Earnings call transcript Q1 2023

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Operator

Greetings. Welcome to Faraday Future Intelligent Electric Inc.

First Quarter 2023 Earnings Call. [Operator Instructions]. Please note, this conference is being recorded. the to turn Relations. Hsieh, now will conference Charles over Investor I you. Thank

You may begin.

Charles Hsieh

welcome, Futures our to Earnings you, XX, everyone, Thank and Faraday results afternoon, issued shareholder XXXX. XXXX Call. a First letter quarter reporting first this May We XXXX Quarter

call our is Global Joining Officer, and Chief Chief Officer Accounting today Chief Execution, Product Yun Faraday SVP Financial Global Officer Chen; of from Han. Matthias Executive Future the our XF Aydt; and Interim

now our letter a of the the investors.ff.com. QX this You later replay can find call shareholder of a copy Investor XXXX Relations website and today on section of at

XX, note on in views and to relied results of be we no any these as undertake as current any call, release will should Except statements representative or the on publicly statements management date. upon of based of and law, to May statements of required These we assumptions. by future events. forward-looking subsequent light revise, revision only XXXX, Please new expectations views or that reflect not be information update this obligation our forward-looking making of as

differ These implied. from statements to of to variety and those that are could results actual expressed a uncertainties or cause risks subject materially

titled For Form Factors factors refer on our section and financial SEC, in discussion to the report the results, our annual XX-K. our other a Risk further that material the risks including please of latest important could affect filings with

case will through in discrepancy, A translations answers translation will our any provided Chinese call, ff.com. statement investors' provide today's during will accessed prevail. English. management's English In convenience their only. are can remarks addition, team translator be All which the for to In of give prepared questions in management and simultaneous

to will I call the of CEO that, With Faraday Future. XF Chen, over Global turn

XF Chen

everyone. production the with today. me where and day, with the story. unit for brief our our go-to-market To the call. start you those and our you plans, that give Aligning about we familiar call, Thank you, are less let strategy joining for conference good a Thank Charles, update price are

overview and fundraising XX with to will vehicle Following Matthias measures, covering some the as strengthen such we've provide will regarding present an for technologies. this, implemented update of Yun topics a and review our our FF financials provide future.

I'm of say March we obstacle. team the ground earlier our our these Though off, to start the that is On overcoming started hit challenges some running production we XX the FF To we up, proud have flagship XXXX. successfully XX, faced in vehicle. ramp during

delivery FF end operational We key continue objectives milestone, reach to phase of and progress previously first in recent the strategic of and XX May made at announced. target To we numerous as kicking accomplished our off important have considerable months. this

our ieFactory a XXXX, line streamed history. watched been It production we that in year this a has long first the was millions by off XX, event April our California FF for vehicle On rolled but we made the FF is Faraday FF Future, at believe XX of video globally. path fans

Homologation Most as successfully testing FMVSS been planned. FF the for have progressing completed. is of XX

front, severity highest the including all passed and crash the performed these test successfully, tests side have We the has crash tests. of rear and

very and really of with progressing results validate are are how the engineering. these tests We believe our happy quality the

an to showcased XX along the that has to software progress. the we On that the and FF this within XX enable vehicle. ago, made FF weeks AI systems intuitive the integrate and We is investors all to of side, interactive generative Future and truly also communicated some users emerging ability significant Two technology. for we've pioneer a its experience users vehicle's epitomized believe Faraday

production achieved the of end March the our efforts, of terms manufacturing FF as planned. at we of start In of XX

quality production, to FF with team at Hanford our hard the users. ramping up highest XX is goal vehicles delivering work Our the of

necessary we first fine the the all production smoothly previous provided of vehicles production coming to assembly run As the has tune required today, off the Further, the line the the vehicles testing. FMVSS for the vehicles in learning more through build for vehicles. allowed than which coming will process

of and Additionally, in delivery In first recently co-creation the and aimed all expert first X-phase first the continuous or delivering these chance industry their our to FPO, our to co-sharing give innovative will pay phase, spirit best XX. plan users FF experience full to a FF and outlined we vision, Futurist at reserve allows Officers experience the look, the the in FF users. Product

vehicles slated take for FPOs at XX of the of vehicles. the our marking for the launch start the processing reserved This the industry initial FF May, of phase. delivery end at The beginning will second the plan expert, is phase of

and X, required experience targeted FF Faraday frame forward. of start end comprehensive of Phase second features. become a parts assuming to them also the to car will the are will time Users the point to possession turning company Future many All for receive full of most where the tests. trainings quarter, revenue-generating of at vehicle's on the completion required take purchasing the invited to XX. receiving In start make vehicle the This the the and our marks FPOs going

that pay market In delivery XX co-creation geared The delivery and phase, buyers/users the X vehicles ensuring in receiving all third demand. arise the third will FF the necessary operation parts on to company experience. deliver FF on our full. and demand flexibility this also for balancing is and We phases timeframes. Please production from that while plan phase, all the to manufacturing that towards users. final XX secure the the avoid required note All this is full possible designed enable will our our users all delivery is approach contingent offer of phase that company completion to best believe receive high successful that shortfalls may

strategy go-to-market sales our to approach. Shifting and

and user designed their throughout provide possible journey. feedback entire feedback technology for adopters edge co-creation about we through can early best program experience their providing believe leveraging FPO is ownership By we Our experience. customers to cut for user reward the direct

are Additionally, solution a designed service we several undertaking customers. to initiatives our premium provide to

XX nationwide assistance to Club roadside all working a offer are to We FF owners. with National XX/X Automobile

Home We have connected. XX.X mobile mobile to Wi-Fi all-new introduced kilowatts hubs. users we concierge fleet service up and service Charger experience, service our also service, and that to allowing style are will leverages FF and FF enjoy the its Furthermore, introducing located support smart centrally our which FF

experience. San We possible forward latest the service New future initiatives expect to update developments. the our Metro, remain Metro for excited and demonstrate with to service and the Angeles Diego, to These roll ownership commitment support and throughout Bay San in Area, network for best customers out markets XXXX. York with looking our Los our you providing Francisco We their our

to I like Now would Matthias. call to over turn the

Matthias Aydt

moments a take of innovative XF. brief would FF Thanks, to to and our provide Faraday XX vehicle to Future. I new overview be like a might those few that

more XXX features seconds. oil miles from features experience and the performance, powered integrated propulsion offers algorithms, a EPA-certified XX XX rear range good a hour a for control XX accelerates miles safety. in than user of X and range standard and cooling optimizing drive axle performance an Our sets and competitors the unit industry. flagship XX its direct miles, remarkable new drivers. to With X.XX per stability automotive design, with FF software to proprietary features It FF is a by and a system XX Its horsepower fully independent active in customer electric X,XXX

In feature mobility industry, to that standard experience robust vehicle, for establishes experience user increasingly the and XX automotive internet internet is intelligent platform. the With addition performance bar. new in-cabin sets ecosystem third as mobile passengers. is luxurious and a the for the important connectivity and real user unique of a the space raising a connected an FF intelligent particularly The mobile becoming living

of lives recognize as importance the into is integrating ahead, norms. AI capabilities transforming everyday economic human we lifestyles AI Looking rapidly and our

for in places believe We human utilize AI us unique have these AI. in investing in interaction been long and a and we to software, that position time, a advances machine

advanced empowering step a the generative a across applications Specifically text displays. queries, models On voice advanced live vehicle, these and and we image education, system, gradually believe use utilize more. was operating models intelligent translations, towards search, these generated AI industry Internet our capabilities, for X, with combines robust entertainment, in range areas. electric including that XX and the designed FF and the large users e-commerce along a analysis, in of language stock with of major personalized We May complex vehicle. car is product a computing to to platform, transportation requires of stack with powerful generation, video capabilities this advanced AI goal transformation connectivity generative suitable The announced a with

artificial users which scenarios intelligence we applies With level third language natural The our the while an various can the immersive convenience experience and extraordinary unprecedented on AI internet of create communication technology for space in communication will enjoy an and FF believe vehicle, users. usage go. abilities interaction intelligent of personalization to

With of electric the increasingly cockpits and intelligent driving vehicles, digital are experiences intelligent. becoming rise

unparalleled be we mobility create will future experience. transforming In cutting-edge mobility provide think scenarios solutions the user believe new future, user way mobility solutions. the redefine to leverages AI core will mobility, ecosystem about the competitiveness AI we of of technology the that and

are world we we think advancements, and a possibilities. new unlock to about way transportation these poised With the revolutionize believe we of whole

ongoing generated world's of and always electric We and the FF of forefront at committed to manufacturers of to has technology. intelligent platforms. technology research and AI AI development adopt vehicles remain innovation one the been is vehicle first

Our internet focus autonomous on is the platforms third and applying space. intelligent to technologies driving these

Yun, the turn call Now the I will over over go financials. will who to

Yun Han

begin by efforts funding discussion our strategy. Thank would a you, a on followed like I financial and by overview Matthias. to cost-cutting providing

and to decreases XX, combined design on other on professional due development XX, Faraday operating expenses $XX services, engineering, X in start First, of company to our results for committee XXXX in as the ended with March services and the X March I of $XXX activities focused reported substantially a cost-cutting research achieved decrease investigation mainly attributable ended production, was expenses and financial would quarter activities of XX to months the vehicle XX, special as completed which in expenses change the FF XXXX. due for the The operating the of XXXX. million XXXX to the like compared capitalizable million and related of in first testing months to primarily was for conclusion operating March measures. summarize XXXX, to Future was

XXXX, March and the million decline loss change $X company's million driven was mark-to-market stock recorded the XX, $XX by year notes change in of measurements for to operating X in this XX, for the income secured convertible warrants net to months the X months quarter March XXXX. the in of the was $XXX expense first ended and the of the price. associated million compared primarily income with due as Net a The ended

December operating billion were a XXXX, XX, million negative $XXX million of XX, XX, Turning and was to operations XXXX. flows XXXX. from and approximately of XX, the XXXX. incurred December cumulative compared million $XXX March company's Since activities company $XXX balance Total liabilities our assets inception, the sheet. cash versus as were assets $X.X on accumulated losses from Total on deficit of total March to million has as $XXX

used net months was in $XX the activities $X.X XX, provided X months $XXX compared cash the months XXXX. March XXXX, Cash ended of ended March to million financing cash to of ended XXXX. the compared to Capital $XX X XX, X including X the XXXX. XXXX, March was for million activities financing Net restricted XXXX, XX, the by activities compared months operating in used were for XX, March XXXX, Net for the $XX XX, for million for as million March $XX million. months million, million XX, X months million expenditures for ended ended cash XX, March March X ended of $XXX was $XXX cash

proceed in of plant California cash expenses the cash as March the by March operations readiness, months and development XXXX, total XX% in was offset of of FF development part partially XX, X to for negative XXXX. due to used finance to XX vehicle the and March XXXX, decrease XX, The XX, expenditures Research mainly the risk on ended capital operating in from accounted such initiatives.

which a financing. capital like notes consisting have In received successfully executives plans, to ramp. to On Partners, financing production, Since of gross additional FF update. has announced we unsecured million provide have funding of then, million $XXX $XXX current and to senior company towards convertible of gross our continued committed our delivery certain route an XX May we conditions. of committed work million support for funding we date. I production our million additional secured SOP of funding this to the team $XXX X, would in Now $XX QX, and and via subject in formal Global

mid- our the FF of commitment team Global confidence continued show company's Partners' long-term in its as well ability goals. management a to shows the by investment to and company as This core achieve

As and a a have show FF of support, portion the of funded already this Partners unsecured Global commitment. investor

have remaining milestones. committed certain and financing we to of $XX conditions Additionally, million, subject

to receive have may is existing expect we $XXX revenue We sales million an option our which investors. from financing, vehicle and of

company this financing, Since the allocated was in year, the has significant financing. the option the of the beginning auction gross This that of which at investors. $XX received of secured company represents a portion notes to previous million

dilution. have used strategic we of subject up to accessing have not line which credit to minimize we to very about certain also equity credit be yet line million, We of equity conditions, to $XXX of as want

financing also exploring company the Furthermore, opportunities. is asset-based

have have cost-cutting been XX us the to several raising, on core to In implementing enabled are delivering we addition vehicle. essential FF focus the items that to initiatives fund that

We continue of developed reduce downs. commercial costs to detailed material road efficiency a cost engineering both improve and and have and map

we breakeven to With XF. in profitable Lastly, XXXX. back a reiterate flow cash I'll it our business hand to that, with goal operating create

XF Chen

shown very Yun. proud and milestones. production to work reach all successfully FF Again, I'm team you, the our hard by Thank of determination

up We are production plant our to coming ramping quarters. looking forward in the Hanford at

providing time are our for forward ready you and look to Operator, your take future questions. you on and updates Thank latest to I interest, developments. we with

Operator

Instructions]. [Operator

Our first Stifel. Stephen Gengaro is with from question

Stephen Gengaro

me, for you questions don't Two mind. if

legacy new think the for coming obviously and little you And sort The of XX? bit into market? first differentiate yourself market, about -- vehicles doing, there's the of the consumer differentiation are maybe FF lot do when a the in the how talk what we a OEMs the and target about

Charles Hsieh

Stephen, for the Thanks it's Charles. question.

I Gulati's think that to Strategy. hand colleague our here. Head I'll over of Prashant Prashant? my

Prashant Gulati

Generally, for why people question. the you think ambition breathe mission, that freely. vision, That's be the for company's move, is the started more XXXX. world thank business in you able live, Stephen, about our that should if to we

than think generally on we least become Now having said, gas So more it's right? we net EVs in ourselves better X It's differentiate as at positive ways, a cars road, right? mainstream. that the

differentiated Two, it's in products, brand attractive U.S. And in bit detail structurally think home positioning each, and a over, we with say, a ways. our I'll out little let we X large a and let's how of go segment of target One markets is are but lay those and strong me up very very product market dual setting right? a of China.

deliveries. we started line the patents Third at, point and we of inflection very is the taken a creating have like technology we've XF first near clean critical to integrated well sheet the where production, and mentioned, we've approach this. finally, moat around done that created then are and vertically And our

key question So about and a target ways those your are get the specific just kind X it we users of of of segment. -- think user bit in and more to terms little

and the segment the competing FF in vehicle comfort of electric of of first flagship way the car, of with performance the an of and ultra Ferrari, that, is of the connected, we technologically Rolls-Royce, the a has a And and driving all-in-one it's handling think be the the sports will it's right? We And car, top SUV, XX advanced. Maybach, Bentley on car dynamics sedan. an it's

the that's product. So of we think how

in with user we've in-person the time, think And frictionless a I where experience -- the So enough market a we've are working about very blue users The sales engagement. spoken for the past. model money and online to to direct both presence constant we take with with create with centers it's differentiated technology, spent product to experience. market, car ocean a lot going of user

maybe high but can our vehicle own it talk at you much, variable too like platform of created we've think just I'll not So that level, can create a architecture on it. models you more LEGO, a

base. can the wheel You stretch

which ton most invested is our You but are can way resources in created only and We we've competition goal importantly, different internet we we've reduce third shareholder in differentiated months. And size, money, where from alignment a of software and our of new the system. FF bringing battery And brought propulsion software management, shortly. All in create with own that are that capability, AI et not and XXX our fairly towards working time, had the over starting where employees is together of a is the and Board, AI. -- this few last all a capability new deliveries the of common cetera. XX

Stephen Gengaro

and sit AI the than side of car in. talk been lot mentioned was you intuitive a the little feels Can a And vehicles have color. you apparent to about AI differentiates? a other the I chance of things great the that more where a user that got one in That's and lot how interface was bit

Prashant Gulati

Yes.

obviously So efficiency, we people. our been only are have value internet who busy software, our technology, and with are appreciate target they but not artificial that productivity, People users building mind, So in right? in capability intelligence. -- we've in

has has XX -- So right? car XG It modems, XG the X the FF has modems. X

we we You industry platform, spend lot a a developing. leading -- which is that can of have time compute

We the internet we've -- advanced I system. We've built have high-speed an said, connectivity like into car. operating ultra

cars capability. has in car We've you natural -- AI all it's complex kind product generative processing done the inches with a past, Siri where through own is of language advanced or you it been And can a right? do queries natural to which brought There like XXX stack, on always more of displays. car now far the talk over the could The we've processing. interface. our Alexa-type has even than -- other market language There together,

platform in world you it that today. don't an in are think I in connectivity, operating any displays, other advanced and don't compute the capabilities see -- car exists foundational these So internet system,

first first kind the think we So able AI. to be of one of are or that I with we'll launch the generative

the can with And car. of personalized experience they people more So interact in the do -- driving, the sit that while or before. not can possible a more was back car get

to have lot we GPT and do generative have integrated so like to we that, do be ability advanced And whole AI more. models able to the a

quite So soon. to that our we're users in that part bringing about excited capability

Operator

Yu question is Bank. from Edison next Our Deutsche with

Edison Yu

describe to of everyone, begin? exactly can deliveries I And operational before what to very side. still you customer sort exactly done you, explain can can needs I'm the over wanted what update. for -- Thank the you comprehensive go the wondering, be done --

Charles Hsieh

the question. for thanks Edison,

that's think talk about. to XF I for

XF Chen

Yes. this Thanks very much for question.

We delivery are end also X for quarter the end the of final delivery. our hold fighting two of -- And with the to Phase market. May, by we

They But tests. these we So now, the and And done major have regulation we major the the before the hand further material, crash in as to to we we the vehicle successfully -- all have described completed. are FMVSS remaining is test milestones. crash. over remain FMVSS most two complete the customers, being tests of right

So already all up now, test-related the and also ground test to test shipped proving vehicle level. we to the produced the and

completed the like test, the As of side for front which crash rear tests. sensitive crash already and test, most including today, we the crash crash the test

positive So us. the is result quite to

continue tests. that finish will crash to We several remain

kind sales the already certification related all published going when continue the Out very license of before for first -- to delivery. California areas will to improve is plan good of items end and EOES of all and the the we deliver good kind of have car our are some got the the we will deliver handover understanding that, by sales-related of we time, May, relevant and of and we compliance of Then how end a because definition the we their this that last June, to milestone. as we can engineering

can parts successful company of plan we our we we the test that with X-phase customers. the the So EOES previously compliance completion so as item. this are we think a deliver suppliers have can up the our handover on final to kind time remaining I -- of to of then working our all And get and vehicles identified, our to contingence

Edison Yu

time readiness starts and line, feeling How Understood. is feel do aspect obviously a the having lot go? interest guys quality? Understood. EV see about you that, of that manufacturing with We lot ready a are you to of

XF Chen

Yes.

within SOP, the good we being SOP whole and have California our through X ieFactory, we installed, March, of which the car April. used do as during is achieved then to which already the defined, of of which Regarding we got -- events. very commissioned being start we the got for first manufacturing we and a first the facility and we the production, By and approved FF of run mid published end weeks, system car

strong quality the this out car batch first this -- people improvement, So which a very of knowhow of for improvement. run validation line, and car, our vehicles we the us provide some is process to training, the call of efficiency the or the first the lesson

talking the about no business normal. quality, a So that's doubt,

some the of car, For first quality. challenges of the the process we part quality facing were that's matter the and quality, no

quite the I think industry. normal in that's

and plan the through slow inspection this car, first for and , process X.X days, we get the being pass -- inspection my get we for first batch , second the example, Take batch. took the around just through first these for issues days to the updated But to So stages. the is car resolved to X.X previously, use we run . a an we cars in build by all

the We the will do in coming our we and with this the shared future. half of a a lot our -- kind information a get this with production the relevant issue for So detailed of place But of the all whole and the idea we with later batch with build, and about so process, capacity gathering current are this more The have improve we have do on. smart year. can I improve we and supply working and plan slow year, to we chain plan year. will -- think of build business in separately for be second can fine-tune learning volume team the the kind in parallel, that smoother

Edison Yu

on Understood. funding Understood. side. question Last the

additional indicated little million -- an we give the more bit that? you $XXX you option of that investors. received I think team a the think at Can indicated on I color

Charles Hsieh

Yun?

Yun Han

This is or our route funding. good invest often their in financing, a the previous investor of can of opportunities committed I question, a so don't take that talk about these optional connection have because the portion Edison, match with Okay. we notes, to question.

for if of they contract, So And they match example, XX%. committed up can funding million, certain have you there's then $XX to match XXX%. another

the So out $XXX $XX April optional $XXX million. investment million. And those investors total we the February require of year, to this since -- is million to fund of $XX million

they basically, So put don't XXX% will in and investors. amount, it. date from at they specific the participation we if lose specific it And a of got

to all the allocated So funded the is million the $XX investor. investor that

this So confidence continuous the company. of supportive that and shows investors

Operator

reached question-and-answer have the end session. We of our

conference. will conclude we today's So

participation. your this You at lines and thank day. for Have a may your time, disconnect wonderful you

Faraday Future Intelligent Electric (FFAI) 11 May 232023 Q1 Earnings call transcript