ONDS - Earnings call transcript Q1 2021

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Operator

Good day, and welcome to the Ondas Network First Quarter's 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note today's event is being recorded. I will now turn it over to Eric Brock, CEO. Please go ahead, sir.

Eric Brock

good welcome and quarter our operator, call. investor you, morning, to and first Thank exciting Ondas. day an is This for

In addition a employees, is be and investors. system. to It's this importantly course introduce wireless huge call investor announced leading homerun. for the network sharing industrial the a a I'm our earnings and our of mission-critical Rrobotics mission Robotics. release, talking American to and deal about This to community. to win to time you, critical I'm with platforms American customers, thrilled sure This is dedicate data sharing great news deal Ondas' for properly two be on Robotics acquisition combining a we'll American of we've enough FullMAX also drone world-class this

American also by and CFO, they Moser; Of their details an our stand platform technology joined we covering today by our time Vijay and incredible on teams and here Stewart have we're activity. to joined QX on with business. Mr. Somandepalli. update an giving I'm in Robotics, of spend Kantor, are course, the share along we you addition, where critical Vijay built CTO, development business Reese results president, their CEO;

our and customers. Robotics. platform drone They glove System. Scout is drone mission-critical solution and is get going wireless first-in-class a coveted that commercial of here America a needs in with box valuable exactly Scout customers. critical needs data data integration and on marketing of leading The outlook, FullMAX what Before best-in-class Ondas technical computing do and the a It's create minutes in even well for the to the Ondas Robotics American and more a infrastructure us. solution bold for we a marketing what the perspective. to mission-critical both platform exactly the in This sector. wireless to like the a connectivity customer from our the as a AR by a turnkey platform couple is in want The fits providing are move complete both on our customers and wireless thoughts as type standpoint markets platform we few called quarter from our expect is charge shareholders connectivity, serving. distribution drone significant take a I and from that's to bring synergies a edge value share

we public defining leading the government and delivering these markets and safety, the data We address. charge critical are in industrial, solutions for

for Now, going Rails Siemens, financial start give Things turn I We're let's the and a announced back And in then And of our in Q&A. we areas course, I'm the clicking Stewart. to acquisition to for where then, American business means that Robotics outlook providing Ondas. development, attention be to are of outline agenda highlighting to we the key we're leave for AURA. time will information are today. regarding going today. on going first review focusing the business the will with from

first Stewart in clear describe in will bookings and on progress generated revenue we plan. the quarter, As detail, record both our demonstrating

hand of through and to the over that on and will new in Stewart, call is more expanding details and We with which to you product X agreements, partnership, Rail our more financial the drive to now markets both critical Siemens' platform we're come. development continue I towards the in Drone our particularly towards and Rails to QX outlook. Class provide ecosystem, we AURA, adoption see broadening

Stewart Kantor

generated X.X made initiatives QX Great. bookings. million revenues of both over progress booked first and excellent highlighting XXXX. our in We record XXX% X.X Thank to revenue you, and of by and business all Eric, key with orders, revenue achieving quarter million growth welcome I begin want the approximately we in everyone. including in on new that

growth primarily and North programs unmanned American network. in with aircraft development navigation our Rail our drone the Siemens market, is partner Mobility, from partner joint which nationwide came deploying Our and AURA

results progress Rail towards excellent substantial have shown both communications year-over-year improvement and Drone financial and Our reflect the markets. scaling

Our expenses million, in compensation. X.X X.X increase the an of XXXX. QX operating approximately X.X stock The primarily results operating expenses of based million increase in were million over was non-cash

Siemens coming as and expect driven in We to continue sales activity mentioned Because happen we timeline. the and on major provide our and a because deployments substantially new in will orders commercial by financial fluctuate our to calls, profitability intend don't guidance. this, of we've quarters, don't quarter-to-quarter fixed AURA. bookings grow revenues Revenue and system primarily full-year from previous

in revenue X.X we revenue as greater AURA. between from and tell next Eric and backlog from come new QX XXXX, the section sales Class will as million that about this orders the well million X.X in more expect detail. will For X and Siemens, Railroads you our

as to quarterly which such based to and year. revenues Our in be the expenses basis X bookings X.X We quarter. throughout see on stock expected we're expenses, operating believe are grow non-cash positioned cash second between exclude million and compensation, the a

the to balance a our customer have end large we strong a burn. revenue cash have the sheet continue cash of first And with in quarter. We relative pipeline, opportunities million XX at modest to in

provide position in all these Eric. now, feel Given great growth the XXXX. and a for Eric will moving we details on And activity more forward. outlook we're factors, customer

Eric Brock

you of as And progress made QX. we've in see, Stewart. a can lot you, Thank

like team, more to So of work have I as to we remind do. course, my

and strong QX milestone While we of as the year. American up is set remains a Robotics for today big news heavy acquisition, course busy the

with of Siemens where network megahertz commercial XXXX. deployments. the have network second be start connect sight American see partners, a ecosystem continue do megahertz. development to deal and as while a I we XXX and on the by AURA. locomotive voice a XXX Starting and beyond data the with with we as of make business rail That our Rails XXX Rails, networks to megahertz a supported Rails, as quarter will will we and progress to includes highlight the as demonstrate significant North throughout want expect Class our to that expect networks in X these other line We multiple the well that move we And we through outside megahertz systems, huge we clear we on including systems is activity Siemens. obviously XXX

as on all to to large towards Let's important that turn work. spectrum our that put to greenfield drive megahertz continue system, to we XXX networks, nationwide customer where adoption

or evolving previously the network is megahertz new worked As expanding. wireless FullMAX group we've in This order now the as the Ondas has to to elevated the with to platform the operating and Rail lab the establish committees we the Comms WCC ratify XXX that Committee to effort MC-IoT shared, now Sunnyvale. umbrella of principally Wireless formally establishment AAR senior rails under and in

including development large are peers the the that expect controls, field new We charge now the drones, network. the users their and strategic networking takeaway be as validating folks opportunity operations approval very further those and other engaged switching, network. and to area of is crossing purchase quarter important for of this Those of there orders a this would in Ondas. with critical this applications train This safety planning decision related for in such functions

timing not will to on when the guidance progress. that second we commercial able we on continue share the these but the with to we in of detailed networks XXX XXXX. expect to half know you, are megahertz We appointments, deployments We're making share begin of

Moving Siemens. to

Class drive them Our pay with to for X. opportunities strategic the partnership to systems creates for the Siemens, Ondas' continues here platform potential the both train from parties. additional for dividends critical systems provide upgrades they revenues

seeing And system groups operating built the Class that in again, Board is the awareness these used business the training rapidly Siemens I units network to user are traction We that Rails. with begin engineers with bandwidth entails. field the earlier increased deemed and the to referred X across all benefits of building the the operations. a network all and beyond critical anticipate for of network as operating Weirdness

megahertz qualified to is for initial activity. product and ordering development sale. let's that is We Siemens' Siemens the call and So being now turn complete XXX ATCS

orders to half. in Siemens the ATCS expect We for place second

product development underway remind generating away addition, the on been Siemens. last by noted the band new I frequency will Siemens product with be by that the from different opportunities completed year. new highlighting. QX. call In Siemens with this That we we a globally is of is to the have separate you product megahertz program a that a to application on want clear expected XXX initiated This be evidence broader during rail marketed of network. revenue program and end for the This that also us is

being critical FullMAX embedded with additional during Siemens train the globally. We systems secure defined expect to software programs additional in platform year with our development

turn AURA. Let's to

spectrum January, continued for their forward has key AURA in network own FCC received AURA AURA This waiver megahertz planning. allows for an to milestones. development with Our work XXX air-to-ground the navigation with the license XXXX their In drone in radio waiver achieving move band. their

we're network included we This with AURA' AURA's has and customers. transitional and FullMAX This and extensive to pleased to equipment mentioned, results for applications. the AURA Stuart UAS on create demonstration will allow testing work now networks optimization As to the Ondas date. of platform completing are testing work the UAS provide aerial for very

commercial expanded network. the product realize partnership In are roadmap for UAS CX parallel, technical Ondas optimized significant equipment development to or FAA and this soon. command nationwide aviation program will this and related scoping AURA sales We and AURA a structures for program, control

AURA here to emerge, sharing more expanding the look big roadmap soon. forward expect relationship details timeline additional with play ecosystem and on and program We to partners we a and

American start massive back vision. with an this to company to I Now saying turn is and let's incredible that Robotics. want talent by

is is The system, Scout System drone Scout enables the a with Importantly, region this UAS, cases. and And drone on a a only is team leader Recent on-the-ground just and that specialized stands operations, an market. operation first and And problem capital a no the a line biggest drones truly of robotics visual the commercializing located sight, approval. have human of drone out Stout With use and solved Boston fully-automated the industrial a platform This called outside consider as beyond AR there in for people of drone-in-a-box world. American Boston. complete, scalable company the many is American FAA of is the to System. be Vijay Robotics community. is drone

MC-IoT gather Ondas our mobile this high-margin, the we to market a to American we and a investors. AR of love platform We model believe as brings $XXX Ondas, markets, Ondas. on addressed also their huge addressable a the as with combination the Ondas industrial going love synergies drone approval FAA what that a and powerful. AR attractive ahead. mover model Today, budgets valuable edge to exactly the CapEx or also robot-as-a-service markets operators, growing. ultimate spending customers high-return between network. penetration government to on the place define System services significant. connectivity businesses. by years to billion drive allow they're in critical patented are is will It's UAS are critical American gathering seeing industrial demand the Ondas as of is device data significant. how sized business platform mobile market and AR's of gas customers The with and been a never railroads, oil The gathering and drone pent-up dollars commercial and are and to valuable the our the drone for be It's and very have in first they'd of huge to here is in mission The huge, coveted ultimate opportunity. system business Ondas to will customers. a the the American believe believe able we groundbreaking and utilities, course, Pricewaterhouses is share access model. data in we Robotics at can Again, markets data Scout The drones. provides via Scout more is as frequency robot-as-a-service weapon capital fit love and is System. in drone-in-a-box we a solution field OpEx value very public stamps addition be couldn't more. market we bringing important the is Robotics commercial better it And this returns huge Of to Robotics for drone that At for by at the before the safety turnkey business, Robotics known wireless lead Scout the and Reese advantage Ondas information value System. significant American and this is on great

of Scout same end-markets customers drone valuable, AR a Ondas value Scout reliable, valuable and with the The The of platform the vice the love and it's for The Ondas' network. expand versa. a technical. real and is very FullMAX secure, the market most Ondas will AR network attack robust reliable, So, are the going networking are this. marketing most reinforces as synergies drone and scalable to the attached and the value are to Robotics' and drones. wireless secure, when American capability mission-critical the wireless

Ondas, solutions, control to lay navigation greater it claim combined broader the That customer For drone benefit extends ability clear, an to commanded the to is radio with CX market starts AURA, even the private networks. market. with

is navigation for leadership extends requirements the both Ondas a low industrial line can in beyond application of private other scale. CX for small drones is drones at altitudes the huge of course, line American and flying which customers market at sight where beyond of rails overlapped industrial position sight, like also customers AR FAA networks visual System in now drones with where defining. an puts local needed visual visual the critical deploying drones that's American for the and smaller the link, the For missions in Ondas. the operate take for be lower at beyond line example, sight, has can address market of squarely large us of to government Scout And deployment a altitudes. markets Robotics to shorter Robotics often

in the AURA. the addition us We radio local with And immediate drone are and network tackling challenges. our we're course, area customers, end applications, interest missions to see the expect of high to solve wide engaging to already Ondas network from private asking drone

I Ondas industrial added you While terrific on hand Reese? American so navigation the American shovels the big jewel a Moser, to and the or positioned play the format System. is in Ondas' all Reese now Robotic opportunity economy. system to will in this picks Scout nervous crown acquisition information provide important network more and to invaluable can of best-in-class role standalone solutions Infrastructure Scout call defined drone System is the applications. as being value Robotics potentiallyfor CEO, an see bringing the to a brings software want backbone platform, he the Robotics drone American drones a

Reese Moser

you, morning, Thank Eric. new of to in chapter Good meet and you this great all everybody, Robotics Ondas. American

of operate drone and Moser, of I'm fully Robotics the we the American Reese American by is beginning of and Eric approved is the automated at name became Co-Founder drones with CEO developer as site. presentation, mentioned in Robotics. my no his company And humans So, FAA industrial systems. fully a to January, automated the first on

And drone is to and understand problem. American about the Robotics the important industry most thing the commercial so,

operate in surface. that for It it make collect having takes a using we have field sector. oil there's to there's is, or talked out quickly success much And manually middle of an now applications, because cases, a data stockpile occurring, multiple the the a and day when practical. times in scratching drones with these stand industries, the and drone as the a agriculture, you been of have at this not the that As there that's vast remote whether day large about the look and person is sense. drone But success and And lot drones majority while sector, in drone use are we that data control, lot to with drone too every consumer reason analyze economical drones gas doesn't the long been a of with for for for barely very a still military of commercial a it's monitoring, these the not time in way commercial of railways, this operated today, being simply opportunity you and for and solution, time value.

that, of of kind default on prohibit top regulations automated this Now FAA operation.

at prohibiting today, in anytime eyes with human obviously drone to a is a [indiscernible]. with the times, ability operate the typically drone this on flying, that ground on So to present has be all

of And with automated the software the were solved changed hardware drone American work use really to of it sector. commercial to number truly developed experience Scout that are a System consists create platform. The systems problem the proprietary Scout to that a it a And so, have we System. and this up hands-off from the means ground to and together dynamic of Robotics completely in what this is

end So the drone, what all purpose. at a that comprises everything our avoid both our day, not product just the what the business data back to software automated. been for at sensors one end And of of are front automated the actually to station, and and end, is tie kind itself. base the use detect and takes the it and at together drone is component of the our drone has Flight so

storage, landing, storage. And precision planning, physical charging, so data automated data processing, mission we've data transmission,

All and of your install and day, field that back they will customer. there indefinitely transferring day data it edge these the every together that can processing at missions XX live and the per to XX, now conducting you systems in

And so, drone economics it what use this dynamic again the a of changes means the changes to and as the well.

approval, access which of the at And to means as company XX% of moment commercial about markets. exclusive degree this right all of of Robotics yet it's any drone no company This FAA January human became a drone with times as in in by drone operations American that space. of So, onsite. most year is important been by require for which incorporates the Robotics mentioned fully the those only American now, approval the now, the markets, our estimation has that the first which automated we're approved this few has has commercial actually this occurred automation,

That after no our during sight dynamic ground on no be means fly time. So or drone, commercial before, no for completely with businesses. line again flights at at the observer the point of what real to economics with or -- humans of and drones the a can have and person to does beyond any do which co-located changes this system recap, can

the type incredibly So, use this of number is the of markets technology number for cases of broad. and

just use are have XX,XXX common the crops, commercial markets, to be this the is but As one a cases divide to them frequent on the to all increase or applications solar have pads overarching And and agricultural that, level require our acres to be those, defense for business. you the gas, the I mentioned, stockpile you few. solution. name And this and of yards, of we digitize to XX% all and to your utilities, especially digitize able among a nuclear, farmland, assets you industrial oil automation broad, scalable those like of world you row categories, into any and market. And basis, want your assets drones market theme crops, monitor with of things of of the railways that and remotely physical a able whether allow XXX system is efficiencies monitor actually well

and effects, the recurring lowers And this instead for and Robotics terms subscription. focus is, type what cost extracted, this from annual was so, system the our margins. annual now, you now the American can two American of operating robot-as-a-service So, the provides, of the you achieve with it also historically it We've provides can combine can is an puzzle data with now and of with is software in And model. the this purchasing final cost which and of of removed customers this that hardware, has of traveling, once piece service the like this most equation, Ondas, customers Robotics the pilot. automation, on we provided that expensive the acquisition

I'll off so it to you And Eric, here. hand from

Eric Brock

Rees. Thanks, right. All

open-ended continues huge wrap on position large Ondas me it move in we before itself let to for growth Q&A. to up markets. So our

have the with and our executing initiatives Siemens AURA adoption. Rails driving momentum critical and platform and We we're on It starts networks.

innovation, sizes as small, leading drones mission We and a platform demand in to American and Ondas spanning best-in-class, CX drone is will we long solutions and applications generation are positioned Robotics to penetration. to high durations. key This Robotics. ranging be for and mission-critical all a The Scout all beyond. IoT from and market it high very age large network. player player the regional ranging in American is and And in our as establishing end-to-end will from platform here be drone-in-a-box infrastructure next mission-critical in integrate our as with end-markets markets for flight driving now low also local altitude to well to Ondas as default

So, operator, let's move to Q&A.

Operator

Thank you.

question-and-answer from the question first Please We Instructions] with Markets. go Latimore will Mike begin Capital ahead. session. Northland Today's now [Operator comes

Mike Latimore

Thanks. acquisition here. Yes. and on the All quarter Congratulations right.

questions a kind like be ROI of charge couple on the do kind prove maybe ARPU Just your and can ROI sort basic. you starting like, a what what is these drone? of pitch that? month, acquisition the And on per with But, of what's what to may customers you of then just, specific

Eric Brock

the All right, to answer I'm ask going Reese question. to

going be that lot think in be at regardless points we know should close to will a is a acquisition the and I this, moment, providing price we're and August. to we this as more expected regarding the little sensitive on information

got a perspective we've we this be But, more for share months on Mike? some here, providing Reese, couple So, details. will you can BUT

Reese Moser

soon. forward are data you robot-as-a-service a Yes, I absolutely. able specific quality this look result mentioned, sharing when the the of at at highest lowest to at publicly we the can do time, look as we And that deliver say, not model, pricing to pricing but as cost. disclosing this Eric

can human increase removed system run it all day. from Our day, essentially continuously, because that again, costs that operation, every in is marginal

allows And never so, new that before. has entirely to even data collect feasible of been an that category

was That that of times we hopefully but more about move question. talking we're unlocks possible talking some resolution, concept answers of get day, data excited a which multiple So, most to new to that sub centimeter every which, day, before, that that never a that, category ahead, importantly analytics. we're as

Eric Brock

conceptually a years. they're a contract agreement how years get Scout the And year, think add me high it five from extremely typically system. just is like, initial Robotics say, going System deploys let field, cost the to five. a the subscription to then works. long-term idea American Yes, of about four get in in customer, And couple covers three, and things just that to deploy When two, the the you the margins Mike, in

Mike Latimore

And imagery you're kind clear, of on Okay, just gathering, that the, video of then you're makes a then data sense. data. and I'm the largely data be to this that pulls in lot gathering guessing

So, stuff? AI maybe the back that and data of and is important analyzed the some background sort most there in sends boiled the

Eric Brock

absolutely. Yes,

of complete the And aspects so we've raw joined to one why a data which it's been again with actionable just of and delivering solution, and ours actual focus create the of customer, reasons that up actual but and information. the deliver to Ondas is, a stack full is so of analytics one not

that's that. multiple there's part our to stack steps and of product itself So,

going actually the what type So, the of use question, that the your first we to case. collect, back data market of do part depends on on

system largely agnostic. payload Our is

is multispectral. that agriculture, within RGB So

types methane RGB other like example. and sensors there typically And of for are markets, it's industrial horizon, on thermal. sensors, the Within the things

so typically, gigabytes work. function station, large as That step a very these the making station. all And again, And image data, a edge collecting we're on order is of is within centers, amount computing of base this a XX which day. that offloaded base the also to to talking key about

additional through front can our ScoutView. together, processed, then you stitched software images those called uploaded And end that that the so, cloud, apply point are on, analyzed AI is to to degree some then finished from at edge. and to the data. analyze that And product And

Mike Latimore

then from you the this critical second the lab? business of And are just Maybe might trial, that get little success timing I a the of took a the is half, I can quarter, or great. the the commercial irregardless core think lab orders that Okay, to of here. there about lab, sort of bit rails some on in couple this orders eventual buy that talk

Eric Brock

on system irregardless rail to where become talked however, we've of rails the lab, it's about. shared going a that and important collaborate is There all the to be is lab activity the place

we Committee, and an So, sort network. Wireless really now are as engaging I as but highlighted not we're it committees, going earlier, further to is the with even use those market now interacting the And folks important with now step. Comms just validates opportunity because the who emerging, of senior operating it's

Reese Moser

continue I independently critical, number applications work I the maybe Eric, to collectively, grow so I think the although can and Hey, the they the interests but also work obviously, on is going of into -- lots the jump think, individually rails. also but so and lab they rails of activity

Operator

Today's National William Instructions] [Operator from next Morrison question ahead. Please go of Securities. comes

William Morrison

Hi, Reese. in There's how -- sorry, questions any you if -- hear Couple background. Eric. doing? Hi, of hammering you the

We have construction going on here, sorry.

Reese Moser

No problem.

William Morrison

AI if cloud questions, you cloud worked? how's or operate And of to radio Couple WiMAX are And in the X Reese. cloud platform or radio a so, Ondas, do Palantir, link you have a with any that in also you software? Do there? this -- like do you or this have CX.ai going radio migrate WiMAX

Reese Moser

a question. that's great Yes,

So that the site. grading the started. question the the The EarPods just is answer sorry, the to short the answer is yes, get my with cloud. data we The how on -- depends information The the available that connectivity site cloud. method. the case, the to in the is operating cellular help which to get can if we we're sometimes is to But FullMAX also use in,

William Morrison

And Okay. your cloud the cloud, interoperate it when to then it? platform into or different in AI you platform a does the with it is get

Reese Moser

a software something is or our cloud, with that that's other is to whether is well It the third-party developed such we have that in by way the system platform a we integrate the the customer where developed opportunity as but in with. work

William Morrison

resources or anything like Intel And that? like any there on NUC itself, is the compute joint

Reese Moser

intelligent the to the planning, mainly in flight On raw a after mission focuses a and itself, landing. perspective then data precision the there for itself base like format occurs. from processing drone on the on stored offloaded intelligence is compute that's dynamics flight and things customer The

William Morrison

Okay.

I So, the of your an in orders? to kind when you expect and can us give what start mean, you idea, Reese, to ramp looks do like pipeline

Reese Moser

absolutely. Yes,

deep a our the with over R&D pipeline years, up we've coordination five building approval. of our customer in FAA recent past So efforts in anticipation been

Now that agriculture this U.S. deployments sectors of to of including rail. we've January companies in Fortune and ahead across looking multiple that a and energy, we're with year, milestone across the number back achieved XXX

immediate Our initial this focus this and target interest of to year. building inventory support in our now turns team QX out to and QX deployments with

Operator

team and it the to turn back this management final gentlemen, session. ladies to any And like I'd question-and-answer concludes remarks. the for

Eric Brock

is government Excellent. for this that is on Ondas big you markets to delivering announcement Today's by to to reminding and commitment a end-markets, Robotics Adding drone proving I'd platforms proof flywheel bringing industrial industrial AURA markets. close American and the targeting. focused win we're important our investors. networks and the and to with Rails our customers value with operator. critical Thank next like is Scout and investors bring solutions System our huge tremendous the valuable for via and complete we're markets generation Robotics' American the is to best working. these We're

course Thanks on at the to you your of terrific gratitude forward again this over support. joining thank year. we team year the to updates close, of joining also initiatives for express behalf So I entire for want look call. with morning. want us We Ondas and key to to our again sharing began I the the on the for momentum

Operator

call. conference today's all concludes presentation. attending This you for We thank today's

disconnect your now wonderful have a day. may You lines and

Ondas (ONDS) 17 May 212021 Q1 Earnings call transcript