Faraday Future Intelligent Electric - Earnings Call - Q2 2025

Executive Summary

• Net loss from operations was $48.1M, a slight improvement vs. $50.6M in Q2 2024; adjusted operating loss was approximately $27.4M (average monthly loss ~$9.0M). Quarter-end cash reached an 18‑month high, supported by $55.1M 6M financing inflows exceeding $43.6M 6M operating outflows.
• Reported Q2 revenue was de minimis at $0.054M as FF91 deliveries remain limited while FX ramps; total operating expenses fell to ~$21.3M, down ~29% YoY.
• Strategic catalysts: inclusion in Russell 3000, over 4,000 paid non-binding FX Super One pre‑orders by quarter end (10,000+ by July 31), FX trial production started in Hanford, and ~$105M financing commitments; management also launched the “EAI + Crypto” Dual‑Flywheel & Dual‑Bridge strategy and the C10 Treasury plan.
• Outlook: management targets meeting the FX year‑end off‑line milestone in the U.S. and the first FX Super One rolling off the Middle East line by year‑end, with continued cost discipline and capital optimization.

What Went Well and What Went Wrong

What Went Well

• FX commercial traction: >4,000 paid non‑binding FX Super One pre‑orders in Q2 and >10,000 by July 31; FX entered parts procurement and trial production at Hanford, with year‑end off‑line targeted.
• Cost control and financing runway: total OpEx down ~29% YoY to ~$21.3M; financing inflows of $55.1M in 6M 2025 exceeded $43.6M operating outflows for the fifth straight quarter.
• Capital markets validation: added to Russell 3000; Vanguard and BlackRock increased holdings >500% vs. Q4 2024; management initiated 10b5‑1 executive stock purchase plans.
• Management quote: “We are excited…FX continues to build strong momentum with its innovative B2B and B2C sales model, and we are encouraged by the early pre‑order numbers for the FX Super One.” — Matthias Aydt.

What Went Wrong

• Revenue remained minimal at $0.054M, underscoring reliance on financing and pre‑commercial FX activities; loss before income taxes was $124.7M for Q2.
• 6M operating cash outflow rose ~50% YoY to $43.6M due to FX ramp timing and payments; total liabilities increased and fair‑value linked items highlight sensitivity to equity-linked instruments.
• Regulatory/legal overhangs: the July financing release disclosed SEC Wells Notices to the company and certain executives, introducing potential enforcement uncertainty.
• Strategic risk factors reiterated: funding needs for AI/EREV/FX, homologation, permits, tariff impacts, go‑forward liquidity, and internal control remediation.

Transcript

Speaker 2

Welcome, everyone, to Faraday Future Intelligent Electric Inc.'s second quarter 2025 earnings call. This is John Schilling, Director of PR and Communications at FFIE. Today, I'm joined by a few members of our leadership team, including our Global Co-CEO, Matthias Aydt, Global President, Jerry Wang, and our CFO, Koti Meka. Today, we will be sharing details from our second quarter 2025 results. The press release, as well as today's presentation, will be available in the Investor Relations section of our website at investors.ff.com. A replay of this call will also be posted there later today. Please note that on the 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, should not be relied upon as representative of views as of any subsequent date, and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For further discussion of the material risks and other important factors that could affect our financial results, please refer to our filings with the SEC. In today's call, we will be covering the following topics: the second quarter overview and financial highlights, our development progress, together with our third quarter and full-year outlook. The management team will also address questions from our shareholders submitted electronically in advance of this call.

With that, I will now turn over the call to Matthias Aydt.

Speaker 1

Thank you, John. Hi, everyone. This is Matthias, the Global Co-CEO of Faraday Future Intelligent Electric Inc. I am pleased to share our key developments for the second quarter of 2025 through today, structured around our seven-tier strategic goals and pillars from S1 to S7, highlighting meaningful progress in operations, improvements in our business and financial fundamentals, and continued strategic execution across our AI-driven mobility roadmap. The FX Super One launch campaign has demonstrated tangible commercial impact, underscoring the effectiveness of our influencer-led marketing strategy. In Q2, we received over 4,000 FX Super One non-refundable pre-orders from both B2B and B2C channels. By July 31, 2025, we received total non-refundable pre-orders exceeding 10,000 units. The campaign's reach was amplified through coordinated digital content and endorsement from high-profile co-creation participants, resulting in broad social media visibility and accelerated customer engagement across both institutional and consumer segments.

FX continues to build strong momentum with its innovative B2B and B2C sales model. We have confidence that we'll further strengthen our pre-order pipeline. By far, FX's B2B strategy has covered multiple key FF partners. We are confident that our innovative B2B/B2C co-creation model will further strengthen our pre-order pipeline. On July 17, 2025, we hosted the global initial launch of the FX Super One MPV in Los Angeles, where we unveiled two groundbreaking global-first products: the FX Super One AI EV MPV and the FX Super One eAI Base System. Alongside the FX eAI embodied AI agent 6x4 architecture, the launch event was live-streamed to a global audience and attended by hundreds of guests. It was a tremendous success, generating a sensational impact in both the United States and China and powerfully promoting the FX brand and the FX Super One product.

One more significant achievement of our delivery in the second quarter is that Mariah Carey, award-winning best-selling female artist of all time and global pop music legend, features prominently the FF 91 2.0 Futurist Alliance in her new music video titled "Dangerous," alongside the FF 91. This reflects a new phase of global cultural co-creation for FF, attracting top-tier celebrities and reinforcing FF's identity as a true ultimate AI tech luxury brand. Moving to S2 and S3 product technology. This quarter, we have officially released software version 2.0.58 for FF 91, delivered via OTA. This version improves software stability and user experience and features the latest FFAI 2.0. Additionally, FF's proprietary next-generation voice assistant and ecosystem service platform, powered by large language models (LLM) and generative AI (GAI), was set to launch via imminent OTA update. Our technological advancement is a key driver for our long-term platform strategy.

Regarding regulatory compliance, the FMVSS, Federal Motor Vehicle Safety Standards Validation and Pre-Verification Testing for FX, has been in progress. Additionally, we have officially submitted a patent application for our Super One eAI Base product. Shifting to S4, our progress on supply chain, industrialization, and delivery. The Hanford plant has completed production and delivery of the FF 91 B2.0 model and continues to produce subsequent vehicles. We also proactively prepared to produce the FX Super One. As of today, we have completed initial preparation for production, including layout planning, equipment procurement and installation, process documentation, personnel planning and training, and the development of quality and logistics standards. FX Super One has officially entered the parts procurement and production preparation phase at our Hanford factory. Moving into trial production internally, we have kicked off the final countdown, targeting the first vehicle to roll off the line by year-end.

Regarding S5, our financial strategy and capital markets activity, Jerry, our Global President, will provide details shortly. Our efforts in the Middle East and China under S6 made us progress this quarter in our key markets beyond the U.S. as part of our third pole strategy. Within our broader global expansion roadmap, we achieved a key milestone in the Middle East during the second quarter. We formally signed the lease and received the keys to our new facility in Wasserheimer economic zone. With the handover complete, site preparation is now underway, and our local team is preparing to assume operational responsibilities. The Wasserheimer facility is expected to support future regional vehicle customization and potential SKD semi-knockdown or CKD complete knockdown assembly operations with strategies that enable cost-effective local assembly accessibility.

This progress further advances our presence across the Middle East and North Africa region and reinforces our dual home plus third pole operating model. Finally, let's look at S7. On the operations front, we were pleased to welcome back our founder, YT Jia, who rejoined the company as a Co-CEO alongside me this past quarter. Since he joined the company, we have achieved a major leap in both operational and capital fundamentals. Market confidence has rebounded significantly, and the company's market capitalization has increased nearly 300%. Our operations team continued to advance the corporate comprehensive compliance roadmap, ensuring full compliance across all areas, from company-level governance to facility operations and product standards. On the system side, we implemented the PPTIA framework across the company. The fundamental framework has achieved significant results in cost reduction, efficiency improvement, and streamlined operations. We continue to strengthen our government relationships.

We've received strong endorsements from California political leaders and positive comments from members of Congress in Washington, D.C., for the Bridge Synergy. We participated in several high-profile events this quarter to showcase our vehicles and highlighted our global engagement, including a business roundtable at the White House. In July, we hosted a successful reception at the Capitol Hill Club, where we showcased the FX Super One and the FF 91. The event included private meetings with over a dozen U.S. lawmakers focused on tariffs, technology, and American manufacturing. We were honored by the strong turnout and interest in FFIE's role in advancing domestic EV production. In addition, our global bridge strategy was backed by Donald Trump Jr., who expressed support for our commitment to U.S. manufacturing, recognizing FFIE's role in advancing innovation, creating jobs, and supporting America's economic comeback.

On August 16 at Pebble Beach, FFIE unveiled its eAI and crypto dual flywheel and dual Brit eco strategy and officially launched the C10 Treasury Plan, the first C10 Treasury product based on the top 10 crypto assets basket indexed by a U.S.-listed company, along with the release of the C10 Index. The C10 Treasury will accumulate and compound a portfolio of the world's top 10 crypto assets with the goal of becoming the top treasury for the C10 basket. Phase one targets purchases totaling $500 million to $1 billion, subject to securing necessary funding, starting with an initial $30 million purchase. By building an independently operating, mutually empowering Web2 plus Web3 dual engine growth system, we aim to accelerate the execution of our eAI crypto strategy and maximize value for our stockholders. Now let's welcome Koti Meka, our CFO, to walk through the financial results for the quarter.

Speaker 3

Thank you, Matthias. Hello, everyone. I'll walk you through several key metrics that highlight both our operational execution and improving financial position in Q2 2025. For the quarter, our net loss from operations was $48.1 million compared to $50.6 million in the same period in 2024. Excluding depreciation, amortization, and stock-based compensation, the adjusted operating loss stood at approximately $27.4 million, made up of $7.3 million in cost of revenue, $4.8 million in R&D, $1.9 million in sales and marketing, and $13.4 million in G&A. The monthly operating loss is approximately $9 million during this quarter. These numbers reflect our disciplined cost management, even as we continue to invest in FF-related engineering, talent expansion, and strategic ramp-up initiatives. For the six months ended June 30, 2025, operating cash outflow totaled $43.6 million, a 50% increase from $29.1 million for the same period in 2024.

This increase was primarily driven by the timing of the payments and the operational ramp-up of the FX platform. The increase in operating cash usage reflects our ongoing investments in product development, strategic execution, and cost discipline as we position the company for growth. Our financing activities generated $55.1 million in net cash inflows during the six months ended June 30, 2025, a 106% increase from $26.7 million in the same period of the prior year. As of August 12, subsequent to Q2's end, we received an additional $45.7 million in financing. Our financing efforts have meaningfully bolstered our liquidity, with quarter-end cash position reaching an 18-month high. This improvement reflects our ability to secure capital despite a constrained macroeconomic environment.

While total liabilities grew by approximately $29.4 million over the six-month period, much was due to mark-to-market adjustments rather than new financing, highlighting the balance sheet's sensitivity to equity-linked valuation changes under fair value accounting. In summary, our Q2 performance reflects meaningful progress across both capital liquidity and operational fronts. We remain focused on executing strategic investments aligned with our core roadmap while optimizing capital deployment and driving toward long-term sustainable growth. I will now invite Jerry Wang, Global President of FFIE, to provide some comments.

Speaker 2

Thank you, Koti. This is Jerry Wang, the Global President of Faraday Future Intelligent Electric Inc. I will now share our progress with capital financing in the second quarter. In Q2, FFIE was officially added to the Russell 3000 Index, a key milestone that enhances our visibility and credibility among institutional investors, analysts, and the broader market. Externally, top-tier international fund managers, including Vanguard and BlackRock, continued to increase their holdings in FFIE. Vanguard currently holds 5.24 million shares and has increased by 500% compared to Q4 2024. BlackRock has increased its holdings in FFIE for four consecutive quarters, boosting its position nearly sevenfold from the previous quarter. As of June 30, 2025, BlackRock reported that it held approximately 5.39 million shares, up from just 780,000. Capital markets are recognizing and gaining confidence in FFIE's authentic value and long-term growth potential.

Internally, we launched our 10B5-1 executive stock purchase plans, which reflect FFIE executives' personal commitment to the company's future and aim to align their interests with those of the stockholders. Our Founder and Co-CEO, YT Jia, Global President, Jerry Wang, myself, FX CEO, Xiao Ma, FFIE CFO, Koti Meka, and several other executives have been officially approved and processed for these 10B5-1 purchase plans. On the capital markets front, we actively participated in several investor conferences, forums, and non-deal roadshows to strengthen our engagement with the broader capital markets. I had the honor of delivering remarks at the Copper Bank's conference, and I just presented at the JPMorgan 2025 auto conference in New York last week. Stakeholder engagement remained a key focus in the second quarter. We hosted our first annual stockholders' day, where we provided in-depth FX product updates and deepened alignment with our retail investor community.

We strategically collaborated with HappyTrade, a global multi-market brokerage and digital asset infrastructure platform, marking Faraday Future Intelligent Electric Inc.'s first step into the Web3 financial ecosystem. We have also engaged a leading financial advisor to help advance global AI and AI EV M&A strategy. Additionally, we recently announced $105 million in financing in July to fund our aggressive growth strategy. This fund will significantly strengthen the company's ability to launch FX Super One, scale up the production readiness, as well as advance our position to be a leader in the AI EV market. Now, let's welcome back Matthias to discuss the outlook.

Speaker 1

Thank you, Jerry. I will now walk you through our key updates with a primary focus on Q3, also structured across the S1 to S7 framework. For S1, first of all, we continue to make strong progress in building our user ecosystem. On the FF 91 side, we expect more elite celebrities and public figures to join as FF 91 owners and co-creation officers. Their participation not only validates our brand but also helps amplify our co-creation vision through instance, innovation, and community building. On the FX side, momentum is accelerating. Our B2B/B2C sales channels have now expanded into eight U.S. states, and we have officially launched the FX Dream Partner program, inviting leading players across various industries to join us in co-creating the next generation of mobility. We are also developing a comprehensive user engagement ecosystem that combines products, platforms, and AI to deepen customer interaction.

In the meantime, our FX service program continues to grow as we expand partnerships with major service and aftermarket providers to establish a strong nationwide after-sales support network. In the near future, we are ramping up physical presence and visibility through a series of high-impact offline activities for the FX Super One. This includes our participation in the LA Auto Conference. Now shifting to S2 and S3 with product technology. We are doubling down on our AI product strategy. A core focus this year is building a robust internal R&D capability, especially in software and AI. We are expanding the transfer of core technologies from our $300,000 flagship FF 91 into the FX product line. In the second half of the year, our voice interaction system built on large language models will be deployed across FX Super One and other models.

These models will connect seamlessly with the full FF ecosystem of intelligent services, delivering a deeply interactive user ecosystem. From there, let's look at S4. We will cover progress on supply chain, industrialization, and delivery. We have launched the pilot production phase of the FX Super One, and equipment installation and commissioning are expected to be completed within the year to enable full vehicle manufacturing capability. In September 2024, the FF and FX dual brand strategy was first announced. In 2025, we expect to complete the FX year-end offline target. Shifting to S5, we are continuously optimizing our capital and financing structure, including bringing in top-tier investment banks and large institutional investors. As always, we continue to uphold the shareholders' first philosophy by putting all of our efforts towards building trust with investors and fully regaining their confidence. Now turning to S6, our efforts in the Middle East and China.

The Middle East market has made positive progress in preparation, including financing, research and development, and vehicle deliveries. It is expected that the preparatory work related to the delivery for the Middle East will be completed within Q3. Strong support from FX partners and the smooth launch of the Middle East factory construction have greatly accelerated our ability to commence vehicle deliveries. We anticipate the first FX Super One will roll off the production line by the end of the year. Finally, let's close with S7 system development and strategic growth. FF will continue to advance its eAI EV dual brand strategy. Our first brand, FF, will remain focused on the outdoor buyer segment, maintain FF 91 deliveries to celebrities and stars, and complete the model change and upgrades to FF 91 2.0.

Our second brand, FX, will leverage the FX Super One to open the Blue Ocean MPV market in the U.S. while rapidly initiating deliveries of several additional models. We are continuing to improve operational efficiency through resource optimization, cost control, and enhanced execution and tracking. Our strategic planning systems have undergone several rounds of iterative refinement, and we are beginning to see tangible results. In addition, we are integrating AI and IT tools across our operations. The ongoing improvement of our IT general controls framework is helping us increase the efficiency of quarterly and annual reporting. We believe FF, propelled by the eAI and crypto dual flywheel bridge eco strategy, could continue to optimize operations in line with our corporate goal, stockholder first. Thank you. Now let's turn it back to John for Q&A.

Speaker 2

Thank you, Matthias, and thank you to everyone who presented today. As we wrap up, I'd like to briefly highlight the materials included in the appendix. In the appendix, you'll find our unaudited balance sheets and financial statements as of and for the three months ended June 30, 2025, providing additional detail on our financial position. These materials offer helpful context to support everything we've shared today. With that, we'd now like to open up the floor for some Q&A. Here are some selected questions from emails sent to us. One, what is the status of your U.S. production timeline? Are you still on target for initial production by the end of this year?

Speaker 1

We remain on track for the first FX Super One rollout in the U.S. by year-end. Recently, we have announced the FX Super One has commenced its trial production phase at our Hanford factory. This procurement and installation work is in progress. In the Middle East, deliveries are planned to start this year.

Speaker 2

Two, are you going to be presenting at any upcoming investor conferences, and will they be webcast?

Speaker 4

We are scheduled to participate in several investor conferences this fall, including the Deutsche Bank Car Conference in Germany on September 8 to 9, 2025, and LA Auto Conference from November 21 to 30. We plan to participate in additional investor conferences in the fourth quarter and will keep the investor community updated. Most of these conferences will be webcast or live streamed, and we will publish the schedules and links on our Investor Relations website. Last week, I presented at the JPMorgan Auto Investor Conference in New York on August 12, 2025.

Speaker 2

Three, what is your strategic plan in the Middle East market? Can you provide an update on the operations there?

Speaker 1

The Middle East is the third major pillar of FFIE's global market strategy. Product and capital markets of China and the U.S. We held a handover ceremony in Wasserheimer, UAE, for our regional factory and operations facility. A critical step forward, the plan for 2025 is to begin sales of the FX Super One model in the Middle East market, followed by sales in the U.S. market by the end of the year.

Speaker 2

Four, do you have a list of future events where we might be able to see the vehicles in production facilities?

Speaker 1

Yes, we are ramping up physical presence and visibility through a series of high-impact offline activities for the FX Super One. We officially unveiled and kicked off the second chapter of our bridge strategy over the weekend at our Pebble Beach event. We will also attend the LA Auto Conference from November 21 to 30.

Speaker 2

Five, with top funds like BlackRock and Vanguard increasing holdings, what themes have come up in your conversations with them?

Speaker 4

We are glad to see capital markets are recognizing and gaining confidence in FF's authentic value and long-term growth potential. We've had constructive conversations with institutional holders around scalability, governance, and capital efficiency. The increased holdings reflect confidence in our long-term potential, and we continue to work closely with these stakeholders to ensure alignment on strategy and transparency.

Speaker 2

Six, how do you plan to achieve the same level of the user experience in human-machine interaction, high-level intelligent connectivity, and precise autonomous driving that some of your peers have already accomplished?

Speaker 1

We have already built a solid foundation in the area of vehicle systems, particularly with extensive team experience in internet services, AI applications, and human-machine interaction. For the final FX product, we will incorporate these advanced technologies and features that have already been tested and validated in the FF 91 on the software platform and intelligent hardware front. We will collaborate with partners and fully leverage supplier capabilities to ensure that resource-intensive areas such as intelligent hardware and algorithms meet industry-leading standards. As for autonomous driving, which involves significant investments in regulations, infrastructure, and data, we will implement it in phases based on technology and end consumers' demand.

Speaker 2

Seven, your company's stock price has made significant progress since the second quarter. Could you briefly introduce what your company's most core value is?

Speaker 4

FF is one of the only four U.S.-listed new energy EV companies to pass crash testing alongside Tesla, Lucid, and Rivian, and among the few that have successfully gone from concept to commercialization. We've invested nearly $4 billion and built a full closed-loop system in the United States, encompassing R&D, safety testing, certification, manufacturing, sales, and after-sales service. As a NASDAQ-listed company, FF benefits from strong liquidity, high visibility, and a broad shareholder base. Our premium brand image is well established, and our FF series targets the untapped Blue Ocean market in the United States. At our Hanford, California, facility, we currently have an annual production capacity of 10,000 units, which can be scaled to 30,000 to 50,000 units for the production of FF and FX vehicles under certain conditions. As an American company with deep Chinese roots, FF keeps a close contact with top China OEMs and tier-one suppliers.

We're leveraging global supply chain advantages, including cost, speed, and scale, to deliver greater efficiency to the United States market. This strategy is now in active execution.

Speaker 2

Eight, besides the FX Super One, you've also mentioned developing a second FX model. How do you plan to achieve it?

Speaker 1

Currently, aside from software, most of FX's work focuses on engineering management. Therefore, many resources and capabilities can be reused and shared within the FX Super One project. Meanwhile, the second model will be managed with staggered resource allocation to better utilize existing resources.

Speaker 2

Nine, which flagship FF 91 technologies are being integrated into the FX product line? How are you managing cost and complexity in that transfer?

Speaker 1

The company's resources are mainly divided into two categories: platform-based and model-based. The platform-based category primarily revolves around FFIE's core AI software and the application of internet technologies, which also benefits FX. This area represents the company's core competitiveness and will be the primary focus of investment. The model-based category includes vehicle programs since FFIE's production has already reached a relatively mature stage. Apart from the software portion, most of our investment in this area will focus on FX's mass production development and complete vehicle testing.

Speaker 2

Ten, what is your monthly burn rate?

Speaker 3

As we mentioned before, for Q2, our adjusted operating loss stood at $27.4 million. That translates to an average monthly operating loss of approximately $9 million, which includes expenses across cost of revenue, research and development, sales and marketing, and general and administrative functions.

Speaker 2

Thank you for your time. This concludes our investor Q&A session. We appreciate all the questions submitted and apologize if we couldn't get to all of them today. We remain committed to maintaining open communication with our investors. That concludes today's conference call. Thank you for your participation.

Speaker 0

Thank you. That does conclude today's teleconferencing webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.