Q3 2026 MicroVision Inc Earnings Call

October 28, 2026

Operator: Good afternoon, and welcome to the MicroVision Q3 2026 financial and operating results conference call. At this time, all participants are on a listen-only mode. At the end of management's remarks, there will be a question-and-answer session. Investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of their viewing screen. Analysts who publish research may ask questions on the phone line. For an analyst to ask a question on the phone line, please press star one on your phone. Please note this event is being recorded. I would now like to turn the conference over to Drew Markham. Please go ahead.

Speaker #1: Good afternoon, and welcome to the MICROVISION 3rd Quarter 2026 Financial and Operating Results Conference Call. At this time, all participants are on a listen-only mode.

Speaker #1: At the end of management's remarks, there will be a question-and-answer session. Investors can submit their questions within the meeting webcast by typing them into the Q&A button on the left side of their viewing screen.

Speaker #1: Analysts who publish research may ask questions on the phone line. For an analyst to ask a question on the phone line, please press *1 on your phone.

Speaker #1: Please note, this event is being recorded. I would now like to turn the conference over to Drew Markham. Please go ahead.

Drew Markham: Thank you, Matthew. Good afternoon. I am here today with our Chief Executive Officer, Glen DeVos, and our new Chief Financial Officer, Christine Chambers. Following their prepared remarks, we will open the call to questions. Please note that some of the information you will hear in today's discussion will include forward-looking statements, including, but not limited to, expected near-term and future revenue, operating expenses and cash usage, strategic plans and execution, expectations regarding product deliveries and commercial growth, impact of cost reduction activities, product applications and use cases, market opportunities, cash flow forecasts, liquidity and financing activities, availability of funds and access to capital, as well as statements containing words like believe, expect, plan, and other similar expressions. These statements are not guarantees of future performance. Actual results could materially differ from the future results implied or expressed in the forward-looking statement.

Speaker #2: Thank you, Matthew. Good afternoon. I'm here today with our Chief Executive Officer, Glen DeVos, and our new Chief Financial Officer, Christine Chambers. Following their prepared remarks, we will open the call to questions.

Speaker #2: Please note that some of the information you'll hear in today's discussion will include forward-looking statements, including, but not limited to, expected near-term and future revenue, operating expenses and cash usage, strategic plans and execution, expectations regarding product deliveries and commercial growth, impact of cost reduction activities, product applications and use cases, market opportunities, cash flow forecasts, liquidity and financing activities, availability of funds and access to capital, as well as statements containing words like "believe," "expect," "plan," and other similar expressions.

Speaker #2: These statements are not guarantees of future performance. Actual results could materially differ from the future results implied or expressed in the forward-looking statements. We encourage you to review our SEC filings, including our most recently filed Form 10-K and quarterly reports on Form 10-Q.

Drew Markham: We encourage you to review our SEC filings, including our most recently filed Form 10-K and 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 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. In addition, we will present certain financial measures on this call that will be considered non-GAAP under the SEC's Regulation G.

Speaker #2: 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 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.

Speaker #2: 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 our Form 8-K dated and submitted to the SEC today.

Drew Markham: 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 our Form 8-K, dated and submitted to the SEC today, both of which can be found on our corporate website at ir.microvision.com under the SEC Filings tab. This conference call will be available for audio replay on the investor relations section of our website at www.microvision.com. Now, I would like to turn the call over to Glen DeVos, our Chief Executive Officer. Glen?

Speaker #2: Both of which can be found on our corporate website at ir dot microvision dot com under the SEC filings tab. This conference call will be available for audio replay on the investor relations section of our website at www.microvision.com.

Speaker #2: Now, I would like to turn the call over to Glen DeVos, our Chief Executive Officer. Glen.

Glen DeVos: Thank you, Drew, and good afternoon, everyone. Welcome to MicroVision's Q3 2026 earnings call. Over the past several quarters, we have talked about the transformation underway at MicroVision and our strategy to build a fundamentally different lidar company. Our goal was to broaden the portfolio to enable MicroVision to have the right solutions for our three primary end markets, industrial, security and defense, and automotive. As we enter the final months of 2026, I can state with confidence that our strategy is working, and Q3 was a very important quarter for us. It achieved significant progress across all areas of the business, the portfolio, commercial success, as well as the organization. Our progress in Q3 positions MicroVision for near and long-term revenue growth with an operating model that will drive positive cash flow.

Speaker #3: Thank you, Jerome. And good afternoon, everyone. Welcome to MicroVision's third quarter 2026 earnings call. Over the past several quarters, we have talked about the transformation underway at MicroVision and our strategy to build a fundamentally different LiDAR company.

Speaker #3: Our goal was to broaden the portfolio to enable MicroVision to have the right solutions for our three primary end markets: industrial, security and defense, and automotive.

Speaker #3: Now, as we enter the final months of 2026, I can state with confidence that our strategy is working and Q3 was a very important quarter for us.

Speaker #3: It achieved significant progress across all areas of the business. The portfolio: commercial success, as well as the organization. Our progress in Q3 positions MicroVision for near and long-term revenue growth, with an operating model that will drive positive cash flow.

Glen DeVos: We'll first take a look at the financials, and then I will go into more detail about the key developments in the quarter that are delivering these results. One of those key developments was the addition of Christine Chambers to our team as our Chief Financial Officer. It's a pleasure to have her with us on the call today. With that, I'm going to turn it over to Christine to go through the financials.

Speaker #3: We'll first take a look at the financials, and then I will go into more detail about the key developments in the quarter that are delivering these results.

Speaker #3: Now, one of those key developments was the addition of Christine Chambers to our team as our Chief Financial Officer, and it's a pleasure to have her with us on the call today.

Speaker #3: But with that, I'm going to turn it over to Christine to go through the financials.

Christine Chambers: Thank you, Glen, and good afternoon, everyone. During my first 2 months in MicroVision, I've spent time with our employees, customers, and shareholders. What I've seen and heard reinforces two priorities that will define our financial strategy going forward. First, improving operating efficiency and reducing cash burn. Second, building a strong financial foundation that supports long-term growth and attracts long-term capital. Today's results demonstrate progress against both of those objectives. Before I provide an update on the Q3 results, let me start with operating discipline, cash flow, and how we fund the business while we execute our roadmap. For the 9 months ending 30 September 2026, cash used in operating activities totaled $49.2 million. We remain on track to finish the year near our target operating cash burn of $60 million, depending primarily on the timing of certain working capital items.

Speaker #4: Thank you, Glen. And good afternoon, everyone. During my first two months at MicroVision, I've spent time with our employees, customers, and shareholders. What I've seen and heard reinforces two priorities that will define our financial strategy going forward.

Speaker #4: First, improving operating efficiency and reducing cash burn. Second, building a strong financial foundation that supports long-term growth and attracts long-term capital. Today's results demonstrate progress against both of those objectives.

Speaker #4: But before I provide an update on the Q3 results, let me start with operating discipline, cash flow, and how we fund the business while we execute our roadmap.

Speaker #4: For the nine months ending September 30, 2026, cash used in operating activities totaled $49.2 million. We remain on track to finish the year near our target operating cash burn of $60 million, depending primarily on the timing of certain working capital items.

Christine Chambers: Looking ahead at 2027, we're targeting approximately $40 million of operating cash burn, a reduction of roughly one-third from current levels. To support that objective, we recently implemented a workforce reduction affecting approximately 28% of our organization. These functions focus primarily on non-revenue-generating functions while preserving the resources required to support customer shipments, commercialization activities, and continued HALO development. These decisions were not made lightly. They were intended to create a leaner, more efficient organization while positioning us to support growth and improved operating leverage as revenue scales. Reductions focused on R&D and G&A groups while strengthening our operations and our supply chain resources. The more efficient operating cost structure aligned with commercial priorities is real and underway. Turning to revenue, we remain confident in our full year 2026 revenue outlook of $10 million to $15 million.

Speaker #4: Looking ahead at 2027, we're targeting approximately $40 million of operating cash burn. A reduction of roughly one-third from current levels. To support that objective, we recently implemented a workforce reduction affecting approximately 28% of our organization.

Speaker #4: These functions focus primarily on non-revenue-generating functions, while preserving the resources required to support customer shipments commercialization activities, and continued halo development. These decisions were not made lightly.

Speaker #4: They were intended to create a leaner, more efficient organization while positioning us to support growth and improved operating leverage as revenue scales. Reductions focused on R&D and G&A groups.

Speaker #4: While strengthening our operations and our supply chain resources. The more efficient operating cost structure aligned with commercial priorities is real and underway, turning to revenue.

Speaker #4: We remain confident in our full-year 2026 revenue outlook, with $10 million to $15 million today. We have approximately $10 million of customer purchase orders awaiting shipment, with a majority of inventory already built and available for delivery.

Christine Chambers: To date, we have approximately $10 million of customer purchase orders awaiting shipment, with a majority of inventory already built and available for delivery. These orders, together with the $4.8 million of revenue recognized through September, give us visibility into our full year revenue outlook. The primary variable is going to be shipments rather than customer demand. While certain supply chain dependencies remain, our focus is on shipping products and continuing to scale commercial operations. The second question I frequently get asked is how we intend to fund the business while we execute our roadmap. For the remainder of 2026, our priority is maximizing non-dilutive sources of liquidity. This includes active working capital management, monetization of non-core assets, and other opportunities to unlock value from assets already on our balance sheet.

Speaker #4: These orders, together with the $4.8 million of revenue recognized through September, give us visibility into our full-year revenue outlook. The primary variable is going to be shipments, rather than customer demand.

Speaker #4: While certain supply chain dependencies remain, our focus is on shipping products and continuing to scale commercial operations. The second question I frequently get asked is how we intend to fund the business while we execute our roadmap.

Speaker #4: For the remainder of 2026, our priority is maximizing non-dilutive sources of liquidity. This includes active working capital management, monetization of non-core assets, and other opportunities to unlock value from assets already on our balance sheet.

Christine Chambers: We also continue to maintain access to existing financing tools and have approximately $40 million remaining on the ATM facility should we determine it appropriate to use. As we look ahead to 2027, we expect revenue to double from our 2026 level. 2027 is supported by committed purchase orders exiting 2026, expansion of IRIS sales to existing customers, as well as sales of our MOVIA products to existing and new customers. Alongside expected lower cash burn, we are evaluating financing alternatives to secure what I would describe as clean capital. This includes strategic partnerships and commercial and licensing opportunities, together with continued balance sheet improvements that strengthen our ability to attract long-term capital. We also continue to evaluate strategic alternatives for certain non-core assets, including opportunities to monetize technologies or establish partnerships that can generate value while maintaining focus on our commercialization priorities.

Speaker #4: We also continue to maintain access to existing financing tools, and have approximately $40 million remaining on the ATM facility should we determine it appropriate to use.

Speaker #4: As we look ahead to 2027, we expect revenue to double from our 2026 level. 2027 is supported by committed purchase orders exiting 2026, the expansion of IRIS sales to existing customers, and sales of our MOVIA product to both existing and new customers.

Speaker #4: Alongside expected lower cash burn, we're evaluating financing alternatives to secure what I would describe as clean capital. This includes strategic partnerships, commercial opportunities, and licensing opportunities.

Speaker #4: Together with continued balance sheet improvements that strengthen our ability to attract long-term capital, we also continue to evaluate strategic alternatives for certain non-core assets, including opportunities to monetize technologies or establish partnerships that can generate value while maintaining focus on our commercialization priorities.

Christine Chambers: The combination of sustainable commercial growth, a lower cash burn, and disciplined financing will create a significantly more attractive financing profile. Turning to our Q3 results, the most important takeaway is that we are beginning to see commercial progress translate into financial results. Q3 revenue was $2.4 million compared to $0.2 million in Q3 2025, and equal to the $2.4 million generated during the entire H1 2026. Year-to-date revenue was $4.8 million, nearly five times the $1 million reported through the first nine months of 2025. Just as important as the growth in revenue is the change in the revenue mix. This time last year, revenue was largely driven by software licensing and royalties. Today, the business is increasingly being supported by product shipments into industrial, security and defense, and automotive sectors.

Speaker #4: The combination of sustainable commercial growth, a lower cash burn, and disciplined financing will create a significantly more attractive financing profile. Turning to our third quarter results, the most important takeaway is that we're beginning to see commercial progress translate into financial results.

Speaker #4: Third quarter revenue was $2.4 million, compared to $0.2 million in the third quarter of 2025, an equal to the $2.4 million generated during the entire first half of 2026.

Speaker #4: Year-to-date revenue was $4.8 million, nearly five times the $1 million reported through the first nine months of 2025. Just as important as the growth in revenue is the change in the revenue mix.

Speaker #4: This time last year, revenue was largely driven by software licensing and royalties. Today, the business is increasingly being supported by product shipments into industrial security and defense, and automotive sectors.

Christine Chambers: Commercialization progress is beginning to show up in financial performance, and Glen will describe details of this progress in a moment. Gross profit was $1.2 million, or 50% of revenue, compared with a negative gross profit of -$0.7 million in Q3 of last year. Year-to-date gross margin improved to 46%, compared with -126% in the same period of 2025. The improvement in gross margin was driven by our ability to leverage inventory and assets purchased as part of the Luminar acquisition, including the new manufacturing facility in Orlando. While gross margin will continue to fluctuate based on product mix and shipment timing, these results demonstrate the operating leverage available in the business as revenue scales. Total operating expenses were $22.5 million in the quarter, down approximately 7.5% from our H1 quarterly average of $24.4 million. Research and development expenses declined to $13.2 million.

Speaker #4: Commercialization progress is beginning to show up in financial performance, and Glen will describe details of this progress in a moment. Gross profit was $1.2 million, or 50% of revenue, compared with a negative gross profit of $0.7 million in the third quarter of last year.

Speaker #4: Year-to-date gross margin improved to 46%, compared with negative 126% in the same period of 2025. The improvement in gross margin was driven by our ability to leverage inventory and assets purchased as part of the Luminar acquisition, including the new manufacturing facility in Orlando.

Speaker #4: While gross margin will continue to fluctuate based on product mix and shipment timing, these results demonstrate the operating leverage available in the business as revenue scales.

Speaker #4: Total operating expenses were $22.5 million in the quarter, down approximately 7.5% from our first half quarterly average of $24.4 million. Research and development expenses declined to $13.2 million, and G&A expense was $9.4 million, including approximately $1.2 million of non-recurring finance-related costs.

Christine Chambers: SG&A expense was $9.4 million, including approximately $1.2 million of non-recurring finance-related costs. While operating expenses remain above prior year levels due to the acquisitions of Luminar and Scantinel, the Q3 reflects the first benefits of our ongoing cost reduction initiatives. Importantly, we are now actively aligning resources towards program and markets with the greatest near-term commercial potential. Adjusted EBITDA loss was $11.1 million. This compares to our H1 quarterly average of $18 million. Note that in Q3, we did recognize a $6.3 million research and development German government grant. While we still have work to do, these results reflect the early impact of both revenue growth and operating discipline. GAAP net loss for the quarter was $12.2 million, or $0.45 per share, compared with a net loss of $14.2 million, or $0.72 per share in the Q3 of 2025.

Speaker #4: While operating expenses remain above prior year levels due to the acquisitions of Luminar and Scantinel, the third quarter reflects the first benefits of our ongoing cost reduction initiatives.

Speaker #4: Importantly, we're now actively aligning resources towards program and markets with the greatest near-term commercial potential. Adjusted EBITDA loss was $11.1 million. This compares to our first half quarterly average of $18 million.

Speaker #4: Note that in Q3, we did recognize a $6.3 million research and development grant from the German government. While we still have work to do, these results reflect the early impact of both revenue growth and operating discipline.

Speaker #4: GAAP net loss for the quarter was $12.2 million, or $0.45 per share, compared with a net loss of $14.2 million, or $0.72 per share in the third quarter of 2025.

Christine Chambers: We ended the quarter with $28.9 million in cash and cash equivalents, compared with the $27.2 million in the end of the Q2. Cash used in operating activities was $13.6 million, improving from $16.5 million in the prior year period. The quarter benefited from the receipt of that German R&D grant. Inventory increased by $3.7 million compared to December 2025 as we built sensors to support customer demand, and accounts receivable increased $1.4 million on higher product shipments in the quarter. As we look ahead to the Q4 and into 2027, our priorities remain clear. Continued converting our expanding commercial pipeline into repeatable product revenue and broaden our customer base, and complete the cost reduction initiatives already underway and deliver our objective of reducing annual cash burn by approximately one-third while continuing to support MOVIA production and HALO development.

Speaker #4: We ended the quarter with $28.9 million in cash and cash equivalents, compared with the 27.2 million, in the end of the second quarter. Cash used in operating activities was $13.6 million, improving from $16.5 million in the prior year period.

Speaker #4: The quarter benefit from the receipt of that German R&D grant. Inventory increased by 3.7 million compared to December 2025, as we built sensors to support customer demand and accounts receivable increased 1.4 million on higher product shipments in the quarter.

Speaker #4: As we look ahead to the fourth quarter and into 2027, our priorities remain clear. Continued converting of expanding commercial pipeline into repeatable product revenue and broaden our customer base.

Speaker #4: And complete the cost reduction initiatives already underway and deliver our objective of reducing annual cash burn by approximately one-third while continuing to support Movia production and Halo development.

Christine Chambers: Continue to strengthen the balance sheet and discipline capital management. We will focus on clean funding opportunities, strategic partnerships, and further simplification of our capital structure. Before I hand back to Glen, I will leave you with three messages. First, commercial activity is increasingly translating into measurable financial results, and we are on track to meet the 2026 revenue guidance of $10 to $15 million. Secondly, we are taking decisive actions to improve efficiency and reduce cash burn by a third next year. And third, we are building a stronger balance sheet and financial foundation to support long-term growth and attract long-term capital. We have more work ahead, but I am really encouraged by the progress we are making and confident in the direction we are taking. With that, I will hand the call back to Glen.

Speaker #4: We continued to strengthen the balance sheet through disciplined capital management. We'll focus on clean funding opportunities, strategic partnerships, and further simplification of our capital structure.

Speaker #4: Before I hand back to Glen, I'll leave you with three messages. First, commercial activity is increasingly translating into measurable financial results, and we're on track to meet the 2026 revenue guidance of $10 to $15 million.

Speaker #4: Secondly, we are taking decisive actions to improve efficiency and reduce cash burn by a third next year. And third, we're building a stronger balance sheet and financial foundation to support long-term growth and attract long-term capital.

Speaker #4: We have more work ahead, but I'm really encouraged by the progress we're making and confident in the direction we're taking. And with that, I'll hand the call back to Glen.

Glen DeVos: Thanks, Christine. I would now like to turn the focus to how we are making this happen, and it really starts with our portfolio and the commercial success we are experiencing across the board. Earlier this year, with the Luminar acquisition, we significantly expanded our portfolio with IRIS, a long-range 1550 nm time-of-flight lidar. Over the past three quarters, we have reestablished commercial contracts for IRIS and restarted the production line in Orlando. This has enabled us to secure POs that not only support 2026 guidance, but continue to expand revenue in 2027 and beyond. IRIS delivers outstanding performance and is the pathway to HALO, our next generation 1550 nm time-of-flight lidar, which will replace IRIS and deliver even greater value to existing and new customers. HALO will launch in Q4 of 2027, and we are now in customer evaluation phase of the program.

Speaker #1: Thanks, Christine. I'd now like to turn the focus to how we're making this happen. And it really starts with our portfolio and the commercial success we are experiencing across the board.

Speaker #1: Earlier this year, with Luminar acquisition, we significantly expanded our portfolio with IRIS, our long-range 1550 nanometer time-of-flight lidar. Over the past three quarters, we have reestablished commercial contracts for IRIS and restarted the production line in Orlando.

Speaker #1: This has enabled us to secure POs that not only support 2026 guidance, but continue to expand revenue in 2027 and beyond. IRIS delivers outstanding performance and is the pathway to Halo, our next-generation 1550 nanometer time-of-flight lidar, which will replace IRIS and deliver even greater value to existing and new customers.

Speaker #1: Halo will launch in Q4 of 2027, and we are now in customer evaluation phase of the program. IRIS and Halo are perfectly positioned to dominate the industrial and security and defense spaces, where 1550 nanometer harsh environment operation and a high-performance point cloud are essential requirements.

Glen DeVos: IRIS and HALO are perfectly positioned to dominate the industrial and security and defense spaces, where 1550 nm harsh environment operation and a high-performance point cloud are essential requirements. 1550 nm lidar is also critical for defense applications as it operates beyond the detection range of night vision systems like night vision goggles. Finally, IRIS and HALO are also fully NDAA compliant products made in the USA. This is exactly what our security and defense customers require. IRIS is delivering, and customers like Overland AI and Lake Fusion Technologies will recognize the value and performance that IRIS brings together for their applications. The selection of IRIS for these programs is another important validation of the technology and the broader opportunity for MicroVision in ground autonomy and aviation applications.

Speaker #1: 1550 nanometer lidar is also critical for defense applications as it operates beyond the detection range of night vision systems, like night vision goggles. Finally, IRIS and Halo are also fully NDA compliant, products made in the USA.

Speaker #1: This is exactly what our security and defense customers require. IRIS is delivering and customers like Overland AI and Lake Fusion Technologies will recognize the value and performance that IRIS brings together for their applications.

Speaker #1: The selection of IRIS for these programs is another important validation of the technology and the broader opportunity for MicroVision in ground autonomy and aviation applications.

Glen DeVos: Now, we are also seeing traction with the intelligent transportation system-related customers or ITS for traffic management and analytics, which represents a new customer base within the security and defense space. in Q3, we made critical deliveries to our development partners for work in this area. We see ITS and traffic management as a key growth area for us in 2027 and beyond, as HALO is a perfect fit for these applications with its range and field of view. Furthermore, as we now have the critical suppliers fully engaged, Q4 will see a significant increase from Q3 for IRIS shipments as we accelerate our deliveries. in August, we announced initial and repeat purchase orders from customers in North America and Europe, representing thousands of IRIS sensors across industrial security and defense applications. Those orders spanned applications including off-road autonomy, space systems, material handling, logistics, robotics, and other intelligent systems.

Speaker #1: Now, we are also seeing traction with the intelligent transportation system-related customers. For ITS, for traffic management and analytics, which represents a new customer base within the security and defense space.

Speaker #1: In Q3, we made critical deliveries to our development partners for work in this area. We see ITS and traffic management as a key growth area for us in '27 and beyond, as Halo is a perfect fit for these applications with its range and field of view.

Speaker #1: Furthermore, as we now have the critical suppliers fully engaged, Q4 will see a significant increase from Q3 for IRIS shipments as we accelerate our deliveries.

Speaker #1: In August, we announced initial and repeat purchase orders from customers in North America and Europe, representing thousands of IRIS sensors across industrial, security, and defense applications.

Speaker #1: Those orders spanned applications including off-road autonomy, space systems, material handling, logistics, robotics, and other intelligent systems. Now, this is important for two reasons. First, near-term revenue confidence for '26 and '27.

Glen DeVos: Now, this is important for two reasons. First, near-term revenue confidence for 2026 and 2027. Those are the IRIS shipments. But also, IRIS is the gateway to HALO. Existing IRIS customers will be able to seamlessly transition to HALO starting in Q4 of next year, and new customers can start their development using IRIS with a planned migration to HALO in early 2028. This secures both near-term and longer-term revenue expansion. HALO will bring the same outstanding performance and reliability in a smaller, lower power, and lower cost package. We have already begun customer evaluations of HALO during Q3, and we will have our pre-production samples available early next year for full customer testing and evaluation. Now, IRIS isn't the only thing that's going on. Scantinel continues to make significant progress with the development of their 1550 nm FMCW ultra-long-range data sample scheduled for early next year.

Speaker #1: Those are the IRIS shipments. Also, IRIS is the gateway to Halo. Existing IRIS customers will be able to seamlessly transition to Halo starting in Q4 of next year.

Speaker #1: And new customers can start their development using IRIS with a planned migration to Halo in early '28. This secures both near-term and longer-term revenue expansion; Halo will bring the same outstanding performance and reliability in a smaller, lower-power, and lower-cost package.

Speaker #1: We have already begun customer evaluations of Halo during Q3, and we will have our pre-production samples available early next year for full customer testing and evaluation.

Speaker #1: Now, IRIS isn't the only thing that's going on. Scant and all continues to make significant progress with the development of their 1550 nanometer FMCW ultra-long-range A sample, scheduled for early next year.

Glen DeVos: As we have discussed, the progression from discrete components to a lidar on a chip is exactly how we will continue to drive down costs for lidar while expanding performance, and that's exactly what Scantinel does. Now, in addition to long-range lidar, Scantinel's fundamentally technology, which is the packaging of high-power lasers and amplifiers onto a low-cost photonic integrated circuit or PIC. This applies to adjacent industries, and that is why the introduction of Scantinel ELSFP, which stands for the external laser source small form factor package. Why that ELSFP product is so compelling. The move to photonic interconnects for high-speed processing requires energy and cost-efficient solutions. Scantinel ELSFP delivers exactly that, and this is just part of the overall trend going to optical interconnects for high-speed data.

Speaker #1: As we have discussed, the progression from discrete components to a LiDAR on a chip is exactly how we will continue to drive down costs for LiDAR while expanding performance, and that's exactly what Scantinel does.

Speaker #1: Now, in addition to long-range lidar, Scantinel's fundamentally technology, which is the packaging of high-power lasers and amplifiers, onto a low-cost photonic integrated circuit, or PIC, this applies to adjacent industries, and that is why the introduction of Scantinel's ELSFP which stands for the external laser source small form factor package why that ELSFP product is so compelling.

Speaker #1: The move to photonic interconnects for high-speed processing requires energy and cost-efficient solutions. Scantinel's ELSFP delivers exactly that. And this is as part of the overall trend going to optical interconnects for high-speed data.

Glen DeVos: Now, that creates an opportunity for MicroVision and AI data center infrastructure, where increasing compute density is creating those significant challenges around bandwidth, power consumption, and data movement. To frame it up, the external laser source market is rapidly expanding, with the TAMs growing into the multi-billion dollar levels by 2030. As Christine mentioned earlier, we are currently in discussion with potential licensees and development partners as we evaluate commercialization paths for this technology. It is just an amazing opportunity for us, and it is a good example of what we mean when we talk about extracting greater value from the technology portfolio we have assembled. We did not have to build an entirely new technology stack to do this. We identified an additional significant commercial application for the technology we already own and as part of our portfolio.

Speaker #1: Now, that creates an opportunity for MicroVision and AI data center infrastructure where increasing compute density is creating those significant challenges around bandwidth, power consumption, and data movement.

Speaker #1: And to frame it up, the external laser source market is rapidly expanding, with TAMs growing into the multi-billion dollar levels by 2030. Now, as Christine mentioned earlier, we are currently in discussion with potential licensees and development partners as we evaluate commercialization paths for this technology.

Speaker #1: It's just an amazing opportunity for us, and it's a good example of what we mean when we talk about extracting greater value from the technology portfolio we have assembled.

Speaker #1: You know, we didn't have to build an entirely new technology stack to do this. We identified an additional significant commercial application for the technology we already own, and that's part of our portfolio.

Glen DeVos: Now, in addition to IRIS and Scantinel, we have continued to develop our MOVIA short-range flash lidar products. MOVIA 120 continues its success for the European UGV market, and we plan to replace that in 2027 with MOVIA Pro, which we launched this month. I will come back to MOVIA Pro in just a moment. First, I want to talk about MOVIA L60, the foundation for our MOVIA Air platform. We now have three offerings within that MOVIA Air platform. The first is MOVIA Air, which is based on the MOVIA L60 sensor and adapted for use in drones to provide navigation and collision avoidance capability. This is especially important for package delivery and near ground applications, delivery drones, or drones that operate in congested areas.

Speaker #1: Now, in addition to IRIS and Scantinel, we have continued to develop our movio short-range flash lidar products. Now, movio 120 continues its success with a European UGV market and will and we plan to replace that in '27 with movio Pro.

Speaker #1: And then, which we've launched this month. Now, I'll come back to Movio Pro in just a moment, but first I want to talk about Movio L60, the foundation for our Movio platform.

Speaker #1: We now have three offerings within that movio platform. The first is movio Air, which is based on the movio L60 sensor and adapted for use in drones to provide navigation and collision avoidance capability.

Speaker #1: This is especially important for package delivery and near-ground applications delivery drones or drones that operate in congested areas. The second is movio Air Plus, which is a complete lidar and camera-based mapping and ISR or intelligence surveillance and reconnaissance payload.

Glen DeVos: The second is MOVIA Air Plus, which is a complete lidar and camera-based mapping and ISR, or intelligence, surveillance, and reconnaissance payload that can be mounted to any drone to provide real-time ISR capabilities and real-time communications to the ground. This is where MicroVision's perception platform shines in being able to fuse camera and lidar into a human and computable readable 3D map in real time. No post-processing, no waiting for the drone to come back. The payload develops a lightweight and highly detailed map that is securely transmitted to the ground, the UGVs, or to other assets in real time. Third, we now have MOVIA Air Plus ISR, where we can deliver the entire system, including the drone and the supporting peripheral equipment. This allows our customers to have a complete out-of-the-box solution ready to deploy.

Speaker #1: That can be mounted to any drone to provide real-time ISR capabilities and real-time communications to the ground. And this is where MicroVision's perception platform shines in being able to fuse camera and lidar into a human and computable readable 3D map in real time.

Speaker #1: No post-processing, no waiting for the drone to come back. The payload develops a lightweight and highly detailed map that is securely transmitted to the ground, to the UGVs, or to other assets in real time.

Speaker #1: And third, we now have movio Air Plus ISR, where we can deliver the entire system including the drone and the supporting peripheral equipment. This allows our customers to have a complete out-of-the-box solution ready to deploy.

Glen DeVos: We have demonstrated the complete system with our development partner, Robinson Unmanned and J.A. Green & Company AUSA, and have a full slate of upcoming US and European demonstrations scheduled for the next months. Our partnership with Jay Green is now a key part of moving from this demonstration phase to engagement and contracts. Similarly, our work with Avular in Europe is opening up that region for us. Air, land, and sea-based autonomy are massive growth areas for MicroVision, and we can play a critical role in all of these systems. Our full range of MOVIA Air platforms enables MicroVision to deliver exactly what our customers need at every level of system capability. We first announced MOVIA Air products in August, and they are now ready to go. Well, let us come back to MOVIA Pro. You have heard me talk about MOVIA S in the past.

Speaker #1: We have demonstrated the complete system with our development partner Robinson & Mann at Jifix, AUSA, and have a full slate of upcoming US and European demonstrations scheduled for the next months.

Speaker #1: Our partnership with JA Green is now a key part of moving from this demonstration phase to engagement and contracts. Similarly, our work with Avilar in Europe is opening up that region for us.

Speaker #1: Air and land and sea-based autonomy are massive growth areas for MicroVision, and we can play a critical role in all of these systems. Our full range of movio Air platforms enables MicroVision to deliver exactly what our customers need at every level of system capability.

Speaker #1: We first announced movio Air products in August, and they are now ready to go. Well, let's come back to movio Pro. You've heard me talk about movio S in the past.

Glen DeVos: This was the generic description of our next generation MOVIA short-range flash lidar platform. MOVIA Pro is the first configuration to launch, and it is like no other short-range lidar in the industry. MOVIA Pro not only delivers exceptional point cloud with unmatched uniformity and coverage, it has the full capability of an onboard system-on-chip, an IMU, which means it can support not only the sensor model or the point cloud model, but full perception and advanced features. This eliminates the need for costly external compute and interconnects, and MOVIA Pro is supported by MicroVision's open software framework, making it easier than ever for our customers to develop and integrate advanced features using MOVIA Pro's histograms, point cloud or metadata. MOVIA Pro brings physical AI to the edge in a fully solid state, compact and cost-effective package.

Speaker #1: This was the generic description of our next-generation movio short-range flash lidar platform. Movio Pro is the first configuration to launch and it is like no other short-range lidar in the industry.

Speaker #1: Movio Pro not only delivers exceptional point cloud with an unmatched uniformity and coverage, it has the full capability of an onboard system-on-chip, an IMU, which means it can support not only the sensor model or the point cloud model, but full perception and advanced features.

Speaker #1: This eliminates the need for costly external compute and interconnects, and MOVIO Pro is supported by MicroVision's open software framework, making it easier than ever for our customers to develop and integrate advanced features using MOVIO Pro's histograms, point cloud, or metadata.

Speaker #1: Movio Pro brings physical AI to the edge in a fully solid state, compact, and cost-effective package. We are currently engaged with requests for movio Pro lidars with over 70 end customers.

Glen DeVos: We are currently engaged with requests for MOVIA Pro lidars with over 70 end customers, a significant increase versus the prior period when we were doing the pre-development with MOVIA S. With our launch of MOVIA Pro now taking place, we will begin that process of converting these customers from development to production contracts. The strong customer interest in orders for MOVIA Pro gives us confidence in our revenue outlook for 2027 and beyond. MOVIA Pro is just the beginning for the MOVIA family of products. Over the course of the next year, we will be announcing additional MOVIA variants as MOVIA replaces existing MOVIA L applications and begins production with new MOVIA customers across all of our end markets. Shifting gears a bit, in July, we announced the formation of MicroVision Semiconductor in Colorado Springs, our advanced ASIC development and mixed signal design center.

Speaker #1: A significant increase versus the prior period when we were doing the pre-development with movio S. But our launch of movio Pro now taking place we will begin that process of converting these customers from development to production contracts.

Speaker #1: The strong customer interest and orders for Movio Pro give us confidence in our revenue outlook for 2027 and beyond. And Movio Pro is just the beginning for the Movio family of products.

Speaker #1: Over the course of the next year, we will be announcing additional movio variants as movio replaces existing movio L applications and begins production with new movio customers across all of our end markets.

Speaker #1: Shifting gears a bit, in July, we announced the formation of MicroVision Semiconductor in Colorado Springs, our advanced ASIC development and mixed signal design center.

Glen DeVos: With more than three decades of custom IC development experience, MSI expands MicroVision's ASIC internal development capabilities, which is critical for us really on all of our products, but also opens up external revenue opportunities, as we announced in September with our photonics application award. MSI brings a critical capability in-house while being able to serve the broader market and as an additional source of engineering service revenue for us. Finally, earlier this month, we announced our strategic commercial alliance with Blue-Band, an established leader in intelligent transportation system design and implementation. While Blue-Band will continue to support their existing customer and partnership base, this alliance immediately opens up the ITS market for both hardware and software sales from MicroVision.

Speaker #1: With more than three decades of custom IC development experience, MSI expands MicroVision's ASIC internal development capabilities, which is critical for us, really on all of our products, but also opens up external revenue opportunities as we announced in September with our photonics application award.

Speaker #1: MSI brings a critical capability in-house, while being able to serve the broader market and as an additional source of engineering service revenue for us.

Speaker #1: And finally, earlier this month, we announced our strategic commercial alliance with Blueband. An established leader in intelligent transportation system design and implementation. While Blueband will continue to support their existing customer and partnership base, this alliance immediately opens up the ITS market for both hardware and software sales for MicroVision.

Glen DeVos: ITS is a high-value, rapidly expanding market, and this partnership enables MicroVision to accelerate its position in the space, expand its customer reach, and generate revenue from Blue-Band's established customer base. Also, separate from our Blue-Band alliance, a leading smart mobility technology provider recently selected IRIS as its long-range sensor for applications within its automated traffic safety solutions. IRIS is also in the final stages of evaluation by a provider of autonomous and intelligent system solutions to deliver an integrated lidar perception solution for automatic traffic enforcement applications. These are two really good examples of programs starting with IRIS that will continue to grow over time with HALO. As I mentioned, Q3 was the inflection point for MicroVision, and we have made tremendous progress in strengthening and broadening our portfolio. Why is this so impactful?

Speaker #1: ITS is a high-value rapidly expanding market, and this partnership enables MicroVision to accelerate its position in the space, expand its customer reach, and generate revenue from Blueband's established customer base.

Speaker #1: Also, separate from our Blueband alliance, a leading smart mobility technology provider recently selected IRIS as its long-range sensor for applications within its automated traffic safety solutions.

Speaker #1: IRIS is also in the final stages of evaluation by a provider of autonomous and intelligent system solutions to deliver an integrated lidar perception solution for automatic traffic enforcement applications.

Speaker #1: These are two really good examples of programs starting with IRIS that will continue to grow over time with Halo. As I mentioned, Q3 was the inflection point for MicroVision, and we have made tremendous progress in strengthening our and broadening our portfolio.

Speaker #1: Why is this so impactful? It enables MicroVision to win in our primary end markets delivering near-term revenue for '26 as well as strong growth in '27 and beyond.

Glen DeVos: It enables MicroVision to win in our primary end markets, delivering near-term revenue for 2026, as well as strong growth in 2027 and beyond. This is exactly what we are now seeing. Let me shift over to the organization, the third element. As MicroVision advances its commercial growth strategy and path to profitability, we are taking deliberate steps to align our organization, talent, and resources with our highest priority opportunities. Our focus is on building a leaner, more agile, commercially driven organization that operates with greater precision, accountability, and efficiency. This includes restructuring our teams to ensure we have the right capabilities and resources directed towards the markets, products, and customer opportunities we believe offer the greatest potential for near-term revenue generation and long-term growth. These decisions are part of a broader commitment to financial discipline and operational efficiency.

Speaker #1: And this is exactly what we are now seeing. The only shift over to the organization is the third element. As MicroVision advances its commercial growth strategy and path to profitability, we are taking deliberate steps to align our organization talent and resources with our highest priority opportunities.

Speaker #1: Our focus is on building a leaner, more agile, commercially driven organization that operates with greater precision, accountability, and efficiency. This includes restructuring our teams to ensure we have the right capabilities and resources directed towards the markets.

Speaker #1: Products and customer opportunities we believe offer the greatest potential for near-term revenue generation and long-term growth. These decisions are part of a broader commitment to financial discipline and operational efficiency.

Glen DeVos: By prioritizing investments, streamlining our organizational structure, and reducing our costs where appropriate, we are positioning MicroVision to execute more effectively, accelerate commercialization, and make measurable progress towards positive cash flow. Our objective is clear: focus our people, our capital, and our capabilities where they can create the greatest impact. This restructuring is not simply about reducing costs; it's about building the organization MicroVision needs for its next phase of commercial growth, with the discipline, focus, and execution capabilities required to deliver on our priorities and advance our path to profitability. Before we call for questions, I want to leave you with a few thoughts about where MicroVision stands today and where we are headed. When I started as CEO of MicroVision just over a year ago, we set out a plan to transform the company, and that is exactly what we have been doing.

Speaker #1: By prioritizing investments, streamlining our organizational structure, and reducing our costs, we're appropriate we are positioning MicroVision to execute more effectively, accelerate commercialization, and make measurable progress towards positive cash flow.

Speaker #1: Our objective is clear: focus on people, our capital, and our capabilities where they can create the greatest impact. This restructuring is not simply about reducing costs.

Speaker #1: It's about building the organization MicroVision needs for its next phase of commercial growth. With the discipline, focus, and execution capabilities, required to deliver on our priorities and advance our path to profitability.

Speaker #1: Now, before we call for questions, I want to leave you with a few thoughts about where MicroVision stands today and where we are headed.

Speaker #1: When I started as CEO of MicroVision just over a year ago, we set out a plan to transform the company. And that is exactly what we have been doing.

Glen DeVos: Over the past quarters, we've consolidated an industry-leading lidar-based technology portfolio