Strategy for Profitability and Scale
Q: How will Nikola achieve profitability through scale?
A: Nikola emphasizes that building scale is essential for profitability. Without meaningful volume, it's impractical to optimize the cost structure. They are focusing on landing big national accounts and expanding their geographic footprint beyond California and Canada to increase their addressable market. This approach aims to build a larger order book, which is foundational to reducing costs and achieving profitability.

Adjusting Prices and Costs
Q: Are you cutting prices or costs to gain customers?
A: While Nikola is not intending to cut prices, they are being flexible on initial deals with big national accounts. They acknowledge the need to optimize their cost structure but believe that meaningful volume is necessary to work with suppliers to reduce the bill of materials. They are confident that once customers experience their trucks, longer-term business will follow.

Impact of One-Time Items
Q: How much did transitory items affect Q1 financials?
A: The first quarter included several unique items that impacted financials, such as warranty expenses, inventory write-downs, and BEV vehicle returns. These items totaled about $18 million in SG&A expenses. Nikola doesn't expect these to continue once they build the scale and get the "flywheel" going.

Lack of Revenue and Margin Guidance
Q: Why did you stop providing revenue and margin guidance?
A: Nikola is temporarily withholding specific revenue and margin guidance until they have more certainty. The company is focusing on building the order book and working through their strategy with supplier partners. They intend to provide more detailed targets in the future and be held accountable to them.

CapEx Guidance and Fuelers
Q: Is CapEx guidance changing due to more fuelers?
A: Nikola has left their CapEx guidance unchanged at $60–70 million for the year, despite adding more mobile fuelers. Some fuelers are financed or purchased by others, which helps manage capital expenditures. They reported $16.5 million in CapEx this quarter.

Hydrogen Infrastructure Build-Out
Q: How are you expanding hydrogen fueling stations?
A: Nikola is deploying more modular fuelers based on customer and sales team feedback, aiming to move fuel availability ahead of demand. This strategy supports selling trucks in new regions and demonstrates the viability of their hydrogen network to partners and financiers.

Battery Supply Constraints
Q: How is battery supply affecting BEV sales?
A: Battery supply remains tight, limiting Nikola's ability to sell on-hand BEV inventory. They are managing supply constraints and focusing on both BEV and fuel cell truck launches, expecting to face these challenges throughout the year.

BEV Vehicle Repurchases
Q: Will you repurchase more BEVs from dealers?
A: Nikola repurchased 15 BEV vehicles as part of optimizing their dealer network. They intend to resell these vehicles and do not currently anticipate further repurchases. They have reserved for potential future returns based on experience.

National Accounts and Large Customers
Q: Are you making progress with large fleet customers?
A: Nikola is increasing focus on national accounts with fleets over 1,000 trucks. They are engaging with big customers who are interested in zero-emission solutions and are confident that landing these accounts will stimulate further demand.

Anheuser-Busch Relationship
Q: Is Anheuser-Busch still a potential customer?
A: Nikola is demoing trucks with many large customers but cannot provide specifics due to confidentiality agreements. Biagi Bros, a distributor for Anheuser-Busch, is using Nikola trucks, but no specific updates on the original 800-truck order were provided.

Reverse Split and Dilution Concerns
Q: Why propose a reverse split and potential dilution?
A: Nikola proposes a reverse split to prevent NASDAQ delisting due to low share price, attract new investors who might avoid low-priced shares, and make additional shares available for future capital raises and partnerships. While mindful of dilution, they believe this provides the flexibility needed for growth.

Hydrogen Fuel Volume Data Sharing
Q: Will you share hydrogen fueling volume data?
A: Currently, Nikola is not sharing hydrogen volume data publicly as it's competitive information. They are gathering data from testing and validating fuelers and may share more information once they are comfortable with utilization levels.

Gross Margin Outlook
Q: How should we think about gross margins?
A: Nikola is not providing specific gross margin guidance at this time due to many moving parts, including supplier negotiations and warranty experience. They expect significant scale in 2025 and 2026, which should lead to positive cash generation and gross margins.

Transitory Items Continuing
Q: Will unique costs continue into Q2?
A: Many transitory costs impacting Q1 are not expected to continue into Q2. Nikola has reserved for potential future BEV returns and is working to reduce warranty expenses as they gain more operational experience.

Hydrogen Costs and Permanent Stations
Q: What's the cost of permanent hydrogen stations?
A: Permanent hydrogen stations are more efficient and can handle 100 to 200 trucks. They cost about 3x more than modular fuelers after incentives. Nikola plans to build permanent stations when there is sufficient demand density.