Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Innoviz Technologies Ltd (NASDAQ:INVZ) recorded strong financial performance in 2024 with revenues of $24.3 million, exceeding the midpoint of their guidance range.
• The company decreased its cash usage in operations and capital expenditures to $81.4 million from $99.6 million in 2023.
• Innoviz Technologies Ltd (NASDAQ:INVZ) entered into an $80 million NRE payments plan with key customers, strengthening its financial position.
• The company completed a registered direct offering of securities, generating gross proceeds of approximately $40 million.
• Innoviz Technologies Ltd (NASDAQ:INVZ) announced an operational optimization expected to deliver approximately $12 million in annualized savings.

Negative Points

• Despite strong financial performance, the company still faces risks and uncertainties related to future events and financial performance.
• There may be continued lumpiness in gross margins as the company ramps up production and NRE revenues fluctuate.
• The company is still in the process of achieving key milestones, such as the C sample phase for its products, which could impact timelines.
• Innoviz Technologies Ltd (NASDAQ:INVZ) is exposed to potential tariff implications, which could affect production and RFIs/RFQs, especially in North America.
• The company has not provided specific quantification of expected improvements in free cash flow or cash burn reduction for 2025.

Q & A Highlights

• Warning! GuruFocus has detected 3 Warning Signs with INVZ.

Q: On the last earnings call, you mentioned a potential nomination with a top auto OEM. Can you provide an update on this? A: (CEO) We have passed the legal discussions and are awaiting the customer's final alignment. We will update once we learn about the OEM's next steps.

Q: Can you provide more detail on your expectation for free cash flow this year and how much you can reduce the burn in 2025 compared to 2024? A: (CFO) We expect to continue reducing cash burden, with NREs being positive contributors. While we can't quantify the improvement at this time, we anticipate an improvement quarter over quarter and year over year.

Q: Could you share insights on potential tariff implications and how they might affect your production and RFIs/RFQs? A: (CEO) Currently, we don't see an impact as our production partner is in Asia, not China. In terms of RFIs and RFQs, we see increased interest in the US, which serves us favorably due to our geopolitical neutrality.

Q: Can you explain what getting an NRE booked means and what triggers those payments to be recognized? A: (CEO) NREs are payments for development efforts before production ramp-up, varying by program type and customer. They are recognized based on milestones, with customer acceptance allowing us to recognize them as revenue.

Q: Regarding the VW ID Buzz program, what milestones remain before SOP? A: (CEO) We are approaching the C sample phase and ramping up high-volume manufacturing. The C sample stage involves testing production validation elements, and once completed, we can reach SOP, targeted for early next year.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.