Earnings call transcript Q4 2022

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Operator

Good afternoon and welcome to indie Semiconductor's Fourth Quarter and Year End 2022 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded.

I will now turn the call over to Ashish Gupta, Investor Relations. Mr. Gupta, please go ahead.

Ashish Gupta

Operator. you, Thank welcome end and Semiconductor's quarter fourth Good earnings to call. year XXXX and afternoon indie

Joining are of Tom highlights and Schiller, provide me first CEO; remarks followed indie's and today opening of CFO Donald by McClymont, quarter Tom's and indie's discuss outlook. EVP and Strategy. review will Co-Founder Donald business indie's QX and

statements be views only subject expectations. not statements expectations and current from of to note we to of subsequent and should Please risks on that views will date. based actual be reflect and relied of uncertainties cause materially variety uncertainties. differ subject and today are any results These which upon as as to could making are that representative our These a risks forward-looking statements assumptions,

discussion our press QX our backlog please formulation For the earnings strategic on methodology, safe statement a refer of harbor release. to

our results, reports XX-K our our XX, For the risk that could ended public year well material affect XXXX, in SEC. Report with important factors December as risks as please review and the fiscal Annual other financial filed on other factors for Form

the certain non-GAAP based and guidance on Finally, measures. discussed are financial results today

GAAP, which our found of please reconciliation earnings press website QX at release, our on For complete call and a was to advance in be issued see this can www.indisemi.com.

I'll now turn the Donald. to call over

Donald McClymont

Thanks, Ashish and everybody. welcome

revenue margin than capping in performance more gross and topline. QX. ahead of which indie second a off and delivered consecutive of our again record expectations quarter year another doubled we Once in

dedicated patent team Autotech extensive reflects world. our innovative backed products, by of employees portfolio strength the by global of developed outperformance sustained around indie's the over XXX Our an highly

revenue to experience markets and we our and addressable user XX% margin gained sequentially million. design gross just We and the significantly to XX% spanning electrification fourth momentum ADAS, and quarter, Specifically, $XX over year-over-year further win during expanded XX% outpaced grew applications.

OEMs exceeded across repurchase experience our support authorized shipments, cumulative of XXX offering period, closed automotive acquisition North ramped million debt our warrant in a Board leading the launched American during note, million user and program. convertible unit share plans, we portfolio Of $XXX of million $XX a

recently with Surya a targeting motor vehicle innovative And a Machines coherent for driver systems. SoC. partnership occupant at captured charging, our key intent acquire to more Semiconductor. solutions controller power E-vehicle battery LiDAR Seeing Entered monitoring. lighting and cooling wireless And we CES, and ADAS delivery, our announced including GEO Demonstrated design

delivered margin million On a improved basis, we and revenue full year in XX%. nearly $XXX XXXX gross to

strategic XXXX November backlog $X.X billion and XXXX, ramps XXXX, billion launch stage billion generation. and of the in of as time flow at program of wins from decade this While $X.X translate balance substantially to into as outsized design growth our revenue our free through setting the sustained, up cash in increasing ultimately and for $X the

to sensor ADAS, vision. Within Autotech employing disparate merging following multiple megatrend. on is that technologies and sensor our together believe computer are and We pure-play indie information, this approaching we a semiconductor process capitalize LiDARs, fusion ultrasound new RADARs, agnostic best-positioned of software the and approach, era strategic

ADAS change lane RADAR cruise adaptive detection applications. assist braking, and Today RADAR spot deployed represents building automatic fundamental emergency widely of all, First is a control, block blind for technology.

investments largest leading to integration Devices our our product team. radar division design to successful scaled future, Analog The the of through assets it critical extremely and near these In it Recall, internal the application, sensor. supplier. the Onsemi's top four development, initiative cross-traffic radar and an our will making acquisitions radar the enable high for win-to-date critical was automotive RADAR significantly volume also system detection accelerating we of

of achieved far range LiDARs has demands using capabilities, emerging safety sensor fully anticipated been within rapidly technology use to mass-market autonomous coherent can resolution impressive vehicles rollout driving depth To compute-intensive we systems systems and Arrays. date, LiDARs addressing complex by enhance the than Gate this high-end perception given of Programmable very Secondly, and deliver cases. the sooner Field

levels offer expensive, also power for add components generate FPGAs nascent of versatility, significant power beneficial flexibility ideal consumption. and of require discrete are and applications. PCBs But high prototyping especially FPGAs cost, problems that size, hungry, for complex additional and are they excess thermal and they

long customers market less seeking are data for This to price than makes market signal system. power with LiDAR merchant XX dissipation automakers Enter any acquisition and integrated, migration Watts Surya the highly world's sub first indie LiDAR implement point coherent software-defined solution, high-performance, SoC, allowing to for $XXX mass our practical range a LiDAR. of the in LiDAR processing

all with LiDAR the Surya Surya digital system. coupled together and high-speed for needed to converters, processing, our digital cost-effective multichannel necessary software system differentiated the market. analog LiDAR signal When integrates lasers, efficient and catalyze can the interfaces with an TeraXion absolutely control hardware

Third, few meters Ultrasound cases resolution park-assist is increasingly deployed to sensing up a to as such low provide and use practical, systems. spatial short-range

sensors due of that benefit they to is key low are particularly their conditions ultrasonic cost. are weather most and resilience effective relatively A and

of product in set We ramp early Hyundai's Smart ultrasound others. the innings our amongst are own feature supporting still Park

XX vision surround driver jam change lane mirrors far traffic least, detection, systems and Many different vision. enabled safety, ADAS cameras are lane assist, in by levels ranging highway occupant from as and can computer automated cases and Image both from in and vision, object use provide these through and autonomous cameras, requiring processing backup function such applications night pilot, occupant other sensing up functions next-generation simple last, the systems, automation. and pilot, And main monitoring. computer of functions driver view parking realize and to vehicles. Collectively,

around growing given And In global $X.X ECUs camera addressable the semiconductor XXX attach be thus to vehicle, needed XXXX, XXXX. cameras billion units an support XXX market. the IHS million will the total market creating rate of is automotive in increasing million fact, by forecasting to

is global a It's our rare that accelerate intent semiconductor. opportunity, an last GEO capitalize our this week, OEMs, Kia, announced Hyundai, Underpinned acquire entry is XXX market industry-leading shipping To world's acquisition Nissan and GEO. to with this viewing and but by fit, target some indeed on we Toyota. are sensing to Honda, perfect camera-based largest the today including patents, of capabilities GEOs case the and automotive

wins deliver key Tier-Xs, in image with design processors video those the has display driver on the With advanced programs. world three video engaged cases, machine allow major both will the algorithms providing sensing use is solutions video for today's features where these focused of processed driver. viewed to of both vehicle fully where to technology multiple assist and more GEO categories projected and to tomorrow. a application-specific every provide the is support supplier is the and vision sensor learning computer ability programs to The by camera key GEOs across than unique and platform XX of in on products generations comprised including for using autonomous viewing, short-term indie vehicles

the in products, significant synergistic opportunities. viewing while sales will global the and need require sensing for resolution time and at same terms of features. processors with GEO and operationally image increase number massive in cross-selling camera both demand a These requirements differentiation channels, will car. and customers, complementary is highly Upcoming regulations OEMs per of

in performance allow for at superior a display and detection, enhanced will technology for object image image the resulting power. machine of to processing applications, the display vision and machine processing lower the delivery latency time-to-collision tailored ultra-low vision going contrast and to the high camera fidelity image system GEO's

know-how the camera combined uniquely the will Indie's camera-based accelerate across sensing with differentiated us GEO's adaptation sensing IP spectrum. to technologies processing and of position technology vehicle

across with LiDAR, More scale and applications. spanning indie mosaic each to of now a and total is RADAR, importantly, GEO computer ultrasound XXX enabling complete vision by sensor underpinned our patents

fuse be and performing integrated the methods will step Our provide our Baron. all into customers highest platforms to next to most sensing with optimized systems

environment experience across prioritize fourth ramp the more leading global information our X a sharing traditional has quarter, horsepower focus continue to communication, much where and become towards and entertainment metrics. cabin than user creating during ever. gears, customer best-in-class portfolio indeed greater differentiation torque, OEMs automakers also Switching unique paramount the XX and a is This experience than to we as cockpit

within user mobile is automotive device means integration Apple ultimate CarPlay way which particular, environment cars, entire as the their throughout Providing seamless Android standard. such experience are is new a differentiating implementing the cabin OEMs the increasingly the and to drivers In without taking and feature teen eyes road. and drivers their their off This more music parents. everything their the messages and even receive favorite calls, key enable for enjoy important make that Auto nervous send for is systems safely set is

creates an emotional integration of an driving is generator Similarly, Illuminating this exterior that for perfect vehicle gaining car's understand Car strong striving to unique drives experience. recognition. significance harmonious dynamic a manufacturers brand a importance of a and connection. as conditions the and are the interior lighting lighting the ambiance more it is of

tailwind year secular the EV the X%. towards up EV of to doubled the electrification. sales by in as demand led of around Automotive, market seeing in and long-term area, shift consumer share According versus XX% we're OEMs a the the to EV prior nearly total the Cox start were US Finally,

more And times penetration number EVs well range. enormous and and integrated positioned world, leading seeking an extend there remains semiconductors continually with highly While of ahead. relationships power-efficient still has indie strong of the opportunity given lies OEMs charging increased blue-sky especially are an here, considerably, who shortened our vehicle to around increasing

will the QX call our for results of and to Tom discussion I over outlook. now turn QX

Tom Schiller

Donald. Thanks,

margin quarter fourth line expectations. indie gross once solid top delivered a outpacing again and

at or post meeting XXX In was better profit seventh revenue XX% guidance. our than to sequentially targets $XX.X least gross and margin XX% year-over-year was up IPO. points year-over-year and margin, our points up quarter beating up our basis for into of $XX XXX million, translating indie's and fact QX million Revenue XX% gross the sequentially, a gross period represents XX.X% consecutive basis

in $X.X the put we've margin years of challenging by XX IPO while the our base, environment, was of of of XX.X%. with supply a revenue chain this At points. two the since quarter million and the our in effectively In nearly quarterly X,XXX fourth margin basis gross revenue despite time just context. announcement indie XXXX a expanding performance To gross

reflecting was product in guidance. extend reach, our plus ERP million, better $X.X indie's implementation support our In a of system. to Turning than with sales R&D investments QX operating of turn, highly was slightly $XX.X to back our development million the $XX.X of SG&A scalable loss accelerated results. QX million, continued

contemplated days from line, interest in hadn't income debt $X.X Below million our stemming interest our the forecast for guidance we ago. original was XX convertible $X.X million, incremental versus

We also quarter, for million last our XXX.X X.X period at ending bought XXX million shares back against guidance shares shares. the million

our reduced we income result, share share level and loss base. net interest of and between the million a a was per loss our fourth delta quarter $X.XX lower results guidance slightly and As the $XX.X the with posted to tied in

debt offering million Turning $XXX.X capital $XXX.X up exited in from as and the million used with to million $XX.X million $XXX.X as These proceeds were by raise. convertible expanded of from and the million year We including offset net balance QX, increases cash, net IT of from million $XX.X our of Wuxi our in well share activities, $X.X CapEx equipment, million partially $X.X subsidiaries operating lab cash sheet. repurchases. in for

multiple the pipeline, XXXX. addition quarter, throughout the to GEO on product of depth top-line plan accelerating program new based ramps we forward, growth and this Looking our later planned deliver of

revenue XX% first annualized rate, revenue range. non-GAAP million the margin plan in we of For with GEO portion the quarter, the gross including to stub to $XXX scale run

of We for are quarter. also the SG&A million million $X in an basis consolidated on planning a $XX R&D,

$X.X Below income of taxes. net the anticipate interest and line, no we million

$X.XX average million X basis, Assuming including weighted loss a outstanding, per net for million share. GEO a approximately shares XXX we expect shares on

this Further, we another will expansion, the reach our and key gross towards of particularly profitability combination sustain XX% margin and operating realizing in post-GEO XX% back growth operating milestone the margin trajectory, us planned gross year, most synergies leverage steeper target enable importantly, model. of to expense indie's and representing half perhaps believe

I'll note, to Donald his that for the closing turn On back comments. call

Donald McClymont

Tom. Thanks,

now and posted Audi, General our Porsche, we Ford, solid just Hyundai, executing car plans. results BMW, and made to indie IPO In Volkswagen, started. XXXX Nissan, brands Daimler, support our and extending growth we've ambitious conclusion, getting And are BYD, like since QX Stellantis is although our substantial progress Motors, the and of

processors GEO to immediately platform our to and offering image field-proven a accelerating of acquisition computer customers. product enabling This solutions, ability the vision our to differentiated capitalize with highly rounds on vehicle. automotive forwards differentiated acquisition fusion rapid by our us our the effectively Our provide true sensor proliferation out sensor fast around portfolio of

autonomous of higher-level and we bringing this process architectures car the value. vastly Autotech shareholder way, In and to realizing thus step sensing powerhouse massive simplify the our vision creating extraordinary and will strategic towards access of as features ADAS enabling in becoming democratize a an uncrashable

for call the open let's Operator, remarks. questions. prepared our concludes That

Operator

Instructions] [Operator first questions. line with with Our proceed ROTH. question comes of Suji Desilva the your from Please

Suji Desilva

'XX for Tom. and like a strong better on outlook to Hi, finish a really, even Donald. sounds Congratulations it Hi. 'XX.

guys. job, great So

Tom Schiller

Thank you.

Suji Desilva

problem. no Yes,

very So maybe near-term XX $X.X expectation billion. really first backlog cover much understanding the a growth of might realistic versus XX give strong years, growth, strong the backlog how kind to that to growth that the that. financial there, some very next on you impressive, growth how question for for the just Is longer next term how months and grows us way of Can what's the sustainable that over because it's Thanks. having few think about or here. of

Donald McClymont

been that been over going has harvested Well, sure, for order. XX We've reverse of in customers fully for And the hasn't into market. with really public we're a mean, months. still kind the that, accelerating positive little only I still their effect yet. a company

we'll So, be Suji, the pull added anticipate due no, that able and you in very in those do strategic will basis. to annual course, some know, on to projects an be I as backlog large

revenue in our we So what mandate entire the of between that to is half expectation profitability this XX we realize to absolute year. mandate, hit and terms that been we line months. draw very our absolute in get you that. mean, the clear, I now second to of our my in next target, we've for have the And team is of can to kind order in where from a are where

projects. for can easy And divide that And at approximately area. of rate just get to time, an XX run by I XX-year think to you the consider a these if the run some over midpoint you making of math,

it So to set in very much that. we'll the and about terms originally so continue of on on such. we months meet And very out do we came where XX first we and are, we we're the IPO. track to delivered plan the when confident to market that in or We're

Suji Desilva

particular great. Korea on region. And one you that wondering acquisition. then is Donald. very Japan, came that queue just Noticing the That's additional there combined perspective that vision perhaps and in It's there, there that helpful geographically to partnership Thanks. Is clearly Semi color a GEO geographically take do you how through through success question something success focus partnerships? a and strong the and I'm would the or GEO if need there expand effort? there

Donald McClymont

in Japan discussed Well, time. is enter there as market we latest conservative simply our because to long market just before, evolution, we've over quite the decided and the particularly a or last takes

in And so without strong supply bunch one that in presence They very into a Tier with have a a of market, good the market. things there, the fairly Japanese that name that attracted OEMs us they Xs. to representation the brand, through of GEO fact was great chain had the

a us that to our a So opportunity just was for into for basically cross-selling enable new products. huge market

there'll ability, world, great have where in the really less And which line and conversely their our very we we cross-selling also in into term of itself will the pretty reputation up a great customers. to that good are a they deploy the opportunity, really where parts we've strong short footprint, the short expect quickly. be other And top in built term reflect products the

that, in they key IP, largely relationships, testament products just work more it executing great How exceptionally was are some did they than to but hard and their that. anything, their focused great a

Suji Desilva

Tom. Thanks, Donald. Thanks,

Operator

from question. Craig-Hallum. comes Stoss the question line with [Operator next proceed Instructions] with Please your Our Anthony of

Anthony Stoss

the My what And understand the congrats length wanted does design on follow of guys. us little the a it GEO Donald. how give Hi had for on a Help the us that what GEO rates as up also accelerate bit, timeframe, acquisition. also to I as you well growth scale, Then company in past. that your under GEO have, Maybe follow-up. cash now, quickly the had sense growth? can I and been you the a maybe

Donald McClymont

Sure.

market. actually we could effectively market, geographies as remarks, include. prepared do, as mean to it's exactly Japan same little in as prototypical I go So perhaps they mostly Asian market slower you how Europe a the little faster identical to are the are starting faster, and said little we certain we geographies so to Certain serve

there opportunities many into are of But, are can of where course, we certain the cases where products their there that acquisition. could we deploy given the that in are ahead see mature that fact areas opportunities

that knew of So our could with effectively hay part this. analysis we we was make

in their terms And to... past, growth of then from you the want

Tom Schiller

doubled Yes. Historically, couple they've been the last they A of million were on a pretty they good growth effectively years path. neighborhood, ago in $XX year.

business own now the in They've some of indie was. by looking course next past ways level. And that take been to sheet their in the so hindered balance to the way we're

the I huge think, explode of here their out so, that's business. synergies one And to

Donald McClymont

I a reach were you situation a similar in think the we we a I became to in us of of their lot will able that mean the similar fact product there are what that realize exactly, we out. they part before to since were And and see Yes, curve potential growth one we came no public. for deployment should

Anthony Stoss

as to your your a big I other radar the opportunities what look just from potential company's follow-up some it's still feedback outside with might win the trialing? win. know Then of customers? you I of the biggest back samples, history sense the I top ago. your mean first wanted four, shipping Perfect. us a give to circle Are time like from what's

Donald McClymont

sorts moment. of we that opportunities We're reality it's set meet becomes generate turning really in don't Well, technologies we'll plan those opportunities appropriate. that for report product it, generally going I we one-stop sensor mean, track us to out. lot to customers. And sorts a good generally a market the into of speaking, all typically product the with time with time the our we're shop development in giving not of developments. detail a the as on of in at And having all about But any on is place

Anthony Stoss

Great. Thanks, Donald.

Operator

Deutsche from comes your with question. line question next the Please Our Ross Seymore with proceed of Bank.

Ross Seymore

for the guys, one technology and me financial then follow-up the ask on side. on letting thanks GEO, the will Hi be question. Two

on So side, the Donald. technology first

but your beforehand? How vision a talked look they had guys You some to understand your we in just bit complementary is division preamble, I substitution or bring potentially at versus business to portfolio. what little it for you pre-existing about wanted this better queue do how

Donald McClymont

pieces reinvent areas where key our certain the in Well, with I had might that this really access queue they order to market in have material activities mean, to we market, just fact so accelerating had the was the were IP have GEO there that ongoing. certain products was that we in of vision time the to

lot parts something way ripple in that a for the have take as our P&L there some even take step are into the that roadmaps today. in work, a will our to us join available will will through of roadmap, IP and Also and beyond be they respect, them of that. The there opportunity IP mature their we as advantage and our that which synergies better

the going sensor portfolio thereof the combining in where we're that the it benefit different together. bringing opportunities they key have next And in into our relative that's as them to topic portfolio where bring It's see going what Ultimately, bind see for we're single massive whole to in modalities, that platforms. is fusion traction sensor processing into. we We the cut we the to most the in. really market, the see and

Ross Seymore

guess Thanks for might I it. be one this Got Tom. And that. for more

about stub of was quarter that said you in million your there first folds how in announcement the kind you and in. guys a guide, just linearity On that of sizing $XX the initial on talked the any GEO side,

Tom Schiller

Yes, sure.

similar a accelerating from quarter. indie in of it's the we of million expecting throughout it's sequential to this And for overall, couple what So, terms GEO we're to just from growth there growth, guided modeling close contribution. then year. in We're

Ross Seymore

you that year-over-year when the are accelerating quarter-over-quarter sequentials And mean you or said maybe both. or accelerating, accelerating

Donald McClymont

both. it's coincidentally, Actually

Ross Seymore

Thank Great. you.

Donald McClymont

Okay.

Operator

Our with line with Riley your proceed question. Craig of next Securities. the question comes B. Ellis from Please

Craig Ellis

like question the the thanks really at from join of But one at GEO look will does $XX I question. you looking for this a if deals to taking standpoint. and one we're GEO-related those a parade revenue in XXX a look Donald, long it's Yes, hit synergy if business, million and start. ask now.

look about to three with vision and timeframe? you three-year do the can you with goes, possible business cross-selling to where big and think think out of what's fusion years, two how this be sensor two If your in

Donald McClymont

kind I short Well, before, it of it I've in if it of same subset view way. take now, you as that can to the to profile as and came out indeed market. the said term, the it's we us little expect Basically,

opportunities to the design the extremely a perhaps over long-term will of about high that volume result much size extremely future wins few longer quarters. we're talked terms so in radar high seeing term, that, design similar and growing which dollar of in as the In last result with win we've the

Craig Ellis

then, And it with of it. GEO Got so few like sounds the a in Tom, millions outlook.

weeks on counting to a a in couple and at obviously just You're go XQ. quarter most full would of then you

Tom Schiller

That's right.

Craig Ellis

XXXX think as do it this go it last XXXX? we and business sustains pacing had through And you the that year

Tom Schiller

We else, fact do, top-line see than Donald the opportunities enormous. -- here. actually we synergy mentioned anything more selling fairly enormous cross see are opportunity we in

conversations So have started. those already

benefit of GEO last stage not expecting million week to then guidance year. the back So we from forth that put for this thereafter sets the 'XX. 'XX of in least this from And some of $XX year. we could That's terms course incrementally see contemplated that even in half in and see at the

Craig Ellis

last one. just the any Tom, if And upside what one on fourth it. sneak margin in the I color in Got drove could quarter. Yes. gross

Tom Schiller

a nice of combination things. It was

bit. little continues Our of scale dynamic general, program improve, loosening here, in, chain ramps in is supply is big a up mix course just the to and then layering new a

also was so And helpful. that

to we dynamics continuing our see of to and those contributing we certainly very gross have So those late all on XX%. -- the contributed to continuing expansion dynamics way that margin are -- of demonstrated

Craig Ellis

the all progress, Congratulations on Great momentum. guys.

Donald McClymont

Thanks, Craig.

Operator

with proceed And Benchmark. our next Acree question Cody your comes of Please question. line from with the

Cody Acree

to you add I second, talk, off me a a about the backlog, Did Tom, you number. give Group. you but my step for to had just congratulations your the backlog an thank did absolute give and call increase? Yes, let

Tom Schiller

cycle. call. We that. to want Not we'll that on along way, make and wins program tuned such, event. Well and course, we that annual Stay the November provide in an this updates conference generally of but the provide

Cody Acree

that Did increase sequentially? number

Tom Schiller

We haven't size since but just them publicly November, we just haven't certainly yet. -- we've won programs some

Cody Acree

And Great. for is GEO. then margin the you're then Okay. contribution? one grow that What And contribution does how term? near that the in the expecting

Tom Schiller

saying You're margins? contribution the incremental

Cody Acree

What to Yes. is, GEO's margin additive increase you've dilutive that what gross base or is what a gotten to it.

Tom Schiller

Sure, sure.

the gross actually work it's line 'XX, lot candidly supply is they've some margins a that there to below So bring margins parity slightly more with some of quarter current but we've quickly And I and and think will fairly initially get in to it their and then relationships in dilutive steps chain with our got And just 'XX we take when at subscale move us. expansion. been average, can enhancing to here we thereafter, their our margin. fact, our in

implement between given I come going to quarter one of announcement and that the going add, synergies. time that half is This was the Those really is have to not this this the focus to year. really much back into the we're in one closing,

Cody Acree

traction marketing those the lastly, like? GEO to be solutions, then and the video to do expect look folding or portfolio that a you machine total into expect offerings And visioning your the just offering. and ADAS processing what do programs as of in When you Okay. from

Tom Schiller

I get-go, well the before we that demand begin homework have. have of we're ours. of the their the portfolio for in market we the to our did into We, course, from potential the incorporate very technologies mean, acquisition about we'll they aware that combination of the Well, and

this pretty immediate. we yes, to be expect mean, for that resonance do I mean, going So the I is

Cody Acree

you, guys, Thank congrats. Excellent.

Donald McClymont

Thank you, Cody.

Operator

we now And call I'll over the for question-and-answer to session. closing the remarks. have end of management reached turn the

Donald McClymont

thanks seeing upcoming joining for investor to see and you everybody. at us you conferences next quarter. Look forward Well, the

Operator

today's at may and you Thank conference your disconnect concludes time. participation. your you for This this lines

indie Semiconductor (INDI) 16 Feb 232022 Q4 Earnings call transcript