Canoo Inc. (GOEV)·Q2 2024 Earnings Summary

Executive Summary

• Q2 2024 delivered record revenue of $0.605M, sharply reduced operating expenses to $41.95M, and materially improved adjusted EBITDA to $(38.6)M from $(62.3)M YoY and $(48.3)M QoQ; GAAP EPS improved to $(0.09) versus $(3.22) YoY and $(2.20) QoQ .
• Management reaffirmed prior cash flow guidance and introduced H2 2024 adjusted EBITDA guidance of $(120)M to $(140)M, citing pacing of capital and supply chain harmonization .
• Operational catalysts: USPS right-hand drive LDV deliveries underway; a USPS EV RFP expected later in 2024/early Q1 2025 for 10–12k units; international pilots in U.K. and Saudi Arabia progressing, FTZ activation at OKC supports export scaling .
• Capital strategy emphasizes incremental, dilution-aware funding and growing share of non-dilutive sources (23% in Q2); cash, cash equivalents and restricted cash were $19.1M at quarter-end (pro forma $33.2M including July proceeds) .

What Went Well and What Went Wrong

What Went Well

• Record quarterly revenue ($0.605M) driven by USPS deliveries and DIU Phase 3 battery-testing revenue recognition; adjusted EBITDA improved 38% YoY and 20% QoQ; adjusted EPS improved to $(0.61) .
• Strategic execution with large fleet customers (USPS, Walmart), concluding demanding pilots (Red Sea Global, U.K. fleets), and rapid OTA updates “often within 48 hours” strengthen product-market fit and services moat .
• Supply chain and footprint progress: inaugural supplier engagement event representing ~52% of BOM, OKC FTZ activated, 50 Arrival UK asset containers received and commissioning begun for vertical integration .

What Went Wrong

• Gross margin remained negative (–$1.24M) given small revenue base and early-stage production; loss from operations still substantial at $(43.19)M despite OpEx cuts .
• Cash balance remained tight at quarter-end ($19.1M; pro forma $33.2M with July proceeds), requiring continued external financing and precise capital pacing; quarterly cash burn in operations was $35.9M .
• Consensus estimates unavailable, limiting market “beat/miss” framing; management continues to cite supply chain harmonization and capital pacing as gating factors for step-level manufacturing .

Financial Results

Notes:

• Q1 2024 revenue and gross margin were reported as zero ; Q2 2023 revenue/gross margin presented as dashes, treated as zero .
• Adjusted metrics per company’s reconciliation; improvements reflect lower OpEx and exclusion of fair value items and other non-recurring effects .

Segment breakdown: Not applicable; company reports consolidated results. Revenue sources cited include USPS deliveries and DoD DIU battery-testing program recognition .

KPIs and Liquidity

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We only build sold units for Grade A BBB creditworthy clients for 2025 and 2026” .
• “We function like a TEM, not an OEM… these things are deeply integrated into their strategy” .
• “We successfully deployed our first OTA updates… often within 48 hours from request to update” .
• “During the quarter, we raised $40 million of capital… first time we’ve raised a material amount of capital from nondilutive sources” .
• “We are focused on left-hand drive and right-hand drive large fleet customers and finalizing their configurations” .

Q&A Highlights

• Capital cadence: Expect continued incremental raises aligned to milestones; prioritizes limiting dilution amid volatile markets .
• Demand/order flow: Conversations advancing post-pilot; focus on a small number of high-volume, multiyear customers to “sell the many” .
• Supply chain: Supplier event (~52% BOM) to align configurations; capital harmonization follows spec lock; leveraging distressed asset buys to close gaps .
• USPS/Delivery schedule: USPS RFP expected late 2024/early Q1 2025 for 10–12k units; company defers customer-specific announcements to partners but anticipates disclosures in the coming quarter .
• Cost control: SG&A/R&D discipline to persist; deployment pacing driven by terms of capital and manufacturing phase; quarterly cash used in ops $35.9M (lower end of guidance) .

Estimates Context

• S&P Global (Capital IQ) Wall Street consensus EPS and revenue estimates for GOEV Q2 2024 were unavailable due to missing CIQ mapping in our data pipeline; therefore, estimate comparisons and beat/miss analysis cannot be provided at this time. We searched for SPGI estimates but could not retrieve them (SpgiEstimatesError) and thus cannot anchor comparisons to consensus [GetEstimates tool error].

Key Takeaways for Investors

• Early commercial traction: USPS deliveries underway; >34k customer miles logged; progress in U.K./Saudi pilots—points to strengthening validation ahead of potential 2025 allocations .
• Operating leverage improving: Quarterly OpEx cut to $41.95M from $62.65M QoQ; adjusted EBITDA improved to $(38.6)M; adjusted EPS to $(0.61) .
• Liquidity tight, but diversified funding: $19.1M cash/restricted at quarter-end (pro forma $33.2M after July proceeds); capital strategy mixing PPA, preferred convert, tax refunds; 23% non-dilutive capital share in Q2 .
• Guidance: H2 adjusted EBITDA $(120)M–$(140)M and reaffirmed cash outflow guidance provide framing for spend discipline; 2024 revenue guidance $50M–$100M maintained .
• Structural moat: TEM model, OTA/service (QRF), right-hand drive capability, FTZ activation—supporting scalable customer configurations and potential UK assembly/logistics benefits .
• Catalysts: USPS EV RFP (10–12k units), anticipated customer announcements, supplier harmonization milestones, asset integration advancing—watch for allocation and delivery schedules for 2025/2026 .
• Risk-monitoring: Persistent negative gross margin and sizeable operating losses; reliance on timely capital access and supply chain execution; absence of consensus estimates limits immediate “beat/miss” trading cues [GetEstimates tool error].