So, yeah, more OEMs are getting active of what are all the features that LiDAR can actually incorporate in there. And to be clear, we make the LiDAR, we do perception software in there that aids it. They develop the automatic emergency braking and those kind of safety features plus high-speed highway driving features, right? So, we support them, but LiDAR naturally can support them much easier than other technologies. But other technologies have been around. If they operate at lower speeds and OEMs want higher speed, they’re going to evaluate those other technologies as well in LiDAR. But I very strongly believe that if you’ve ever really worked with the LiDAR data stream, if you’ve been around engineers that work with LiDAR, it is so much easier to do it with the LiDAR data stream.
Kevin Garrigan: Okay. Got it. That makes sense. Okay. Perfect. Thanks, guys.
Anubhav Verma: Thanks, Kevin.
Operator: Thank you. I will now turn this call back over to Anubhav Verma to read questions submitted through the webcast. Thank you.
Anubhav Verma: Thank you. So, the first question is, why has there been a lack of any communication from the company since February 29? And are there expectations of further delays in the RFQ decision making timeline? And how is MicroVision adapting to these changes? Do you expect to add to the RFQ pipeline?
Sumit Sharma: Well, I’ll answer the last one first. Yes, we do expect to add to the RFQ pipeline. We already have a couple of line of sights to RFQs for both MOVIA and MAVIN that we’re starting to engage. Our team is going to be flying globally to go support the OEM in the early stages as they start developing their plans. As far as like what’s the delay since February 29, we had our earnings call. And as I mentioned early on, when Andres asked the question, we were engaged, very actively working with them. You really have to stay silent till you know what’s going on. And it was just — you can imagine, like — if you go back and read the transcript, where they are the things that they’re offering, it is — it was very, very confusing times.
You really wanted to make sure that you got to a point where you can get some sort of agreement or really understand what is on the table, and then communicate. And as we got closer to the earnings call, here we are to announce — to let you know exactly what that one RFQ is. The other one is actually was for the MOVIA S. I think that was — to be honest with you, it was — OEM was pretty clear about it, that it’s their product strategy for different regions. And that one really perhaps was — it could come up live, it could change, because their own strategy is changing within, right? It’s not clear. They just wanted to give us like, “Hey, don’t call me every week and ask me what this is going to be, but just give us some time to go figure that out, right?” So, I think it made the most sense to get on the earnings call and talk about it with the color because you can’t really do this much of color in a short press release or a small comment.
Anubhav Verma: Thanks, Sumit. The next question is, last year at the Retail Investor Day, MicroVision reiterated that the company is very far ahead of the competition and it would take years for them to catch up. Does this statement still hold true? And if it does, the OEMs are still keeping their bar standard high, or are they lowering it to accommodate more choice in suppliers?
Sumit Sharma: Yeah. It is 100% true, and I’ll give you an example. These seven RFQs we’re talking about that MAVIN is part of, we have to dumb down MAVIN to be in the middle of it. I mean, it’s — there’s things that we have to do, but we can certainly do it, right? I mean, there’s nothing new development. It’s just new calibration, new firmware, new development for us as part of our ASIC, so it’s not that big of a deal. But as you can imagine, right, as I always said, right, it is best-in-class, so far ahead. When you get into these RFQs, nothing has been thrown at us that requires us to meet it. If anything else, we’ve been brought towards the mean. We’re not at one end of the bell curve anymore, right? We’re kind of brought towards the median, towards everybody else, saying, how would you do this?
What’s your cost structure? What’s your size? What’s your performance? Right? So, yeah, you have to compete in that range, because they want to make sure that the advantageous solutions are, of course, size and power, things like that. But the base specifications of range and resolution, they want to make sure that you meet and exceed it. Whereas, all the requirements that we have, we don’t really look for exceptions. Whereas I believe — what I believe is, like, others have to have some exceptions into some of the things that they’re asking for, in case that there was an actual incumbent, with that specs that we have to meet. So, it’s clear to us like the gap that our competition has sometimes because the spec that we see that was created for the incumbent, right, it clears that we can do that, and this was your original requirement, we can meet that as well.
So, again, you have to be humble. You work with them. They are the customer. You have to whatever their strategy is, if they develop a very specific software, like for example, the dynamics in LiDAR offers something a huge advantage, a very, very huge advantage, but it would take up a period of time for people to actually realize that advantage because they would have to work on software slightly differently. But if they want us to do a static — one single static field of view because that’s how their software has been written so far and they don’t want to rewrite companies with the software, we can do that. We can give them the best that it’s ever going to be. But if they need something else that actually eases their path for integration, of course, we support that.
So, yeah, what was said about MAVIN, right, I mean, that’s going to stand the test of time. It’s going to be a long, long, long time before we have to redesign it. I think there’s a question I recently got from somebody that I met about monostatic LiDAR, I may have mentioned long time ago, “Are you guys developing that?” And in this OEM meeting, I clearly said, what I have far exceeds what you need. I can meet your cost structure. I can meet your power structures. There’s no need for that, right? So, it’s a futuristic product that — if there was volume then we would invest in it. But right now, we meet size, performance, exceed everything that you have. So, therefore, at this moment for MAVIN, we want to finish our B-sample. We want to get the industrialization done.
We have the automation that’s going to be placed in. We can get some samples for you, get the reliability test started. And that’s the basis from which we’re going to do. We’re not going to enter a new redesign for that because there’s no need for it at the moment, right? And I didn’t get much pushback. So, I still believe the statement that’s made is totally valid. I have no reservation in saying that.
Anubhav Verma: Thanks, Sumit. So, over a year later since the Investor Day, how does MicroVision feel about its market position given both Innoviz and Luminar have publicized new slimmer units to fit behind the windshield? So, let me get the market perspective and maybe you can handle technical perspective. I think what the markets — the way markets are reacting to these announcements are I think it’s evident in the stock price, right? And I think this was also in response to my — to — response to the question Cantor raised before that I don’t think the markets is giving any credit to anything that’s being said for publicity, because at the end of the day the numbers are speaking for themselves, right? As I described the market cap of these LiDAR companies which have announced $1 billion awards, they are trading lower than the market value of before the awards, right?
What that means is the market is discounting these awards and is predicting that this is destruction in value since the time they signed up for the awards. And if I can simply — that’s a lot of complicated financial jargon, but if I can simply break it down how the game is going to be played is, is about how do you navigate these years when your revenue and your costs are mismatched. So at this point, I don’t think any LiDAR company can afford to spend on new developments because they have to perfect what they’ve got. Recently, we saw in the Q1 announcement that companies are spending more on the industrialization by depending on third parties rather than doing it in-house. So, in my mind this model becomes unsustainable and that’s sort of why it’s reflective in the valuation of these companies.
However, I think the question — I keep going back to the point that, yes, even while that’s happening with the other players, what we have got to do is make sure sign up for good deals and making sure our survivability or we make sure our runway, our cost structure is palatable which can support the scaling of the business because when these millions of volumes of units arrive, you want to be there to catch them all when some — because you have seen a few LiDAR companies fall off the map and this will continue to happen. You just got to be there when this happens, because, as Sumit described, our product, in my mind, still beat and meets the expectations of all the RFQs that we are in.
Sumit Sharma: Yeah. And I think us compared to the other size and stuff, I think everybody wants me to comment on that. Like first of all, I would like to say, this is our earnings call for MicroVision, right? I would rather talk about us. I would love to come out here and talk about a partnership that has formed and what that all means, right? I think I would welcome that day. The problem we have right now is not technology, it’s a business problem we’re working on. As far as — so like, let me separate it, then I’ll get back to the business problem in a second. If you look at our technology, hands down, where it’s going to win, is when I walk into a room like that, I talk about a wafer, that our MEMS comes from a wafer, and we have lasers coming from this and these are all semiconductor technologies for MOVIA and MAVIN.
Those guys are still coming in with a box, which has got a glass prism rotating and a little galvo moving. What is the steering technology? So, everybody talks about it, right? But can everybody talk what’s under the hood? Some of them are still doing CAD and Photoshop, and they’re talking about samples. Others have actually started with the MEMS, and it was too hard, so they went away and now they’re in the galvo space in their next generation. So, what you don’t know is who’s going to win long term. So, yeah, people have made announcements, they have market support, they have analyst support, like whatever they have. At the end of the day, you have to have the product to win and the product — the simplest product should win in the market.
But the hard thing is, those companies through de-SPAC were able to raise a significant amount of money, right? We still go trickle by trickle, year by year, right, because we are an older company and we have different constraints. And to be honest with you, I’m sure you guys are sick of hearing about it and I’m pretty sick of talking about it, I don’t want to talk about anybody else. I really want to talk about what we’re working on, right? And this is a business problem now that when you deal with the OEMs, you have lots of people in the company, lots of money to be — just sitting around in a bank, then you could probably go strike a deal and then you can, like, plaster it up and talk about it anyway to the market because you can’t really talk about what’s underneath it and you make it complicated for others.
But I focus myself and my energies and the company’s energies to focus on the real problem to solve to get a real customer that is actually going to turn things around for us long term, right? And I’m absolutely certain of it. The technology and the work that’s been done to our team in Hamburg and the team here in Redmond has been saying the test of time. And at the end of the day, when you think about who wins, it’s going to be somebody that’s talking about a wafer level stuff. It’s not talking about like galvo. It’s as open as I am of talking about the technology, right? Now, all I have to do is get an OEM to agree to these things and move on with that, and that’s what I’m going to focus on.
