Management Commentary
"We made meaningful progress executing our strategy during the first quarter, which culminated in our recent announcement of being selected for series production with one of the world's three largest vehicle groups," said Omer Keilaf, CEO and Co-Founder of Innoviz. "This marks our third design win for series production, our first for InnovizTwo, and also our first as a direct Tier1 supplier. This is a major achievement that we believe will propel us to a market leading position and accelerate our ability to potentially win many other opportunities. Being selected out of many other LiDAR and Tier 1 solutions is a vote of confidence for our technology, product and company."
"We are implementing our strategy systematically. The automotive industry is at a unique inflection point and we believe that with this win we are meeting it with the right momentum. Our objective is to secure several additional series production deals in the coming years to provide us with meaningful and sustainable revenues. We will also build our production capacity for our two new products, InnovizTwo and Innoviz360, to quickly penetrate the non-automotive market, which we believe is in great need of solutions like ours. Our strategy is designed to maximize our long-term market share as we grow our revenues short-term and deliver profitability in the coming years."
Commercial Progress Resulting from First Quarter Activities
Following two years of working closely with the customer, we plan to incorporate InnovizTwo LiDAR and Innoviz Perception Software into a new platform that will serve multiple auto brands over the next decade.
For Innoviz, this new nomination marks:
- Third major series production design win in the automotive space.
- First design win for series production with the new generation Innoviz product, InnovizTwo.
- First design win for high volume series production with Innoviz as a direct supplier.
- Selection for a high-volume project by one of the world's largest vehicle groups.
- Increase of forward-looking order book by $4 billion to a total of $6.6 billion (not including NRE, samples during development, production tools, and post-launch software services).
- A surge of confidence made by one of the largest vehicle groups in the world is likely to influence many other car makers.
- A joint announcement is expected following the first delivery milestone in the coming months.
Expansion and Delivery
On a continuous quest to grow the Company's market share and revenues, Innoviz is working on many fronts:
- RFI/RFQ funnel: There are currently 12 different customers at different stages of the RFI/RFQ process. The company believes that the recently announced design win will accelerate these decisions to select Innoviz.
- China: Innoviz recently announced a collaboration with China- and Germany-based LiangDao, a global leading system provider of LiDAR sensing, to accelerate the introduction of series production solutions of high-resolution LiDAR for the Chinese market, based on InnovizTwo.
- Production readiness: Targeting completion of InnovizOne production validation toward the launch of Innoviz's existing series production programs next year.
- Sales and revenues: Innoviz is currently developing high-volume production tools for its new products, InnovizTwo and Innoviz360. Both products are expected to achieve improved margins and fast market penetration due to their ability to provide a significantly stronger product fit compared to other solutions in the market today.
Corporate Development
Increased employee headcount by 15 people in the first quarter of 2022, bringing the Company's total number of employees to 419 as of March 31, 2022. The increase in headcount was driven by the need to support current and upcoming programs and new product development. Approximately 70% of the Company's employees are members of the Company's research and development team.
First Quarter 2022 Financial Results
Revenues for Q1 2022 were $1.8 million, compared to $0.7 million in Q1 2021. The Company expects InnovizOne sales to continue to increase this year and is also planning to sell the first samples of InnovizTwo this year.
Operating expenses for Q1 2022 were $31.1 million, an increase from $19.7 million in Q1 2021. Operating expenses in Q1 2022 included $4.7 million of share-based compensation compared to $1.8 million of share-based compensation in Q1 2021. The increase in operating expenses was primarily due to the increase in the number of our employees and in share-based compensation.
Research and development expenses for Q1 2022 were $22.8 million, an increase from $16.7 million in Q1 2021. Research and development expenses in Q1 2022 included $2.7 million attributable to share-based compensation compared to $1.3 million attributable to share-based compensation in Q1 2021.
Innoviz had approximately $275 million in cash, short term deposits and marketable securities as of March 31, 2022 compared to approximately $304 million as of December 31, 2021. We believe our debt-free balance sheet and strong cash assets will enable us to continue executing our strategy. We remain focused on using our cash to make strategic investments in research and development, sales and marketing, and production ramp-ups.
Guidance
As a result of Innoviz's new design win with one of the world's largest vehicle groups, Innoviz is updating its guidance as follows:
- Innoviz is increasing its forward-looking order book guidance by more than 150% to $6.6 billion, up from $2.6 billion projected last quarter.
- Innoviz currently has 12 prospective customers in RFIs and RFQs stages, up from 10 at our last earnings call.
- Innoviz expects to achieve its stated goal to secure 10 pre-production programs during 2022. To-date the company has secured 9.
Conference Call
Innoviz management will hold a web conference today, May 11, 2022, at 9:00 a.m. Eastern time (6:00 a.m. Pacific time) to discuss these results. Innoviz CEO Omer Keilaf and CFO Eldar Cegla will host the call, followed by a question-and-answer session.
Investors are invited to attend by registering in advance
here. All relevant information will be sent upon registration.
