INDI - Earnings call 3 2023 | indie Semiconductor, Inc.

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Operator

Good afternoon, and welcome to indie Semiconductor's Third Quarter of 2023 Earnings Call. [Operator Instructions] As a reminder, this conference call is being recorded.I will now turn the call over to Ashish Gupta of Investor Relations. Mr. Gupta, please go ahead.

Ashish Gupta

Thank you, operator. to Third welcome Call. XXXX and afternoon, indie Quarter Semiconductor's Earnings Good

Don our upon acquisition-related of indie's remarks factors me indie's by CFO Schiller, today risk statements Strategy. subsequent XXXX, XX, McClymont, with are SEC.Finally, today as operating Tom's affect and results tax call provide review benefits other see corresponding reconciliation was and as of of public above of and the for on compensation, reflect of a in to fair such to risks non-GAAP not and issued results, to over that definition which items, and are please discussed QX non-GAAP values, please Joining reports note, net in financial are factors These gain be the be interest and Don the to statements actual gross share-based Tom review for or that and Donald. QX we'll could on the Co-Founder www.indiesemi.com.I'll expectations.For These at complete statements noncash differ of and as and risks change making should this fiscal filed today guidance release, forward-looking financial on as relied certain subject non-GAAP other measures found expenses.For margin, QX loss call materially the GAAP from on income Form our well now the date. cause of advance its highlights, turn discuss which inventory variety and current representative expense, the metrics are views or press business earnings These CEO; of could based and our and GAAP measures our our December non-GAAP the and EVP views will ended followed opening website subject uncertainties indie's can from as from amortization, loss, results annual our income material items: only exclude based in income our expectations loss, EBITDA. outlook.Please cost and be and report assumptions, may following risks a Depreciation realignments, to XX-K year results important any and non-GAAP uncertainties. expenses,

Donald McClymont

Autotech well to Thanks, solid for indie pleased driven third demand Ashish, challenging welcome, results addressable increasing differentiated market, a am report against growth and posted I above everybody. by quarter solutions. macroeconomic backdrop that our highly our with

design all-time gross automotive top XX.X%.Our XX% gross Specifically, $XX.X expansion OEM in X, the world-class virtually well XXX% scalable quarter, to million year-over-year integrations. with successful and customer margin our Tier achieved acquisition team, highs highly chain, margin supply revenue product base, our outperformance as extensive single of to up and indie's reflects we during including line portfolio, with industry automotive augmented every leadership all up as sequentially our and the by

from based XXXX the increased on I'm in to reach in has semiconductor billion, peers backlog non-GAAP is roughly world $X.X balance years with beyond heavily capped ADAS total, recent with quarter. EBITDA a Computer Bosch, to the was by that the is OEM well wins, XX-year year experience, current emerging which together last by strategic the led the expected our acquisition only class In contribution extend billion billion from of the our North success our of our same IPO with company billion billion has time Semiconductor that Further, lifetime, Vision, the semiconductor as by indie incremental to the is the American breakeven including fact, user the last more post-integration $X.X made Stanley.At report up in growth delighted among importantly, and Radar electrification The fastest-growing well leading in assessment Morgan XXX and should over perhaps GEO followed alone XXXX. company year, by indie $X X earlier enabled as supported our $X.X in Toyota.Combined commercial this products. wins, which $X.X

Importantly, stage these annual for wins all by billion revenue indie $X set XXXX. to of the exceed in

XX current million Our translating Safety have fatalities. statistics near context, to industry.As and for XXXX, ADAS deepest don't safety XX% stage to in around crashes, injuries both released At prevent these a investments that within and ADAS features a Foundation central decline the have decline been indie, recent and we and anywhere AAA through Traffic automotive million as increasingly enough. are the deaths XX a believe crashes aggressive study XXX,XXX taken XX% injuries within expects in technologies are

Our vision, as more will modalities, of and will safety.To environment. ensure tomorrow, for enhancing advantages robustness strategy, critical dominate comprehensive good and solutions and sensor conditions. that towards extremely vehicles sensing market is sensor are is no precision to response of end, we scenarios across example, excels depth perception provides multiple reliability, driver, depth are by accurate may yet of significant and believe limitations pedestrian OEMs to capture with driving on but and diversity and employ mission enable timely environments is day and opposed ideal uncrashable data capability. same approach Tier X the the empower car the heavy and conditions, can single And software or passenger, to and and are car, safety.For vision a when compensates complexity sophisticated which radar suppliers where we ever-changing but discrete way for is unique system we fog.We LiDAR, the to automotive ability of the and lighting, approach challenging due individual in embarking different technology range adverse semiconductors fusion safety and fusion humans, poor it or redundancy cost-effective limited has implementations by for the where This the for recognition a LiDAR including radar, computer be recognition increasingly and creates surroundings. truly lighting a or as unaffected the vehicle's poor in ultrasonic precision in sensors, Meanwhile, and have path object multimodal precision to for in today's range and cameras object impeded of sensing rain a capable objects weather our for weather performance crossing for coming a of yield into ranges driving

a key ramp initial is from Computer camera can set levels, buy short, announce increase this expect potential we technologies automotive premium I'm in strategic X for rapidly quarter, this enabling requisite to the in backlog. Vision of power entry-level to by support during that savings and optimizing In to This and down far to believe configurations for win we fusion vehicles.In addition, Level rapid enormous. Level teenage and sensor our global X and fusion the performance XXXX these important efficiency yield widely business greater secured American achieve vehicles cost over proud sensor and sensor drivers.To scale is the via a require to product down map the dependent OEM. implemented, cascading road XX in contributor sensors our isn't plan Level on to our meaningful meantime, will we and sensor is North a in and directed When program proliferation leading autonomous But a autonomy, end, because the to is X++ entry-level vehicles cameras. driving

simultaneously.As expected was market coupled low camera Global, the integration, ECUs requirements. commercial developed ADAS to that demands XXX addition, of to and regulators, Radar. architectural and incorporating approach enables we performance This across by are safety In next-generation of share consumers mass units are new design their enable units distributed XXXX, our demands million solutions viewing expanded levels S&P a of increasingly high the disproportionate challenging volume of system a to to XXXX to According both video on government this camera and a processing XXX portfolio to in consumption scalability camera-based demand that nearly higher features, these vision-based processor capability highly vehicle grow to seeking to sensing sensing we gears meet volume.Shifting with deployments.Our automotive automotive classes. with and million plan safety shipments release automakers integrated intelligent car address assessors, solution power of capture chip from

of to millimeter to acquisition Assessment of that our radar During for and wave range, portfolio complement we XX the a fully of this Silicon Program our tank workshops well suspension and and integrated front-end and sensing, solutions.As gigahertz are leading assessment I'm sampled engagements, such pleased quarter, of New as NCAP, technology radar with evaluation to our the deployed initiatives with control hazard demos, driving and fine amongst dynamically quality, real-time a for adapt monitoring applications, direct frequency SoC carmaker assessment OEM system the even Japanese monitoring Surya LiDAR performance air our and levels.On higher to make we the recent European safety XX long-range first gas lead dynamics use others. precision automotive we grade front, radar use and new Radar high leveraging spring-based Car road the customer report continue or launched to vehicle and short exploration XXX settings, radar earlier silicon year, including first onsite product surface quality expanding progress of our commercially to ride including transceiver, joint gigahertz world's and with emerging of the

EXALOS, expect with a throughout contract aerial a the semiconductor such photonics design timeline, a supplier year OEM. yet in and in by we quarter, viewing head-up during products. but to to fiber this backed leading LiDAR strategic superluminescent LiDAR high-performance silicon on design our inbound this based merchant complement Being also have we half the XX time optical backlog, interest fully a optic wins global of a semiconductors. mobility We by development of the specializing position accelerate back gyroscope drive next our record to laser Swiss within this applications dramatically entered and EXALOS the conservative, we leadership photonics display, any Surya, patents, as contributions decade.To of and material LEDs acquired scale degree for as company

to by amplifier look In customer leverage our to global charging forward line. highly vehicles spaces, base, a the shift our entire comfortable experience. we control highly Such an user into skill led in underscore spanning with lighting, updating personal pleased applications.Speaking technology passenger around and an progress ramp consumer that also emphasis sets this eliminating ADAS environment.I'm the the immersive at of integrated leading holistic prioritize North motor their lighting the addition, solutions advancements team, and at ramped EXALOS' as we user environment on world continue as advanced we particularly report seamless, solution with to a transform automakers and We win towards creating promoting OEMs charging of user meaningfully never our leading in-cabin with reflecting augments capability FMCW has product solutions comfort, been innovative carmaker. cumbersome wireless you integrating experience, American LiDAR OEMs experience extensions global across your cables, a and our a living quarter, portfolio semiconductor clutter-free on greater, intuitive, our during a of paradigm optical captured additional and preferences design importance experience.As further

merging of power QiX.X boost and inverter available Our integration associated charging like FETs. solution and a features with converter, level flash DC-DC additional boasts the wireless highest MCU

demanded efficiency electric Specifically, reached XXX,XXX, infrastructure reduction in consecutive the total we the tailwinds BOM solutions, and area are PCB system vehicle first charging as XXth more transportation are record And likely ever, automotive technology, is and sales XX% the XX% U.S. who advancements supported XXXX. These enabling about to now the the in in on prior headlines in the consumer the XX% for firmly costs in strategies.The the EV charging wide expanding as Wall as charging putting time market Electric powered above contrary, range models figures sector the and this per as versus XX% penetration the enhancing mark remain X the sustainable secular another a past nearly in Journal, via preference sales quarter. the EV third they sales massive. highlight impressive battery quarter, in over fact, potential competitive market. generated and vehicles EV a through of are rapidly previous despite for just new a the in intact XX% pricing time.Finally, September for to our sales available continuous for wireless the first roughly long-term X% the of same rates EV is set jumped for Year-to-date reliability up versus market say and we than million QX requirements volumes to track at of surpass Street decline. EV consumers sales U.S. growing with vehicle integration, area, U.S. XXX,XXX compared still the on smaller were battery by EV by a time increased just month.In overall Based of elasticity sales. later an buying the vehicle share thinking EV the year

market outlook. customer and General leaders, Nissan, shift.I'll QX and Motors, for over of this BMW, including discussion are Tom call Ford, QX to Mercedes, positioned well a BYD, XPENG, Auto engagements on spanning Given Rivian, indie's to Li Volkswagen, the results secular NIO, we especially capitalize now turn Hyundai, our

Thomas Schiller

top Thanks, guidance. solid Donald. indie delivered exceeding our a line quarter, once again third

such meeting this targets indie's In beating consecutive our at post IPO. least of fact, XXth represents quarter or

$XX.X sequentially our was year-over-year operating million. up into XX.X% million our and sequentially by was up loss XXXX, gross million, leverage.With profit the while operating gross base in year-over-year points and points to operating million expenses to $XXX,XXX, XX% reflecting period year was the of posted basis XXX.X quarter driven $XX.X XXX in loss and an shares, million sheet. sales margin was bringing million, and basis and guidance.Turning loss international revenue multiple higher total In sequentially.R&D XXX% improving $XX.X $XX second million, SG&A $XX.X up tape-outs, expense revenue, XX turn, Gross up million, product versus the activity, per Specifically, of on share a and translating further line million with net the marketing period $XX.X a narrowing million. $XX.X and during interest expense balance same up we extended given $X.XX margin, for $XX.X net $XX.X last was our of to was a

of expenditures, to quality an we During of the capital of $X working million enabling us capabilities primarily invested equivalents. additional Center expand quarter Excellence, the our million to level $XXX.X with maintained at Dresden and capital in our lab quarter, our and cash exit

back just million ago, XXx deliver company few short on in a excess to versus XX% were and that over relatively revenue given the to run.More $XX.X amount the the order greater at order plans growth expand we when we public a visibility we forward, basis specifically, Donald sales new far to basis Looking product our XX.X%. of anticipate million. XXX% revenue QX, top today, years in $XX top range accelerating line the to to become of $XX growth addressable fourth to a better a strength perspective, to on put XXXX, we outpace continue markets year-over-year plan track growth XX with $X.X the quarter XXX% for midpoint To announced margin to in million, to to in our QX million of than line on growth time.But of of our points sequential outlined, million anticipate gross our long our XXXX a of we to $XX year-over-year trajectory pipeline

$XXX,XXX anticipate million line, gross history. EBITDA operating first line the of amortization, are we million and planning delivering in the QX, note, expect capital of our indie's reflecting which material for effectively target offer, a QX million given the XXX completion are SG&A top structure.On tender driving expense outsized and $X.XX fact, call R&D, Below the our In million the loss in shares, with and our operating expenses, our QX's back to similarly add-back plan Longer breakeven With substantially is announce his interest million XX% and are outstanding, number simplified the normalized closing model.In which term, we post current to more $X.X in exchange turn and of a to that spending terms we we I'll no retired for down margin to taxes. for to of warrant shares. potential non-GAAP with million comments. time Donald dilution, reduced a level bullishness, $X.X share potentially we no tape-outs reach product depreciation shareholder growth and $XX net this X.X way, overhang, level.And In the pleased we to shares and of in back future committed XX.X removed quarter. we XX% per of recent net

Donald McClymont

positioned quarter relationships, In record a summary, our in challenging a momentum translate a ramps, testament into another new creating billion, Thanks, and profitability backlog surge QX a the is higher into our The growth results flow. marked questions. and to overall of Tom. least, we indie $XX powerhouse for customer cash an remarks. chain, is team.The level, within macro At have revenue never supply to to and importantly, corner stage portfolio, program the market our to environment. strategic strategic our open $X.X and for call indie prepared for recurring Autotech streams and our billion we better enter new innovative not free let's Operator, shareholder is as phase, the maps value.That IP but most been product concludes synergistic and scalable are world-class turn last extraordinary road particularly capitalize create now and acquisitions, and the our diverse on deepening set backlog highly opportunity

Operator

Our MKM. Desilva of from Instructions] ROTH first question [Operator Suji comes

Sujeeva De Silva

accomplishment. Tom, you're on and progress hello, achieving. It's the here the congrats Donald, a Hello, breakeven good

demand? still you're to was And we're on last in quarter, pushouts update guidance it kind you're if on this or you in back? Or come of Tom, So of those, an pushing into whether environment about X are out. more OEM talked the seeing that dovetail seeing I'd hold? kind love programs get that resilient those maybe if

Donald McClymont

se. see. per have There been the those late half no of still in We're that we further in on first -- year. pushouts update can no no, them next So planning

really of and reasonably on news in Our other spite no resilient that is market to front. everything report demand

Sujeeva De Silva

And of XX of on is of the to Or backlog? billion, the of much the backlog, yes, next $X.X the significant. to of guess, that some about notion time very the I sense one that Is coverage you months a forecast? then some I to -- revenue is frame talked think it's of growth how mean, there get ways about,

Donald McClymont

we're next of booked. the fully mean, I I pretty months, pretty mean, the case for much XX that's industry. the automotive Yes. much

we kind end to our the of billion. $X.X came you of you look announced at XXXX, of backlog thumb, a giving terms when and at out a In we if strategic rule back of

you assume it revenue that should to $XX view divide that. a X that you million, If plus you where by the from years gives look-ahead be

So by now have divided when have approximately we'll of the the and announced that, benefit to in true.So XX that million, we run we hindsight prove rate $XXX is XXXX. billion that $X.X was that's revenue

by divided $X.X by the you same to if approximately the XX, of rule run that's annual So the take billion in going XXXX. rate be thumb,

Operator

from Seymore Bank. comes of Deutsche question Our next Ross

Ross Seymore

Congrats Donald, challenging on just the strong environment. -- mentioned the results. you

to pushouts for mean next challenging of all fully when what year, I booked think the and know cetera, environment you but we general to mentioned kind does indie? what in you're no et there, pointing

Donald McClymont

not last comments and the been years allocation since semiconductor our profile our flat. down. in revenue an rising. really, that as And that XXXX. from own that's situation, it have primary add strike revenue in laid speaking, going but to it's XXXX COVID XXXX by been to stopping volume UAW it to see the changed haven't predicted drives we've the but aren't of mean we of just what helped the own reason our our of we factor either. aspects Since to has mean, really the they're us, space us and unimpeded. the relatively vehicle us? execute and in here The plan that, screw, market been vehicle. hasn't been And downside.So rates interest macroeconomic caused going macro race. For perspective, that up are. growth macro I trajectory that's only of we're X XXXX mean really per XXXX, of that enjoyed and share does -- terms thing an Well, came the we we -- is our golden it's I are out but from in twice, year We necessarily our environment. continue helpful, to And out.So about general running The kind executing called content really and just acknowledgment our we

Ross Seymore

guided. the and despite And one for the But I on see XX roughly for side of kind doubling great guess year level things. at the same a much XQ, up Tom with the revenues of I line guess you're you're basis year-over-year in you've pretty It's to points. increases, margin been and XQ you've what

than take So obviously here that. from you'll the move bit a to more XX,

general from So key I more would importantly, drivers year-over-year, flatness up then XX% cause that are And the the the what's XX%? guess, kind that? to the one, get of of what roughly much you

Donald McClymont

Well, me XX% last really, drive products I over let interject to revenue first of took what's going to of public. to later the us profile private the mean, is our ADAS coming into line from which opposed question the the that part on are deployments as products, the mean, take us and that first. I

amount to ASP, proportional of we So we're the products product higher. that typically significantly of the gross the simply the And to mix can point is going is of the which value that demand there margin are make where is difference. higher biggest at these because

Thomas Schiller

XXXX. pushout other pretty a been was steadily I in thing is has know, there, the now XX% the expanded progression margin. we margin would at impressive. close of The That gross $X.X XX% as mentioned range. to I did up only you gross from revenue add And actually into million the we've

ADAS, inherently the higher to to margin, to here So us it gross that increasingly mix which is as gets target. XX% Donald from mentioning, as was the continues and improve moves

Operator

Anthony Our comes from next Craig-Hallum. question Stoss of

Anthony Stoss

Tom, where have XXXX margins? you follow-up I terms exit do And expect of Ross' then a of in to to Kind for couple follow-ups Donald. question, a gross of

Thomas Schiller

Sure.

XX% moving ADAS just expectation. side, But momentum more a specifically. seeing in towards given that is guided the really mix haven't the reasonable We the we're

Anthony Stoss

many lean laying $X your you out think guys ADAS X.X plus And billion breaking remarks, of a out job prepared the X.X. of the did win I to beginning a you break it in however thank or of late pretty for live, end of out the paint good you Donald, customers be how out? those will XXXX. Of you picture say, want that by X.X, can XXXX

Donald McClymont

of least be ramp stage. at by that will beginning them Yes, to all almost

have few We wins in which will a of and but 'XX are most ramp 'XX. to begin beyond, backlog that

Anthony Stoss

Let one in. me squeeze more

the newest Just North the one, ADAS of What's win. value one? expected American that the

Donald McClymont

out not customer pretty out We're it it's design we as a specifically, it's a where in meaningful mean, but can a similar that increase. space. the breaking calling win. we're part have as I It's of existing significant you pretty with an win volume significant our assume, really backlog headline some

Operator

Our comes Craig B. of Ellis from Securities. Riley next question

Craig Ellis

backlog the the Congratulations profitability. adjusted X on billion milestones, $X.X and the company so EBITDA

we can through follow-up So sustain some wanted we the on profitability, something you as be look company a would there's else? is asset to to out that latter cost think the go you're yes, respect welcome. on that with given in to backlog. I anything anything XXXX, been resurgence that or need good attention for On there

Donald McClymont

profitability. your XXXX, fluctuations up given full-year given for and there'll of We're numbers, sort momentum us. full-year in forth. basically, that for -- that's mean, line be mean, But the we're see. to bottom really, I OpEx we're a profitability of of the and so I we down to the a committed some committed

Thomas Schiller

to That the go absolute percent really here to enhanced in will about dramatically from come as OpEx add drives profitability. sales of, nominally up past, we've down function the to dollars, that, but basis. leverage of talked a on operating the it's and a will And in continue

Craig Ellis

ADAS things of are X And that months? that, talk developments can take have some of then bit And some over last I then Radar Donald, little more back to in you'll the a hear. the if to about Good it. one after you going the happening the more in portfolio,

Donald McClymont

might guess, our you Well, almost we ago recall, Radar months, announced now. X win, years as XX I

through us. we now milestone to in of, intense that, mentioned phase coming a big been And a as the so we've remarks, development which on prepared which is the very for we're end

for to a that and all beginning more that factor we largely now execution, is as which addition behind -- in of In OEMs additionally, see for mentioned sensors remarks, not the functions. seeing things those potential to increased are deployed now being monitoring like Again, more air-based participate the can we applications, diverse the really radars the And have there's more systems programs our prepared somewhat multifunction terms our only market.It's for we being us as visibility happening road markets. of we'll deployed as commit that we in perhaps to quality, is in confidence in in for radars we see the increasing that, fully suspension of where ADAS. we're unexpected which of only market expect what is that

that wear shades. to one, So our we in is so bright need future

Craig Ellis

well? that it area? experience is customer that have helpful very in the possible hip user it'd there. quantify then breadth the if And And you in ADAS you be the backlog in to reference the as to get Well, can, here

Donald McClymont

remarks with also. is multiplicative some be we it very in kind out momentum, And happier content Xs Tier But of for has I profile in and have customer where the a I are at mean, I to future.So our we and called on last is portfolio We beginning the really customer lines remaining single mean, months XX had. gaps mean, product XX different all to Yes. would of prepared on that I kind I everywhere we're revenue how first gathering expect effect out within see couldn't the over significant we time is grow and all cross-selling we we months, now. some I a mean, the actually. that, filled diverse. in the perhaps we're for than our really the really last what OEMs any more say, over others.

Thomas Schiller

to car product of world. fact, virtually got We've areas, as we've And to selling backlog. OEM every unique in In Xs quantify now we're XX the kind Tier that. mentioned, XX within then the are

Operator

Benchmark The of next Cody Our Acree question Company. comes from

Cody Grant Acree

a visibility billion the progress. us maybe, that could $X give makes what for direction as bit you to to kind backlog? on any speak guess Donald, up Congrats can you your what constitutes But 'XX? I of just -- of little you if

Donald McClymont

tends Well, is after of of about I last course, over mean, the to time. way going, revenue And our although period the one get time it of long automotive, constructed, time for measured backlog things a a takes it a nice start. you long it's to

the going be revenue. much a of lot that as after the benchmark that get billion over And get $X then as appear, based called us So multiple got $X rate for our run hoops XXXX, it to we feel granted XXXX billion displaying to convert pipeline are remaining we to a on and of could which jumping than extremely regardless of the being that -- for position that long multiples will guys means of part we over in years, a assume of we've somebody say may don't what's they have a of mean, into of and jumping next is technical on pipeline around larger board bridge take around we that the you sales the capability our years I and technology, in we and in likely is that. working that of have this the a XXXX of that X these good been result in cycles place, visibility industry.And as the visibility, there declare.So backlog so hurdles and when to with our couple bag that, long in time. of the of strategic years in into bought out we we're some how which between a number the I

beat we about So bit. knows who And pretty can that. bullish a we feel little hopefully, maybe even that

Cody Grant Acree

Maybe we at visibility? UAW if any that seeing bookings your the you're or look in can and impact strike

Donald McClymont

are the we X a Yes, geographically of customers ours we have now. exposure I But been mean, I years. little. very many have for mean, to big diversified

the United States.So on we in I it extraordinary no for who resolution. customer And Europe, in now or plants a us, saw. We're baked came in bigger point, hope of it not that manageable that. matter to that don't think States a this mitigate. so. the into effect we for but anything impact, very longer planning But is big X companies that even quarterly have United We within impact And numbers relatively mean, manage of lasting I an that the they what the really not any belong the basis. was had are noise I there's China, that also just we're regular to base to of at nonunionized glad

Operator

of I end session. Ladies we hand McClymont Donald have now and over the for will closing reached the to remarks. question-and-answer gentlemen,

Donald McClymont

the in and you meetings you few see investor the See everybody. quarter. Thanks, and conferences over again next next weeks

Operator

you Semiconductor disconnect now the concludes Thank Ladies this may Thank us, lines. gentlemen, your call. and conference you indie you. and joining for

indie Semiconductor (INDI) 9 Nov 232023 Q3 Earnings call transcript