Toni Chen's questions to Ecarx Holdings Inc. (ECX) leadership • Q2 2024
Question
Toni Chen of SPDB International requested an outlook on hardware gross margin and pricing trends for the second half of 2024 and into the next year. She also asked about the expansion strategy for the in-house Antora and Makalu chipsets with overseas customers and their representation in the quarter's five new design wins.
Answer
CFO Phil Zhou acknowledged that pricing pressure will continue but stated ECARX aims to maintain its 20%-ish gross margin through cost optimization, growing service revenue, and global expansion to diversify its margin pool. COO Peter Cirino explained that the Antora platform is gaining traction in China and is being pitched in global RFQs, while the high-performance Makalu platform serves a more niche, premium segment. He noted that both platforms build out the company's software stack for future applications.