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LT

Luminar Technologies, Inc./DE (LAZR)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue was $15.6M, down 17% QoQ and 5% YoY; GAAP gross loss was $(12.4)M and GAAP diluted EPS was $(0.62). Management cited lower Volvo EX90 demand, a delayed NRE contract, and winding down a non-core data contract as key drivers .
  • FY 2025 guidance was cut: sensor shipments to 20k–23k (from 30k–33k), revenue to $67M–$74M (from implied $82M–$90M), YE cash & marketable securities to $80M–$100M; Q3 revenue guided to $17M–$19M .
  • Strategic pivot: exiting non-core data and insurance businesses; intensified focus on Halo platform and commercial markets (defense, trucking, security) with specific milestones (ASIC tape-out and Thailand line by YE 2025; Halo B-sample by Q2 2026) .
  • Balance sheet actions: $200M preferred facility availability (initial $35M closed) and repurchase of $50M face amount of 2026 converts; remaining 2026 notes targeted below $100M by YE to avoid springing maturity .

What Went Well and What Went Wrong

What Went Well

  • Management set concrete execution milestones for Halo and manufacturing: ASIC tape-out and Thailand high-volume line by YE 2025; Halo low-volume prototype line by Q1 2026; Halo B-sample by Q2 2026 .
  • Strategic focus sharpened: exit of non-core data and insurance businesses to reduce OpEx and cash burn; reiterated plan to reach non-GAAP OpEx in the low ~$30M range by YE 2025 .
  • Balance sheet progress: entered a $200M convertible preferred facility (initial $35M drawn) and repurchased $50M face of 2026 notes, reducing near-term maturities and extending liquidity runway .

What Went Wrong

  • Revenue softness: QoQ decline driven by a 1,000 unit sequential drop in Iris shipments to ~5,000, a delayed NRE contract into Q3, and the wind-down of a high-margin data contract; gross loss also pressured by a $3M non-cash warranty reserve .
  • Unit economics: Iris sensor sales remain underwater given lower-than-expected volumes on Volvo EX90; tariff charges of ~$1M also weighed on COGS in Q2 (mitigation expected for remainder of year) .
  • Guidance cut: FY 2025 shipments lowered by ~10k units and revenue reduced accordingly; YE cash & marketable securities outlook moved down versus prior framework .

Financial Results

MetricQ2 2024Q4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$16.5 $22.5 $18.9 $15.6
GAAP Gross Profit/(Loss) ($USD Millions)$(13.7) $12.5 $(8.1) $(12.4)
GAAP Net Loss Attributable to Common ($USD Millions)$(130.6) $(44.2) $(76.5) $(30.5)
GAAP Diluted EPS ($USD)$(4.32) $(1.26) $(1.82) $(0.62)
Non-GAAP Net Loss ($USD Millions)$(81.1) $(49.8) $(63.1) $(73.1)

Segment revenue breakdown:

Segment Revenue ($USD Millions)Q2 2024Q4 2024Q1 2025Q2 2025
Products$15.7 $18.9 $13.0 $12.0
Services$0.7 $3.6 $5.9 $3.7
Total$16.5 $22.5 $18.9 $15.6

KPIs and cash metrics:

KPIQ4 2024Q1 2025Q2 2025
Non-GAAP Free Cash Flow ($USD Millions)$(62.2) $(44.3) $(53.8)
Cash & Marketable Securities End of Period ($USD Millions)$182.7 $138.2 $107.6
GAAP Operating Expenses ($USD Millions)$78.2 $64.2 $27.1
Non-GAAP Operating Expenses ($USD Millions)$55.0 $45.2 $47.0

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Sensor Shipments (units)FY 202530k–33k 20k–23k Lowered
Revenue ($USD Millions)FY 2025Implied $82–$90 $67–$74 Lowered
Non-GAAP Gross Loss ($USD Millions per quarter)FY 2025$(5) to $(10) per quarter (avg) $(5) to $(10) per quarter (avg), likely higher end due to data wind-down Maintained (with mix headwind)
Non-GAAP OpEx ($USD Millions per quarter)YE 2025Low ~$30 range Low ~$30 range Maintained
Cash & Marketable Securities ($USD Millions)YE 2025>$100 (excl. undrawn $50M LOC) $80–$100 (excl. LOC) Lowered
Revenue ($USD Millions)Q3 2025N/A$17–$19 New point-in-time

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024)Previous Mentions (Q1 2025)Current Period (Q2 2025)Trend
Halo platform & milestonesUnveiled Halo; customers transitioning; prototypes delivered; industrialization via TPK Unified product architecture; moving all customers to Halo; mid-’26/early ’27 launch target Specific milestones: ASIC tape-out, Thailand line, prototype line, B-sample; OEM development continuing Accelerating clarity
Supply chain & tariffsPlanned downtime aided Q4 margin; Asia manufacturing ramp via TPK ~$1M tariff charges; mitigation actions underway ~$1M tariff charges in Q2; expect no material tariffs rest of year; transition production to Thailand Improving mitigation
Automotive volumes (Volvo EX90/ES90)EX90 launched; ES90 added; cautious on ramps ~6k sensors shipped in Q1; conservative haircut to IHS forecasts ~5k sensors shipped; lower Volvo demand; shipment guide cut Deteriorating volumes
Commercial/Defense adjacenciesIndustrial OEM contract; broader applications beyond auto Adjacent market sales at higher ASPs helped Q4; pursuing non-auto Emphasis on trucking, security, defense; seeing revenue today; expect growth in 2026 Expanding focus
R&D execution & warrantyNRE reversal aided margins; Halo dev progress Middle innings of Halo investment; shifting resources from Iris/Iris+ $3M non-cash warranty reserve for IRIS reliability testing; Halo milestones reiterated Mixed (one-time reserve; continued progress)
Leadership/corporateStrong Q4 finish; restructuring savings CEO transition to Paul Ricci announced Ricci setting operational discipline; exiting non-core businesses Stabilizing operations

Management Commentary

  • “We took decisive steps this quarter to deliver on our customer commitments, advance Halo as the foundation of our future, and sharpen our focus on near-term revenue and profit opportunities beyond automotive in commercial markets.” — Paul Ricci, CEO .
  • “We recorded a $3M noncash warranty adjustment driven by updated assumptions as we completed the final reliability testing for IRIS... Excluding this, our gross loss would have been in line with guidance.” — Tom Fennimore, CFO .
  • “We are underwater on the sensor economics… transitioning more of the production over to Thailand… given the lower expected volume, unit economics on Iris aren’t where we want them to be.” — Tom Fennimore .
  • “We repurchased $50M in face amount of our 2026 convertible notes… approximately $135M remain outstanding; our target is below $100M by year-end.” — Tom Fennimore .

Q&A Highlights

  • Adjacent markets trajectory: Commercial markets already contributing revenue; increased sales/marketing to grow through 2026; investments consistent with low-$30M OpEx target .
  • Iris unit economics: Acknowledged negative sensor economics at current volumes; Thailand production transition designed to improve unit economics .
  • Guidance delta drivers: ~2/3 from lower sensor shipments (30–33k → 20–23k), ~1/3 from data contract wind-down; Q4 revenue impact ~$5M expected from data wind-down .
  • OEM updates: Ongoing Mercedes development agreement with milestones; objective remains future production agreement conversion; Volvo volumes lower than anticipated, relationship continues .
  • Tariffs: ~$1M tariff charges in Q2; customer solutions to mitigate exposure; no material tariff charges expected rest of year .

Estimates Context

  • S&P Global consensus for Q2 2025 EPS and revenue was unavailable at the time of analysis; therefore, estimate comparisons and beat/miss assessments could not be performed [Values retrieved from S&P Global]*.

Key Takeaways for Investors

  • Revenue softness and guidance reset reflect slower OEM ramps and the wind-down of non-core data, with Q3 revenue guided to $17M–$19M setting near-term expectations .
  • Strategic pivot to commercial/defense adjacencies aims to diversify revenue with potentially better unit economics while Halo remains the long-term automotive platform .
  • Concrete execution milestones for Halo and Thailand production increase accountability and timeline visibility into 2025–2026 deliverables .
  • Cost discipline continues: non-GAAP OpEx targeted to low ~$30M by YE 2025; exiting non-core areas supports lower cash burn trajectory .
  • Balance sheet actions (preferred facility, converts repurchase) reduce near-term debt risk and extend runway; CFO targeting < $100M 2026 converts by YE .
  • Iris unit economics remain a headwind until volumes scale or mix shifts; management expects tariff headwinds to abate after Q2 .
  • YE 2025 cash & marketable securities outlook moved down to $80M–$100M (ex-LOC), highlighting importance of execution and capital access (ATM/preferred) through 2026 .