Aeva Technologies - Q1 2024

Executive Summary

• Q1 2024 revenue was $2.1M vs $1.1M in Q1 2023, reflecting continued Aeries II shipments and NRE; GAAP EPS was -$0.67 vs -$0.80 YoY and non-GAAP EPS -$0.56 vs -$0.67 YoY.
• Record product shipments, progress on Daimler Truck program milestones, and finalist status with a global top-10 passenger OEM; total liquidity stood at $314.3M ($189.3M cash/securities + $125.0M available facility).
• Non-GAAP operating loss of $32.1M was near flat YoY ($31.3M prior year), while gross loss remained negative; cash use was $32.6M driven by operations and capex.
• Wall Street consensus estimates from S&P Global were unavailable for comparison in this recap; no explicit quarterly guidance was provided, but prior messages indicated at least 100% FY24 revenue growth and OpEx discipline was maintained.

What Went Well and What Went Wrong

What Went Well

• Record sensor shipments and successful integration into Daimler Truck vehicles for on-road data collection; “on track with OEM development milestones and start of production timelines”.
• Automotive pipeline advanced: finalist position after comprehensive audit with a global top-10 passenger OEM; multiple RFQs in progress with decisions expected this year.
• Strong liquidity: cash, cash equivalents, and marketable securities of $189.3M plus an undrawn $125.0M facility, enabling execution on existing and prospective programs.
  Quote: “We shipped a record number of sensors… and are overall on track with the OEM development milestones and start-up production timelines.” — CEO Soroush Salehian.

What Went Wrong

• Continued operating losses: GAAP operating loss of $37.3M and non-GAAP operating loss of $32.1M; gross loss of $1.4M, highlighting ongoing scale-up costs ahead of SOP.
• Elevated cash consumption: gross cash use of $32.6M in Q1 as the company invests in product and manufacturing readiness.
• Limited quarterly revenue scale ($2.1M) vs long-dated commercialization timelines, with near-term visibility tied to RFQ awards and industrial ramp later in 2024.

Transcript

Operator (participant)

Good day. My name is Desiree, and I will be your conference facilitator. I would like to welcome everyone to the Aeva Technologies' First Quarter 2024 earnings conference call. During the opening remarks, all participants will be in listen-only mode. Following the opening remarks, we will conduct a question-and-answer session. As a reminder, today's conference call is being recorded and simultaneously webcast. I would now like to turn the call over to Andrew Fung, Senior Director of Investor Relations and Corporate Development. Andrew, please go ahead.

Andrew Fung (Senior Director of Investor Relations)

Thank you, and welcome, everyone, to Aeva's First Quarter 2024 earnings conference call. Joining on the call today are Soroush Salehian, Aeva's Co-founder and CEO, and Saurabh Sinha, Aeva's CFO. Ahead of this call, we issued our first quarter 2024 press release and presentation, which we will refer to today and can be found on our investor relations website at investors.aeva.com. Please note that on this call, we will be making forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect our views only as of today and should not be relied upon as representative of our views as of any subsequent date. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations.

For a further discussion of the material risks and other important factors that could affect our financial results, please refer to our filings with the SEC, including our most recent Form 10-K. In addition, during today's call, we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of Aeva's performance. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from GAAP results. The webcast replay of this call will be available on our company website under the Investor Relations link. With that, let me turn the call over to Soroush.

Soroush Salehian (CEO)

Thank you, Andrew, and good afternoon, everyone. In Q1, Aeva continued to build on our strong start to 2024 as we executed to our customers' milestones, as well as furthered our commercial traction on new opportunities. I would like to highlight our key accomplishments in Q1. We shipped a record number of sensors to customers in the first quarter, including to Daimler Truck. As a result, the first Daimler Truck vehicles equipped with Aeva sensors are now on the road for real-world operation in order for Daimler Truck to continue to ready their stack for commercial operations. We are excited to enter this next phase and are overall on track with the OEM's development milestones and start of production timelines. We also made significant progress on multiple automotive RFQs.

In particular, Aeva completed a comprehensive audit for a global top 10 passenger OEM and advanced on multiple other automotive engagements, which reflects the growing interest and maturity of Aeva 4D LiDAR. To support our commercial momentum, we established a new Automotive Center of Excellence located in Germany, which positions Aeva to collaborate directly and more closely with our existing and new partners in Europe. We believe this team further positions Aeva to expand our automotive momentum. Let's now discuss in more detail our recent business developments. With Daimler Truck, we have successfully kicked off the next phase as their exclusive Tier 1 production supplier for long-range and ultra-long-range LiDAR. In Q1, we delivered a significant number of sensors to Daimler, which have been integrated into the trucks and are now on the road collecting data.

As part of this, our teams are in close collaboration to integrate Aeva's unique velocity data into their perception stack and continue addressing key use cases needed for safe operation at highway speeds. This work and the real-world data will help Daimler Truck and Torc validate their stack on routes they intend to deploy for commercial use in series production. Overall, we are progressing well on Daimler Truck's milestones on their path to production. We will continue supporting the rollout of additional trucks over the course of this year as Daimler Truck expands its fleet for on-road deployments. As partners, we are jointly on track for Aeva's start of production in 2026 to support Daimler Truck's market entry in 2027, which they recently reiterated in their post Q1 investor update.

As highlighted in their Q1 update, Daimler Truck is making great strides on their path to vehicle launch, where they highlighted the start of testing with the industry-first vehicle platform and finalization of the production intent hardware for commercial launch. Finally, before moving to the next topic, we will have some additional updates to share together with Daimler Truck and Torc at upcoming events. The first will be at a fireside chat at Financial Times Future of the Car later this week, where I will be joined by Peter Vaughan Schmidt, the CEO of Torc. Later this month, we will be at Advanced Clean Transportation Expo, or ACT, with Joanna Buttler, Head of Autonomous Technology Group at Daimler Truck, and other key management at Torc. We hope to see you there. Now, I would like to provide an update on additional opportunities that we are working on in automotive.

Interest in Aeva's unique 4D LiDAR continues to increase following the production program win with Daimler Truck. This is across a range of applications, including for both passenger and commercial vehicle programs. Based on our engagements and inbound interest, we are excited to see that the industry is advancing on its trend towards FMCW technology to enable new capabilities, including automation at highway speeds. While the adoption of FMCW has begun first in commercial vehicles, there continues to be signs of similar trends emerging in passenger vehicles, with an increasing number of industry participants publicly announcing FMCW initiatives for next generation programs, as well as Aeva's growing number of RFQs. In particular, we mentioned last quarter our engagement with a new global top 10 passenger OEM.

I am pleased to share that we have advanced as a finalist on this OEM's RFQ, having completed the comprehensive audit and final assessment ahead of their award decision. In Q1, we also progressed on other ongoing automotive RFQs and advanced from the RFI to RFQ stage on additional opportunities. We continue to expect a number of these RFQs to be awarded this year. In addition, the recent rulemaking from the National Highway Traffic Safety Administration, requiring passenger vehicles in the U.S. to have standard automatic emergency braking systems by 2029, has the potential to accelerate OEM adoption of LiDAR. We believe FMCW LiDAR is an enabler for achieving the more stringent requirements.

The new standard will require OEMs to prevent forward collisions at speeds up to 100 kilometers per hour or 62 miles per hour, as well as prevent collision with pedestrians at up to 45 miles per hour, both of which are at higher speeds than what solutions on the road today are reliably capable of preventing. Building on the work that we have done with Daimler Truck, we believe Aeva 4D LiDAR is particularly well positioned to help OEMs achieve automation at higher speeds. Aeva's unique ability to simultaneously deliver long range at high resolution and instant velocity measurement enables our LiDAR to more accurately detect and classify objects at farther distances, even in challenging conditions such as inclement weather. The new standard also requires, for the first time, that testing for pedestrian automatic braking to be conducted in the dark without overhead lighting.

With more than 3/4 of pedestrian fatalities occurring in conditions other than daylight, this is another important test scenario where we see LiDAR, with its ability to function in complete darkness, has the potential to meaningfully improve safety for vulnerable road users, like pedestrians and cyclists. Aeva's 4D LiDAR further improves perception with instant velocity for every pixel that can enable faster and more accurate object segmentation and greater ability to filter out noise, resulting in more confidence in avoiding hazards on the road. So overall, we are highly encouraged by this industry development. Our focus is on meeting the growing interest for Aeva 4D LiDAR and converting our current RFQs to production wins. As part of this, Aeva announced a new Automotive Center of Excellence with a local engineering team in Europe, out of Germany.

This positions Aeva to collaborate more directly and closely with OEMs that we are engaged with in the region, and will also allow us to accelerate the validation, testing, and as well as providing direct OEM support for their programs. We have assembled a team of industry veterans with extensive experience spanning ADAS, autonomous and software technologies at top OEMs and suppliers, such as Mercedes-Benz, Daimler Truck, and Valeo. We believe this new center of excellence will not only enable us to support our existing engagements, but also better meet the growing interest for Aeva 4D LiDAR on new opportunities. With that, let me turn the call over to Saurabh to discuss the financials.

Saurabh Sinha (CFO)

Thanks, Soroush, and good afternoon to everyone on this call today. I would like to review our Q1 financial results. Revenue in Q1 was $2.1 million, driven by scaling of Aeries II shipments and NRE revenues. Non-GAAP operating loss was $32.1 million, which is near flat year-over-year, as we maintained a disciplined approach to capital allocation. Gross cash use, which we have defined as operating cash flow less capital expenditures, was $32.6 million in the quarter. We finished Q1 with a total liquidity of $314.3 million, which includes $189.3 million of cash, cash equivalents, and marketable securities, and a $125 million of available facilities.

As a result, we remain in a good position to continue executing with our existing production partners and to build on our growing commercial momentum with additional production program wins. As Soroush mentioned earlier, we are engaged on a number of RFQs which are expected to be decided during this year. We believe that the combination of our differentiated technology and a strong balance sheet positions us well to execute on our existing programs and win additional programs. With that, let me turn the call back to Soroush for closing remarks.

Soroush Salehian (CEO)

Thank you, Saurabh.

... Aeva is off to a great start in 2024. In automotive, we executed the Daimler Truck milestone and realized strong progress with multiple automotive RFQs. In industrial, we are on track with our first industrial SOP later this year with Nikon. I want to thank the Aeva team for enabling these accomplishments and for their continued commitment to Aeva's mission and partners. Looking ahead, we continue to see strong and growing momentum for the adoption of FMCW technology to bring new levels of capabilities to markets in both automotive and industrial. We continue to position Aeva for greater success, having added leaders in their respective field and maintaining a solid financial position. Together with our strong progress on multiple RFQs, we remain confident in executing on our existing programs and securing additional production wins. With that, we will now open the line up for questions.

Operator (participant)

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Shadi Mitwalli from Craig-Hallum. Please go ahead.

Shadi Mitwalli (Senior Research Associate)

Hey, this is Shadi Mitwalli on for Richard Shannon. Thanks for taking my question. Starting off with the Daimler win, is Aeva experiencing any halo effects after this win to show other customers that you are ready for start of production wins?

Soroush Salehian (CEO)

Hey, Shadi, this is Soroush. Happy to answer that. Yeah, absolutely. Actually, overall, we are seeing a growing interest for our technology, specifically for FMCW, especially on the back, on the heels of the DT, Daimler Truck win. And, you know, a number of inbound since we have announced that at CES earlier this year. I think one of the things that's very important is we're also seeing this feedback from the OEMs that the win, the production win, which we had with Daimler Truck, really helped de-risk the OEM's decision as we're - as they're moving to the next generation platforms, as they're, you know, completing this pilot initial deployment and their decision to move to FMCW, to frequency modulated technology. This win really helps de-risk that.

So all, you know, the concerns or potential comments around, hey, would FMCW, would 4D LiDAR happen? Is it an if? It's no longer, and I mentioned this on the last call as well, it's no longer really a matter of if, and now it's really a matter of the execution and the timing of how we make this happen. And we're seeing that feedback directly from the OEM, which we're really excited about. And as I mentioned on the call, this also, you know, is not just limited to commercial vehicles, especially on the passenger vehicle side. We're now engaged in multiple automotive RFQs. As I mentioned earlier, since, you know, it's been about two months only, right?

Since we introduced this new top 10 passenger vehicle OEM, we have now made significant progress on that side, on this RFQ as well. We, in the past few months, we have completed a comprehensive manufacturing and quality audit, which is now the second time that, that we're doing that. And we have now also been a finalist on with this top 10 passenger OEM for the RFQ, for the final production award. So this is a significant opportunity that we're on track with the timing of this happening in the next few months this year, as we talked about that. So, you know, on the back of this momentum, we are seeing growing interest across both passenger commercial vehicle.

And that's also why we talked about earlier, that we have decided to establish this new Automotive Center of Excellence, out of Europe and Germany, to really help us expand our, you know, engineering team, to work directly with the OEMs, to be able to provide direct support and, really shortcut some of those interactions and timing of the discussions, with folks, both in Europe as well as globally. So overall, I would say that we are seeing definitely these tailwinds help us advance on automotive, especially on the passenger car side as well.

Shadi Mitwalli (Senior Research Associate)

Awesome. That's great to hear, and, that makes sense. And then just, one more follow-up question. I know you have, you know, currently one or, yeah, one top ten OEM. Are you able to quantify if any of your other RFQs or RFIs are with, top ten OEMs?

Soroush Salehian (CEO)

Yeah, look, we obviously haven't talked about, you know, X number of top ten and X number of top five or whatever it is, but I can tell you that at this point, we are engaged on pretty much at multiple, significant scale and top OEM, RFQs. We know there is both, there is folks in different regions, there's passenger vehicles as well as commercial vehicles. But obviously, as we provided the update in this quarter, we are making progress on multiple fronts, but we have been also giving some clear updates on our progress with this specific top ten passenger OEM. So it's not just one OEM, and, you know, we're working on that. There is multiple across passenger and commercial vehicles.

And decisions are happening, multiple of those decisions throughout this year. So that's also the other thing that we're seeing. And overall, from a start of production timing, we also see those to be aligned around the same time frame with Daimler Truck, maybe a little bit later, but it's around that time frame.

Shadi Mitwalli (Senior Research Associate)

... Awesome. Thanks for the color on that, and that's all for me.

Operator (participant)

Your next question comes from Colin Rusch at Oppenheimer. Please go ahead.

Colin Rusch (Managing Director and Senior Analyst)

Thanks so much, guys. You know, now that you've got a number of units, test units out, and you've run your own system on the software side, can you talk about how much compute efficiency you're seeing for customers because of the real-time velocity data? And then also, you know, how important the lower power consumption is and some of the decisions that you may end up seeing later this year from customers.

Soroush Salehian (CEO)

Yeah, thanks, Colin. Happy to answer that. I think one of the things that we are seeing from customers is that, first of all, there is this significant focus on advancing automation, you know, towards the highway on highway at highway speeds, right? So the current solutions are getting on the highway, but they're not quite achieving highway speeds. As we have seen, and we talked about earlier as well, the new ruling by NHTSA to further expand, you know, automatic braking with higher speeds, I think is very important, and I think this is gonna be a tailwind for LiDAR industry as well.

We see that, for our technology, for FMCW, a key driving point, because with our technology, we have the ability to see further with velocity, and the perception enabled by that allows some of those, compute and calculations and inferences to be reduced and minimized at the system, at the vehicle, OEM side. Because of the fact that we effectively are able to to bypass, a number of inferences and directly measure those things, such as the velocity of dynamic objects, and that helps tremendously, both from a factor of safety standpoint, from a high confidence of object detection standpoint and classification, but also on the compute side, as you mentioned. So this is something that then we see allows OEMs to do two things.

One, increase their functionality, right, without having to keep adding on significant costs, right? So that's important, which means we can actually reduce maybe some of the cost on super advanced processing power, high power or high cost processing nodes, especially important as you go into mass market. And two, it could also allow them to potentially reduce maybe some of the other sensing modalities that are out there. Obviously, with our technology, because of the fact that we can measure distance and velocity, we see potential opportunity that in some of the mass market opportunities, that this could potentially replace some of the other sensor modalities.

For example, maybe you still have a radar sensor, but you can plug in the solid LiDAR and reduce the need for an advanced radar or completely, completely replace that. So that's something that we see potential as you go into higher volumes where performance over power and performance over cost becomes super critical, that this technology is already showing that roadmap for the OEMs. And I think at the end of the day, the biggest thing is OEMs are looking to, what we hear, really future-proof their stack. And, you know, now they're moving past this pilot stage, right? For now, we're moving from the pilot stage, where there's lower volumes, to really mass scale.

You know, and we think in the next few years, as you know, our, our ramp-up with Daimler Truck and market entry, you know, in the 2026, 2027 timeframe hits on the road, that's where those, you know, higher, volume opportunities are gonna kick in. And having this capability and then that transition towards FMCW is where we see happening around this timeframe, which brings, you know, brings all this back together, if that makes sense.

Colin Rusch (Managing Director and Senior Analyst)

That's incredibly helpful. And then, you know, just outside the automotive space and the transportation space, there's obviously a move towards trying to understand and monetize AI in the physical world. You know, sensors are an incredibly important part of that. Can you talk a little bit about, you know, not just with the metrology opportunity, but other opportunities that you guys are seeing coming your way, you know, now that there's some incremental validation on the technology?

Soroush Salehian (CEO)

Yeah, you mean on the non-automotive side. Did I hear that right?

Colin Rusch (Managing Director and Senior Analyst)

Exactly right.

Soroush Salehian (CEO)

Yeah. Yeah, so, absolutely. So first of all, you know, we have significant interest and, and growing momentum on the automotive side, as, as you can see and hear from us. But that doesn't mean that we are not doing anything on the industrial side. As a matter of fact, we are fully on track with our, you know, Nikon program later this year, where that's gonna start ramping up. And, we are seeing, because of the fact that the core innovation of our technology being everything integrated on the LiDAR optical front into the silicon photonics module, we are utilizing that off the, you know, same technology, different software, to be able to achieve very different performances, like metrology and precision on other applications.

So we are engaged with a number of other folks in the industrial state, industrial side to also expand on, on the, on this, you know, the backbone of what we're doing with Nikon, if that makes sense. So, and as we have more, of course, we'll talk about that. But I think with... What we're seeing is with obviously advancements on, robotics, manufacturing, advancements of the use of AI, for both vision-based as well as now point cloud-based solutions, that's an area where, we think our technology could also play a role.

And as we are able to use this, you know, the economies of scale with our production scale for automotive, we think that's gonna become a pretty interesting, attractive product for these non-automotive customers to be able to reduce costs while improve efficiency and automation at the factory level, especially on the manufacturing side and kind of robotic side that exists.

Colin Rusch (Managing Director and Senior Analyst)

Perfect. Thanks so much, guys.

Operator (participant)

Our next question comes from Kevin Garrigan from WestPark Capital. Please go ahead.

Kevin Garrigan (Senior Research Analyst)

Yeah. Hey, guys. Thanks for letting me ask the question. I apologize if I missed this. I know you said you were making progress with more passenger vehicles. Have you gotten more interest from other trucking OEMs as well?

Soroush Salehian (CEO)

Mm-hmm. Yeah, Kevin, happy to answer that. Absolutely, yeah. You know, we are, at this point, engaged in multiple RFQs. This includes both passenger as well as commercial vehicles programs. And as I was mentioning earlier, you know, it's always the first win that sets the foundation for others to follow, right? So what we are hearing and we're seeing from the OEMs is that, you know, the Daimler Truck win really helps de-risk the decisions of the OEMs as they move from pilot to kind of production deployments, and as they make decisions to go to the next generation, especially transitioning to FMCW technology. So, and that is across passenger as well as commercial vehicles. So we are seeing interest in both of that.

Obviously, you know, Daimler being the marquee brand and, you know, key customer for the space, we are seeing others really interested to be able to tap into our technology for their application, both in kind of some high ADAS as well as automated highway applications.

Kevin Garrigan (Senior Research Analyst)

Okay, perfect. And then kind of going off that, can you give us some color on the processes for both trucking and passenger cars, kind of pertaining to not only the RFI and RFQ processes, but also the milestones to get to SOP? You know, I would imagine that passenger vehicle OEMs, and I may be wrong about this, but they'd be much more kind of stringent on certain tests or validation processes.

Soroush Salehian (CEO)

Yeah, happy to. So overall, actually, in automotive, you know, there's a number of activities, there's a number of standards, there's a number of qualifications. When you deal with, you know, some of these top brands, it doesn't actually matter, I think, in terms of where exactly the exact application. There is a certain level of super stringent requirements on qualification needed. You know, for example, Daimler, we had to go through a significant qualification steps across our manufacturing process, quality, and development teams, and we were audited, right? And did that. On the trucking side, commercial vehicle side, actually, some of the requirements on performance and reliability and shock and vibe and lifetime actually is much more stringent on the passenger car side.

So, that's why we see that, you know, enabling our technology to be really, you know, I would say, think of it as mass market OEM tested and proven. In some ways, that makes it easier to also then deploy that into a mass market consumer or passenger vehicle application. But just remember that at this point, as I mentioned, at this point, we have done this now twice. We have completed, you know, last year, early in the year, we introduced first time the concept of the top 10 OEM, right? And throughout the year, we provided updates, within a few months after, within a quarter or so after, we were able to pass a comprehensive audit by that top 10 OEM.

And, you know, we completed manufacturing and quality audit there. And then, you know, within six months, we won the program, was a production win and became Daimler, and that's when we announced that, right? So now we are talking about a second time, a new top 10 passenger OEM, and, you know, the time to we have done this, manufacturing and quality audit by this passenger OEM is now, you know, faster than what we talked about last time.

So we're using the maturation of the company, not just the products of our organization, of our team, of our processes, and we're seeing that significantly across the board, which gives us added confidence as we go towards some of the finalization of these RFQs in the next number of months.

Kevin Garrigan (Senior Research Analyst)

Yep, that makes a ton of sense. Okay, perfect. Thank you for that.

Operator (participant)

Our next question is from Suji DeSilva from Roth MKM. Please go ahead.

Suji DeSilva (Managing Director and Senior Analyst)

Hi, Soroush. Hi, Saurabh. So, for Daimler, could you maybe handicap the opportunity to expand beyond, I guess, trucking, which is mainly North America, in my from what I can tell, to additional geographies and then passenger? Just give us some sense if, you know, work's already done and, you know, how much of those could waterfall in versus what a realistic expectation is.

Soroush Salehian (CEO)

Yeah, sure, Suji, happy to answer that. So obviously, you know, with Daimler Truck, we're laser focused on delivering on our first program launch, SOP for 2026, right? We're acting as tier one, as the exclusive supplier for long range and ultra long range LiDAR for the series production program. We are obviously working across the board on providing sensors and some of the sort perception software aspects that we talked about for that program. But we're also closely engaged with the Torc team, which is developing, of course, the autonomy stack.

Overall, obviously, we see opportunities in the future to expand this partnership for potentially other markets, other regions, and other applications. The whole point is that we're building a foundation of a technology stack, which is really enabling highway autonomy at highway speeds. This can be applied to a number of applications. As I mentioned earlier, you can see that, you know, not just commercial vehicle, but now also passenger vehicle OEMs are increasingly looking to expand their operational design domain to higher speeds. And with the NHTSA ruling, that requires more than 60 miles per hour automatic emergency braking, we think that's gonna be important and kind of requirement for OEMs, including passenger car side.

So the short answer is, bottom line, the developments we're doing is not going to be limited just to a certain use on the commercial vehicle side. We see potential opportunities to expand from there. And as we have more that we can share in the future, if we were able to do that, we would of course be talking about it. But we do see opportunity to further expand our partnership here, and we'll continue to work together.

I just wanna mention also that, obviously, we have a couple of exciting events later this month, both with the CEO of Torc Robotics later this week in London, actually, where we're gonna be on stage talking about the latest progress with our program on the production side, as well as later this month, at the end of the month, with the head of autonomous group at Daimler Truck at ACT Expo in Vegas. So we'll have some more exciting updates to talk about. So, you know, feel free to join at that time.

Suji DeSilva (Managing Director and Senior Analyst)

No, that's great, great exposure for you guys, obviously. I'm gonna step back and ask a question about the kind of the process that you went through to win Daimler Truck. Maybe you could enumerate three or four key steps in that as you look back on it. I'm asking the question in trying to understand your pipeline better. Which of those steps did you, when you passed it, did you gain the most confidence that you would win this customer? You know, in the pipeline, how many potential customers are maybe already past that phase, just to get a qualitative sense?

Soroush Salehian (CEO)

Hmm. Sure. Good question. So, I can give you at a high level. Obviously, there is a number of steps, and, you know, typically, the process, you know, could take a number of months to, you know, one or two years, right from the very beginning, first conversations. But at a high level, you know, there is RFI, RFQ, and then, of course, the final nomination, and there's a number of steps in between. I think one of the key milestones is, first of all, the transition from RFI to RFQ stage, which is critical, and that is where the, you know, final commercial bids, as well as the key step, which is manufacturing and quality audits happen, past RFQ stage.

There is kind of a down selection phase, maybe sometimes happening during the RFQ phase, in which the finalists are picked. So there is kind of two, three main, but two checkpoints after the RFQ. So there's RFI to RFQ, and then two more checkpoints with the audit, as well as a down selection. And with Daimler Truck, of course, we've gone through all of those, and we were able to, you know, since we introduced it early in the year, last year, advance for, you know, to the RFQ stage. And then from there, within a quarter or a few months after that, we talked about passing the manufacturing audit. And then from there, we became the finalist, and we won it just a quarter after that.

So within two quarters, from RFQ to manufacturing audit, finalists, and award. We're now talking about a number of other programs. There's multiple others, as I mentioned, including passenger commercial vehicles. You know, we have advanced on a number of those past this RFQ phase. As I mentioned, with this top 10 passenger OEM, we have now crossed both RFQ phase, we have now crossed the manufacturing audit phase, and we've now crossed the finalist, being a finalist on that final phase of the RFQ to the nomination. So it's been only a couple of months. We've made significant progress on this program, and we're pretty excited about that.

Suji DeSilva (Managing Director and Senior Analyst)

Appreciate that. So it's very detailed. Thank you.

Operator (participant)

There are no further questions. Ladies and gentlemen, this concludes the call for today. Thank you for calling in. Please go ahead and disconnect your lines.