FFAI - NASDAQ

Greetings, and welcome to Faraday Future Intelligent Electric Inc. Third Quarter 2025 Earnings Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to John Schilling. Thank you, John. You may begin.

Welcome, everyone, to Faraday Future's Third Quarter 2025 Earnings Call. This is John Schilling, Director of PR and Communications at FF. Today, I'm joined by a few members of our leadership team, including our global Co-CEO, Matthias Aydt; our CFO, Koti Meka, and our Global FF President, Jerry Wang. Today, we will be sharing details from our third 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 third quarter overview and financial highlights; our development progress, together with our fourth quarter and 2026 outlook. At the conclusion of the overview, the management team will also address questions from our shareholders submitted electronically in advance of the call. With that, I will now turn the call over to Matthias. Thank you.

Thank you, John. Hi, everyone. This is Matthias, Global Co-CEO of Faraday Future. I am pleased to share our key developments for the third quarter of 2025 through today structured around our 7 Tier 1 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 road map. For S1, our user ecosystem at the global launch of the FX Super One NPV in L.A. on July 17, we unveiled 3 groundbreaking innovations, the FX Super One EAI-MPV, the FF Super EAI F.A.C.E. System and the FF EAI Embodied AI Agent 6x4 Architecture. The event drew major attention across the U.S. and China, further elevating the FX brand. As of the launch, FX has secured over 11,000 paid nonbinding Super One preorders. Faraday Future also finalized the U.S. production assembly plan for the FX Super One. The company's bridge partners and supply chain collaborators will commence component supply for the production assembly phase. FX has also rolled out national co-creation and sales events across 8 major U.S. states receiving enthusiastic feedback in New York, Boston and L.A. The FX Super One continues to build strong momentum, reflecting the growing success of our co-creation ecosystem online direct sales model. In the third quarter, we have signed a 100-unit nonbinding and nonrefundable FX Super One deposit agreement with Ariana Motors, one of the largest independent dealerships in Las Vegas. We also expanded our co-creation network through new nonbinding and nonrefundable deposits with the ALPS, a leading global MCN agency and a key TikTok partner managing over 3,000 influencers, Space Auto of Beverly Hills-based luxury auto dealer, strengthening our reach across Southern California's ultra-luxury market and both auto, one of Boston's largest independent dealerships through a 100-unit preorder agreement that marks our entry into the Massachusetts market. In October, we also signed a nonbinding 1,000-unit preorder agreement with

Thank you, Matthias. Hello, everyone. I will walk you through some key metrics that highlight both our operational execution and improving financial position in Q3 2025. For the quarter, our loss from operations was $206.8 million compared to $25.2 million in the same period in 2024. These changes reflect our investment in engineering, talent expansion, strategic initiatives and alignment of the value of our assets related to manufacturing. For the 9 months ended September 30, 2025, operating cash outflow totaled $79.2 million compared to $51.8 million for the same period in 2024. This increase was primarily driven by changes in working capital and the operational ramp-up of the FX platform. The increase in operating cash usage reflects our ongoing investments in product development and strategic execution as we position the company for growth. Our financing activities generated $135.8 million in net cash inflows during the 9 months ended September 30, 2025, a 144% increase from $55.7 million in the same period of the prior year. In Q3, we received approximately $132.4 million in net financing proceeds from third parties, substantially exceeding $54 million from the same period last year. Notably, Q3 2025 marks the sixth consecutive quarter, in which financing inflows outpaced operating outflows, reinforcing a sustained trend that supports our operating runway and FX platform execution. Turning to our balance sheet, which now includes investment in Qualigen. Our net assets decreased compared to the year-end on December 31, 2024, primarily reflecting a realignment of asset values based on the updated operational plans and near-term production forecasts, while total liabilities grew by approximately $47.2 million over the 9-month period, a material portion of that increase reflects mark-to-market changes in existing convertible instruments. These dynamics underscore the sensitivity of our balance sheet to equity-linked valuation movements under fair value accounting. In summary, our Q3 performance reflects meaningful progress, and we remain focused on executing strategic investments aligned with our road map while optimizing capital deployment and driving toward long-term sustainable growth. I will now invite Jerry Wang, Global President of FF to provide some comments.

Thank you, Koti. This is Jerry Wang, the Global President of Faraday Future. I will now share our progress with capital financing in the third quarter. First, we remain grounded in our stockholder-first philosophy. During the quarter, we continued our stock purchase program, which offers exclusive benefits for verified stockholders and eligible retail investors who participate in our ecosystem and preorder channels. Turning to liquidity and financing. We previously announced approximately $136 million in financing commitments to support our growth strategy, FX Super One launch readiness, and our position in the AI EV market. As of the end of the third quarter, we have received approximately $82 million, with the remaining amount subject to closing conditions and timing. We continue to manage deployment carefully and evaluate additional financing opportunities as needed to prudently support commercialization and ecosystem execution. Turning to corporate compliance and governance. In September, we successfully completed the NASDAQ 1-year compliance monitor period, returning to fully normalized normal listed company status. In addition, our management continued to demonstrate alignment with stockholders through Rule 10b5-1 stock purchase plans. Founder and Global CEO -- Co-CEO, YT Jia completed approximately 560,000 in purchases of FFAI common stock under a previously announced plan as of September 8, 2025. These purchases underscore management's long-term confidence and commitment to create shareholder value. We announced, and subsequently closed an approximately 41 million strategic investment in Qualigen Therapeutics, Inc., a NASDAQ-listed company including $30 million invested directly by Faraday Future and a $4 million personal investment from our founder and Global Co-CEO, YT Jia. This investment is intended to accelerate deployment of a crypto flywheel business and further advance the dual flywheel and dual bridge strategy. Qualigen's future financing will be conducted through a new entity without diluting FFAI's share capital. In summary, our capital markets efforts during the third quarter centered on 3 priorities: securing and prudently developing capital to support commercialization; building new digital asset financing platforms that completed building new digital asset financial platforms that complement our mobility business; and reinforcing strong compliance and investor alignment. We believe these initiatives position Faraday Future to execute the milestones ahead while maintaining strategic flexibility. I will now turn the call over to Matthias for the fourth and next year's outlook.

Thank you, Jerry. I will now walk you through our key updates with the primary focus on Q4 and next year also structured across the S1 to S7 framework. For S1 user ecosystem, we will be focusing on multiple areas on the user acquisition side. We continue to drive the FF 91 2.0 Futurist Alliance deliveries and FX Super One preorders. We are on track to deliver an additional FF 91 2.0 Futurist Alliance unit in December. For FX, we have now established FX Pars, our preorder holders in California, New York, Massachusetts, Texas and Nevada. The next phase of expansion will target New Jersey, Florida and Washington, where we are seeing strong signs of demand. We believe this expansion will support incremental preorder volume and broaden our FX Pars network. In parallel, we are making steady progress and tasks required to support vehicle deliveries, including sales operation, aftersales and service capability, auto finance and compliance. In addition, we continue to build the organization's execution capability through targeted hiring. Lastly, we are focused on enhancing our customers' user experience. On FF 91 2.0, we continue to upgrade our third AI space experience and specifically for the FX Super One, we will collaborate with content and application partners, including live sports, streaming, and in-vehicle entertainment to broaden our third AI space strategy. We also expect continued improvements in the experience and performance of the EAI space as part of this road map. Now shifting to S2 and S3 with product technology. We will continue to focus on building a robust internal R&D capability in software and AI while accelerating the transfer of core technologies from our flagship FF 91 into the FX product line to deliver a deeply interactive user ecosystem across all our vehicles. On the regulatory front, we expect to complete a series of Federal Motor Vehicle Safety Standards Assessment Tests at MGA, paving the way for further engineering development to ensure full compliance, enable the rollout of the first U.S. version FX Super One. From there, let's look at S4 where we will cover progress on supply chain, industrialization and delivery. Following the launch event of the FX Super One in the U.S. and U.A.E. in July and October, respectively, we have been accelerating our logistics and supply chain initiatives, enhancing training and strengthening our qualified team metrics management. We will release the first version of the manufacturing management system. For our second plant FX model, FX 4, we plan to show it's redesign rendering during the time period of Los Angeles Auto Show in November, subject to securing the necessary agreements. We also reaffirm our plan to introduce a series of models over the next 5 years, covering 4 major segments in the U.S. market. We do look forward to sharing more updates. Shifting to S5, we will focus on increasing our stockholders' base and additional outreach to investors and bank relationships with global efforts. We will be opportunistic in our fundraising efforts and evaluating various funding channels. Now to S6, our efforts in the Middle East and China. Our other key markets beyond the U.S., following a successful Super One product final launch event in Dubai, the preparatory work related to the delivery for the Middle East has officially been completed. The first Super One is scheduled to be delivered in November. We believe that high-net-worth users and investors in this region will strongly support our international expansion. Finally, let's close with S7 system development and strategic growth with new leadership recently joining FF, we are strengthening our expertise in legal affairs, capital markets and communications, financial management and government affairs. We are solidifying compliance. We will also continue improving operational efficiency and cost control across all entities, reinforcing our corporate goal of putting stockholder-first. Looking to the future, we expect to achieve a key milestone with the delivery of the first FX Super One vehicles in the U.S. and the Middle East making the beginning of a full-scale effort to strengthen FF's global delivery capabilities to support future rollouts. Now let's turn back to John for Q&A.

Thank you, Matthias, and thank you to everyone who presented here today. With that, we'd now like to open the floor to Q&A.

The first question, what are the key features of FX Super One?

FX Super One is more than an MPV. It's the world's leading EAI MPV, a truly AI-driven luxury cabin that intelligently adapts to your lifestyle. Powered by the super EAI FACE system, it transforms your relationship with the vehicle into something far more engaging and human. AI tech luxury and comfort, this FX Super One blends artistry and intelligence to craft an atmosphere of tranquil indulgence. It's zero gravity NAPPA leather seats with 10-point massage deliver effortless serenity and a purification system, antibacterial intelligence and super-quiet acoustic engineering create an environment of calm purity. FX Super One delivers a luxurious, comfortable, healthy, and private experience across all scenarios, turning every journey into a first-class experience for both body and mind. Dual power options AI HER, and AI EV engineered for effortless strength, composure and precision, the FX Super One introduces a new generation of intelligent power, AIHER hybrid extended range and AI EV battery electric systems, both paired with standard intelligent all-wheel drive. The result is best-in-class efficiency across all conditions and a seamless human machine connection that inspires confidence in every drive. Expansive and adaptive design with a commanding 213-inch overall length, 150.5-inch interior space and a 72.6-inch shared track layout for the second and third rows, the FX Super One creates an open, flexible environment that adapts to every lifestyle. Every detail has been sculpted for balance, comfort and ease, ensuring that every passenger enjoys true VIP serenity within this executive class EAI MPV. Truly perceptive EAI agent equipped with the world's first FF Super EAI FACE System and the EAI space, the FX Super One offers an ultra-clear, immersive multiscreen and multimodal interactive experience. It becomes the embodied AI agent, an intelligent life form that perceives things, communicates and grows. It understands you better than you do and reshapes the bond between you and your vehicle, 360 degrees intelligent safety. Built upon a high-strength steel cage body with extended full-length side curtain airbags, protecting all 3 rows and 4 longitudinal, 7 transversal multi-beam architecture, the FF Super One delivers next-generation safety intelligence. Through dual core protection, structure and algorithm, it fuses predictive sensing with physical resilience to create a truly holistic intelligent safety ecosystem.

Question number two, how many preorders has the company received to date? And when will they turn into firm orders?

As of October 28, the company has secured nonrefundable deposits, nonbinding B2B reservation orders for more than 11,000 FX Super One units and approximately 250 refundable nonbinding B2C preorders. We continue to expand our market through the co-creation ecosystem, direct online sales and FX Par partnership models. Partners do not only reserve vehicles, but also responsible for off-line operations and services in specific regions, sharing in the revenue. Preorders will convert to binding sales orders ahead of vehicle availability.

The third question, update on tariff impact. How much will it increase costs for next year? How are you mitigating it?

We see tariffs as something that affects the entire U.S. auto industry, not just one company. In many ways, tariff policy is part of a broader industrial strategy. It can help drive more local production, innovation and supply chain resilience, which ultimately strengthens the competitiveness of U.S. brands. The recent progress in U.S.-China trade discussions is encouraging. A more stable and predictable tariff environment benefits everyone. It reduces uncertainty for manufacturers and helps keep costs manageable for consumers. At FF, we operate our own factory in Hanford, California, with an annual SKD capacity of up to 30,000 vehicles as production of both the FF and FX brands scales up and more components are localized, we expect to rely less on imports and contribute even more to U.S. advanced manufacturing. At the same time, with the FX Super One model entering mass production in 2026 and gradually ramping up capacity, we expect the impact of tariffs on our cost over the next 12 months to remain manageable. While tariffs on Chinese-made EVs could reach up to 100% under certain policies, their main goal is to balance global competition and boost domestic capability. In that context, our FX bridge strategy becomes even more important. It helps connect global supply strengths with the U.S. innovation and efficiency. We've also been in active and constructive dialogue with policymakers to ensure tariff measures, support innovation, sustainability and affordability. So the entire industry can continue to grow in a healthy way.

Question number four. Following the UAE launch, what initial reservation volumes have you seen? And what is your business strategy in the UAE?

We have received B2B preorders for more than 200 Super One units in the UAE. We have strong support from high-value co-creators including government officers and potential investors. We can also ramp up crypto-related business more quickly due to government support. Following the official launch of the FX Super One in the UAE, we have opened preorders through our local partner network and have seen strong early interest from both private buyers and institutional customers.

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.