Recording in progress..

We're going to start in about 5 minutes and that's meant to give you enough time to go to the URL that's on the screen right now, and what's our next installment of our path to series production video series. So please take a moment now. We're going to -- we'll come back in about 5 minutes.

That will give you time to go ahead and take a look at that video. And just one more time, I know some people may have joined a little bit late, but welcome to the call. We're taking about 5 minutes to give you a chance to watch our new path, the series production video, the next installment of that.

Now, the URL's right there, you can take a look at the video and then we'll be back on about 5 minutes after the hour. Well, I hope that gave everyone time to watch that video. Welcome to our third quarter business update call. I'm Trey Campbell, Luminar 's VP of Investor Relations.

With me today are Austin Russel, Founder and Chief Executive Officer, and Tom Fennimore, Chief Financial Officer. As a quick reminder, this call is being recorded and you can find the earnings release and slides that accompany this call at luminartech.com/quarterlyreview In a moment, you'll hear brief remarks followed by Q&A.

Before we begin, let me remind everyone that during the call, we may refer to GAAP and non-GAAP measures in our remarks. Today's discussion also contains forward-looking statements based on the environment as we currently see it, and as such, does include risks and uncertainties.

Please refer to our press release and business update presentation for more information on the specific risk factors that could cause actual results to differ materially. With that, I'd like to introduce Luminar Founder and CEO, Austin Russel..

Webasto and Inalfa. These companies directly manufacture roofs for many of the biggest global automotive OEMs and customers. And now they're integrating Iris into their offerings such that OEMs can seamlessly adopt our optimized solution without having to launch extensive integration work themselves.

And this is an important part towards the ultimate vision of how we can see this technology being standardized throughout the broader industry. So that's the quick view there.

One of the things that you may have seen in Trey 's background -- I think that was actually the -- something that you would call the Indy Autonomous Challenge and we'll get to that in a sec but one important motto that we have that's informal in the Company is show not tell. We've had that since our inception.

One thing this quarter that we're very proud of is to be able to show off the true capabilities of our tech. One of the examples this -- was this in the autonomous challenges it's, effectively evolving itself into what could be seen as the modern brand challenge that kicked off this autonomous vehicle industry.

The high-speed race around the 8,500 track and with no drivers. It's pretty wild seeing cars that get going 155 miles an hour without anyone behind the wheel. And certainly, the fastest our tech has ever gone. But it, hopefully, serving as an inspiration for what's possible.

And I think what's really cool about it, it seems that it's the same tech and it seems like it's something that's in these cars that actually what's making its way into consumer cars that you could buy. And that's what makes it really inspirational. and again, showing our talent and capabilities. So, raising that awareness.

That was an inaugural event, but hopefully it becomes a recurring thing. At the same time, we also did conduct and conclude our European live roadshow this past quarter. The team had over 60 different customer or third-party engagements out there and had vehicles on in Europe to be able to do these live demonstrations.

What we heard loud and clear is that proactive safety and highway autonomy are going to have the opportunity to change the industry as we know it, and it's exciting to be at the forefront of it. All right, so all this is great and all -- new major customer wins, expanding ecosystem, and certainly exceeded our expectations.

But execution is everything when it comes down to the product. And at the beginning of the year, we outlined 5 key milestones to the business and how we measure success. And that is from both the commercial perspective and an execution perspective, and Tom will be getting into greater detail.

But sneak preview on that is that we've been meeting or beating all the different 5 key milestones. And part of why we increased guidance on some of those milestones in the past quarter, but for one of those, we've already accomplished, I increased guidance well.

Tom will be getting into greater detail on that, but I'd say for the past quarter, we've had a particular focus on supply chain and industrialization as we progress on the path to series production, and do have some significant updates as it relates to Iris.

So, both engineering and tooling are now predominantly complete and we've secured our supply chain for next year in an environment where that's not always a given and are now entering the C-phase of our product cycle for Iris.

So huge leap forward, and in parallel, our contract manufacturing partners Celestica and Fabrinet are also continuing to execute alongside us because they help optimize process and build our capacity in preparation for series production. It's obviously important to note that all this is a first for the industry.

This infrastructure largely doesn't exist for creating it. It's really hard stuff. Just like our technology, we're building out our supply chain from scratch, we're building out our tooling, our process, all this stuff. It's a very intensive period, we've been heads down just trying to execute to a.

But we believe that all of that will pay off big time over the mid and long term. And so that's kind of the update as it relates to Iris. From a software standpoint, the big things through our last update were the development of the Sentinel alpha.

So that's an -- it's a big step forward, and we actually were able to do a review of our proactive safety with live demonstrations to customers at IAA in in Munich. People were pretty blown away by what was possible, and just appreciating how much we can improve safety today when it comes to active collision profession.

So great to see that all materialize, come together, and make that happen. It is all sowing the seeds from what we've had earlier on in the year and the investments that we make. It's all kind of materializing at this point in substantive capacity.

So, before I hand it over to Tom, I just want to acknowledge and then thank the Luminar team for all their hard work and everything that goes into this as you know how intense things are, which over the past year though, the team has actually nearly doubled in size and is only getting stronger by the day.

So, we're really able to punch above our weight class by attracting top talent across both the tech and the automotive industry. And great to see people that are big believers in division as we pioneered this industry.

One last note is, well, just for all those that are on the call, is with regards to the upcoming CEF, you guys maybe familiar, it's the large tech or now as much Texas automotive actually show in Vegas that obviously didn't happen the prior year. But as the world kind of opening up, it's great to be there.

We're going to have a blowout CES, a lot of stuff going on, so would encourage everyone to -- if you're able to make it, it'll be fun. With that, handover Tom to talk to milestones and financials. Thanks..

Great. Well, thank you, Austin. Earlier this year, we outlined 5 2021 milestones to measure our progress against Iris and Sentinel industrialization, major commercial wins, and cash spend. We raised guidance on a couple of these milestones last quarter, and I'm happy to say we continue to remain on track to meet or exceed each of these 5 milestones.

And in fact, we've already achieved a couple of them. Let me review now in more detail. Our first milestone is to enter the C-sample phase for Iris, we have now predominantly completed both our engineering and production tooling for Iris and secured our supply chain for the subsequent year.

We're entering the C-phase as we speak, and continue to work closely with both Celestica and Fabrinet to get ready for series production. Manufacturing complicated opto -electronic devices in series production scale at automotive brake quality is not an easy task. And our team has done an amazing job working around the clock to make this possible.

Separately, our integration of OptoGration is going very well. This secures a key element of our supply chain for series production for the foreseeable future. And that's very important, especially in midst this global chip shortage for all experience. Our second mile is delivering an alpha release of our Sentinel product.

In our last update call, we showed a video demonstrating Proactive Safety on the truck. We followed that up with the debut in a more challenging test scenario with IAA in September. This included automatic emergency braking functionality at speed scenarios that existing ADAS systems just can't match.

We have successfully developed our alpha version of Sentinel and what -- and we'll unveil it at CES in early January. The third milestone was to achieve six major commercial wins this year, a target we doubled during our last earnings call. I'm proud to say we have already achieved this goal with the recent NVIDIA and Polestar wins.

These 2 major wins bring our publicly announced total to 6 for the year. 2 other wins this quarter, we are excited about are the autonomous trucking companies embark in Kodiak combined with our Daimler Truck partnership announced last year. These wins extend our leadership position in the autonomous trucking space.

Our 4th milestone is to grow our forward-looking order book this year by at least 60%, an increase from our original 40% target. We're going to do a formal tally of where our forward-looking order book stands at the end of the year, but based upon our success so far this year, I'm confident we're going to meet or exceed that target.

Our final milestone is to maintain strong liquidity with the target to end this year with a greater cash balance than we started. We remain on track to meet this, and ended Q3 with $545 million in cash. Before we move to Q&A, I'd like to share some quick highlights from our Q3 financials and outlook for the year.

Revenue for the quarter was $8 million up almost 90% year-over-year in 26% from last quarter. The increase in revenue was driven once again by increased program revenue, as we start to launch and execute more series production wins. Our non-GAAP gross loss for the quarter was $1 million.

Our contribution margins for our LiDAR sensors, continue to remain very healthy. Of the $9 million of non-GAAP comps, we had in last quarter, approximately $8 million of that, was non-recurring engineering expenses in fixed manufacturing costs associated with our advanced manufacturing facility here in Orlando.

As we discussed previously, our gross margin private serious production is not a good indicator of our future unit profitability. Instead, we are focused on optimizing our unit contribution margin for when we reach series production and scale.

We plan to discuss this in more detail as we get closer to series production, including the progress to achieving our mid and long-term bomb targets. And we continued to be on track to achieving those.

Our cash spend during the quarter was a little over $37 million, incrementally higher than the first half of the year as we accelerate our investments to fund the successful launches of our multiple wins. For the year, we still expect revenue to be in the $30 million to $33 million range as program revenue from recent wins continue to come online.

As a reminder, this guidance excludes the impact of any accounting contra revenue charges. During Q4, we expect to incur approximately $1 million of contra revenue associated with warrants provided to a customer before we went public in exchange for helping provide resources for product development and validation.

In closing, I'd like to continue to thank the Luminar team for another amazing job and strong quarter. With that, Trey, let's move on to Q&A..

Thanks, Tom. Thanks, Austin. With that, we'll start the Q&A and we'll try to get everybody on the call. Let's keep it to 1 question and 1 follow-up. First question, is going to come from Tristan Gerra of Baird. Tristan, go ahead..

Good afternoon. You've mentioned a couple of trucking design wins. Could you give us some color, as to when you expect those wins to start ramping? And also, would it be for L-3 or L-4 capabilities right off the bat? I mean, given that L-4 is basically transferring the liability from the driver to the vehicle and trucks of this year very heavy.

Do you think that it's going to take some time and will your LiDAR 's be more for proactive safety into trucking?.

No, it's a good question. And I think there will be more to come ultimately, when it comes to holistic trucking strategy at CES, but this is as good of a lead up as we could hope for. And the focus I would say for the U.S. deployments is generally around driver out of the loop L4 capability for this.

So that's what people have been going for, and this is -- they're targeting a 2024 on timeline in the case of end-marks for the commercial deployments.

seeing that happen and obviously part of the missing puzzle piece has been the level of performance and capability of safety of what can be enabled with the sensing aspect and perception perspective that's incredibly valuable. They did a whole analysis on that and published that as well. So that's been good.

Kodiak is at a little bit earlier stage, but they've been -- they just raised their next round, and excited to see them at full speed ahead. So, from a commercial standpoint, I continue to think that there's a massive opportunity when it comes to autonomous trucks.

And on the wake as well as the global supply chain shortages and everything going on, I think that needed demand is only ever clearer. That makes sense..

Great. And then for my follow up question, as you reiterated the full-year revenue guidance, your implied that Q4 revenue is basically a 50% sequentially increase and more than a doubling from your Q1 was in your level.

Could you give us a little bit of color as to what's driving that inflection point and also, at this point, how much NREs are embedded in your revenue currency?.

Tristan, most of our revenue now is the program revenue or as you said, the NRE. As we win more production wins and we start doing the development work to get that ready for series production, that revenue is going to grow. If you go back to Q1, we really had only, I would say 1 win that was the predominant contributor to that.

As we get to Q3 and then also to Q4, there's actually going to be several. So, the more wins we get and the more work we do, the higher that revenue goes..

Noted, obviously, when it comes down to it. The revenue that, you're talking about in this context, is all leading up to series production. And it is a different kind of revenue altogether. As much as anything it's -- I'd say it's an indicator.

It's not a precise indicator at all when it comes down to it, but the question is that, what kind of revenue is it with this? And at the end of the day obviously, the most significant indicator is, the actual wins themselves, that you can see.

I mean that's the factor that matters most that, leads to how you can build an order book and how you can build fundamental value for the business..

Great. Thank you very much..

Thanks, Tristan. The next question will come from Emmanuel Rosner at Deutsche Bank..

Good afternoon, everybody.

First, can you hear me?.

Yeah. We can hear you, Emmanuel..

Yeah. We can hear you, Emmanuel..

Awesome. First question is on the video opportunity. And we'd love to hear you speak about what you find exciting. But if -- maybe if there's any thinking around timeline or sizing of the opportunity. Obviously, this is a partnership now.

How many automakers or other type of place do you expect to source system directly like this as opposed to a different part of the system separately. Just any color around.

How do you think about this opportunity?.

So no, I mean, I think this is really interesting for sure. It's very different. And I'd say it's, in some ways even much more significant than any given single OEM win, because this is a platform play, right? And being designed in, with this is super meaningful.

I mean, I imagine some of you guys, you may cover in video as well, or have some context with regards to how well they've done taking over in leading this modern revolution as is describing it. I think in the auto industry they have been doing incredibly well for themselves.

So, it's awesome to be working with -- I mean, there's really 2 key players that dominate the space, there's Mobileye and Nvidia. And now we've got both so Yes. I think -- and would certainly look forward to a lot of success on their part. Obviously, some of it is in our control, but some of it's in their hands.

At the end of the day, our goal with all of this is to create scenarios where it's heads, we win, tails we win type scenario, regardless of who ends up -- who the OEMs work with at the end of day..

Just in terms of sizing up the opportunity or are the timeline any details you can give on this?.

Yeah. So, they've -- either they've stated publicly the plan, the first planned production is in 2024..

And then second question. Obviously, you have hit a lot of your goals already for this year, especially in terms of commercial wins.

Where do we go from here? What should we be looking forward to?.

It's a very good question, Emmanuel. We've already hit our 6. I don't think we're done winning yet this year. I don't know if that means there -- that will necessarily get to a point where the customers are going to be in a position to make public announcements. But the pipeline of the opportunities that we're engaged on.

I would say is not only the biggest it's ever been, but it's the highest quality that it's ever been to..

Yeah..

Thanks, Emmanuel. The next question comes from Gus Richard at Northland..

Thanks for taking the questions. For the most part, you guys have vertically integrated, the only exception is the compute engine. And your software's written to Nvidia.

And I'm just wondering if you talk a little bit about the strategy of having everything vertical except for that piece of the solution?.

Right. Well, it may be tough to buy Nvidia but -- at this stage, but maybe you know, maybe next time. No, I'm just kidding.

I would say that, a lot of the kinds of vertical integration that we're doing, really comes down to extremely specialized works that we do when it comes to fundamental of the LiDAR, when it comes to certain aspects of the software on that. I would say that like, from a computer perspective, it's much a platform place, anything.

I don't actually think we need to own that. This is also where there are great solutions that exist today like Mobileye has a great solution, NVIDIA has a great solution with that. I don't think we have to re-invent the wheel along those.

The question -- as in -- inn the sense that I don't think that those are the fundamental bottlenecks to seeing this kind of technology and system and value standardized across the broader industry. I think that we're moving full speed ahead on that.

So, the question is that, how do we continue to accelerate things from a value perspective, as it relates to the LiDAR, as it relates to the software, as it relates to all of the stuff. And we have been very smart in delivered decisions when it comes to megabyte partner. And for the broader ecosystem on.

In this case, when it comes to compute this is one that we specifically chosen partner. So, if that helps answer the question makes sense,.

I think it does. Then a lot of the auto OEMs are developing their own silicon for autonomous driving.

The -- how difficult if some of the OEMs develop their own ASICs will it be to deport your software over to their ASICs? How do you see that playing out over the next couple of years?.

Yeah. It's a good question, and I think -- well, for the most part, I'd say for the vast majority of OEMs and folks, we see them sticking to Nvidia and mobile AI -based platforms as well that designed in. But that said, we are able to be compatible with other architectures as well, and we're actually looking into that in a couple of cases.

But incremental -- I mean, as with each different compute architecture, there's incremental work that is required. But we're obviously trying to build our software in a scalable of a way, as possible when it comes down to it. So, it depends totally on the type of compute architecture and just how exotic it necessarily is.

But for standard architectures, it's not exceedingly difficult and certainly doable..

Got it. Thank you so much..

Thanks, Gus. The next question comes from Michael Filatov with Berenberg..

Sorry. Thanks for taking my question, guys. So, the first one around the Nvidia win, I guess I'm curious.

Is the Nvidia platform sort of an open-source platform, or what you guys are selected as sort of the primary offering where the one with the biggest stamp of approval? Because it seems like you go to their website and there's 3 other LiDAR suppliers on there and 8 different sensors for other suppliers on the Nvidia website that are being offered.

So, I guess how does that compare to what you guys have one here?.

Yeah. No, it's a -- and I think it's actually not an unreasonable question. It's actually kind of confusing. So, this is where -- just for sake of clarification. The distinction here, and this is really important, is that -- yeah, so Nvidia obviously does have a broader ecosystem of companies that use their chips.

The key distinction here is that -- using their chips is great and all. We've been doing that for a few years and along with other companies as well. And as part of their drive ecosystem and everything they have, which just cool.

But the significant thing here, and it really newsworthy thing, is not that at all, which I would say probably half the companies in the industry have. Into their credit, Nvidia has done a good job of proliferating their chips in technology. But when it comes down to this, this is for their autonomous driving solution.

This is for their full-stack solution, and we're the only lidar Company for that. And that's a very important and critical distinction is what they 're building their software stack on. This is what actually gets designed in. That's the important part.

And then again, that's not to say that no one else will ever work with that video by default for autonomous vehicle companies. Like I said, most -- or lighter companies, I mean, most new in some capacity. But this specifically for Hyperion, this is their plan..

I guess, ultimately, will the OEMs be working with the Hyperion platform? Will they still individually source the sensors or they take this one stop platform at -- with all the centers on their website that are listed including yours?.

Well, I think it would be virtually impossible to try and hot-swap a different sensor or a software that's not built on it, even if you try necessarily but -- and obviously the only reason why you do that in the first place is if, A. Had better performance or B. It was more cost effective and could actually do that.

But that said, that's -- this is one of those things where it's obviously very high barriered entry, but equivalently very high barrier to exit with this. So, it's part of the design of this. And again, not to say that someone couldn't work with other components or actually, one configuration as you could also.

I mean, people work with Nvidia where they don't have a LiDAR at all, you can do that. It's just a question of, if you want the autonomous driving capabilities and you want to be able to enable that, and you want to use Nvidia solution than you would use this.

An automaker can say, still develop their own stack and use an Nvidia chip, but then that defeats part of the whole purpose of what's trying to be done is to see standardization of functionality, standardization of technology as part of the display..

Got it. And just one quick follow-up around the vertical integration and the acquisition of OptoGration.

It seems like you're virtually integrating a very -- around a very specific design, and I'm curious, does that mean you're really confident in this design in perpetuity, I mean, specifically the ingaas photodiode, right? Is there any roadmap to change away from that? Because of your vertically integrating around it, I guess what's the strategy in mind?.

We have absolute 100% extreme confidence that, this is not just the path crossed, but actually, I don't know who or where of any other viable path to get to this level of stack and economics that are ultimately needed to be able to need to these long-term trajectories of building this kind of business and then this And to scale Luminar, 10X or 100X over the long term for what we want to do.

Yes, it does absolutely reflect that conviction. Now, I get part of this though, is that, that doesn't mean that we're like done, in terms of our tax developments for everybody by any means. And then there's 2 aspects to that. 1. Is going beyond the hardware and the software side, which we really started to see a lot of results on.

But the other aspect of it is from a LiDAR standpoint to part of the reason of bringing these guys in house, I mean, is to actually built out in automotive supply chain, like most -- If you try and go into series production with LiDAR as a state.

Like the supply chains don't exist to supports a Siri production product for a LiDAR as it stands right now. Like they're not there, they're not automotive qualified, they're not IETF certified. And none of this -- you have to be able to actually establishes established process and have those ownerships to make this happen.

Otherwise, you just don't see it even coming to fruition. So, we see all the supply chain challenges that people having today. The risk is 10X higher when you get to this level of specialization with all this is, this is already in the case for this.

And that's why we've gone in some of these cases, like I said, part of the reason of the significance of how we were able to do this, is it for these kinds of companies in the same thing for Black force engineering for example that, we acquired previously, we signed up these guys with exclusivity agreements years ago.

Such that, it would enable us the opportunity to work closely with them, collaborate on this and ultimately have the opportunity to potentially buy them. And that step that's basically that, puts it in our favor. It's going to continue to be an important part.

But again, for next-generation component development for this, these of the right guys to do that. It's either in the same architecture, but there are improvements and we can move out in even much faster pace and take it out of niche world in an automotive world..

All right, understood. Thank you very much..

Thanks, Michael. The next question comes from Aileen Smith at Bank of America..

Hi, guys. I wanted to follow-up on Michael's question in how automakers can develop their own hardware stack and SPAC components accordingly while still using Nvidia 's chip.

Is there any precedent with Nvidia or other players, and not just for automotive, but possibly other industries as well, that you guys look to assess how components and hardware on a reference platform ultimately make their way into being quoted on production platforms by the ultimate customers of Nvidia? I think we can assume that being on a reference platform makes for somewhat of a sticky position, but are there examples that you can point to where that clearly demonstrates that that is the case?.

Yes. There are examples. I'm not sure. I don't think we can probably speak on behalf of Nvidia for them since they're not all public, but I think when it comes down to it, the opportunity here for what it is, and you have to separate out into 2 different things. One is the compute platform itself with a chip, people use their video chips.

Originally, they actually, I think, they got their name in gaming, right? Of all things and then kind of moved over to automotive and all the stuff. People use it across the board. The value here is the autonomous NUVO platform. It's the full stack, it’s the software, it's the solution.

If you're using it in Nvidia solution as part of that, then that's where we are getting better into that. Not going to say that it is impossible to use an Nvidia chip without a Luminar LiDAR, like people are doing this today on cars and they don't have that.

But again, like part of the whole point of the benefit of what they're doing is to enable that solution.

For other automakers that have developed their own full-stack solutions or are developing it, you may have seen some of our announcements already with them, in terms of what it comes out where we've partnered directly, regardless of whether Nvidia is in it or not with there it’s full-stack solution.

One example -- for example, with this -- and here's like a hybrid, if you have Volvo, which we obviously been very -- Volvo has been very public with us. They're using an Nvidia chip. They're using the full-stack solution from Zyntax and us and then also using our label.

So that's like, one example there too of where it's not that but it is still Nvidia platform. But we still got the win and that's where it goes back to the comment of heads a win, tails a win. That's the kind of play and setup that we want to have..

Okay, great. That's helpful. And then I want to make sure I understand the 6 commercial wins secured during on the year and there's 2 additional ones in the quarter, which I think you cited as Kodiak and embark. I would've considered the NVIDIA-1 to be included in those commercial wins.

So, the question is, was Nvidia already included in your cited commercial wins? I think you had 1 that was just undisclosed earlier this year.

Is it not counted because of technically closed post-quarter or is being selected for inclusion on a reference platform not considered a commercial win until it's for production with an automaker?.

Yes. So, Aileen, we've laid out in the past our definition of major commercial win..

Sorry, but just to clarify, I think there's a confusion on that. Kodiak and Embark are not the major commercial. It's Nvidia and Polestar, so sorry, it's confusing.

Yeah, that’s where I was going to go, which is the 6th that we had this year, they're public announced that meet our threshold for major commercial wins, site or Shanghai auto, Pony AI, Airbus, the Volvo standardization win, Polestar, and then Nvidia.

The criteria that we have for major commercial when is that, there is a written agreement that memorialize this that, the customer has deliberately selected our technology and needs to be with a major industry player that is going to lead to a series production program or an equivalent major commercial platform, right.

So, when you think about Airbus, that's not series production, but their major industry player and what we plan to do with them, we expect to be a significant commercial opportunity. That's the bar to get to a major commercial win. Kodiak and Embark are great customer wins.

We're optimistic that there -- that those partnerships are eventually going to evolve into major commercial wins. We're not counting them in that category today. In the past, we said we had 1 undisclosed, that was Polestar.

And so, look, there's some kind of timeline between when we actually achieved the win and then when the customer is been on a publicly to disclosed that. We work with our customers on very sensitive projects and we don't publicly disclose them until they're ready.

The other thing that I would say is in our forward-looking order book, which once again is our estimate of the expected revenue over a lifetime of a program that we've won, we only have our major commercial wins in our order book.

And when we update it at the end of the year, we're only going to include the major commercial wins we have on December 31st, 2021 in that calculation. Now look, we're going to include those major commercial wins, whether they're publicly disclosed or not, but they will be in that calculation..

Got it, perfect that clears some questions I had around the commentary on slide calls, but that makes sense. Thanks for taking the questions..

Thanks, Aileen. The next question comes from Itay Michaeli at Citi..

Awesome. Great. Thanks. Hey, everyone. Tom, you mentioned to an earlier question around the pipeline and the funnel was strong and of high-quality.

I was hoping you give us a little bit more high-level detail about what you're seeing there, maybe by geography, premium versus maybe even mass-market, automaker interest, as well as the idea of option versus standard equipment as you've seen with your other customer recently.

So just curious if you can maybe go a little bit more into your earlier comments about the funnel and pipeline..

Yeah. It's all of the above. If you -- I always think of the automotive industry as having three major regions; China, North America, and Europe. And then you also kind of have the luxury brands and then the mass-market brands.

And then right now, I would say, because we have finite resources, we're really prioritizing where we're going to devote serious resources for the potential programs that we're engaged in. And so, from this perspective, I would say the pipeline is across these 3 major regions, across premium versus mass market.

It includes standardization opportunities, it includes both hardware, as well as hardware plus.

either Sentinel software aspects of it. And I would say it's almost exclusively companies that are in that passenger vehicle or commercial trucking landscape..

Perfect. That's very helpful. And just a quick follow-up on the 2 commercial truck partnership wins.

Is there any potential software contemplated in those wins or is it still a bit too early for to know and finalize that?.

I say for the most part, for some of these providers, they're developing their own software stack when it comes down to it. But there are different things that we contribute certain components of Sentinel too. It's just a level in varying degrees depending on the OEM or in this case, AV player.

I would say there's a general tendency for greater opportunity with the OEMs themselves, which is our focus, as opposed to providing software for independent attack AV companies when it comes down to it, and that's where we think the value is.

Say like the trucks of this world, for example, which is something that we had the prior-year that was a good example of a major win. Hope that makes sense.

Yeah, maybe a quick follow-up. Awesome.

What would you get data back from these partners as well that you can leverage internally? Or it has to be determined as well? Even if you're not selling in the software, is there any leveraging of their data that you can leverage yourself?.

Yeah. There are absolutely significant data benefits when it comes to these kinds of things. And particularly when there are software components to all of this, like in the case of some of the other relationships to the moguls of this world or whatever maybe.

Yeah, I said that I have the intent to ultimately use to be able to have -- you actually don't want all the data. You just want -- you want useful bits of information as these cars are driving around to have that global presence, have those miles, and everything.

And just as an example, any single OEM deployment and data from that is -- orders a magnitude more than every robotaxi Company and Company on the planet combined, like, times 100. That's the value that you're talking about here. And we don't have to pay $1 billion a year to maintain a fleet. We actually get paid to do it.

So of course, what that means is that, you also were able to have product improvement, safety improvement and other stuff along the way. So, it makes it easier. Makes it -- it's not just like an -- it's not a one-sided thing, it's a win-win for everyone..

Right. Awesome, that's very helpful. Thank you..

Thanks, Itay. The next question comes from Jaime Perez at Lafferty..

Hi everyone. Hi, everybody. How's it going? Great quarter. I'm looking at Slide 7 at the Nvidia platform, and what I see is your use -- your LiDAR, they use from redundancy. So, they basically are error checking.

If we laid off, they're providing upfront forward sensing; is that correct? And does that -- how does that -- can you give me a little bit more detail or is that error correcting?.

I think that's sort of the semantic of how to described it. I mean effectively, all centers have to be redundant. You have to have some kind of redundant mechanism, for example, if you had a functionally critical system that was dependent only on just a single Luminar LiDAR like, nobody is deploying that.

That's usually the reason why people still have to camera on their vehicles or others up for why implementing radars. Obviously, the core of the data that you actually get to understand where the position of the. everything is going around that's seeing, comes from the LiDAR.

But it is -- it is redundant in the respect of the architecture of other vehicles such that if any single thing were to fail, the car would be able to come to a safe stop on the side of the road in autonomous operation, or be able to still have some basic capabilities..

All right. As my follow-up, any non-automotive side, from like aerospace and remarks? Thank you..

Yeah. I mean --.

Yeah. Look, I think we announced Airbus earlier this year, but I would say where we're spending predominantly most of our time is on the automotive, as well as commercial trucking landscape. I think that that's an area where our long-range ladder can make the biggest impact.

And quite frankly, when we look at our TAM, it is by far and away, the biggest part of what -- of the opportunities we see out there..

All right. That's all the questions I have. Thanks..

Thanks, Jaime, appreciate it. The next question comes from Dan Levy of Credit Suisse..

Hey. Here we go. Hey, good evening. Thank you for taking questions. Tom, I want to follow up on 1 of the prior responses you gave, and this is just on some of the -- some color on the order book.

These discussions that you're having on the automotive side, are these all for series production programs? And maybe you could give us a sense of how much your agreements with Volvo on XC90 from earlier in the year has led to other dialogues or discussion with other automakers for series production programs?.

Sure. Yeah. Look, Dan. We're focused only on engagements that are going to lead to series production. Or for the area or equivalent for areas outside of passenger vehicle programs. We're not -- I think we're past the point where we're going to be engaging with customers and selling them a LiDAR so that they can test it on the bench.

This is -- how do you take our technology? And how do you deploy it in the series production vehicles? The announcement we made over the summer with Volvo, where we -- our original deal with them was an option leading the standardization. A lot of customers took notice for two reasons. 1.

Is it demonstrates Volvo 's confidence in our continued execution. That they're willing to give us more and more business. They've said publicly that, their goal is to ultimately put our technology on every vehicle that they made. They said in their IPO perspective that they plan to LiDAR on all of their next-generation electric cars.

Not just the successor program to the XC90 's. And so that's a big vote of confidence in us. But more importantly also, for those competitors to Volvo, they see their competitor deploying this technology very soon.

And they want to make sure that, they're not going to be in a position where they're going to fall behind from a technological perspective..

Great.

A lot -- it sounds like a lot of the other programs that you're looking at are probably similar in terms of the type of functionality and capability that it's enabling highway autopilot, this Level 2 plus, plus level 3 type functionality?.

So, here's the way that I would say it, which is in -- you kind of see it with Volvo, which is the highway autonomy is the sizzle that everybody loves to talk about and get in the door, and when you look at some of the pricing that folks like Tesla are able to get for that type of functionality from even better system, it's a great profit generator for these OEMs.

So that is the sizzle that I would say drives a lot of the attraction. What drive standardization is that Proactive Safety element of it, where you can substantially improve the safety capabilities of existing ADAS systems.

And so, when you look at some of these proactive safety videos that we've been putting up there, and what these systems are able to detect, it's just no other ADAS system on the road today can really approach some of the capabilities in some of the speeds that we've been demonstrating..

And it's important to point out that the kind of proactive safety functionality that -- that's something that really doesn't need to sit on the traditional levels scale as you're talking about.

It's an entirely different dimension of capability that also has definitely gotten people excited and -- but yes, I agree with everything Tom said and just got to keep digging into the next level..

Thanks. Then the -- my follow-up is I want to go back to Nvidia agreement. Maybe you can give us a sense of what the process was to get sourced.

Was this a deep RFQ process in which they were looking at a number of different LiDAR providers, and after the process, they chose you? And how much is their exclusivity versus potential for Nvidia to add other LiDAR providers to the platform?.

Yeah. I see 2 different things. I'd answer the first part of it. One is, when you -- the whole point of when you build a stack -out, you have to be able to have an architecture that you're building that with. And in theory, someone could build different stacks that are trying to build off different types of sensing systems.

But this isn't like a hot - swappable commodity with the same kind of architecture. By any means is that, they are actually generally dramatically different. And when you do that, you really have to be able to build your stock on a given architecture.

And that's why it's been such an important focus of ours to make sure that, we can give successfully get designed in. 2. These key defining platforms. Because the decisions are being made today, they can have effects for 10 years, maybe 20 years in some cases on platforms cycle perspective. That's a really critical part. When it comes down to it.

Would say -- what was the first -- what was actually the first part of the question there too, is that you.

.

I'd say, men like -- this stuff is intensive. It's -- and not in the sense that -- there's a lot of work that goes into this. I don't want to -- I don't want to speak on to -- in behalf of any video or any OEM or anything, when it comes into play.

But these are multiyear processes that extensive amounts of diligence are don e and a lot of work that goes into the slips. Let's say it doesn't exactly happen overnight..

Great. Thank you..

Thanks, Dan. And with that, that's going to end our Q&A session. I want to thank everybody for joining our Q3 earnings call. We look forward to talking to you for our Q4 earnings call, and potentially a CES if you can make it there. Thank you, everyone..

Thanks, everyone..

Alright. Kevin, you can close this out..