So I think that’s why, when we say we are confident to stay in the mid-range of our guidance, it’s already capturing part of those synergies.

Speaker #1: I believe a little less than one third of those synergies come this year, and the rest comes in 2027 and 2028. Regarding CAPEX for the manufacturing, that's another area where we have been doing a lot of studies on how to be more efficient.

Eduardo Couto: I believe a little less than one-third of those synergies come this year, and the rest comes in 2027 and 2028. Regarding CapEx for the manufacturing, that's another area that we have been doing a lot of studies how to be more efficient. We are going to be able, or we are studying to use the existing Embraer facilities as much as possible so that we can only invest in manufacturing facilities as later as possible. Probably this year, we're talking about $20 million in CapEx investments. Next year, this number should go higher, something around $50 million, and probably another $30, $40 million in 2028.

Eduardo Couto: We are going to be able, or we are studying to use the existing Embraer facilities as much as possible so that we can only invest in manufacturing facilities as later as possible. Probably this year, we're talking about $20 million in CapEx investments. Next year, this number should go higher, something around $50 million, and probably another $30, $40 million in 2028. In overall, we're going to be investing around $100 million, to have, I would say, a modular production capacity, and we can grow this capacity, of course, as demand grows. That's what we're planning.

Speaker #1: We are going to be able, or we are studying, to use the existing Embraer facilities as much as possible so that we can only, you know, invest in manufacturing facilities as late as possible.

Speaker #1: So probably this year, we're talking about $20 million in CAPEX investments. Next year, this number should go higher, to something around $50 million, and probably another $30 or $40 million in 2028.

Speaker #1: So in overall, we're going to be investing around 100 million to have I would say a modular production capacity and we can grow this capacity of course as demand grows.

Eduardo Couto: In overall, we're going to be investing around $100 million, to have, I would say, a modular production capacity, and we can grow this capacity, of course, as demand grows. That's what we're planning.

Speaker #1: So that's kind of what we're planning.

Savanthi Syth: That's helpful color and great capacity to spend there. If I might, just on the flight timing, it looks like maybe full transition flights have slipped a bit into Q4 from Q3 in thinking when those will be done. Just wondering if that impacts the timing of when you start building certification-conforming aircraft, or if those two things aren't really connected.

Savi Syth: That's helpful color and great capacity to spend there. If I might, just on the flight timing, it looks like maybe full transition flights have slipped a bit into Q4 from Q3 in thinking when those will be done. Just wondering if that impacts the timing of when you start building certification-conforming aircraft, or if those two things aren't really connected.

Speaker #6: That's helpful color and great kind of capacity discipline there. If I might just on the flight timing, it looks like maybe full transition flights have slipped a bit into 4Q from 3Q.

Speaker #6: And kind of thinking when those will be done, just wondering if that impacts the timing of when you start building certification-conforming aircraft, or if those two things aren't really connected.

Speaker #1: Yes, Savi, this is Johan. Yeah, both are connected, obviously, but the full transition flight is planned by the end of this year, right? We'll see exactly. You know, we've resumed the flight campaign.

Johann Bordais: Yes, Savi, this is Johann. Both are connected, obviously, but the full transition flight is planned by the end of this year. We'll see exactly. We've resumed the flight campaign. We're thrilled about it. We just made, as we announced yesterday also, the transition with turning on the pusher, it should be 30 to 40 flights until we really complete the full transition. This is when we'll go to the 90 knots, and then we'll turn off the lifter. By the end of this year, we'll see how it goes. Obviously, we'll have some more information the next quarter. Then it really triggers also the conforming product of the first one. We'll be debuting the assembly. We already have parts of suppliers that are ready, and they've been shipping out to us.

Speaker #1: We're thrilled about it. We just made as we announced yesterday also the transition with turning on the pusher. So it should be 30 to 40 flights until we really complete the, you know, the full transition.

Speaker #1: This is when we'll go to 90 knots, and then we'll turn off the lifter. So, yeah, by the end of this year, we'll see how it goes.

Speaker #1: Obviously, we'll have some more information in the next quarter. And then it really triggers also the conforming product of the first one, right?

Johann Bordais: We'll be debuting the assembly. We already have parts of suppliers that are ready, and they've been shipping out to us. We'll start the assembly, the assembly will be finalized next year. H2 will be the first flight of the conforming prototype.

Speaker #1: We'll be debuting the assembly. We already have parts at suppliers that are ready, you know, and then shipping out to us. Then we'll start the assembly, and the assembly will be finalized next year.

Johann Bordais: We'll start the assembly, the assembly will be finalized next year. H2 will be the first flight of the conforming prototype.

Speaker #1: And then the second half will be the first flight of the conforming prototype.

Speaker #6: Helpful. Thank you.

Savanthi Syth: Helpful. Thank you.

Savi Syth: Helpful. Thank you.

Speaker #1: Thank you.

Johann Bordais: Thank you.

Operator: Our next question comes from Andres Sheppard with Cantor Fitzgerald.

Speaker #2: And our next question comes from Andres Shepard with Canter Fitzgerald.

Operator: Our next question comes from Andres Sheppard with Cantor Fitzgerald.

Speaker #1: Hey everyone, good morning. Thank you for taking our questions, and congratulations on the quarter. Johann, I wanted to start with maybe the transition flight.

Andres Sheppard: Hey, everyone. Good morning. Thank you for taking our questions, and congratulations on the quarter. Johann, I wanted to start with maybe the transition flight. Congratulations to the team on the beginning of the transition flight campaign, as you mentioned. My question there is, can you remind us, you talked about it a little bit already, how do you expect this program to ramp up going forward? What do you see as the major validation from the flights? Can you remind us where we are on the design and build-out of the 6 conforming aircraft, which you'll also be using as part of your flight campaign? Thank you.

Speaker #1: Congratulations to the team on the beginning of the transition flight campaign as you mentioned. My question there is just can you remind us, you know, you talked about it a little bit already, but how do you expect this program to ramp up going forward?

Speaker #1: You know, what do you see as the major validation from the flights? And then can you remind us kind of where we are on the design and build out of the six conforming aircraft which you'll also be using as part of your flight campaign?

Speaker #1: Thank you.

Speaker #3: No, thank you, Andres. Thank you for your question. This is important. Obviously, you know, since the very beginning, we elected to have the lift and cruise configuration.

Johann Bordais: No, thank you, Andres. Thank you for your question. This is important. Obviously, since the very beginning, we elected to have the lift and cruise configuration, which we understand is better for certification purpose, also for the aftermarket operation for the operator customers, and this is exactly what we're doing with the engineering prototype. Separating the vertical flight from the horizontal flight is what has led us to have this block building, what we call it, methodology that Embraer has been doing for the last 56 years. It's been proving efficient. As we go, we test each component, this is what we've been doing, right? Since the last flight, even prior to this, the first flight that we had in 19 December, we've been having the first phase, which is the hover phase.

Speaker #3: Which we understand is better for certification purposes, but also for the aftermarket operation for the operator customers. And this is exactly what we're doing with the engineering prototype: separating the vertical flight from the horizontal flight is what has led us to have this block building—what we call it—a methodology that Embraer has been doing for the last 56 years.

Speaker #3: And it's been proving, you know, efficient. As we go, we test each component. And this is what we've been doing, right? Since the last flight and even prior to this, the first flight that we had on the 19th of December, and then we've been having the first phase, which is a hover phase, and then we had three months of upgrading and software integrating, also with the pusher that we will turn on, ready to turn it on on the ground first, but now in flight.

Johann Bordais: As we go, we test each component, this is what we've been doing, right? Since the last flight, even prior to this, the first flight that we had in 19 December, we've been having the first phase, which is the hover phase. We had the 3 months of upgrading and software integrating also with the pusher that we will turn on. We did turn it on the ground first, now in flight. This is part of the plan, flight campaign, it's going to take us to the end of the year. We like to progress, like I like to say, progress with purpose, right? We don't want to cut any corners. We know all those tests are important.

Johann Bordais: We had the 3 months of upgrading and software integrating also with the pusher that we will turn on. We did turn it on the ground first, now in flight. This is part of the plan, flight campaign, it's going to take us to the end of the year. We like to progress, like I like to say, progress with purpose, right? We don't want to cut any corners. We know all those tests are important. We've tested more than 150 points of testing, which is very important in our process. Expanding the envelope of flight, right? We're learning as we're doing this. With this, we're transferring this to the conforming prototype as much as possible. This is exactly what we're doing.

Speaker #3: So this is part of the plan—the flight campaign. And yeah, it's going to take us to the end of the year. So, you know, we like to progress.

Speaker #3: Like I like to say, progress with purpose, right? I mean, we don't want to cut any corners. You know, we know all those steps are important.

Speaker #3: We've tested more than 150 points of testing, which is very important in our process. And then expanding the envelope of flight, right? And then we're learning as we're doing this.

Johann Bordais: We've tested more than 150 points of testing, which is very important in our process. Expanding the envelope of flight, right? We're learning as we're doing this. With this, we're transferring this to the conforming prototype as much as possible. This is exactly what we're doing. We're going to be freezing in the design of the aircraft by the end of this year. We call the CDR phase, with all the suppliers. The 21 suppliers also will be done by the end of this year. Like I said, assembling. Some of them, by the way, the CDRs are done with the suppliers, some others are not yet.

Speaker #3: With this, we're transferring this to the conforming prototype as much as possible. And this is exactly what we're doing. We're going to be freezing the design of the aircraft by the end of this year.

Johann Bordais: We're going to be freezing in the design of the aircraft by the end of this year. We call the CDR phase, with all the suppliers. The 21 suppliers also will be done by the end of this year. Like I said, assembling. Some of them, by the way, the CDRs are done with the suppliers, some others are not yet. We'll transfer this knowledge to the conforming prototype. We'll have 6 conforming prototypes built up next year, with the first flight, as I've said, it's going to be crewed with a pilot. It's going to be the H2 of next year. 6 prototypes to go until the certification for 2028. It takes about 12 months from the first flight. This is a rule of thumb that we have at Embraer that has been proven also for certification with ANAC.

Speaker #3: We call the CDR phase with all the suppliers, the 21 suppliers also will be done by the end of this year. And then like I said, just assembling some of them, by the way, the CDRs are done with the suppliers.

Speaker #3: Some others are not yet. And then we'll transfer this knowledge to the conforming prototype. We'll have six conforming prototypes built up next year. With the first flight, as I said, it's going to be crewed with a pilot.

Johann Bordais: We'll transfer this knowledge to the conforming prototype. We'll have 6 conforming prototypes built up next year, with the first flight, as I've said, it's going to be crewed with a pilot. It's going to be the H2 of next year. 6 prototypes to go until the certification for 2028. It takes about 12 months from the first flight. This is a rule of thumb that we have at Embraer that has been proven also for certification with ANAC.

Speaker #3: It's going to be the second half. Of next year. Six prototypes to go until the certification for 2028. It takes about 12 months from the first flight.

Speaker #3: This is a rule of thumb that we have at Embraer that, you know, has been proven also—for certification within ACT.

Speaker #1: Excellent. Thank you, Johan. And maybe just as a quick follow-up. So you know, at the Farnborough Air Show, you added to LOIs to the backlog.

Andres Sheppard: Excellent. Thank you, Johann. Maybe just as a quick follow-up. At the Farnborough Airshow, you added two LOIs to the backlog. I guess the question, how significant are these orders? How are you thinking about converting those to binding orders going forward? What do you see as maybe the main differentiator of the backlog? Thank you.

Speaker #1: So I guess the question, how significant are these orders? How are you thinking about converting those to binding orders going forward? And what do you see as the maybe the main differentiator of the backlog?

Speaker #1: Thank you.

Speaker #3: No, thanks, Andres. It is important for us, right? I mean, whether it's new LOI or it's an order conversion, I think it's just important as to move on and also prepare the entry into service.

Johann Bordais: Thanks, Andres. It is important for us, right? Whether it's a new LOI or it's an order conversion, I think it's just important as to move on and also prepare the entry to service. We do sign those contracts when they make sense. It's just not adding up aircraft numbers to the 2,700 aircraft under LOI and the firm orders, 100 airplane under the firm orders with Revo and AirX that we announced early on. It is to make sense. It's exactly when we have the right mission to fit what the aircraft is meant for. If you look at Move, which is the Cabo Verde network and operation, that's exactly what we want, right? It's really to start with the ecotourism going and the whole country is also investing massively in the tourism.

Speaker #3: And we do sign those contracts when they make sense. It's just not, you know, adding up aircraft numbers to the 2,700 aircraft under LOI and the firm orders, 100 airplanes under the firm orders with REVO and AIREX that we announced early on.

Speaker #3: But it is to make sense. It's exactly, you know, when we have the right mission to fit what the aircraft is meant for. And if you look at MOVE, which is the Cabo Verde network and operation, that's exactly what we want, right?

Johann Bordais: It's really to start with the ecotourism going and the whole country is also investing massively in the tourism. We feel that the eVTOL is definitely needed so they can grow together with the country. Then we also have another one which is important to us, is the leasing community with Shearwater, right? Recently purchased by the Bay Point Capital Company. It also shows and adds up to the other leasing company that we have, those different models that's going to be sold. We sell to a leasing company, and then they lease the aircraft to operators, or we sell directly to the operators.

Speaker #3: It's really to start with the equatorism going and the whole, you know, country is also investing massively in the tourism. And we feel that the EVTOL is definitely needed so they can grow together with the country.

Johann Bordais: We feel that the eVTOL is definitely needed so they can grow together with the country. Then we also have another one which is important to us, is the leasing community with Shearwater, right? Recently purchased by the Bay Point Capital Company. It also shows and adds up to the other leasing company that we have, those different models that's going to be sold. We sell to a leasing company, and then they lease the aircraft to operators, or we sell directly to the operators. Very similar to what we see in the aeronautical business, which is rotary aircraft or the fixed-wing aircraft. As you can see, it's getting interesting from the leasing community, which I think is super important for us.

Speaker #3: And then we also have another one, which is important to us—the leasing community. With Shearwaters, right? Recently purchased by the Bay Point Capital company.

Speaker #3: And it also shows, you know, it adds up to the other leasing company that we have—those different models that are going to be sold.

Speaker #3: You know, we sell to leasing companies, and then they lease the aircraft to operators, or we sell directly to the operators. It's very similar to what we see in the aeronautical business, which includes rotary aircraft or fixed-wing aircraft.

Johann Bordais: Very similar to what we see in the aeronautical business, which is rotary aircraft or the fixed-wing aircraft. As you can see, it's getting interesting from the leasing community, which I think is super important for us.

Speaker #3: So as you can see, it's getting interesting and from the leasing community which I think is super important for us.

Speaker #1: Wonderful. Thanks, Johann. Congrats again for passing on.

Andres Sheppard: Wonderful. Thanks, Johann. Congrats again. We'll pass it on.

Speaker #3: Thanks, Andres.

Johann Bordais: Thanks, Andres.

Speaker #2: And we'll go next to Amit Dayal with HC Wainwright.

Operator: We'll go next to Amit Dayal with H.C. Wainwright.

Speaker #1: Thank you. Good morning, everyone. Thank you for taking my questions. With respect to the synergies, Edu, maybe can you elaborate a little bit on what the components of those synergies are?

Amit Dayal: Thank you. Good morning, everyone. Thank you for taking my questions. With respect to the synergies, Edu, maybe can you elaborate a little bit on what the components of those synergies are? Are these mostly from engineering or is there any IP or infrastructure? Can you maybe just give us some color on what the different aspects of these cost synergies and where you are going to capitalize on are?

Speaker #1: Are these, you know, mostly from engineering, or is there any IP or infrastructure? Like, can you maybe just give us some color on what the, you know, different aspects of these cost synergies with Embraer you are going to capitalize on are?

Speaker #4: Yes. When we talk about the synergies, we break that in three pockets. One pocket is the EV structure, where we look everything that we do at EVE.

Eduardo Couto: Yes. When we talk about the synergies, we break that in three pockets. One pocket is the EV structure, where we look everything that we do at Eve

Eduardo Couto: Yes. When we talk about the synergies, we break that in three pockets. One pocket is the EV structure, where we look everything that we do at Eve See things that Embraer already does on the parent level, right? We analyze what we have to do at Eve, and also what could have been done by Embraer, right? This is more on the administrative side, right? General expenses. We have been able to find things that Embraer is doing, they can do for us, so we don't have to have a dedicated team at Eve doing that. This is one type of synergy we do.

Speaker #4: And see, you know, things that Embraer already does on the parent level, right? And we analyze what we have to do at EVE, but also what could have been done by Embraer, right?

Eduardo Couto: See things that Embraer already does on the parent level, right? We analyze what we have to do at Eve, and also what could have been done by Embraer, right? This is more on the administrative side, right? General expenses. We have been able to find things that Embraer is doing, they can do for us, so we don't have to have a dedicated team at Eve doing that. This is one type of synergy we do. On the Eve structural level, what could be done by Embraer, what needs to be done by Eve. The second thing is the master service agreement with Embraer. Embraer has this big pool of engineers that has been working for us. They do a lot of activities for us. We are the whole time taking a look on that, how we can be more efficient.

Speaker #4: So this is more on the administrative side, right? General expenses and we have been able to find, you know, things that Embraer is doing, they can do for us.

Speaker #4: So we don't have to have a dedicated team at EVE doing that. So this is one type of, you know, synergy we do on the EVE structural level, what could be done by Embraer, what could be done what needs to be done by EVE.

Eduardo Couto: On the Eve structural level, what could be done by Embraer, what needs to be done by Eve. The second thing is the master service agreement with Embraer. Embraer has this big pool of engineers that has been working for us. They do a lot of activities for us. We are the whole time taking a look on that, how we can be more efficient. What transactions we can pay. Sometimes we can pay things directly to suppliers of Embraer, so it doesn't need to go through Embraer, so that we can save some money. A big work on this service agreement with Embraer. The third pocket is industrialization, right?

Speaker #4: The second thing is the master service agreement with Embraer. Embraer has this, you know, big pool of engineers that has been working for us.

Speaker #4: They do a lot of activities for us. We are the whole time, you know, taking a look on that, how we can be more efficient, you know, what transactions we can pay.

Eduardo Couto: What transactions we can pay. Sometimes we can pay things directly to suppliers of Embraer, so it doesn't need to go through Embraer, so that we can save some money. A big work on this service agreement with Embraer. The third pocket is industrialization, right? As I said, we want to be as efficient as possible. Embraer has a lot of existing assets, and a lot of investments that were already done that we don't need to do it again. We were discussing what is the most efficient way to produce our eVTOL so that we don't need to duplicate infrastructure investments that Embraer has already done. Those are the three pockets, Eve structure, the Embraer service agreement, and the industrialization.

Speaker #4: Sometimes we can pay things directly to the suppliers of Embraer. So it doesn't need to go through Embraer so that we can save some money.

Speaker #4: So, you know, a big work on this service agreement with Embraer. And the third pocket is industrialization, right? As I said, we want to be as efficient as possible.

Eduardo Couto: As I said, we want to be as efficient as possible. Embraer has a lot of existing assets, and a lot of investments that were already done that we don't need to do it again. We were discussing what is the most efficient way to produce our eVTOL so that we don't need to duplicate infrastructure investments that Embraer has already done. Those are the three pockets, Eve structure, the Embraer service agreement, and the industrialization.

Speaker #4: Embraer has a lot of existing assets. And a lot of investments that were already done that we don't need to do it again. So we were discussing what is the most efficient way to produce our EVTOL so that we don't need to duplicate infrastructure investments that Embraer has already done.

Speaker #4: So those are the three pockets: Eve structure, the Embraer service agreement, and the industrialization.

Amit Dayal: Understood. Thank you for that.

Speaker #1: Understood. Thank you for that. And then I will give...

Johann Bordais: I will give two concrete examples of exactly what Edu has mentioned here on those three pillars of synergies. The first one is on the organization, as you mentioned. This is something that we have at Eve, 176 employees, Evers, that how we call ourselves. We also have the MSA with Embraer that involves about 800 people. If you think about it, that's 1,000 people organized. The way we were organized before, we would have some mirror organization, right? Like program, for example. We figured we could get more synergy by having one program on one side, which comes with the responsibility, right, and then ownership, which belongs to Eve.

Speaker #3: Two concrete examples of exactly what Edu has mentioned here. On those three pillars of synergies, the first one is on the organization. As he mentioned, this is something that we have at Eve—176 employees, Eveers, as we call ourselves.

Speaker #3: And then we also have the MSA with Embraer that involves about 800 people. So, if you think about it, that's 1,000 people, you know, organized.

Speaker #3: But the way we're organized before, we would have some mirror organization, right? Like program, for example. And then we figured, you know, we could get more synergy by having one program on one side, which comes with the responsibility, right, of an ownership, which just belongs to EVE.

Johann Bordais: We figured we could get more synergy by having one program on one side, which comes with the responsibility, right, and then ownership, which belongs to Eve. On the other part, as Edu did mention, some other team would go to Embraer, and because of the volume of people that they have, they could get some work with maybe less people, and then direct some workforce to other project within Embraer. We've seen those gains. That is the first tangible example. The second one, which I think also is important, is on the certification program.

Speaker #3: But on the other part, as Edu did mention, some other team, you know, would go to Embraer and because of the volume of people that they have, they could get, you know, some work, you know, with maybe less people and then direct some workforce to other projects within Embraer.

Johann Bordais: On the other part, as Edu did mention, some other team would go to Embraer, and because of the volume of people that they have, they could get some work with maybe less people, and then direct some workforce to other project within Embraer. We've seen those gains. That is the first tangible example. The second one, which I think also is important, is on the certification program. As you remember, last year we did announce that we would put the landing gears and wheels on our vehicle. Well, the conforming prototype will have those landing gear, and it allows us to move around the prototype in Gavião Peixoto faster.

Speaker #3: So we've seen those gains. That's the first tangible example. The second one which I think also is important is on the certification program. As you remember, last year we did announce that we would put the lending gears and wheels, you know, on our vehicle.

Johann Bordais: As you remember, last year we did announce that we would put the landing gears and wheels on our vehicle. Well, the conforming prototype will have those landing gear, and it allows us to move around the prototype in Gavião Peixoto faster. With that in mind, what we could come up with at Embraer is use the existing facilities and hangars that they have instead, and maybe add up a couple of containers in a kind of startup style, let's say. Then, it will allow us, we have the FATO and vertiport, and it will avoid some cost avoidance on the building of a brand-new hangar that we had original plan.

Speaker #3: Well, the conforming prototype will have those landing gears, and it allows us to move around the prototype and get on Peugeot faster. And with that in mind, what we could come up with at Embraer is use the existing facilities and hangars that they have instead, and maybe add, you know, a couple of containers in a kind of startup style, let's say.

Johann Bordais: With that in mind, what we could come up with at Embraer is use the existing facilities and hangars that they have instead, and maybe add up a couple of containers in a kind of startup style, let's say. Then, it will allow us, we have the FATO and vertiport, and it will avoid some cost avoidance on the building of a brand-new hangar that we had original plan. Those are substantial saving that it is a reflection of a direct synergy with Embraer.

Speaker #3: And then, you know, it will allow us, we have the FEDO and Vertiport and it will avoid some cost avoidance on the building of a brand new hangar that we had original planned.

Speaker #3: So those are substantial saving that, you know, it's a reflection of a direct synergy with Embraer.

Johann Bordais: Those are substantial saving that it is a reflection of a direct synergy with Embraer.

Speaker #1: And then going forward, can this continue to add up for you guys? I know the range is $100 to $150 million now, but in the future, can you potentially find more areas of cost synergies?

Amit Dayal: Going forward, can this continue to add up for you guys? I know the range is 100 to 150 now, but in the future, can you potentially find more areas of cost synergies?

Speaker #4: Oh yeah, I think, you know, the focus right now is the synergies related to the certification, right? Until we get certification in 2028. But when we think about, for instance, services and support, right, Embraer has a lot of MROs and a lot of facilities spread worldwide that we can also leverage and don't need to invest.

Eduardo Couto: Oh, yeah. I think the focus right now is the synergies related to the certification, right? Until we get certification in 2028. When we think about, for instance, services and support, right? Embraer has a lot of MROs and a lot of facilities spread worldwide that we can also leverage and don't need to invest. The focus now is certification synergies, but once we enter into service, there is a lot that we can use from existing assets that Embraer already has.

Speaker #4: So the focus now is certification synergies. But once we enter into service, there is a lot that we can use from existing assets that are Embraer already has.

Amit Dayal: Understood. Thank you for that. Just one last question, guys. This partnership with Hitachi, is this more for Eve's operational execution and infrastructure, or are you targeting the general eVTOL infrastructure opportunity with this partnership?

Speaker #1: Understood. Thank you for that. Just one last question, guys. You know, this partnership with Hitachi, is this more for EVEs? You know, operational, you know, execution and infrastructure or are you targeting, you know, the general EVTOL infrastructure opportunity with this partnership?

Speaker #3: Yeah, thanks. I mean, since the beginning, we've strongly believed in the agnostic way, right? This is the way we're going to be creating the UAM.

Johann Bordais: Yeah. Thanks, Amit. Since the beginning, Amit, we strongly believe in the agnostic way, right? This is the way how we're going to be creating the UAM. If we are able to have different type of OEM in different vertiports, this is what we want. We want to scale up UAM, we'll do this only if we standardized or whether it's the electrification, whether it's the BTMS, which is the battery thermal management system, and so on, right? Same thing with the FATO, I think this is what we're looking for, this non-exclusive partnership with Hitachi is exactly going in this direction.

Speaker #3: If we are able to have different type of OEM in different Vertiports and this is what we want. We want to scale up the UAM and we'll do this only if we standardize our whether it's the electrification, whether it's the BGMS, which is the battery thermal management system, and so on, right?

Speaker #3: Same thing with the FETO and I think this is what we're looking for. And there's none exclusive partnership with Hitachi is exactly going in this direction.

Speaker #3: I mean, it's a great partner. You know, into the electrification around the world already on many industries and they're naturally, you know, coming to the EVTOL world and their knowledge will be paramount to make sure that we can spread with their system or any other system spread the UAM.

Johann Bordais: Amit, it's a great partner into the electrification around the world already on many industries, they're naturally coming to the eVTOL world, their knowledge will be paramount to make sure that we can spread with their system or any other system, spread the UAM.

Amit Dayal: Understood. Thank you, guys. That's all I have. Appreciate it.

Speaker #1: Understood. Thank you guys. That's all I have. Appreciate it.

Speaker #3: Thanks, Andy.

Johann Bordais: Thanks, Amit.

Speaker #2: And as a reminder, it is Star One to ask a question. And we'll go next to Austin Mueller with Canaccord Genuity.

Operator: As a reminder, it is star one to ask a question. We'll go next to Austin Moeller with Canaccord Genuity.

Austin Moeller: Hi, good morning, Johann, Edu. For TechCare, how should we think about the process of revenue generation on the $1.4 billion in MRO contracts? What kind of work might need to be performed on these aircraft in their first year after delivery to customers?

Speaker #5: Hi, good morning. Johann here. For TechCare, how should we think about the process of revenue generation on the $1.4 billion in MRO contracts?

Speaker #5: What kind of work might need to be performed on these aircraft in their first year after delivery to customer?

Speaker #3: Thanks for the question. This is since the beginning, the inception of EVE, we think about three pillars, which is the vehicle itself, this is about the customer support and services, strong from the Embraer experience, obviously, and network.

Johann Bordais: Thanks for the question. Since the beginning, the inception of Eve, we think about three pillars, which is the vehicle itself. This is about the customer support and services drawn from the Embraer experience. Obviously, a network, Edu mentioned it, right? The MRO, for example, not only, it's all about the spare parts, about the training of pilots and mechanics and so on, right? Technical services, and you name it. Then the third one is the Vector. It's about the UATM. When it comes to TechCare, it's the name of our solution, the suite of solution, technical solution that we have. It's a fly by the hour program. Not fly by view. It's based on the hour. This system, well-known in the industry.

Speaker #3: Edu mentioned it, right? The MRO, for example, but not only that. I mean, it's all about the spare parts, about the training of pilots and mechanics and so on, right?

Speaker #3: Technical services. And you name it. So, and then the third one is the vector, it's about the UATM. When it comes to tech care, it's the name of our solution, the suite of solutions, technical solution that we have.

Speaker #3: It's a fly-by-the-hour program, not fly by the way, but it's based on, yeah, on this system, well-known in the industry, but what happened is that during our negotiation with the suppliers, with our partners, the 21, 22 suppliers that we have, it's a life cycle contract that we have.

Johann Bordais: Not fly by view. It's based on the hour. This system, well-known in the industry. What happened is that during our negotiation with the suppliers, with our partners, the 21, 22 suppliers that we have, it's a life cycle contract that we have. Not only it's for the prototype, conforming prototype, but also contracts for the production of the Eve 100, but it's also for the customer support and services. We want to be the face to the customer, right? This is something that the model that customers have been asking us.

Johann Bordais: What happened is that during our negotiation with the suppliers, with our partners, the 21, 22 suppliers that we have, it's a life cycle contract that we have. Not only it's for the prototype, conforming prototype, but also contracts for the production of the Eve 100, but it's also for the customer support and services. We want to be the face to the customer, right? This is something that the model that customers have been asking us. We're going to be creating a new category of aircraft and a new segment of aviation, and they want to make sure that we're committed. This is exactly the spirit of Eve. Just to make sure that we are embedded in the operation, right? They want two things.

Speaker #3: So not only it's for the prototype conforming prototype, but also contracts for the production of the E100, but it's also for the customer support and services.

Speaker #3: And we want to be the face to the customer, right? This is something that the model that customers have been asking us, we're going to be creating a new category of aircraft and a new segment of aviation.

Johann Bordais: We're going to be creating a new category of aircraft and a new segment of aviation, and they want to make sure that we're committed. This is exactly the spirit of Eve. Just to make sure that we are embedded in the operation, right? They want two things. They want to make sure our operators will want to have the availability of the vehicle when needed, really ready for the mission, and also the operating cost. The best way to do this when it comes to customer support and services is for you to be the face of the customer, right? That's how we're going to be doing.

Speaker #3: And they want to make sure that we're committed and this is exactly the spirit of EVE, just to make sure that we are embedded in the operation, right?

Speaker #3: They want two things. They want to make sure our operators will want to have the availability of the vehicle when needed, you know, really ready for the mission.

Johann Bordais: They want to make sure our operators will want to have the availability of the vehicle when needed, really ready for the mission, and also the operating cost. The best way to do this when it comes to customer support and services is for you to be the face of the customer, right? That's how we're going to be doing. It's basically MRO, material availability with an exchange program, and the repair. Also, a network, right? That we do this for the base customer. The training, remembering that we do have a contract with ECTS, which is a joint venture between CAE and Embraer, that today do all the Phenom and also the E2s. Yeah, and the technical services.

Speaker #3: And also the operating cost. The best way to do this when it comes to customer support and services is for you to be the face to the customer, right?

Speaker #3: And that's how we've got to be doing. So it's basically MRO, material availability with an exchange program and the repair also a network, right, that we do this with the base customer.

Johann Bordais: It's basically MRO, material availability with an exchange program, and the repair. Also, a network, right? That we do this for the base customer. The training, remembering that we do have a contract with ECTS, which is a joint venture between CAE and Embraer, that today do all the Phenom and also the E2s. Yeah, and the technical services.

Speaker #3: And the training, remembering that we do have a contract with ECTS, which is a joint venture between CAE and Embraer that today do all the phenom and also the E2s.

Speaker #3: And yeah, and the technical services on top of this, very important, we're also a big banging on the headcrew, which is a prognostic service that Embraer provide to their customers that we will have.

Johann Bordais: On top of this, very important, we're also piggybacking on AHEAD, which is a prognostic service that Embraer provide to their customers that we will have, with sensors all throughout the machine, the eVTOL, then we'll be able to see what's the prognosting the maintenance of the aircraft. When it comes to the aircraft and the needs, it's an electrical vehicle, it's definitely less maintenance task. Again, I mean, this type of program, it's all about predicting the future. Murphy is really king on trying to break those machine and they make sure that they break where it shouldn't. With that Eve TechCare services, we will return the operation as fast as possible. This is what the operator wants.

Speaker #3: So it, you know, with sensors all throughout the machine, the EVTOL, then we'll be able to see, you know, what's the prognostic the maintenance of the aircraft.

Speaker #3: When it comes to the aircraft and the needs, it's an electrical vehicle. So it's definitely less maintenance task, but again, I mean, this type of program, it's all about predicting the future.

Speaker #3: Murphy is really keen, you know, on trying to break those machine and make sure that it breaks where it shouldn't. And then with that tech care services, we will return the operation as fast as possible.

Johann Bordais: With that Eve TechCare services, we will return the operation as fast as possible. This is what the operator wants.

Speaker #3: And this is what the operator wants.

Speaker #5: Okay. And can you comment on the component- or part-level differences between the six cert-conforming prototypes that you expect to start building this year, and that will be completing different tasks?

Austin Moeller: Okay. Can you comment on the component or part level differences between the six cert-conforming prototypes that you expect to start building this year and will be completing different tasks?

Speaker #3: You mean compared to the current engineering prototypes?

Johann Bordais: You mean compared to the current engineering prototypes?

Speaker #1: No, no, I think the difference between the six, right?

Eduardo Couto: No, I think the difference between the six, right? Is that

Speaker #5: Right.

Johann Bordais: Right. Between the six? Oh, okay.

Speaker #3: Between the six? Oh, okay.

Eduardo Couto: Are you talking about the difference between the six, the conforming prototypes, or you're talking the difference between the conforming prototype and the engineering prototype also?

Speaker #1: Are you talking about the difference between the six prototypes, the conforming prototypes, or you're talking the difference between the conforming prototype and the engineering prototype also?

Speaker #5: The six conforming prototypes.

Austin Moeller: The six conforming prototypes.

Johann Bordais: Okay. Yeah, we do have Bazile here on the line. He can give you a little more detail.

Speaker #3: Okay. Yeah, we do have Basile here on the line that can give you a little bit more detail.

Marcelo Basile: I can help on that. Good morning. This is Marcelo Bazile, Austin. The difference of those prototypes are related to the, what the matters of certification we have ahead. The first one will be related to the envelope expansion, and they will be dealing with the handling quality performance. The second one, you'll be going deep on the handling quality and on some tasks regarding also in performance. The third vehicle, you'll be dealing with systems, and most likely propulsion and electrical system. The fourth system, the fourth aircraft, you'll be dealing as well going deep on systems but with focus on avionics. The fifth prototype is more related to the interior cabin systems. It'll be the first one that will have a aircraft with the full cabin implemented. The sixth one, you'll be dedicated to the function and reliability testings.

Speaker #2: I can, I can help on that. Good morning. This is Marcelo Basile. Austin. And the difference of those prototypes are related to the what the matters of certification we have ahead.

Speaker #2: So the first one you'll be related to the envelope expansion. And they were dealing with handling quality performance. The second one you'll be going deep on the handling quality and on some tasks regarding also in performance.

Speaker #2: The third vehicle, you'll be dealing with systems, and most likely propulsion under the electrical system. The fourth aircraft, you'll be dealing as well, going deep on systems but with a focus on avionics.

Marcelo Basile: The fifth prototype is more related to the interior cabin systems. It'll be the first one that will have a aircraft with the full cabin implemented. The sixth one, you'll be dedicated to the function and reliability testings. Basically are the most close to the series prototype, series aircraft. The deliver plan will be compliant with the function reliability. Basically, the last thing that we have before entry to service under the type certification achievement.

Speaker #2: The fifth prototype is more related to the interior cabin and systems. You'll be the first one that will have the aircraft with the full cabin implemented.

Speaker #2: And the sixth one, you'll be dedicated to the function and reliability testing. Basically, these are the most close to the series prototype, series aircraft. And the desert plane, you'll be compliant with function reliability; basically, the last thing that we have before entry to service under the type certification achievement.

Marcelo Basile: Basically are the most close to the series prototype, series aircraft. The deliver plan will be compliant with the function reliability. Basically, the last thing that we have before entry to service under the type certification achievement.

Speaker #5: Really helpful detail. Thanks, everyone.

Austin Moeller: Really helpful detail. Thanks, everyone.

Speaker #2: You're welcome.

Marcelo Basile: You are welcome.

Operator: As a final reminder, that is star one if you would like to ask a question. Moving on to Andre Madrid with U.S. Bancorp.

Speaker #4: And as a final reminder, that is star one if you would like to ask a question. And moving on to Andre Madrid with U.S. Bancorp.

Operator: As a final reminder, that is star one if you would like to ask a question. Moving on to Andre Madrid with U.S. Bancorp.

Andre Madrid: Johann, Edu, Lucio, good morning.

Speaker #6: Joan, Edu, Lucia, good morning.

Speaker #1: Good morning.

Johann Bordais: Morning.

Lucio Aldworth: Morning.

Speaker #6: Good morning.

Eduardo Couto: Morning.

Johann Bordais: Morning.

Lucio Aldworth: Good morning.

Eduardo Couto: Good morning.

Speaker #2: Good morning.

Speaker #6: Looking at, you know, the supply chain team, maybe give us an update there. And also, as you're going through production, your conforming prototypes, do you think there's room to add additional suppliers still?

Andre Madrid: Looking at the supply chain, can you maybe give us an update there? Also, as you're going through production of your conforming prototypes, do you think there's room to add additional suppliers still?

Johann Bordais: Yeah. A good question. Supply chain, we do have 22. I keep saying we have 21, 22, because, as a matter of fact, there's a few of them are remaining, but there's what we call it the off-the-shelf type of components, like an ELT or those type of thing that there's not much of a negotiation or a customization to our vehicle. It's something that comes with the aircraft and needs to be on the aircraft. All those contracts were closed and negotiated back. The first contract was on the battery, back in 2023, and with the battery and the engines. We are going through this development phase, right? Back and forth with requirements that we have, we send it to the suppliers then they answer back. We make those changes as we're evolving also and testing the vehicle.

Speaker #3: Yeah. Good question. Supply chain, we do have 22. I keep saying we have 21, 22 because as a matter of fact, there's a few of them remaining, but there's what we call it the off-the-shelf type of components, like, you know, an ELT or, you know, those type of thing that, you know, there's not much of a negotiation or customization to our vehicle.

Speaker #3: It's something that comes, you know, with the aircraft and needs to be on the aircraft. But all those contracts, we're closed and negotiated. Back the first contract was on the battery and the back in 2023.

Speaker #3: And with the battery and the engines, we are going through those development phase, right? So back and forth with requirements that we have and we send it to the suppliers and then the answer back, you know, we make as changes as we're evolving also and testing the vehicle.

Johann Bordais: We are going through this development phase, right? Back and forth with requirements that we have, we send it to the suppliers then they answer back. We make those changes as we're evolving also and testing the vehicle. Like I said previously, we will have to freeze the design of the aircraft, the Eve 100, by the end of this year. We can accept afterwards minor changes, right? For certification and for exactly all the test phases that Bazile actually mentioned on the sixth vehicle, we really need to have this configuration frozen by the end of this year. This is what we're going to be doing, with all the suppliers.

Speaker #3: But like I said previously, we will have to freeze the design of the aircraft, the E100, by the end of this year. We can accept minor changes afterwards, right?

Johann Bordais: Like I said previously, we will have to freeze the design of the aircraft, the Eve 100, by the end of this year. We can accept afterwards minor changes, right? For certification and for exactly all the test phases that Bazile actually mentioned on the sixth vehicle, we really need to have this configuration frozen by the end of this year. This is what we're going to be doing, with all the suppliers. It's going to happen by the end of this year. Those contracts are one also of the big synergy and knowledge that we're gaining from the Embraer team. For the last 6 years, they've been negotiating this contract, it's a life cycle contract here. Like I said, it's not for only the production.

Speaker #3: But for certification and for exactly all the test phases that Basile actually mentioned on the six vehicle, then we really need to have this configuration frozen by the end of this year.

Speaker #3: So this is what we're going to be doing, you know, with all the suppliers. So it's going to happen by the end of this year.

Johann Bordais: It's going to happen by the end of this year. Those contracts are one also of the big synergy and knowledge that we're gaining from the Embraer team. For the last 6 years, they've been negotiating this contract, it's a life cycle contract here. Like I said, it's not for only the production. It's really to make sure that all throughout the life of and the operation of the eVTOL, our eVTOL, then they will be supporting us and ramping up, right? We do have important clauses that allow to increase the ramp-up and the production, for example, based also on the experience of Embraer.

Speaker #3: And then it's those contracts or it's one also of the big synergy and knowledge that we're getting from the Embraer team for the last 56 years.

Speaker #3: They've been negotiating this contract and it's a life cycle contract yet. Like I said, it's not for only the production; it's really to make sure that all throughout the life of and the operation of the EVTOL, our EVTOL, then they will be supporting us and wrapping up, right?

Johann Bordais: It's really to make sure that all throughout the life of and the operation of the eVTOL, our eVTOL, then they will be supporting us and ramping up, right? We do have important clauses that allow to increase the ramp-up and the production, for example, based also on the experience of Embraer. We know that Embraer has been very good to manage and really a spirit of partnership throughout the pandemic, but after the pandemic, with our suppliers. That's the same methodology that we're using. Locating people also at suppliers to follow up with the development and the engineering teams. That's the DNA of our relationship with the suppliers.

Speaker #3: So, we do have important clauses that allow us to increase the ramp-up and the production, for example. But it's also an experience of Embraer, and we know that Embraer has been very good at managing, and really has shown a spirit of partnership throughout the pandemic.

Johann Bordais: We know that Embraer has been very good to manage and really a spirit of partnership throughout the pandemic, but after the pandemic, with our suppliers. That's the same methodology that we're using. Locating people also at suppliers to follow up with the development and the engineering teams. That's the DNA of our relationship with the suppliers.

Speaker #3: But after the pandemic, with our suppliers—and that's the same methodology that we're using—locating people also at suppliers to follow up with the development and the engineering teams. So this is how we, you know, that's the DNA of our relationship with the suppliers.

Andre Madrid: Got it. That's very helpful. I'll leave it at one. Thank you.

Speaker #6: Got it. That's very, very helpful. I'll leave it alone. Thank you.

Speaker #3: Thank you.

Johann Bordais: Thank you.

Operator: This now concludes our question and answer session. I would like to turn the floor back over to Lucio Aldworth for closing comments.

Speaker #4: And this now concludes our question and answer session. I would like to turn the floor back over to Lucio Aldworth for closing comments.

Operator: This now concludes our question and answer session. I would like to turn the floor back over to Lucio Aldworth for closing comments.

Speaker #5: Thanks, Gary. And thank you everyone who joined the call today. As you saw, we achieved several important milestones this quarter. And we're going to continue evolving quickly and forward.

Lucio Aldworth: Thanks, Gary. Thank you everyone who joined the call today. As you saw, we achieved several important milestones this quarter, and that we're going to continue evolving quickly and forward, and all of our achievements are going to be much more clearly visible to all in the investment community. We look forward to meeting you in the next upcoming events we're going to be participating in. As always, if you have any questions, don't hesitate to reach out to me or my team. Thank you, and have a good day.

Speaker #5: And all of our achievements are going to be much more clearly visible to all and to the investment community. We look forward to meeting you at the next upcoming event.

Speaker #5: We're going to be participating and as always, if you have any questions, don't hesitate to reach out to me or my team. Thank you and have a good day.

Speaker #4: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines and have a wonderful day.

Operator: Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines, and have a wonderful day.

Speaker #1: This meeting is no

[Analyst]: This meeting is no longer being transcribed. This meeting is no longer being recorded.

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