Amnon Shashua: Beyond Volkswagen that launched a year ago with a 12 versus 2.5, we have now two additional OEMs with big programs with cloud enhanced ADAS, and it’s ramping-up. I believe at the end of the day, every carmaker with a front-facing camera would include also as an option maybe higher trim option and enhanced ADAS, because it doesn’t add any hardware to the mix, it’s just a software update and it makes a lot of sense. But by increasing significantly increasing the ADAS capability by having the data from the cloud, about where the landmarks are, the drivable path location of the traffic lights, association of traffic light, drivable path, all of this creates new opportunities for enhancing driving assist at quite a reasonable cost of few tens of dollars for car per year, something like that.
Samik Chatterjee: Okay and for the follow-up. We get a lot of questions about sort of how to think about performance in the recession and if the backdrop was to get worse. I know you talked about sort of tapering some of the OEM demand that you’re seeing in terms of volumes. But how are you sort of thinking about the likelihood of pushouts, particularly a program, the plan towards the end of the year, pushing out timelines in terms of launches or adoption of certain programs. And also how would you sort of flex your OpEx in this scenario that macro does being a bit worse? Thank you.
Dan Galves: Yes so, I mean – this is Dan. Obviously, we’re susceptible to swings in global production a bit by, as you’ve seen in the past years we’re growing so much faster than overall production, that is not as big of an impact to us as probably to others. We acknowledge kind of the risks around production and that’s why we set our forecast to basically flat to 1% global production growth, even though – and set our volume forecast below the orders and commitments we’ve gotten from our customers. We’re definitely not hearing about any kind of like push-out of programs or anything like that and also we have the driver of adoption growth that wouldn’t impact us too much as well, but not hearing, just to be clear, not hearing anything about that.
So overall like, we’ve done well in all kinds of environments over the last 10 years. And yes, that’s so that’s – and in terms of flexing operating expenses, I don’t think we would. I think that our business is built for the long-term to drive content per vehicle growth to drive new solutions for the next 10 years plus. So, I don’t think we would pull-back on operating expenses.
Samik Chatterjee: Got it thank you. Thank you very much.
Dan Galves: Thanks, Samik.
Operator: Our next question comes from the line of Luke Junk with Baird. Please proceed with your questions.
Luke Junk: Good morning. Thanks for taking the questions. First, wanted to ask so we’ve talked about SuperVision quite a bit, cloud-enhanced ADAS as well, I’m wondering about EyeQ Kit if we could discuss the evolution of those conversations with customers. How that’s developed over the past six-plus months, let’s say. And could it or has it been intersecting with SuperVision at all with these customers?
Amnon Shashua: Yes, indeed. All the advanced system Chauffeur and SuperVision, EyeQ Kit comes as a critical component, especially when you talk about the Chauffeur, some of the SuperVision programs include also EyeQ Kit some do not. But EyeQ Kit is becoming a major component in our discussions of advanced system. So advanced system is something beyond the SuperVision and beyond.
Luke Junk: Thank you for that. And for my follow-up, I just wanted to ask a question on near-term expectations. So in light of the component issue that you said with SuperVision, which sounds like it’s, just timing and the timing of expenses, are there any additional guardrails we should be keeping in mind when it comes to near-term especially first quarter expectations? Thank you.
Dan Galves: Can you repeat the question, Luke? Sorry about that.
Luke Junk: Yes, sorry about that. So the question is in terms of the first quarter, on the financial side of things, so clearly want to be looking at timing around SuperVision and component availability expense timing as well around R&D. Just wondering if there’s, any additional guardrails or things that would be specific to the first quarter we should be keeping in mind beyond just the revenue waiting first half versus second half, let’s say? Thank you.
Dan Galves: Yes I mean, I think we covered that. We think Q1 revenue will be below Q4. We’re not going to get more specific than that, and kind of talked about the reasons I mean, every year we have more revenue in the back half versus the first-half we do think it’s going to be a little bit more pronounced this year, because of the constraints on SuperVision supply in the first-half as well as. We do think that there was some additional buying of EyeQ before the price increase, which I think is natural, we don’t think it was major, but that’s our read of why Q1 is a little bit below Q4, I hopefully that gives you enough information. Thanks, Luke.
Operator: And our next question comes from the line of Rajvi Gill with Needham & Company. Please proceed with your question.
Rajvindra Gill: Yes, thank you and congratulations on great results. A question on the ASPs you mentioned that third of your revenue growth last year came from higher ASP growth, and this appears to be a very strong kind of investment thesis of your ASPs kind of move higher. How do we think about the balance between kind of unit growth versus ASP growth as you kind of ramp-up more of the SuperVision products?
Amnon Shashua: I mean, I think – you want to take that?
Anat Heller: So and that – there is a big difference between ASP of EyeQ and SuperVision therefore when you’re going with the volume of SuperVision, you don’t need to grow a lot in order to produce these – or generate this high revenue. So there’s a big difference there and we think that as we go further, with a higher SuperVision in the mix, you will see this ASP continue to grow.
Dan Galves: Exactly I mean, I think we have a lot of visibility on content per vehicle growth the design-wins that we achieved in 2022 came in at $105 per unit. On a blended basis, right, that’s a mix of base EyeQ, cloud-enhanced ADAS, SuperVision. SuperVision was definitely the biggest contributor to the year-over-year growth in ASP that we saw in Q4. Even though it was 0.5% of the volume and like we said in the prepared remarks. We see a trajectory to the low 60s in the back half of 2023, still with really one customer, plus an additional Geely brand in the back half. So a very powerful driver and the fact that Chauffeur is becoming a bigger part of the discussions with OEMs, brings even more potential upside in the future. It takes time to play out like everything in this business, but we’re feeling really good about the content per vehicle trajectory.
Rajvindra Gill: Appreciate that. And for my follow-up, a lot of the questions we receive from investors is, trying to analyze the evolving competitive landscape with very large semiconductor suppliers, as well as some niche competitors that are developing certain types of computer vision application? So I’m wondering as you are increasing the content per vehicle as you’re adding and kind of upgrading and upselling your customers to higher levels of autonomy, how do you currently see the competition and how do you foresee it evolving as OEMs going to adopt higher levels of autonomy? Thank you.
Amnon Shashua: I think when you go to those, high level of complexity of systems, the semiconductor is really a small part of the mix. You have so much on top of the semiconductor. You have the perception software, the driving policy software, the control of the car software, the mapping, the integration of all of them together it is way, way beyond a semiconductor business even when you talk about the basic ADAS, which is a front-facing camera with a chip behind it. The optimization and the economy of scales over the last decade of this particular product, makes it very, very unlikely to a newcomer to gain market share. It’s highly optimized the validation as it’s very, very expensive, requires hundreds of petabytes of data to properly validate.
And if you don’t have any disrupting new idea there, being able to take market share in that particular highly optimized business is very, very unlikely and less incumbent for some reason stops to deliver and I don’t see us stopping to deliver. So really the game in terms of market share is on the complex systems, SuperVision and beyond. I think there Mobileye is clearly at a very, very leading position a SuperVision type of a product, I don’t see anything outside of the Tesla FSD that even comes close to it. And we are having a very strong traction for it, more and more carmakers more brands. Chauffeur is another step-up. So this is where the competitive game is going to be not on the low end ADAS. And there it’s way beyond a semiconductor business.
Dan Galves: Thank you, Rajvi.
Rajvindra Gill: Appreciate that. Thank you.
