Release Date: November 27, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Arbe Robotics Ltd (ARBE, Financial) secured two key customers for the development of its imaging radar, including a top 10 OEM and a well-known European truck manufacturer.
- The company successfully began trading on the Tel Aviv Stock Exchange and raised $30 million through a convertible bond offering.
- Arbe Robotics Ltd (ARBE) reported a decrease in operating expenses from $12.6 million in Q2 2023 to $11.6 million in Q2 2024.
- The company is actively engaged in obtaining full design-ins with leading global automakers, expecting decisions in the coming months.
- Arbe Robotics Ltd (ARBE) has strengthened its positioning in RFQ engagements, with expectations of revenue growth in 2025.
Negative Points
- Total revenue for Q2 2024 was only $0.4 million, a marginal increase from $0.3 million in Q2 2023.
- The company reported a negative gross margin of 9.5% in Q2 2024, worsening from a negative gross margin of 1% in Q2 2023.
- Net loss in Q2 2024 was $11.8 million, only a slight improvement from a net loss of $12.6 million in Q2 2023.
- The OEM decision timelines have shifted from late 2023 to 2024, potentially delaying expected revenues.
- Adjusted EBITDA for 2024 is projected to be a loss between $30 million and $36 million, indicating continued financial challenges.
Q & A Highlights
Q: Can you walk us through the milestones needed to enter series production with the TOP10 OEM and when you expect that decision to be made?
A: The decision to go to production with this radar has already been made. The OEM's internal team is adapting our reference design to their needs and developing a full radar model for production. We expect to start gaining revenues from this win by the end of 2025 or early 2026. - Kobi Marenco, CEO
Q: Can you share more details on the goal of achieving four design wins this year and the expected timeline to revenue?
A: We have already achieved one out of the four design wins. We are in the final stages with a few major RFQs and expect the year model to be 2028, focusing on safety applications. We anticipate starting to gain revenues by the second half of 2026. - Kobi Marenco, CEO
Q: Any initial guidance on revenue growth for 2025?
A: We have preliminary orders from China and are progressing towards production. We expect to gain revenues from these orders in 2025, aided by Bosch's investment in a new subsidiary. Our target is to meet the preliminary order numbers from the Chinese market. - Kobi Marenco, CEO
Q: Can you update us on the competitive landscape and key factors in the selection of Arbe's radar?
A: The landscape hasn't changed much; however, there's a major shift in OEMs understanding the necessity of high multichannel radar for safety applications. Our advantage lies in offering a high channel count at a competitive price, unlike more expensive and power-hungry alternatives. - Kobi Marenco, CEO
Q: How does the trucking opportunity compare to the automotive opportunity in terms of market size and pricing?
A: The trucking market is lower in volume but higher in radar pricing. It's not a major part of our business, but being selected by a truck company signifies the high safety standards our radar meets. - Kobi Marenco, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
