Good morning. I would like to welcome you to our Q3 2024 Earnings Conference Call. Joining us today are Omer Keilaf, Chief Executive Officer; and Eldar Cegla, Chief Financial Officer. Following their opening remarks, we will open the call to your questions. I would like to remind everyone that this call is being recorded and will be available on the Investor Relations section of our Web site at ir.innoviz.tech. Before we begin, I would like to remind you that our discussion today will include forward-looking statements that are subject to risks and uncertainties relating to future events and the future financial performance of Innoviz. Actual results could differ materially from those anticipated in the forward-looking statements. Forward-looking statements made today speak only to our expectations as of today, and we undertake no obligation to publicly update or revise them. For a discussion of some important risk factors that could cause actual results to differ materially from any forward-looking statements, please see the Risk Factors section of our Form 20-F filed with the SEC on March 12, 2024. Omer, please go ahead.

Thank you, Maya, and good morning, everyone. Thank you for joining us. The third quarter represents another strong quarter for Innoviz, both in terms of revenue and cash performance. During the last quarter, we announced a new partnership with a leading Level 4 platform partner. Today, I'm happy to share that, following this agreement, we entered two new OEM programs, with expected SOP in 2026. I will share more detail on this momentarily. Revenues for the quarter were $4.5 million, above the midpoint of our guidance range of $3.5 million to $5 million. We further decreased our cash used in operations and capital expenditures, from $28.6 million in Q3 2023, by approximately 38% to $17.7 million this quarter. Both Eldar and I will provide color on this later. On today's call, I'll begin the discussion by providing more details on our announcement of the two new OEMs. Then, we will discuss our progress regarding the different Volkswagen programs. I'll then give an overview of our pipeline and highlight several of the programs we are competing for. These are exciting programs with notable OEMs. And on some, we're expecting nomination decisions in the near-term. I'll provide some high-level detail on these and explain why we are confident in our positioning. We will also share with you exciting breakthroughs on the technological front. These developments allow us to significantly improve our products' performance in both range and resolution. And also provide new and unique LiDAR capabilities which are valuable to our clients. I'll conclude the technical discussion with an update on our new short-range offering. Finally, I'll discuss our expectations for the rest of the year in addition to reviewing our Q3 financials. Starting with our announcement on the two new OEM programs, during the third quarter, following our engagement with a…

Thank you, Omer, and good morning, everyone. Starting with cash, we ended Q3 2024 with approximately $87.7 million in cash, cash equivalents, bank deposits, marketable securities, and short-term restricted cash on the balance sheet. Cash used in operations and capital expenditure came in at $17.7 million compared to $28.6 million in Q3 2023, and $21.6 million last quarter. We are continuing to drive sequentially decreased cash burn, resulting from our focus on Innovis 2 platform and our strong revenue performance. As Omer mentioned, we are realizing the benefits of our strategic realignment. Having reduced investments in InnovizOne development, our organization is leaner, more agile, and entirely focused on platform with InnovizTwo. I'm pleased to share that we are on track to achieve the expected saving from the realignment, reinforcing Innoviz history of financial execution. We are very proud of the trend of consistent improvement in cash burn that we have delivered over the course of the year. While there may be continued lumpiness on a sequential basis, on a fully year basis, we expect to see lower overall burn in full-year of 2024 than we saw in full-year of 2023. Looking into 2025 and beyond, we remain confident in our ability to manage our expenses effectively and keep our burn down on an annualized basis. Gross margin continue to improve quarter-over-quarter. Going forward, we expect margins will continue to be lumpy as we ramp up the InnovizTwo platform as unit volumes fluctuate and NRE revenues continue to vary from quarter-to-quarter. Now turning to the income statement, revenues for Q3 were $4.5 million compared to $3.5 million in Q3 of 2023, and in line with our guidance range of $3.5 million to $5 million. This represents another quarter in which we have delivered on the top line, extending our record of strong revenue execution. Our operating expenses for Q3 2024 were $26 million, a decrease of 6.4% from $27.8 million in Q3 2023. This quarter's operating expenses included $4.2 million of share based compensation compared to $5 million in Q3 2023. Research and development expenses for Q3 2024 were $19.7 million, a decrease from $20.7 million in Q3 2023. The quarters R&D expenses including $3 million of share based compensation compared to $3.1 million in Q3 2023. To conclude, the third quarter represents another quarter of solid performance from both revenue and cash perspective. We're encouraged by the ongoing strengths of our expense management and ability to consistently meet or exceed our revenue guidance. Looking into Q4, we expect a strong finish to the year in which we maintain lower burn while further ramping up InnovizTwo and working to secure additional design wins. With that, I'll turn the call back to Omer for a few closing remarks.

Thank you, Eldar. Before I wrap up the call and open for Q&A, I wanted to remind you all in January, we'll be back at CES in Las Vegas, providing a closer look at our recent technological advances for the CES community and touching base with numerous customers and suppliers. I hope to see some of you there. In conclusion, Q3 was another strong quarter for Innoviz in terms of revenue performance, cost discipline, advancing customer relationships, and further developing our technology. We were happy to add two new OEMs through our partnership with the Liverpool platform partner, who we are collaborating with to bring our solutions to the market. We are excited to see the first test vehicles on the road already in 2025 and look forward to the expected launch in 2026. An increased number of OEMs customers supports our revenue growth in the short and long-term through NRE bookings, samples and production unit sales. Meanwhile, continuing to build the momentum of securing additional new OEMs. We see this collaboration as potentially very valuable as we expect to continue to grow the partnership with additional OEMs. We hope to share more information on this by the end of the year. Our work with Volkswagen continues without delay. We're meeting deadlines and delivering high quality products to the program. And we are optimistic about the opportunity to expand the relationship with this key customer. Across the board, we deepen our relationships with our customers and we believe that our next few wins are within reach. Our pipeline remains robust and we are working to further advance our RFIs and RFQs. Heading into next year, as we add additional programs, we expect to accelerate our revenue streams and reinforce our record of strong top-line performance. Our superior technology, balance sheet, and favorable external market factors give us confidence we can achieve our goal to become the leading tier one automotive lighter supplier. And with that, Operator, please open the call for Q&A.

Thank you. [Operator Instructions] Our first question today comes from the line of Andres Shephard of Cantor. Please go ahead.

Hey, good morning good afternoon, everyone. Can you hear me okay?

Yes.

Yes, okay.

Wonderful. Well, good to see you both. Congratulations on the quarter, and thanks for taking our questions. Omer, I want to maybe start, obviously exciting news on the recently announced Level 4 commercial agreements, I understand that you're not yet disclosing the client's names, but wondering if you could perhaps give us a bit more details on the agreement and maybe particularly what kind of volumes might you expect from these. Thank you.

Yes, sure. So, the platform partner that we are working with currently has a customer base of around five customers, which are expected to deploy their vehicles in different regions between 2026 onwards. Our each program consists of volumes that are ranging between high tens of thousands of vehicles to small figures of hundreds of thousands of vehicles. Of course, multiply that by the number of LiDARs, which is nine LiDARs per vehicle. That generates quite a meaningful revenue per customer.

Wonderful, super helpful. Maybe as a follow-up, regarding your 2024 revenue guidance that you provided, wondering if you could maybe give us a bit more granularity there, specifically how much of these revenues do you expect will come from NREs versus, say, product shipments or BMW, just any additional color there would be helpful. Thank you.

Basically the fourth quarter is a mix between revenues generated by product sales to the BMW launched vehicles, and there are NRE components that are related to programs we announced during the year, such as the short range program we announced several months ago. Some of the Level 3 programs we're supporting with Volkswagen and the new programs that we are, that we just kicked off. In terms of kind of the mix, in terms of percentage, I'm not sure, if we want to --

Most of the revenues are in our area at this point of time, and that sample shipments. Yes. And then, samples together with the BMW revenues.

I mean, obviously, the fact that we're now shipping nine LiDARs per vehicle for this Level 4 platform and you understand where there are multiple customers, which each one of them is required to bring up a certain fleet. The multiples are expected to grow through that.

Wonderful. And maybe if I could just squeeze one last one. Just on BMW, we didn't highlight it too much on the call today, but just what kind of volumes should we expect? Or is that going to be the primary source of revenue for next year? Just wondering if you can maybe give us an update on where that relationship stands and kind of how you see it, play out through 2025. Thank you.

Sure. I mean, during the first year of launch of BMW, we do not expect high ramp. Next year, we are expecting additional volume coming from the launch of BMW in China. In terms of, volume, we cannot disclose obviously, BMW expectations. Our work with BMW continues also relates to future programs. There is an R&D program working between us for, kind of new development for new platforms.

Great. Thank you so much. Congrats again on the quarter. I'll pass it on.

Thank you very much.

[Operator Instructions] Our next question today comes from the line of Mark Delaney of Goldman Sachs. Please go ahead.

Yes. Good afternoon. Thanks very much for taking my questions. For the program with the top 10 OEM where you've passed the technical and production audit and are now in advanced legal discussions, can you talk about what needs to be done to work out those legal arrangements, and are there other LiDAR providers being considered to your knowledge? And then, if you do win this program, when would the SOP be? Do you think you'd be standard fit, and any sense of the volumes that went fully ramped for that program?

Yes, okay. Obviously, there is a certain limit to what I can share, on this specific program. What I can say is that this is a customer that we were working with for quite a long time. My understanding is that we are competing versus another LiDAR or LiDAR player or LiDAR, say, traditional Tier 1. In terms of volume, it's a top 10 OEM. So, obviously, the expected volumes are quite meaningful. Mid-decade is probably the best I can offer in terms of SOP without disclosing a very specific year at this point. We're still trying to be on the right side of the customer.

Understood. Thank you for the color. You can share and hopefully that goes well for you guys. My other question was around the financial profile of the company. I mean, in particular, how you're thinking about the balance sheet and as you mentioned, you took down the cash burn. Do you think you can sustain those lower levels of cash use into next year? And what are applications for potential capital raising? Thank you.

Yes. So, maybe before I answer that, so there was a question I actually skipped, and by mistake. You were asking about what's left to close in the dialogue. So, basically, there are actually only, like two legal points that we're kind of negotiating on and hoping that I believe we can close. So, it's not there's nothing, I think substantial. We understand that we met the technical requirements and commercial. So, we basically feel that we're in a very kind of final stage. On the financials of the company, so obviously, the new OEMs with the expected revenues that we are looking at for next year, adding to the NREs that we are expecting to lock by end of this year. Plus, as you understand, we look on the programs that we're competing on in a, I would say an optimistic view. We believe we'll be able to lengthen our financials, well into 2026, where we expect a very steep growth of revenue coming from different programs that are launching at that year.

Maybe if I can add you, you can see in every aspect that we are doing better. We are doing better, obviously in the cash burn, but we're doing also on the top line. Year-over-year, we're doing better in the gross margins, which you see are closing to positive already. We are obviously controlling our expenses. I believe we have a very nice pipeline in front of us that can generate a lot of revenues and a lot of opportunities that can converge positively, hopefully. So, we have the confidence that we have what it takes.

Thank you. I'll pass it on.

By the way, maybe I'll just add, other than that OEM, there are other OEMs we're competing. So, it's not a single opportunity on the table right now. We're only referring to the, I think two or three that were kind of some things that we're excited about. We're excited about other things as well. It's not a one shot kind of situation.

Thank you. Our next question comes from the line of Jash Patwa of J.P. Morgan. Please go ahead.

Hi, thanks for taking my questions, and congratulations on the two new program wins. How should we think about the NRE revenue opportunity preceding start of production in 2026 for the two new programs, with the LFO platform partner? And any early guardrails you could share for revenue and post profit trajectory into 2025? Thanks, and I have a follow-up.

Sure. Obviously, NREs are preproduction, revenue generation. Once you reach SOP, meaningful portion of the revenues would come from sales of products. And before the production starts, revenue is based on NREs and sample sales. And as I said, we're now looking at the content per vehicle, which consists of nine LiDARs per vehicle, the multiples are quite significant, especially when talking about a platform that is going to be that was adopted already by a few customers. So, we believe that 2025 would be meaningful in that manner. What was the rest of it?

Just any early guides around 2025 from a revenue or gross profit standpoint?

I think it's, we haven't yet finished the year before talking about guidance for next year. What we're seeing is, this year was primarily revenue generation was taken from programs we locked in 2023. This year, we're adding, we already have four more programs that we're supporting, additional to the ones that we had locked previously. And we expect to close more deals, in the short-term and of course, long-term. And this will create aggregation of new generation of revenues that will come on top. And at 2026, we expect several launches that will contribute to your significant growth in revenues. I think at this point, this is kind of, like, how I can offer at this time.

Got it. That's helpful color. And then, just maybe switching gears to from a technology standpoint, curious if you could elaborate on the in LiDAR infrared imaging feature. It seems like a very exciting opportunity. Wondering what you're hearing from OEMs on this feature, and does the inclusion of the infrared camera help in any way to bridge any performance gaps that might be there for LiDARs versus traditional cameras used in automotive?

Gladly. And the ability to generate the camera within the same hardware of the LiDAR is very helpful in terms of synchronizing an image to a LiDAR. When you think about the platform, generally you have a camera which sits in a different location. And you need to apply many calibrations -- online calibrations and frame synchronization in order to allow a good, I would say, correlation between the data that is generated by the different sensors. That takes a lot of effort and many errors in this process. Being able to generate a perception software, which is LiDAR-based only, which can generate both a LiDAR image and an IR image, provides an unprecedented performance of perception which you cannot achieve by using a LiDAR alone. We talked in the past about having redundancy and separation of layers between camera, LiDAR, and radar. The fact that the LiDAR is able to provide both image and LiDAR allows you to do a low-level fusion by the LiDAR itself and using it as a very strong primary sensor that would definitely outperform the other sensors on the vehicle, which is only based on camera perception when you talk about the standalone perception layer for each of them. So, the LiDAR is going to be definitely a prominent, I would say, leading solution in the platform as we believed in the past, in terms of what it's capable to add to the capability. So, you could actually see lights from the scene. This is something that LiDARs generally cannot do. Meaning that you'll be able to see in some cases winks -- I would say trough kind of -- when you go right, winkers of the car. Winkers? Yes, sorry, when the car can signal. This is kind of an additional and stopping lights, braking lights of vehicles. These are features that are generally not available for LiDARs and are only provided by the camera and without redundancy. So, the fact that the LiDAR can potentially provide those values and these features is very helpful in order to do the low-level fusion between the camera and the LiDAR. Other than that, it is helpful in cases where you have a low confidence in the camera due to shadow casting, which you can confirm from the IR image taken from the LiDAR in terms of low-level fusion. And actually, there are really more features that I think overall will become very important to the customer. We already started to show it to a few customers that were very excited about it. So, yes, I definitely see high value through this new feature.

That's very interesting. Thanks for taking my questions and good luck.

Thank you.

Thank you.

We have no further questions. Please proceed.

Okay. Thank you very much for joining our earnings call. We are always happy to be here and reflect to you the progress that we're making. I hope to share more in the coming months. Hoping to see you at CES and invite you to see the progress we're making. Thank you very much.