Greetings, and welcome to the Aurora's Third Quarter 2025 Business Review Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Stacy Feit, Vice President, Investor Relations. Thank you, Stacy. You may begin.

Thank you, Alicia. Good afternoon, everyone, and welcome to our third quarter 2025 business review call. We announced our results earlier this afternoon. Our shareholder letter and a presentation to accompany this call are available on our Investor Relations website at ir.aurora.tech. The shareholder letter was also furnished with our Form 8-K filed today with the SEC. On the call with me today are Chris Urmson, Co-Founder and CEO and David Maday, CFO. Chris will provide an update on our progress we have made across the key pillars of our business, and David will recap our third quarter financial results. We will then open the call to Q&A. A recording of this conference call will be available on our Investor Relations website at ir.aurora.tech shortly after this call has ended. I'd like to take this opportunity to remind you that during the call, we will be making forward-looking statements. These statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed, projected or implied during the call. In particular, those described in our risk factors, including in our annual report on Form 10-K for the year ended December 31, 2024, and other documents filed with the SEC as well as the current uncertainty and unpredictability in our business, the markets and economy. Additional information will also be set forth in our quarterly report on Form 10-Q for the quarter ended September 30, 2025. You should not rely on our forward-looking statements as predictions of future events. All forward-looking statements that we make on this call are based on assumptions and beliefs as of the date hereof, and Aurora disclaims any obligation to update any forward-looking statements, except as required by law. Our discussion today may include non-GAAP financial measures. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results. Information regarding our non-GAAP financial results, including a reconciliation of our historical GAAP to non-GAAP results, may be found in the shareholder letter, which was furnished with our Form 8-K filed today with the SEC and may also be found on our Investor Relations website. Our discussion today may also include reference to forward-looking free cash flow, a non-GAAP financial measure. To the extent that this forward-looking financial measure is provided, it's presented on a non-GAAP basis without a reconciliation due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. With that, I will now turn the call over to Chris.

Thanks, Stacy. In the third quarter and early October, Aurora achieved several more driverless trucking industry firsts, rapidly advancing our path to scale and further extending our leadership position. The crank we set in motion with commercial launch is now accelerating, delivering compounding returns across our technology, operations and customer adoption. Earlier this month, the Aurora Driver surpassed 100,000 driverless miles on public roads. Importantly, we've maintained 100% on-time performance, while upholding our perfect driverless safety record. Last week, we launched driverless commercial operations on the westbound 600-mile lane from Fort Worth to El Paso, setting a new benchmark for autonomous trucking. This expansion accomplished just 6 months after our driverless launch is faster than any other self-driving company has scaled to a second U.S. market. The Aurora Driver unlocks substantial value on this lane, and we're thrilled to add multiple customers, including one of the leading carriers in the U.S. to our driverless cohort for this route. To meet expected customer demand in the second quarter of 2026, we plan to launch our second-generation commercial hardware kit on a new fleet of trucks that will enable driverless operation without a partner requested observer. This third vehicle fleet fortifies our near-term capacity plan and supports our scaling objectives for 2026. Let's dig into what we've been up to. Following earlier-than-anticipated validation of night driverless operations in July, we're already seeing the utilization potential of our self-driving trucks. Our highest mileage driverless truck logged nearly 18,000 miles in a single month. This demonstrates the confidence we have to operate trucks at an annual run rate that doubles the industry average. Our team's focus has since turned to driverless lane expansion and validation in more challenging weather conditions to further increase the value of the Aurora Driver for our customers. Our second…

Thank you, Chris. Let's discuss our financial results for which we have provided a summary on Page 17 of the slide deck for reference. Third quarter 2025 revenue totaled $1 million across driverless and vehicle operator supervised commercial loads for Hirschbach, Uber Freight, Werner, FedEx, Schneider and Volvo Autonomous Solutions, among others. The Aurora Driver achieved another record number of commercial miles driven during the quarter, which drove a 12% sequential increase in revenue from the second quarter. Third quarter operating losses, including stock-based comp, totaled $222 million. Excluding stock-based comp of $51 million, R&D totaled $138 million, SG&A was $28 million and the cost of revenue was $6 million. We used approximately $149 million in operating cash during the third quarter and capital expenditures totaled $8 million. This cash spend was meaningfully below our externally communicated target, reflecting continued strong fiscal discipline. We expect cash use of $175 million to $185 million during the fourth quarter of 2025. During the third quarter, we issued 80 million shares of Class A common stock through our at-the-market program for net proceeds of $460 million. We used $21 million of the net proceeds to fund the tax liability associated with the vesting of our employees' restricted stock units during the third quarter. In turn, we ended the third quarter with a very strong balance sheet, including increased liquidity of $1.6 billion in cash and short-term and long-term investments. We expect this liquidity to fund our operations into the second half of 2027. We will be providing 2026 financial objectives in the fourth quarter 2025 business review in February. For the remainder of the year, we will continue to focus on expanding driverless operations and advancing our program to support our 2026 scaling objectives to accelerate our first-mover advantage to reinforce our leadership position. With that, we'll now open the call to Q&A.

[Operator Instructions] Our next question comes from the line of George Gianarikas with Canaccord Genuity.

Maybe first, I'd like to ask if you could sort of give us form and shape to your plans for moving from a terminal to endpoint shipments.

Yes. Thanks, George. Great to take a question from you. I think one of the misconceptions that we hear is that this is kind of a big deal, and it really isn't. So today, for example, when we're operating -- getting to our Houston terminal, we drive for about 5 miles through various industrial park surface streets to get to our terminal. So we have a system that's capable and able to deliver this, like it works well. So for us, it's just a matter of timing and sequencing when the volumes are sufficient that it's relevant for our customers. And so we intend to be rolling that out to customers through the next year. Dave?

Yes. And I would say maybe 2 other things. One of them is on the misconception piece, right? Like if you think about endpoints, customer endpoints, roughly 80% of those endpoints are within a 5-mile range from a highway. So this is not a difficult technical challenge at all. I think -- the other thing it's important to point out that we started out -- and everything kind of relates to our technology rollout and our crawl, walk, run, right? So we started out operating a small fleet of trucks that we're continuing to build up. But it's important to understand that we need to be able to drive in all weather conditions, right? We already opened up nighttime earlier. We're expanding lanes, but we also want to be able to operate in rain and heavy wind. And when we're able to operate in all these conditions then, when we go to customer endpoints, we're able to operate a larger number of vehicles between their specific endpoints. So the one thing that's really important is to make sure that we've got a really robust product that is operating between the endpoints. So I would say that this is a very deliberate plan that we're executing upon.

And maybe as a follow-up in 2 parts. So in your press release, you say that you want to deploy hundreds of trucks next year that feels like a little bit of an acceleration. Is that true? And the second part of the question is, is that being enabled by your partnership with international, which I think is new. Did you have a partnership with international before this?

Yes. So this is, I think, in line with what we've been saying for a while now. We've been saying we want to get 10-plus -- tens of trucks this year, and we want to get hundreds next year. And so I think it's us aiming to accomplish what we set out to do. In terms of with international, this is a new relationship. So we are purchasing trucks from international, and we're doing the upfit ourselves. We continue to work with Volvo and PACCAR and continue to be excited about the plan forward with them. This is a way for us to take timing into our own hands, ensure that we can deliver this and support and fortify our volumes for next year as a response to the customer interest that we're seeing today.

Our next question comes from the line of Ravi Shanker with Morgan Stanley.

If I can just quickly the line of discussion on international. I just wanted to confirm, so are you just buying the trucks off a lot and kind of rolling that out as a third fleet? Or is this an actual OEM relationship like you have with PACCAR and Volvo, in which case, kind of is there a time to commercial launch of that as well?

Ravi, it's Dave. So we are buying stock trucks. We're not actually buying necessarily up a lot. We are ordering them through international, but there is no co-development partnership associated with those. So it's important to understand that we've got a tremendous experience in how to integrate the Aurora Driver into platforms. We've done it on like roughly 8 platforms. So we understand all the necessary capabilities to launch a safe product. And in this particular case, we've got 2 partnerships with co-developments already. We felt this was a great opportunity for us to continue to meet customer demand and work and offer the Aurora Driver on a third platform.

And to answer the second half of your question, Ravi, we expect to have the international truck on the road driverless in Q2 of '26. So we're excited to add that to our growing fleet.

Understood. That's helpful. And maybe as a follow-up, as you guys get closer to launching Gen 2 and specing the Gen 3 hardware, when do you get a sense of the bill of materials and the cost of the system involved? And maybe also, like when do you expect to have conversations with your OEM partners and maybe launch actual pricing of the truck and the system for your customers?

Yes. So I think on the bill of materials for the Aurora Driver, we have very good insight into that today. We track it as part of our development process. We know what that bill of material cost is. And it's important to understand again that as we look at that cost, that doesn't get borne upfront as part of the purchase of a truck, that is paid through the subscription that customers will pay for the Aurora Driver, this Driver as a Service model. And we factored that into the cost and into the revenue stream and profitability of the business going forward.

Our next question comes from the line of Colin Rusch with Oppenheimer.

You've talked a lot about the simulation expertise that you have. Can you talk a little bit about any sort of acceleration that you're seeing or any sort of transitions that may see hiccups, as you move to the new hardware?

Yes. Well, first, yes, we think simulation is an important tool. It's something we've invested in and I appreciate you recognizing that. No, we don't really see any hiccups. Like one of the things that we -- that I think a lot of folks don't really understand is that the automated driving system is a complicated, difficult thing to build. But the tools and process and rigor you have to put in place to have conviction that the thing is safe to put out on the road and operate at 70 miles an hour down the freeway is at least as hard, if not harder. And so as we've been building our processes for validation and release, we've designed them with an eye towards this needs to scale. This needs to allow us to accelerate our release process over time and meet the needs for that second generation, third-generation hardware. And so it's kind of moving along as we'd hoped. So yes, I hope that -- I'm not sure if I answered your question, but we're feeling pretty good about this.

Okay. Yes, I'll follow up offline. The second one is really around customer comfort with the technology. Now that you're accumulating a fair amount of experience on the road without the driver, how quickly are customers getting comfortable with taking a safety driver out of the cab and thinking about actually starting to deploy with you guys out of the gate without a driver?

Yes. I think that, one, it's dangerous to characterize all customers in one bucket. And so there's obviously a spectrum of them. But what we're seeing is enthusiasm, right? The conversation has moved from, hey, maybe this will happen to, oh, it's happening. I can see why this will benefit my business. I would like to have access to that. And so we mentioned Russell Transport. That's a customer that just signed up with us and signed up with us on day 1 to operate driverlessly. And we expect that to be the flavor of many of the customer relationships that we're going to put in place going forward.

Our next question comes from the line of Andres Sheppard with Cantor Fitzgerald.

Congrats on all the great progress. I think some of our questions have been asked. But Chris, I'm hoping maybe if you can help us maybe give us some granularity as to how we should think about the truck deployments for Q4 and maybe early next year to -- I guess, so you have 5 in operational as of now. So to get to more than 10, presumably, that means deploying 6 additional trucks before year-end. So I mean, how should we think about Q4 deployments and maybe ASPs? Any granularity you might be able to give us there? I know we'll get more color on Q4 for next year, but helpful...

Yes. Yes. So we expect to get to 10 trucks operating driverlessly at the end of this year. We'll kind of ramp them through the course of Q4. We really -- you're probably sick of us saying crawl, walk, run but we very much believe that. We want to make sure that customers are comfortable, regulators are comfortable that we're building out at a rate that really enables us to do something useful in the world. For us right now, it's a balance between increasing driverless operation and utilizing the fleet that we have to advance capability to deliver that value to customers. And so we're putting time into, of course, the lane expansion work and into weather so that as those trucks begin operating driverlessly, they're maximizing the utility for the customers.

Got it. Okay. That's helpful. And I guess as maybe a quick follow-up. So in your presentation in the time line slide, you talked about having positive gross profit by end of '26 or early '27. How should we think about that? Is there a certain number of trucks in operation that you think you'd need to get to that point? Or is there a better way to think about kind of that ramp-up?

Yes. So it's a little bit of truck volume. It's a little bit of continuing our capabilities that we're focusing on today. So there's -- what we've tried to describe as 4 key enablers. The first one is to launch our second-generation hardware kit. We are well on the way to that, and that will be launched with the introduction of our new fleet of trucks in April. So we're really excited Q2 -- sorry. And we're really excited about that. I think there's an element of continued progress on remote assistance. And we've said before, again, remote assistance, they're not operating the vehicles, but they are supporting the vehicles if there's any need for support like detecting different signs and things like that, that we want to clear. We're well on our path towards that where we think we're going to be able to have one person operating and supporting multiple vehicles. We're going from a few to many. And so we think that path is pretty clear. There is an element of what type of support do we need on site if we're able -- if there's, let's say, we have a tire blowout or something like that. We're pretty confident in that. That still needs a little bit of work to prove out, but we think that there's a pretty clear path to that. Those are the big items that we talk about. And then the last one is, obviously, you need a sufficient scale because we do have some structural cost elements, whether we operate at our terminals or our insurance costs, et cetera, where just purely the mileage accumulation is really important. So again, I think when we originally talked about gross profit positive, we had established a target for ourselves, this was back in '24, by the end of '26. We launched a little bit later for commercial launch. So we expect that may flow into '27, early '27. But we still feel confident that, that's a good target, but we're not putting any formal guidance out yet for '26 profitability.

And just to add on what Dave was saying right now, like take, for example, the Aurora Driver hardware kit, there, we just look at the BOM cost, and we see roughly half the price of what our current system is. And then you add to that the increased durability, so you can amortize that over a longer distance or a longer amount of driving. That's a big mover, and we see that coming online in '26 or in Q2 '26.

Our next question comes from the line of Chris Pierce with Needham & Company.

If we just go back to the international truck announcement, I just want to understand, will customers be able to buy international trucks that you upfit? Or is this just something you're doing to sort of pull forward or accumulate more proof points with the Aurora Driver technology?

So as you know, today, we're operating in this, what we call Transportation-as-a-Service mode, where we're operating trucks for our customers. And initially, we expect that's how this will operate. So we'll own these trucks. They'll be out there revenue generating, generating value for customers. Maybe at some point in the future, we consider that. But initially, this is going to be trucks we own and operate and get paid for.

And should we think about, if it goes well, is this something where you've talked about launching with other OEM partners in the past. Do you -- but international has a public autonomous partner already. Do you see a world where OEMs have multiple autonomous platforms and the end user, the truck fleet chooses which one they want based on metrics or price? Or how do you kind of see the market shaking out?

Yes. We've made no secret that we intend to have the Aurora Driver available on all OEM platforms. And we love the opportunity to compete. We think the Aurora Driver is going to be the best product in the market. And so yes, we would love to have and hope to have a long-term relationship here.

Okay. And then just lastly for me, not to sort of put you on the spot, I'm not sure how many headlines you're watching during the day, but there were some headlines from NVIDIA all across mobility today with OEM partners, eVTOL partners and in the -- with international in the trucking space. What's the right way to sort of frame this announcement, if you saw it versus your relationship with NVIDIA? I just want to kind of understand what is new, not new, kind of how we should think about that broadly, if there's something you can speak to?

Yes. We've obviously been working with NVIDIA and AUMOVIO on the third-generation Aurora commercial hardware kit for some time now. I think we announced it back in January, maybe. So great to see others recognizing the opportunity to use this technology. We think it's great hardware. And will this continue to build our business? Yes. NVIDIA makes good products. So I'm not surprised others are using them.

Our next question comes from the line of David Vernon with Bernstein.

So first question for you on the equipment side. You mentioned in the presentation that the second generation should be getting a 50% reduction in the hardware cost. Is there a scale number to think about that you need to hit to get to that level? And then with this equipment, like what's the actual life cycle of this stuff? Like how often do you -- are you envisioning that you're going to need to kind of be upgrading the hardware on a truck? Or is it going to lack the truck?

Yes. So as we talk about the price point of the bill of material savings, that's across this production run of 1,000-plus units, right? And as we talked about in the past, we have the vehicles we have today with our first-generation hardware. We knew we could build that in tens and not more. And that's why we have the second-generation hardware where our contract manufacturing partner, Fabrinet, is producing those, and that gets us to 1,000 plus. And then, of course, the truly large automotive scale comes in with the AUMOVIO partnership, and that's when we can get to tens of thousands of units. So this fits kind of the bridge between tens and tens of thousands. And so the price numbers are across that 1,000-plus scale, and we have commitments and alignment on that. In terms of the life cycle, we expect this hardware to be lasting 1 million miles. That aligns well with the kind of useful first ownership for many of these trucks and meets our objectives for the profitability and financials here.

Okay. That's helpful. And then, Dave, my second question would be for you on your sort of illustrative end-to-end case study, looking on Page 16 of your presentation there for Fort Worth to Phoenix. If I have my metrics right, I'm pretty sure a fully loaded Class A tractor can go 1,000 to 1,200 miles on a full tank of gas. With the driverless, couldn't this truck make the trip in a day as opposed to the 2 to 3 that a normal trucker would quote for? And if that's right, then why sell it at 205 a mile?

Yes. I think it's a -- well, a couple of things. Number one, yes, we can drive the same distance for fuel economy. We're actually probably slightly better for fuel economy. We're averaging about 15% better than the traditional human driver. We can go all that distance and our intent is to go in a single day. I think the 205 is also illustrative for us because each lane is going to be a little bit different in terms of its pricing environment and the customers. And so for us, we've always said that in the Transportation-as-a-Service element, which is -- this is the illustrative kind of example, and then there's the Driver as a Service example. In each of these particular examples, Transportation-as-a-Service, we're kind of pricing like the rest of the market. And for the Driver as a Service, we've got the 65% to 85% range. But we'll get more specific on pricing when we get a little bit further along.

David, I just jump in here for one second. I think -- just because Dave doesn't have the slide in front of him. The revenue per mile that we have there, that's not necessarily to Aurora, right? So this is an end-to-end in a Driver as a Service business model. That is an industry rate that DAT sourced, right? So we're using that cost. Basically, that's what a carrier would be paid to haul those loads on that lane based on industry data. And then we're showing how much more revenue and margin we can drive for the customer based on the Driver as a Service model in which they are paying us the driver fee. So we can actually walk through the math offline, but I just wanted to clarify that one piece.

And I do think, though, to your point as there is an opportunity potentially for premium pricing here because of the speed at which you can move these goods. But we're still exploring when and if that's an appropriate lever to pull.

Okay. And -- but -- is the software subject to any hours of service or no? And then I'll let you go, sorry...

No, it's not. No, the software is not subject to hours of service because if you just think about the reason for the hours of service limitation, it's because a person gets tired, right? Our software is that super human ability to not get tired.

Our next question comes from the line of Mark Delaney with Goldman Sachs.

First, just hoping to better understand some of the progress the company has been making with Volvo. I think in the last earnings call, you spoke about hoping to have 20 trucks from them by the end of the year. Where do you stand with that? And if I understood the press release today, you also are working to integrate at lineside. So if you could share some time frames for that as well. So a couple of different parts to Volvo time lines and progress, please.

Yes. Mark, can you just hit the first part again, just to make sure I got it correct.

I thought you were planning to take some trucks from Volvo Autonomous Solutions, if I was remembering correctly. Where did you stand with those and getting those validated? And then I think you also talked today about doing some lineside integration. I was hoping to also understand when that may materialize.

Yes. Okay. So I just want to make sure that I got the 20 part right. So yes, for Volvo Autonomous Solutions, what we had said, and we had said this last time as well, that we are starting to get their second set and now we're actually in the process of building kind of their third set of trucks. And so there's -- they call like B-Sample and C-sample. So they're development trucks that have all the representative hardware. But as Chris mentioned, there's still some updates associated with the firmware and the software that need to be done to have them fully validated for driverless operations on their truck platform. And we're in the midst of deploying those trucks, and we use them in terms of delivering commercial loads to support Volvo Autonomous Solutions business as well as development testing and integrating them into our second-generation hardware. What Chris referenced even today is that we actually have our first lineside integration of the Aurora Driver kit being lineside installed at an assembly plant -- at their New River Valley assembly plant. And so that's really a look into the future because remember, one of the things that we're really excited about with the PACCAR and Volvo partnerships is the ability to build at scale. And one of the key components of really building at high scale, high volume is the ability to lineside install like it was any other part that was being assembled onto the vehicle. And so we're making progress on both of those fronts.

Very helpful, David. And just the time frame to be done with the testing and validation with Volvo, do you have an estimate you can share?

Yes. We -- again, same as always, we're going to try not to talk about our customers and our partners' timing. We let them do that, but we're making tremendous progress. And again, we're starting lineside integration. So things are advancing really well for us.

Okay. And then just my last question was just on the news with international. Maybe just talk a little bit more around how that's evolved and how that supports your driver out timeframes that you were describing in your prepared remarks.

Yes. So I think with international, also super excited. And we've had a lot of -- the interest and the customer demand on the Aurora Driver has really been strong, and we continue to make great progress technically. And we want to be able to kind of fulfill that promise of being able to deploy these trucks across the Sun Belt and working off of international trucks where we upfit stock trucks from international and being able to install the Aurora Driver on those and deploy those driverlessly without an observer in the second quarter of 2026 is a great opportunity for us to meet demand and kind of fill that volume potential and continue to demonstrate our leadership position. So our focus is really on continuing to build the momentum across the board.

Our last question comes from the line of Itay Michaeli with TD Cowen.

Just 2 questions on the product road map. First, Chris, you mentioned kind of solving for some of the dust storms. I'm curious as you solve for that, how much of that was kind of done by the lidar -- your lidar versus radar? And secondly, I guess, a slight delay in the rain and heavy wind update. Just maybe talk a little bit about that. Was that just tied to maybe having to solve for the dust storms first and that pushed out a little bit? Anything you could share there would be helpful.

Yes. So on the -- how do we deal with the dust storm part of this. There, as we said for a long time, we see real value in having a complementary set of sensors. They have different strengths and weaknesses. And so there isn't like we just use lidar or we just use radar. We build a model, a perception model and AI model that's taking data from those different sources and producing the best possible outcome from it. And so we lean into the special properties that come along with FirstLight, our FMCW lidar. And of course, radar, given its relatively longer wavelengths is less impacted by dust. And so between the 2 of them, we do a really nice job of seeing what's on the road in front of us. In terms of the rain pushout, this is -- like we look at this as just not a thing, right? Whether it's the end of December or the kind of the beginning of January, we just like to report things with integrity, and we realized it was going to come out in the release a couple of weeks later than we had originally said. So we just value transparency figure we'd share that.

Yes. And it's also important to point out that we also pulled ahead the Fort Worth to El Paso lane quite a bit. We're going to continue to drive towards moving really quickly on this. And as Chris reminded me even earlier today, we are going to give people a little bit of a breather during the holidays.

Yes, Dave has to remind me not to beat myself and the team on the week or 2 here, given that we pulled the other thing forward.

Thank you. At this time, this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.