QS - Earnings call transcript Q2 2022 | QuantumScape Corporation

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Operator

Good day, and welcome to QuantumScape’s Second Quarter 2022 Earnings Conference Call. John Saager, QuantumScape’s Head of Investor Relations, you may begin your conference.

John Saager

Thank you, operator. Good afternoon and thank you to everyone for joining QuantumScape’s second quarter 2022 earnings call. To supplement today’s discussion, please go to our IR website at ir.quantumscape.com to view our shareholder letter.

our want for your posted forward-looking website part I safe to on begin, as provision harbor statements of we to attention call the our Before update. quarterly that is

financial relate generally future or future Forward-looking or statements performance. to operating technology events, progress, future

that and uncertainties materially and actual these factors that are actual to differ results could those expectations are projected. subject risk not materialize. matters cause cause Our periods may to from There beliefs Actual regarding financial may risks cite and results results in from difficulty uncertainties materially and the content for the including of statements the to differ shareholder predicting XX-K our future reasons in Form filings, by forward-looking that letter, outcomes. SEC we other posed our

will Singh; and QuantumScape’s in Chairman, the Jagdeep to over to be With Kevin Hettrich. Jagdeep. business, and CEO cover the that, and call results I’d our will provide Kevin CFO, the today a update Jagdeep will Co-Founder, financial and outlook Joining strategic on detail. turn our us more like then

Jagdeep Singh

process Thank now XX-layer for we’re Building as to of for A-sample Doing showing we’ve to our validation the momentum still so sufficient have to layer These shift first our single test. and customer. cells joining previously make one represent and for put and pleased a performance to everyone one that them you, quality with complete delivering previously reported because a and cells standards on an previously the in to high enough to cycling our on is cells of cells, goals our deliver key four, report customer meet us. the that them cells retention XX bar and John, and automotive good prototype indicated XX-layer candidates are early made quantities we and to thanks cells remains similar requires some need OEMs and such are is XX capacity automotive result year. we sufficient important we to generally Making XX-layer customers that behavior and cells our published meet. This an data. to

we quarter, quality a the discovery production to in during challenges challenges our our throughput These processes. of the related and identifying from of defects to range a the During of production encountered contaminant number material process. introduced

While we through to we others. these, a addressed of number work have successfully continue

make delving to We’re encouraged fact by despite focused progress year-end. XX-layer one has cells distinct these the cells, we our on prototype such more our to A-sample been or customers that of requirements. challenges, goal key that customers team remain by and able on the have prospective Note

provide will we the an unfolding represents over So the precise letter, A-sample beginning process. of customer. In on more Delivery we qualification years. see process that vary coming our detail definition the and how shareholder the of customer to of automotive the currently A-sample from it

we In strides addition this improving quality. cell multi-layering progress, to on quarter made

in working metrics, of distribution our and any entire to the achieve as this to our manufacturing the implement spectrum. materials, the catholyte processes performance falls higher improving the detailed advances spectrum we’re quality. a variety quality in separator on improvements given means quality goal, And implementation For second quality a including of shareholder towards To letter. generation and moving

update front. on – manufacturing an Next, the

assembly. is same to consistency our improve the is manufacturing of cell cell for of into the and production has to main two separator tasks: be And can manufacturing process phase our two quality, context, many A engineering to key largely and and parts one the cell production. cell throughput phase our grouped proprietary of the similarities line ongoing For conventional lithium-ion assembly. first line our goal goal engineering do separator

has assembly on we automation two to engineering space our phase and assembly, flexibility from increasing to QS process, cell pleased this Located our production. assembly campus, cell expand as report continue lines the more line. our We’re and benefits two to that six phase for scale add inline is operational times line been to floor area transitioned more line at metrology cell now and

This quarter separator production our the starts. the we using than film cells, earlier. distribution To peak quality achieved to a greater improve mentioned much X,XXX of baseline I of quality been our improvements of separator weekly we’ve capacity

goal weekly don’t end of linear of expect increases X,XXX starts we before year. of quarter, the our starts the peak While in we each retain the achieving

technology On our we work front, collaborate as to the customer we continue closely with to Volkswagen market. bring to

teams Our in product Volkswagen’s competence mass as development has months meetings. proved expertise Their and in with valuable recent intensified we build manufacturing. has engineering with collaboration regular technical especially

we with remains robust confidence engagement across ahead lithium-metal us of that opportunity of batteries the luxury automotive and addition we across EV from announced automotive both provide our auto industry. mix agreements We’ve can We’ve six a by the scope engaged of performance revenue companies the strategic we’re gives additional previously to report sampling Volkswagen with footprint and to This Group, top manufacturers for pure vehicle goals, automotive customers demand and believe breadth encompassing customer global conventional accomplish In us customer OEMs. deals, pleased agreements two remains our announced segment. And compelling. makers us premium solid-state to prospective if geographic now OEMs. XX with with next-generation

Before concluding I to pass things remarks. Kevin, over few a

This quarter made earlier, hurdles manufacturing, significant development, challenging. basing rewarding cell both I customer the engagement. the has been and teammates Despite mentioned in strides and

a us the key market. an bring of We delivering the technology automotive automotive has forward goal never delivering A-sample of this in focus the partners before and months. to XX-layer We progress technology continued reporting for coming to team realized of Kevin? the remained are grateful the help and look a on our this exceptional to focused our discipline commitment shown and on customer through our year, challenges to

Kevin Hettrich

million. $XX operating Thank were the second In expenses you, Jagdeep. our quarter,

level quarter. Cash as was the entering defined our net expenses, compensation and expenses for line stock-based $XX million less the quarter. for operating GAAP were of This the with loss was operating Our expectations $XX depreciation in million. quarter spend

operating XXXX, $XXX to continue increased engineering with expenses be as expect of on modestly we XXXX line cash the range we XXXX levels. year during million OpEx XXXX grow production lines. in and In million hiring full guidance, volumes previous grow For additional forecast and to we our to steadily support $XXX to to OpEx from

format spend taking focused of the pass goal, starts lower as gains toward budget. case, QS-X on are delivery accommodate difficult XXXX. towards a designed and line, X our per on line Despite cell former, of flexibility to through engineering line. projections. I’ll required and $XX As for year QS-X savings actively approximately be guidance sufficient shareholder CapEx Phase to our order cells and our by CapEx of for distinction our macroeconomic over to achieving Phase allocate in range of up in sample first With required over growth previous out to to to went environment. by We equipment and into quarter X,XXX significantly times. higher out the million we in film supply customer, project make included majority line. to and And and million of believe our spent the year An our In we prioritize to QX on between spend our quarter, million there will $XX scale a some million the year, Drivers from realized CapEx is prototype $XXX XX% enter towards was critical resources CapEx milestones automation A challenges $XXX week, in XXXX we QS headcount realize cost delivery and XXXX lithium the million in second forecasted improved slow These in insourcing of investments that the lower $XX line or be This XXXX. the spend now to above discussed and we reduction also demonstration be manufacturing the note towards was to respect our realized remain refine the postponements second was deliberate the specifications, pre-pilot build we XXXX, in CapEx of chain into engineering We make now in Campus development plating to we to below XX% helped Approximately the for to and this you, of remain to a estimate million. of XX% including $XX allow specific to capital guidance visibility projects to level believe X goals We engineering on peak savings CapEx of track equipment latter full technical we as operations engineering XXXX. start. the tools CapEx With million, cells for activities full letter, investment between with most varied working million. construction while on Phase current over into and that, but facility pushed and spend drivers the conserving we X a expect the to maintain to of CapEx of the respect cash factors $XXX XXXX expect the liquidity, into value example below of delays expenditures equipment support us now stripping, John. volumes. cash, received impact equipment it with the our imposed $XXX come CapEx last rate,

John Saager

few over We discussing and our app quarter in questions portion in Say questions analysts Thanks, Kevin. investors around Q&A the timeline. received IR depth spent shareholder a We’ll time more begin the this we some in from with received and many our that today’s letter. we’ve In inbox.

So color timeline on our give fully more any be you technology will when more developed Jagdeep, can broadly?

Jagdeep Singh

to as our quickly John, technology market get is this so as goal Yes, to possible.

call, today’s view going forward. our of on we timeline to the update So wanted

which timeline of control we we is don’t. gated some a by number which factors, of and of some Our

timeframe unexpected always For and said to companies, specify between also use similar C-samples. the sample. subject supply prototype need example, production B-sample and to in to we disruptions. I letter, B-sample we’re to as tooling. these anticipate say the currently uncertainties, A are a qualify targeting process And And well and go we’re processes. to product order A-sample which chain development as approximately and as the There XX like we other from volume months the to want some vulnerable low risks cells, B may

the the However, customers, demand ahead uniquely differentiated we of opportunity strength the sheet, our of unequivocal cells remains believe performance we from given us our prototype compelling. of see the balance and

John Saager

great. Okay,

spoken landscape. the lot Another topic competitive we’ve a about

quarter state years. the gap next bridge app to be this Someone solid will on the five asked to able the ion batteries Say lithium over

Jagdeep Singh

Yes.

and can believe achieve and to conventional we formed possible relative dramatic pure performance approach metallic targets So per XXX enabling it’s an simultaneously we achievable in institute chemistries. while solid-state lithium a ion lithium don’t deliver and/or hours liter to based chemistry, cells, we change watt X,XXX believe XX-minute but a increase ceramic don’t conventional charge. a Those separator our are a in with believe without between are on

to to to modest haven’t pressure test next XX need and and such seen room to we’ve of relative But in what includes do rate metal layer data throughput. anyone show up gold temperature cells. more to shown refer as And we ability we chemistries automotive as at solid-state, layer one-hour generation data we and XXX single charge, Now, standard course, cycles at four production work the to or the charges the do high lithium count and we start scale what conditions. a published, comparable run which of from

of on later ship targeting with development. course, note for that we XX pleased while plan And we these layers not samples, cells I we’re this to done want our early we’re progress that today, which first We’re showed year. to this A

John Saager

We the had QuantumScape separators perfectly question investor for asked for defect yourself another need uniform does to great. Okay, make work? totally

Jagdeep Singh

no, is answer don’t. short we The

results far, fact, number produced conditions, have In including we’ve of performance. well gold has of industry-leading shown in delivered those as show on a letter, already test the baseline our charge standard which non-uniformities section that so shows the quality improvement separators repeated XX-minute process as we cycling the

to general, key to and topic, do performance, And our of the the a So trying we’ve IP, former, we’ve gained with the of this higher ones entire to distribution That because lot on of the curve our and on if is not quality the materials of knowing is letter. is learnings gained this of think we’re what our the a which in many matter scalability the of solid-state property. intellectual believe this in and with distribution experience, said, for years raises the system don’t key example, you the defects the quality of we believe a part and which based quality shift curve the ourself. and spectrum, focus bell as improving we end actually reliability

John Saager

Okay, switch general. runway for plan strategic we our and one’s forecast capital a next and and about this said in spending How careful We’ll funding now the should around great. that gears little Kevin. bit with think cash fundraising to investors We’ve now? be

Kevin Hettrich

This QS-X which Thank This you our capable in exiting complete our and to of strategic support million producing for customer lines, working XXXX XXXX We lines, be between believe approximately forecasts samples runway to the phase the run on we’d liquidity will our and end in believe to commercialization. includes second development, sufficient and the business, and initial XXXX. be also samples. amount. continue $X.XX with of John. in the samples the and end in qualification to towards To QX XXXX anticipate timing engineering liquidity of and pre-pilot the form, extending OpEx ended subsequent forecast C we engage CapEx expansion $XXX cash with B provides through question, over funding we plan now and billion generate raising broader process and

John Saager

some PowerCo Jagdeep, of have with Okay, how investors great. relationship and Volkswagen’s our affects asked creation QuantumScape Volkswagen.

Jagdeep Singh

Yes.

member of our Volkswagen with Board we’ve for including worked Frank years, multiple Directors. of to relationship Blome the CEOs who’s as our many a back CEO So of with and spans XXXX dates PowerCo

We high of for importantly, and Frank’s more operational a have important with and experience – trust tremendous a respect knowledge Frank. of amount more battery degree

of which is core its Given working within that center battery we’ve the the of group VW, been with PowerCo a excellence is inception. former since

natural. this to be quite expect transition We

John Saager

six come of which technical been Okay, And largest had had are questions the to question, layer Morgan. challenge you in develop two His looking cell? in next technical months? Asumendi J.P. great. milestones to what And achieve has you José we from first then the to overcome the XX

Jagdeep Singh

Yes.

of looking our risk off in quarter, six faced sample. I qualification the view path most and delivery to of Relative So is This to the important challenge our next the to the milestone largest we’re substantial represents of forward. A automotive last in achieve allows process course, of reduction composition discovery months the the part technical kicks in would we a this that the in great and the say metrology it course, work contaminant to it. to referenced some were work through our team, a QS of of on material was the to this we able letter. resolve us And we the identify contaminant

John Saager

structure, you José’s this any was battery color and any firm? there great. Volkswagen new question in form Is collaboration? with recently your regards on the second with additional collaboration Okay, company has can to the provide launched the changed

Jagdeep Singh

of to recent we the VW with haven’t to collaboration, the announced any meetings, in program relative relative management nature but months with changes. more frequent So we’ve collaboration the closely more technical and collaborating itself, been

John Saager

so Thanks much, guys. Okay.

to of Q&A call. today’s the questions. portion We’re open lines Operator, begin the please for now ready

Operator

Instructions] Our open. first Dong the line of your [Operator with Wendy, line Wendy from Deutsche Absolutely. is Bank. is question

Wendy Dong

a task more on out, possibly you’re or items Provide year. which for that leading bit the spending to the the detail lower is CapEx pushing

chain Thanks. supply kind that’s technical kind what know you the that facing. I you that pushing guys supply factors of But what Specifically, considering mentioned you challenges of factors, chain up. are

Kevin Hettrich

you for thank Wendy, the question.

$XXX $XXX to $XXX If $XXX midpoint take guidance midpoint quarter $XXX last of million $XXX annual the the current to you million million million. million it the and of compare compare of from to million,

that aspects the an assembly, in the those that about. primary would high the which The refine up in goals the to I example gated in would that were has think used postponement we delayed And into proprietary seeing ordering confidence what technical of and $XXX cell of gated much still which had bulk be And some deliberate our the asking million cell equipment XXXX, we are drivers specification. design. achieving in while development. have approximately you’re buffers is, We execution We by by of that of pushing XXXX, goals be XXXX target XXXX, buffer. of

in separator Another example our wanted we you tooling when that supply automates quality combine with resulted those process improve of to one changes of And updated quarter those processes. the our in industry, processes our and capital and some postponements ordering forecast. that’s headwinds facing what’s into to incorporate some the made chain in be we reliability would our of and separator changes

Wendy Dong

Okay. it. again, Separately, go to A-sample to was B-sample. can remind Got what’s if I from wondering you required us,

B Could and of You sort Thank of to A that targeting to well. C need us similar from go steps you. sort to task mentioned B? like that sort the of a from to timeframe the awarded timeframe XX-month remind that you’re you accomplish as

Jagdeep Singh

Yes.

this that one. Jagdeep, So take is I’ll

So generally in see them the order speaking, whatever things the product is want. of delivering OEM A-sample they functionality to is the to automotive capable that basically the convince they need

the will OEM, functionality made that using a of B-sample different OEM closer maybe more small So production vary that But that. that have processes. The a will are bit are obviously some tweaks typically little by represents in processes A-sample typically the it’s okay. to typically definition

then is the which be those production they more but you’re produce is on handmade. has the production smaller production A-sample, versions like the than the – can tooling, production going Now implemented on which the all of And processes production be functionality, they’re actually can completely cells. the on and C-sample has to tooling

the C-sample think depends that to you So a serve. trying you’re on of vehicle about then the clearly line the C-sample, if that definition volume of

a very car units that a a be X,XXX million if much than Because C-sample So line other that right? year, just that a you’re in a a case. the like makes type are of one units car case, serve a – tools required different year, the bigger to makes than a trying will

of generations. it’s with production So line, stages different have that cells – the that that trying are is coming. line. volume only is these serve is big typically you’re a And function of a big sample the off that line multiple your make much to the C-sample all how point how line which real definition how The I’ll

cells. the So are Bs Cs. and there first the very on we B-samples make, and prototype As said might be we which that what And call B-sample here was multiple the

could are than like they’re Those volume process but of So lower where others. steps prototypes. they’re the B-samples, some line off come a

really of timeline. summary a that’s So our

Wendy Dong

my so Okay. Thanks. Thanks much for taking question.

Jagdeep Singh

Absolutely.

Operator

Thank you, Wendy.

is Daoud line Gabe line next question Our of from the open. your is Cowen. with Gabe,

Gabe Daoud

Thanks, little and a just all afternoon, everybody. to the for Thanks maybe could bit the remarks. timeline. try prepared if more on Jagdeep, in hone we

So A, if months about it it’s being between and think C, we delivery. XX December year and call this if is B A

So early to C-sample stood your does has put frame up just late Could XXXX XXXX, that that timeline and QS-X, XXXX. you like in maybe then I delivery then late progression guess? then help us maybe and QS-X to

Jagdeep Singh

Yes.

Gabe, So, say did exactly the out. we didn’t We say the question. for C is you thanks laid didn’t QS-X the and anything anything we What though timeline about about on in for letter. what – say B A,

the of on cells A-sample B, are happens would coming off what the which line anticipating, of Remember of is at A and for that, as us using this is, production C production and the assuming defined that absolutely XXXX put end A as assuming of end That months XX then targeting gap So C-sample. C-sample, the year, roughly and the into tooling. you’re said, we right. B and course, we’re as between we

that, function. is And blueprints which be to the course, about we’ve sometimes that to able be point. have generating at revenue a is for capability would should the that because, you line, really said it be the need after all of QS-X, So

key One the able around of be all specifications, tools, is processes, functions of the to to the so the get on. QS-X details the and

turn order bigger able more can larger So, lines. up those them be to tools we and of to versions of

because do line to obviously that just production out higher the don’t to do puts you at all details you don’t tooling, volume start up, that. you the turn on the is, So have want trying And want capital thing risk. before to a worked

Gabe Daoud

Okay. of say on I XXX closer the Got like I there’s And that’s XX-layer, are, as I That’s first it. back A-sample maybe here just to but what energy is guess, follow XX-layer can there to looks and on sorry, hit standpoint? know XX-layer, And the then Thanks, we density of up. I focused that since maybe, and guys. the question. cycles, on Thanks guess helpful. so did that the the guess anything just we’re then Jagdeep. like then curious part an if the as is representing that an you kind

Jagdeep Singh

Yes, sure.

And making progress we explicit So milestone move XX-layer had. made we enough an cells. to the wasn’t we felt that the XX-layer, like where XX-layer we to on could

pointed over out, XX-layer we that you cycles As what cells. in XXX reported already

gives the So, to have July, we close in refine continue energy we really And All design, with to doesn’t still happen densities think A-sample the and to and we’re of that any today the connection really test optimized. to of to for to year. improvements more see need that, the with cells. to energy us isn’t cells XX-layer number things those have in point really pleased that are the those the cell out, target Gabe, number because first already that layers incorporate we make right over the and the on able work the it B-sample. density A-sample be quite XX-layer on packaging and are didn’t months switched production isn’t haven’t be The a will you as of going the things commented to levels, actually, on end

Gabe Daoud

Jagdeep. Got it. Thanks,

Jagdeep Singh

Gabe, Absolutely.

Operator

with UBS. Snyder is your question Thank of the you, Chris, Gabe. The open. from line next is line Chris

Chris Snyder

there any and with move delivery be you. is of progressing timeline. the helpful? a be But I would question forward? specific my that assume be to checkpoint QS-X, B-sample, question. to towards Or follow Gabe’s color that taking on C-sample And wanted fair the for is up commissioned on a a focus to with thank really met thanks QS-X it required Hey, on could for

Jagdeep Singh

great a is this Yes, question.

of one from things goals line. can we otherwise of think I XGWh a the point we need gain C-sample. QS-X that doing meet that QS-X that, the to is that one we think think, line of that is make at that And lot are the by the can might thinking we learnings this itself we

that basically the to we of more think think QS, Phase So us we might need quickly. some deliver up line, or we essentially same QS-X QS-X subsequent out coming C-sample can to the which of scaling lines learnings do XGWh X that the to otherwise opens a possibility production

So thinking as our if them the things and would we’d planned current be that’s to certainly way that and like go unfold. see

Chris Snyder

sized Thank I analyst from announce agreements. I the OEM production the facility of facility that JV or be substantial continues – Is been it’s on kind the as could the commercially than And first be the of commercial an that consensus there community with a kind number is would counterparty the view obviously general just first the other think commercial QS-X you. of to Volkswagen mean, just and counterpart. opportunity the company Volkswagen?

Jagdeep Singh

to we’re So, a the non-Volkswagen serve ways different is said needs specifically to other obviously venture we going customers, Volkswagen, designed couple for with with to of outside else JVs the anything is them. Volkswagen, Volkswagen. there’s of think which haven’t There do joint I serve who the about

a serve this of vehicles. QS-X produce we will C-samples us One of to certain is that off course, volume line of through where allow QS-X expanded

one volume performance line. have out wouldn’t super of perhaps But with vehicles do the that vehicle VW So, like other type be is be with an – of super, for like joint with the ventures, have high like programs we option. option premium would that type of we one There’s ones to high course, able to OEMs. do we smaller,

fact, think section venture of I of XX joint a the announced that there other one discussing of possibility with Top had the, the In automotive OEMs. in that a one we agreements specifically

that. But think as another that creative are And there get ways I to is more at on And ways possibility. can. that said example other build guess, to factories, also that that’s looking do might the past, I sort it’s a but our other small to of main there technology to market basically there. general beyond of get those that, involve an So the we’re factory. were as it’s factory, opportunities three a is we’ve the into we quickly is in One goal QS-X

do OEMs to JDs. VW The that. is second is of example The an deal partner to with

past are haven’t basically The what we sense. But them. general where of and provided for license the referenced some the any one economics we make we for one sense those a business the sense religion that IP. most three that, in makes We options us, to and for any around to have only don’t although more the want pursue point investors, might our customers. there’s partner we details make third that the someone on occasionally any as trust We it if do at core our

Chris Snyder

just in. I Appreciate that. one could one squeeze If last

amongst years, what just the interested produced be you most produce, – you’re company’s most amongst to you and whether the be on think couple that tracking, would kind that technology, number market. metrics what all which is I metrics has test Jagdeep, Over the hear of metrics just be provided indicator they’ve just of test what it the important? high is you of data the data a guys your to all these do the company data to view and very past significant the of interested, test progression,

Jagdeep Singh

Yes. Great question.

lithium-metal cells published say call these energy designed what I the is dense right? anode carbon gold-standard that we we highly are of for conditions, showing idea most lithium-metal data significant obviously because this or which probably, high carbon-silicon notion the would I So that the density, test think this aspect of is energy anode. is the than more is data

So the up to But to that charge. kind of of demonstrated operate getting XXXX hour we’ve important design these that of numbers. the a chemistry per rates possibility with point you that liter XXX with type high is that opens can one that

temperature. for room XC, recent do published at testing we XX that Celsius one-hour our at degrees all meaning we Recent times So tests cycles in XC rate XXX have been pressure. as at of and a no below question his Gabe to and than earlier We more of in dropping where then modest you alluded recent pressure that. atmospheres times in would pressure use X.X approximately charge

life. So results I this, is that they’re show that, temperature that’s or rate the that gold-standard key on or conditions or is, these focused point first under without cycle compromising done pressure test

The rate. higher second that ability on even data shown key thing both is the run I’d the data front we’ve to showing say at

data on we this XX charge, a some So row. year earlier published minute in times XXX

not really data remarkable also even lithium-ion really we from But that result, seen or any have as power. And are increasing thing haven’t would that for matter think third that designed for which terms really in other the that’s power that that do showing designed players type that can lithium-metal are then we point on cells. highest I to for counts. cells the we I data a layer possible of energy player energy, data So cells, for any keep

I on layer of which we’ve – stay and tried we’ve while trying of the increasing focused to maintain keep nose that is just level think counts to steadily to grindstone the mission, our functionality. kind keep to

on least XX data to So well, layers, we to the and XX, run XX. early four-layers at now one-layer XX to from very

compelling with three We’re not right? gold-standard fundamental careful yet. high But I approaches think comfort at to now take those be the cells to and haven’t lithium-metal really be The one-hour want for that to for of things And layer cycles. is density with things those that that then data, data And of run capability seen we try charge about us combined, that increase automotive that. compelling. that the charge I gives count The think very that. very lot rate high data here, rate other energy to single-layer with cells. are done the something what would things I a all we

Chris Snyder

Thank all for you Appreciate it. that.

Jagdeep Singh

Absolutely. Thanks for the question.

Operator

The is line Chris. with of line you, next Baird. question from is open. Thank Kallo your Ben, the Ben

Ben Kallo

cell or a adding how the good guess like the could cell, just on all relationships Hey, like of have from talk different span do question. two my those maybe just Thanks how new Maybe guys. them provided question? for two-layer I through afternoon kind Congrats you is relationships. with differ, sample relationships us taking customer

Jagdeep Singh

Yes.

is quite set agreement out the generally of a So get the production they providing line. then of of to to that there, intermediate basically a addition a represent OEM this with they What the part our certain out are of reservation our in samples. of And OEMs those effectively QS-X pre-pilot these amount relationships are that, similar. that – involves capacity on

that there’s So, line. to six and that OEMs they we’ll cross we’re up really samples section A-sample I of leading but such broad A-sample, is, think that the not pre-pilot represent a subsequent thing now provide automotive the about sector, excited before only And samples them right. the

pure hand, well brands. represent and So letter type They XX in non-top EV one as the luxury XX I they on players represent, as well-established top mentioned OEMs. but players type premium, conventional

we spectrum represented. both of So have the multiple ends on of axes

being work allows that But to to or some more who the supply little better in the to a is we time full about, of sure we have I spectrum order to be before, for work worse we that we that we’ve choose exposure we of we tried sector. make benefit the to encompass And in sector of provide future. choose the automotive position into have whole we about, thoughtful think, to today. automotive, demand players right be, constrained we’ll Frankly, that are of to who us the for There’s more said with. be tried the think position think strategic ability sales than we’ve as now. we the with;

So momentum us. deliver really just these feel we of potential of the cells, is trying OEM about our I opportunity we ahead good the to so now focus think can realize and pretty the pretty,

Ben Kallo

something for testing I I was guess, you or everyone I’m is, received data, has versus there maybe have relationship received an asking they others, to that. is what actual just or everyone in you their started physically at different stages Thank tested test so, have cell. are,

Jagdeep Singh

because of every think, made guys, to knowledge process. of well are have, yes, received it say I quote most and their list cells I players Yes, should the stages cells one full on but most haven’t them don’t just I at and tested have And I different And I so these I there of this have these think tested me have most question, but everyone of already received of but some and has for at think look say not I in and them. fact I my would them this, think them. stage

So obviously a along someone had like is, we’ve lot longer. further VW that in partnership for place

Some we’ve regular announcing every in of at the players been players, newer time. intervals

most to some already will test guys of haven’t and cell them, going different at get and their them. received process. But are them shortly tested points that of be, have these cells and of in will some So,

just So moving players there’s with forward a their but these is that points journeys. different in the process all

Ben Kallo

you Thank last then maybe you highlight it? changed it’s Cool. step Could into the out means you. just how completed. manufacturing delve you question, how more bit what, previously what cell and on, that did you. a being Thank you that from the call And and

Jagdeep Singh

yes. Oh

I to think line. was Phase particular reference that the X

engineering up have we and line, we line cell that engineering X a this turned capacity our Campus in Phase And version production, were now line. X line capability which and X new older facility. and as for assembly off Phase turning that So to our Phase was we’ve QS additional transferred of building in

Kevin, Also, add? a have to people, the new anything planning pre-pilot the place things because in line. – point and important it appropriate and that QS-X, means which actually means, deploying in in all to appropriate we’re an this able the rooms put we’re into be where rooms clean making is we you’d those which building, this cells. building and make the to that’s rest to now place cells power, supply go then the facility and So is dry on of

Kevin Hettrich

summary, I Jagdeep. And a that’s think good

Ben Kallo

Thank a night. you, guys. Have good

Jagdeep Singh

Thank Absolutely. Ben. you,

Kevin Hettrich

Thank Ben. you,

Jagdeep Singh

progress just Yes, I’d to like I this incredibly problems their of dedicated hard new look our forward to And technology forward customers ongoing get call. call. to to efforts and their to commitment their associated thank reporting market. a overcome to for all us quarters out the in go helping like everyone We the of to thinking also with let ahead joining course, our investors support our groundbreaking the our close coming for for mission. further me thank technology want thank market. on I’d amazing bringing the team to for

Operator

call. earnings Thank XXXX QX for all participation. QuantumScape the you your concludes That

disconnect your lines. You may now

QuantumScape (QS) 28 Jul 222022 Q2 Earnings call transcript