Financial Data and Key Metrics Changes - The company reported a GAAP net loss of $9,300,000 or $0.48 per share in Q2 2025, an increase from a net loss of $8,000,000 or $0.46 per share in Q2 2024 [22] - Non-GAAP net loss was $6,700,000 or $0.35 per share in Q2 2025, compared to a non-GAAP net loss of $5,500,000 or $0.31 per share in the prior quarter [22] - Cash burn decreased to $7,100,000 in Q2 2025 from $8,100,000 in Q1 2025, despite one-time expenses [20][22] - The company ended the quarter with cash, cash equivalents, and marketable securities of $19,200,000, which has since more than tripled [22][23] Business Line Data and Key Metrics Changes - The company has signed six revenue-generating contracts in Q2 2025, tripling the number of contract wins from two in the previous quarter [19][40] - The sales funnel has grown significantly, leading to 30 new potentially high-value customer engagements [7][19] - The launch of Optus, a next-generation platform, has been deployed to multiple customers, enhancing the company's ability to scale efficiently [7][12] Market Data and Key Metrics Changes - The company is seeing strong traction in various sectors including defense, smart infrastructure, rail, trucking, aviation, and security, indicating a diverse market presence [16][40] - The integration with NVIDIA's DRIVE AGX ecosystem is expected to accelerate OEM collaborations and expand market reach [17][30] Company Strategy and Development Direction - The company aims to transition from product development to active sales and deployment, focusing on delivering differentiated products that gain market traction [25] - The capital light financial strategy allows the company to maintain low operating costs while driving significant scale [13][20] - The focus on physical AI and the integration of third-party software solutions through Optus is expected to enhance market opportunities [12][70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline, with over 100 potential customers actively engaged and 30 in advanced negotiations [19][60] - The company anticipates modest top-line revenue growth for the remainder of the year but emphasizes the importance of accelerating customer engagements [19] - Management highlighted the importance of maintaining a disciplined approach to capital allocation while scaling operations [23][86] Other Important Information - The company has secured a $30,000,000 opportunity with a top global transportation OEM, expected to contribute to revenue this year [6][48] - The total potential liquidity, including cash and credit facilities, is approximately $126,000,000, providing a strong foundation for future growth [23][84] Q&A Session Summary Question: Can you provide more details on the Navidion integration? - The integration with NVIDIA has positioned the company at the top of performance benchmarks, simplifying conversations with OEMs and enhancing credibility [29][30] Question: Can you elaborate on Optus and its role in the broader strategy? - Optus combines sensing and analytics, allowing for tailored AI solutions and rapid deployment across various markets, filling the gap while automotive ramps up [34][35] Question: What is the status of the customer pipeline? - The company has over 100 engaged customers, with 30 in advanced negotiations, and is seeing traction across diverse industries [40][60] Question: Are there additional deliverables for the $30,000,000 opportunity? - The company is on the customer's timeline for integration and deployment, actively working on the project [48][49] Question: Can you provide insight into the sales and marketing expenses? - The increase in sales and marketing expenses is primarily due to reallocating funds from G&A and R&D, rather than new incremental spending [53] Question: What does "physical AI" mean in the context of the company's strategy? - Physical AI refers to the interaction of AI and sensing with the real world, extending beyond automotive applications [70] Question: Is the company looking to partner with defense contractors? - The company is open to partnerships with defense contractors and is actively pursuing opportunities in that sector [76][81]

Business Highlights - AEye tripled new business wins from 2 to 6, with visibility to additional non-automotive orders totaling thousands of units[18] - A leading transportation OEM selected AEye for a potential $30 million revenue opportunity[18] - AEye launched OPTIS™ powered by NVIDIA Jetson Orin, securing multiple deployments in airport safety and security, perimeter monitoring, and transportation logistics[18] - AEye is fully integrated into NVIDIA DRIVE AGX Orin platform, potentially driving expanded engagement with leading OEMs and paving the way for Hyperion integration[14] - AEye was chosen for GM-sponsored WinTOR initiative, creating the potential for a significant sourcing advantage for future OEM programs[16] Financial Performance - GAAP Net Loss for Q2 2025 was $(9.3) million, with a GAAP EPS of $(0.48)[29] - Non-GAAP Net Loss for Q2 2025 was $(6.7) million, with a Non-GAAP EPS of $(0.35)[29] - Net Cash Used in Operating Activities for Q2 2025 was $(6.4) million[29] - Cash, Cash Equivalents, and Marketable Securities totaled $19.2 million[29] Financial Outlook - The company expects FY 2025 cash burn to be within the previously communicated range of $27 million to $29 million[31]

[Second Quarter 2025 Results Overview](index=1&type=section&id=Second%20Quarter%202025%20Results%20Overview) AEye achieved significant commercial traction with new business wins and a potential $30 million OEM contract, ending Q2 2025 with $19.2 million cash and $7.1 million cash burn [Recent Business Highlights](index=1&type=section&id=Recent%20Business%20Highlights) AEye achieved significant commercial traction in Q2 2025, tripling new business wins and securing a potential $30 million OEM contract - Tripled new business wins from 2 to **6 in 2025**, with visibility to additional non-automotive orders potentially totaling thousands of units[1](index=1&type=chunk)[5](index=5&type=chunk) - Secured selection by a leading global transportation OEM for a potential **$30 million revenue opportunity**, expected to begin generating revenue this year[4](index=4&type=chunk)[5](index=5&type=chunk) - Fully integrated into NVIDIA DRIVE AGX Orin platform, driving expanded engagement opportunities with leading OEMs[4](index=4&type=chunk)[5](index=5&type=chunk) - Launched OPTIS™, powered by NVIDIA Jetson Orin, and secured multiple deployments in airport safety and security, perimeter monitoring, and transportation logistics[4](index=4&type=chunk)[5](index=5&type=chunk) - Chosen for GM-sponsored WinTOR initiative, creating the potential for a significant sourcing advantage for future OEM programs[4](index=4&type=chunk)[5](index=5&type=chunk) [Recent Financial Highlights](index=2&type=section&id=Recent%20Financial%20Highlights) The company ended Q2 2025 with **$19.2 million** in cash and equivalents, with a **$7.1 million** cash burn - Cash, cash equivalents, and marketable securities were **$19.2 million** as of June 30, 2025[7](index=7&type=chunk)[12](index=12&type=chunk) - Cash burn excluding net financing proceeds in Q2 2025 was **$7.1 million**[12](index=12&type=chunk) - GAAP net loss in Q2 2025 was **$(9.3) million**, or **$(0.48) per share**, based on **19.1 million** weighted average common shares outstanding[12](index=12&type=chunk) - Non-GAAP net loss in Q2 2025 was **$(6.7) million**, or **$(0.35) per share**, based on **19.1 million** weighted average common shares outstanding[12](index=12&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted the transition to sustained growth, driven by an expanding sales funnel, strategic partnerships, and strong financial discipline [Management Commentary Details](index=1&type=section&id=Management%20Commentary%20Details) Management highlighted the transition to sustained growth, driven by an expanding sales funnel, strategic partnerships, and strong financial discipline - AEye reached a critical inflection point in Q2 2025, moving beyond the development phase to deliver sustained growth[4](index=4&type=chunk) - The sales funnel has grown exponentially, with active engagement with more than **100 potential customers** and **six new contracts** signed in 2025[4](index=4&type=chunk) - Apollo's selection by a leading global transportation OEM represents a potential **$30 million opportunity**, expected to contribute to revenue this year[4](index=4&type=chunk) - Apollo is certified as part of NVIDIA's DRIVE AGX Orin platform and selected for the GM-sponsored WinTOR program, underscoring AEye's leading position in automotive markets[4](index=4&type=chunk) - The launch of OPTIS™ unlocks expansion into high-value applications like intelligent transportation systems, airport safety and security, perimeter security, defense, and transportation logistics, with multiple deployments already secured[4](index=4&type=chunk) - The company ended Q2 with **$19.2 million** in cash, cash equivalents, and marketable securities, which has more than tripled since then, positioning AEye to capitalize on growing customer demand[7](index=7&type=chunk) [Company Information](index=2&type=section&id=Company%20Information) This section provides an overview of AEye's lidar technology and details for the Q2 2025 investor conference call [About AEye](index=2&type=section&id=About%20AEye) AEye is a pioneer in software-defined lidar technology, offering solutions for autonomy, infrastructure, and security - AEye offers unique software-defined lidar solutions that enable advanced driver-assistance, vehicle autonomy, smart infrastructure, security, and logistics applications[10](index=10&type=chunk) - AEye's flagship product, Apollo, is recognized for its small form factor and ability to detect objects at up to **one kilometer**[10](index=10&type=chunk) - AEye also offers a full-stack solution through its OPTIS™ platform, which captures high-resolution 3D images, interprets them, and provides real-time direction[10](index=10&type=chunk) [Conference Call and Webcast Details](index=2&type=section&id=Conference%20Call%20and%20Webcast%20Details) AEye management hosted an investor conference call on July 31, 2025, to discuss Q2 2025 results - AEye management webcast its investor conference call on July 31, 2025, at **2:00 p.m. Pacific Time (5:00 p.m. Eastern Time)** to discuss Q2 2025 results[9](index=9&type=chunk) - The call was hosted by AEye CEO Matt Fisch and CFO Conor Tierney[9](index=9&type=chunk) - The webcast and accompanying slides were accessible via the company's website at https://investors.aeye.ai/ and https://aeye.pub/4nGHVGn[9](index=9&type=chunk)[10](index=10&type=chunk) [Financial Outlook](index=2&type=section&id=Financial%20Outlook) The company provides its financial outlook for 2025, including expected cash burn [2025 Financial Outlook](index=2&type=section&id=2025%20Financial%20Outlook) AEye expects full-year 2025 cash burn to be between **$27 million** and **$29 million** - AEye expects cash burn for full year 2025 to be within the previously communicated range of **$27 million to $29 million**[8](index=8&type=chunk) [Non-GAAP Financial Measures](index=2&type=section&id=Non-GAAP%20Financial%20Measures) This section explains and reconciles non-GAAP financial measures used to assess the company's performance [Non-GAAP Measures Explanation and Definitions](index=2&type=section&id=Non-GAAP%20Measures%20Explanation%20and%20Definitions) Non-GAAP measures provide additional insight into performance, with definitions for non-GAAP net loss and Adjusted EBITDA - Non-GAAP measures provide additional insight into the Company's on-going performance and enable more meaningful and consistent period-to-period comparisons[11](index=11&type=chunk) - Non-GAAP net loss is defined as GAAP net loss plus stock-based compensation, stock issuance and debt issuance costs, change in fair value of convertible note and warrant liabilities, expenses related to contested proxy, and loss (gain) on termination of operating lease, net[14](index=14&type=chunk) - Adjusted EBITDA is defined as non-GAAP net loss plus depreciation and amortization expense, less interest income and other, plus interest expense and other, plus provision for income tax[14](index=14&type=chunk) [Reconciliation of GAAP to Non-GAAP Financial Measures](index=8&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) This table reconciles GAAP net loss to non-GAAP net loss and Adjusted EBITDA for Q2 2025 and 2024 Reconciliation of GAAP to Non-GAAP Financial Measures (in thousands, except per share data) | Metric | Q2 2025 (3 months) | Q2 2024 (3 months) | YTD 2025 (6 months) | YTD 2024 (6 months) | | :------------------------------------------------ | :------------------ | :------------------ | :------------------- | :------------------- | | GAAP net loss | $(9,270) | $(7,987) | $(17,286) | $(18,206) | | Non-GAAP net loss | $(6,670) | $(6,232) | $(12,159) | $(13,439) | | Adjusted EBITDA | $(6,891) | $(6,489) | $(12,542) | $(14,177) | | GAAP net loss per share (basic and diluted) | $(0.48) | $(1.16) | $(0.95) | $(2.80) | | Non-GAAP net loss per share (basic and diluted) | $(0.35) | $(0.91) | $(0.67) | $(2.07) | | Shares used in computing GAAP net loss per share | 19,125,970 | 6,874,454 | 18,137,050 | 6,499,089 | | Shares used in computing Non-GAAP net loss per share | 19,125,970 | 6,874,454 | 18,137,050 | 6,499,089 | [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section contains forward-looking statements regarding future events and trends, subject to risks and uncertainties [Forward-Looking Statements Disclaimer](index=3&type=section&id=Forward-Looking%20Statements%20Disclaimer) This disclaimer outlines forward-looking statements, their inherent risks, and the company's policy on updates - Forward-looking statements are predictions about future events based on current expectations and assumptions, subject to risks and uncertainties[13](index=13&type=chunk) - Specific forward-looking statements include potential benefits from NVIDIA DRIVE AGX Orin platform integration, potential **$30 million** revenue from a leading transportation OEM, visibility to additional non-automotive orders, market opportunities for Apollo and OPTIS™ products, and the Company's expected cash burn for full year 2025[13](index=13&type=chunk) - Many factors could cause actual future events to differ from forward-looking statements, including program delays, market conditions, and regulatory changes[13](index=13&type=chunk)[15](index=15&type=chunk) - Readers are cautioned not to put undue reliance on forward-looking statements; AEye assumes no obligation and does not intend to update or revise these statements[16](index=16&type=chunk) [Consolidated Financial Statements (Unaudited)](index=5&type=section&id=Consolidated%20Financial%20Statements%20%28Unaudited%29) This section presents the unaudited consolidated financial statements, including balance sheets, statements of operations, and cash flows [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) The balance sheets show AEye's financial position, with total assets decreasing from **$27.12 million** to **$22.10 million** Consolidated Balance Sheet Highlights (in thousands) | ASSETS | As of June 30, 2025 | As of Dec 31, 2024 | Change | | :------------------------ | :------------------ | :----------------- | :----- | | Cash and cash equivalents | $2,374 | $10,266 | $(7,892) | | Marketable securities | $16,836 | $12,012 | $4,824 | | Total current assets | $20,412 | $25,171 | $(4,759) | | Total assets | $22,102 | $27,120 | $(5,018) | | LIABILITIES | | | | | Total current liabilities | $10,587 | $11,307 | $(720) | | Total liabilities | $11,920 | $11,996 | $(76) | | STOCKHOLDERS' EQUITY | | | | | Total stockholders' equity | $10,182 | $15,124 | $(4,942) | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) The statements of operations detail revenue, gross loss, and net loss for Q2 and YTD 2025 compared to 2024 Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q2 2025 (3 months) | Q2 2024 (3 months) | YTD 2025 (6 months) | YTD 2024 (6 months) | | :-------------------------------------- | :------------------ | :------------------ | :------------------- | :------------------- | | Revenue | $22 | $32 | $86 | $52 | | Cost of revenue | $108 | $160 | $204 | $423 | | Gross loss | $(86) | $(128) | $(118) | $(371) | | Total operating expenses | $8,619 | $8,128 | $15,387 | $18,616 | | Loss from operations | $(8,705) | $(8,256) | $(15,505) | $(18,987) | | Net loss | $(9,270) | $(7,987) | $(17,286) | $(18,206) | | Net loss per common share (basic and diluted) | $(0.48) | $(1.16) | $(0.95) | $(2.80) | | Weighted average common shares outstanding | 19,125,970 | 6,874,454 | 18,137,050 | 6,499,089 | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statements detail operating, investing, and financing activities for the six months ended June 30, 2025 Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | YTD 2025 (6 months) | YTD 2024 (6 months) | Change | | :------------------------------------ | :------------------ | :------------------ | :----- | | Net cash used in operating activities | $(14,158) | $(14,241) | $83 | | Net cash (used in) provided by investing activities | $(4,686) | $2,993 | $(7,679) | | Net cash provided by financing activities | $10,952 | $5,531 | $5,421 | | Net decrease in cash, cash equivalents and restricted cash | $(7,892) | $(5,717) | $(2,175) | | Cash, cash equivalents and restricted cash at end of period | $2,374 | $13,365 | $(10,991) | [Investor Relations Contacts](index=9&type=section&id=Investor%20Relations%20Contacts) This section provides contact information for investor relations inquiries [Investor Relations Contact Information](index=9&type=section&id=Investor%20Relations%20Contact%20Information) Contact details for investor relations, including agency and company representatives, are provided - Agency Contact: Evan Niu, CFA, Financial Profiles, Inc. (eniu@finprofiles.com, 310-622-8243)[21](index=21&type=chunk) - Company Contact: AEye, Inc. Investor Relations (info@aeye.ai, 925-400-4366)[21](index=21&type=chunk)

Company Overview - AEye stock (NASDAQ: LIDR) experienced a significant increase of nearly 240% in July, although it has since retraced by approximately 12% in the last five trading days [1] - AEye specializes in developing adaptive LiDAR systems for advanced driver-assistance systems (ADAS) and autonomous driving capabilities [1] Compliance and Investor Confidence - The company regained compliance with Nasdaq's minimum bid price requirement in late July 2025, closing at or above $1.00 for 10 consecutive trading days, which likely boosted investor confidence [3] - Increased trading volume has been observed over the past month, indicating heightened investor interest [3] Strategic Collaborations - AEye's Apollo lidar sensor has been integrated into Nvidia's DRIVE AGX platform, which is widely used for enabling autonomous and semi-autonomous driving capabilities [4] - This collaboration provides AEye access to a growing ecosystem of OEMs and Tier 1 suppliers, enhancing technical validation and reducing customer acquisition costs [5] Financial Performance - AEye generated only $64,000 in revenue last quarter, with total sales over the last 12 months declining by 71% to $240,000, resulting in a high price-to-sales ratio of 314x compared to the S&P 500's 3.1x [6] - The company reported a trailing operating loss of $32 million, indicating significant cash burn and a lack of near-term profitability [6] Market Position and Risks - While the partnership with Nvidia is promising, it does not guarantee commercial orders or long-term adoption, as the deal is not exclusive and Nvidia collaborates with other lidar partners [7] - AEye is characterized as a highly volatile microcap stock with a market capitalization of approximately $70 million, suggesting potential risks for investors [7]

Core Insights - AEye's stock surged nearly 50% on October 25, 2023, and has increased over 3x in a week due to a collaboration with Nvidia [2] - AEye specializes in adaptive LiDAR technology for advanced driver-assistance systems (ADAS) and autonomous vehicles [2] Company Developments - AEye's Apollo lidar sensor has been integrated into Nvidia's DRIVE AGX platform, which supports autonomous and semi-autonomous driving functionalities [3] - This integration provides AEye access to a significant ecosystem of OEMs and Tier 1 suppliers in the autonomous vehicle sector [4] Financial Performance - AEye reported trailing twelve-month revenue of only $246,000, with a significant decline in sales of 71% over the past year [5] - The company generated just $64,000 in revenue last quarter, leading to a high price-to-sales ratio of 314x compared to the S&P 500's 3.1x [5] Operational Challenges - AEye faces substantial operating losses, with a trailing operating loss of $32 million and no immediate path to profitability [5] - The partnership with Nvidia, while promising, does not guarantee commercial orders or long-term adoption, as it is not exclusive [5]

Core Viewpoint - AEye, Inc. (NASDAQ: LIDR) has experienced a significant stock surge of 240% at market open, which has since moderated to 149%, indicating strong market momentum for the company [1]. Company Summary - AEye, Inc. is a technology company that specializes in manufacturing lidar sensors, which are critical for various applications including autonomous vehicles and advanced driver-assistance systems [1]. Market Context - The surge in AEye's stock price reflects broader trends in the technology sector, particularly in the lidar and AI markets, which have been gaining traction due to increased demand for advanced sensing technologies [1].

PART I - FINANCIAL INFORMATION [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) For the first quarter ended March 31, 2025, AEye, Inc. reported a net loss of **$8.0 million**, an improvement from the **$10.2 million** net loss in the same period of 2024, with total assets of **$28.8 million** and total liabilities of **$11.8 million** [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, the company's total assets increased to **$28.8 million** from **$27.1 million** at year-end 2024, primarily due to an increase in marketable securities, while cash and cash equivalents decreased significantly to **$5.3 million** from **$10.3 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $5,267 | $10,266 | | Marketable securities | $20,659 | $12,012 | | Total current assets | $26,962 | $25,171 | | **Total assets** | **$28,796** | **$27,120** | | **Liabilities & Equity** | | | | Total current liabilities | $10,769 | $11,307 | | **Total liabilities** | **$11,798** | **$11,996** | | **Total stockholders' equity** | **$16,998** | **$15,124** | - A new current liability for a convertible note of **$3.2 million** was recorded as of March 31, 2025[14](index=14&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For the three months ended March 31, 2025, revenue was minimal at **$64 thousand**, up from **$20 thousand** year-over-year, with the company significantly reducing its net loss to **$8.0 million** from **$10.2 million** in Q1 2024, driven by a **35% reduction** in total operating expenses Q1 2025 vs Q1 2024 Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $64 | $20 | | Gross loss | $(32) | $(243) | | Research and development | $3,490 | $4,532 | | General and administrative | $2,895 | $5,615 | | Total operating expenses | $6,768 | $10,488 | | Loss from operations | $(6,800) | $(10,731) | | **Net loss** | **$(8,016)** | **$(10,219)** | | **Net loss per share** | **$(0.46)** | **$(1.61)** | - Weighted average shares outstanding increased significantly to **17.4 million** from **6.4 million** year-over-year, reflecting share issuances from financing activities[16](index=16&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) During the first quarter of 2025, stockholders' equity increased by **$1.9 million** to **$17.0 million**, primarily due to the issuance of **4.5 million shares** for **$7.8 million** and **$2.5 million** in stock-based compensation, offset by the **$8.0 million** net loss for the quarter - The company issued **4,514,023 shares** under its Common Stock Purchase Agreements for proceeds of **$7.8 million** in Q1 2025[18](index=18&type=chunk) - The accumulated deficit grew from **$373.1 million** at the end of 2024 to **$381.1 million** as of March 31, 2025, due to the quarterly net loss[18](index=18&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities was **$7.8 million**, consistent with the prior year, while investing activities used **$8.6 million** due to increased purchases of marketable securities, and financing activities provided a substantial inflow of **$11.4 million** from a convertible note and common stock issuances, resulting in a net decrease in cash of **$5.0 million** Q1 2025 vs Q1 2024 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(7,803) | $(7,885) | | Net cash (used in) provided by investing activities | $(8,578) | $368 | | Net cash provided by financing activities | $11,382 | $120 | | **Net decrease in cash** | **$(4,999)** | **$(7,397)** | | **Cash at end of period** | **$5,267** | **$11,685** | [Notes To Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20To%20Condensed%20Consolidated%20Financial%20Statements) Key notes highlight the company's early-stage nature, its reliance on raising capital to fund operations, and its assessment of sufficient liquidity for at least one year, with Q1 2025 activities including a **$3.24 million** convertible note issuance, a **$1.4 million** cash settlement of a lease dispute (resulting in a **$1.7 million** gain), and continued capital raising through stock purchase agreements - The company has a history of net losses and negative cash flows, with an accumulated deficit of **$381.1 million** as of March 31, 2025, but management believes its plans to raise capital and manage spending alleviate substantial doubt about its ability to continue as a going concern[29](index=29&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk) - In January 2025, the company issued a senior unsecured convertible promissory note with a principal amount of **$3.24 million** and a warrant to purchase **805,263 shares**, for which the company elected the fair value option[62](index=62&type=chunk)[66](index=66&type=chunk) - The company settled a lease termination dispute in April 2025, involving a **$1.4 million** cash payment and a warrant for **350,000 shares**, which was treated as a subsequent event resulting in a **$1.685 million** gain recorded in Q1 2025[58](index=58&type=chunk)[90](index=90&type=chunk)[91](index=91&type=chunk) - Revenue in Q1 2025 was **$64 thousand**, entirely from development contracts with a European customer, recognized over time, compared to **$20 thousand** in Q1 2024 from prototype sales[82](index=82&type=chunk)[83](index=83&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's early-stage nature, its reliance on Tier 1 automotive suppliers like LITEON for commercialization, and the critical need to raise additional capital to fund operations, having raised **$11.1 million** in gross proceeds in Q1 2025, which contributed to a reduced net loss of **$8.0 million** for the quarter - The company is an early-stage entity with a history of losses and is dependent on raising additional capital to fund operations and achieve commercialization of its lidar solutions[96](index=96&type=chunk)[98](index=98&type=chunk) - Key strategic initiatives include leveraging its Tier 1 partner, LITEON, for automotive market entry and pursuing non-automotive opportunities, with recent partnerships announced to enter the Chinese market[100](index=100&type=chunk)[101](index=101&type=chunk) - In Q1 2025, the company raised **$11.055 million** in gross proceeds through stock purchase agreements and a convertible note issuance[99](index=99&type=chunk) - Management believes its plans to manage spending and raise capital alleviate substantial doubt about its ability to continue as a going concern for at least 12 months from the report's issuance date[145](index=145&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Comparing Q1 2025 to Q1 2024, revenue increased by **$44 thousand** due to development contracts, cost of revenue decreased by **63%**, and total operating expenses fell by **35%** (**$3.7 million**), driven by lower R&D costs and a **$1.7 million** gain from a lease settlement, leading to a reduced operating loss of **$6.8 million** and a net loss of **$8.0 million** Comparison of Operations for the three months ended March 31 (in thousands) | | 2025 | 2024 | Change $ | Change % | | :--- | :--- | :--- | :--- | :--- | | Revenue | $64 | $20 | $44 | 220% | | Gross loss | $(32) | $(243) | $211 | (87)% | | Research and development | $3,490 | $4,532 | $(1,042) | (23)% | | General and administrative | $2,895 | $5,615 | $(2,720) | (48)% | | Loss from operations | $(6,800) | $(10,731) | $3,931 | (37)% | | Net loss | $(8,016) | $(10,219) | $2,203 | (22)% | - The decrease in General and Administrative expenses was primarily driven by a favorable adjustment of **$1.685 million** upon the settlement of a lease dispute[125](index=125&type=chunk) - Interest expense and other increased significantly due to **$2.1 million** in costs related to new financing arrangements in Q1 2025[128](index=128&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had **$25.9 million** in cash, cash equivalents, and marketable securities, with primary liquidity sources from equity issuances, including **$11.4 million** provided by financing activities in Q1 2025, and despite ongoing losses, management believes its capital-raising plans and spending management will provide sufficient liquidity for at least the next year, though subject to "baby shelf" rules limiting capital raises - As of March 31, 2025, cash, cash equivalents, and marketable securities totaled **$25,926 thousand**[131](index=131&type=chunk) - The company has several financing facilities in place, including a Common Stock Purchase Agreement (CSPA) with New Circle and an At-The-Market (ATM) agreement with A.G.P., which provided gross proceeds of **$6.5 million** and **$8.2 million** respectively through March 31, 2025[139](index=139&type=chunk)[140](index=140&type=chunk) - In January 2025, the company issued a convertible note for an aggregate purchase price of **$3.0 million**[141](index=141&type=chunk) - The company is limited by the SEC's "baby shelf" rules, which restricts the amount it can raise through its Form S-3 shelf registration to one-third of its public float in any 12-month period, as its public float is below **$75 million**[136](index=136&type=chunk)[183](index=183&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks, primarily interest rate risk, credit risk, and foreign currency exchange risk, with interest rate risk on its cash and marketable securities considered low due to their short-term nature, credit risk concentrated with two customers, and foreign currency risk arising from euro-denominated transactions not currently hedged - **Interest Rate Risk:** A hypothetical **10% change** in interest rates is not expected to have a material impact on the company's financials due to the short-term nature of its cash and investments[161](index=161&type=chunk) - **Credit Risk:** As of March 31, 2025, two customers accounted for **10% or more** of accounts receivable[162](index=162&type=chunk) - **Foreign Currency Risk:** The company has exposure to fluctuations in the euro versus the U.S. dollar but does not currently engage in hedging activities[164](index=164&type=chunk) [Controls and Procedures](index=40&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[166](index=166&type=chunk) - No material changes to the internal control over financial reporting occurred during the first quarter of 2025[169](index=169&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) The company was involved in a legal dispute with the landlord of its former headquarters over an alleged breach of lease, which was settled on April 28, 2025, involving a payment of **$1.4 million** in cash and the issuance of a warrant to purchase **350,000 shares** of common stock - A complaint was filed against the company in August 2024 regarding a breach of lease for its former headquarters, with the landlord initially claiming up to **$8.5 million**[172](index=172&type=chunk) - On April 28, 2025, the dispute was settled, with the company agreeing to pay **$1,400** in cash and issue a warrant to purchase **350,000 shares** of common stock at an exercise price of **$2.22 per share**[172](index=172&type=chunk)[285](index=285&type=chunk) [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) The company faces numerous significant risks, including a history of losses and the expectation of continued losses, substantial reliance on Tier 1 automotive suppliers for market entry, and the critical need to raise additional capital, alongside uncertainties in market adoption of lidar technology, intense competition, potential supply chain disruptions, and the risk of stock price volatility and potential delisting from Nasdaq - **Financial Viability:** The company is an early-stage company with a history of losses (**$381.1 million** accumulated deficit) and expects to incur significant losses for the next few years, necessitating additional capital which may not be available on acceptable terms[177](index=177&type=chunk)[178](index=178&type=chunk)[180](index=180&type=chunk) - **Business Model Reliance:** The business substantially relies on relationships with Tier 1 automotive suppliers to secure design wins with OEMs, as highlighted by the recent termination of its program with Continental and new engagement with LITEON[175](index=175&type=chunk)[179](index=179&type=chunk) - **Market and Technology Risk:** Market adoption of lidar is uncertain and may develop more slowly than expected, with the company facing intense competition from other lidar developers and alternative technologies like cameras and radar[176](index=176&type=chunk)[211](index=211&type=chunk)[246](index=246&type=chunk) - **Supply Chain Risk:** The company relies on third-party, and sometimes single-source, suppliers for key components, making it susceptible to shortages, price fluctuations, and disruptions, particularly from international suppliers[175](index=175&type=chunk)[215](index=215&type=chunk) - **Stock and Listing Risk:** The company received a notice from Nasdaq on March 11, 2025, for non-compliance with the **$1.00** minimum bid price requirement and has until September 8, 2025, to regain compliance or face potential delisting[199](index=199&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=82&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities during the period - None reported for the quarter[333](index=333&type=chunk) [Defaults Upon Senior Securities](index=82&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None reported[334](index=334&type=chunk) [Mine Safety Disclosures](index=82&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[335](index=335&type=chunk) [Other Information](index=83&type=section&id=Item%205.%20Other%20Information) For the three months ended March 31, 2025, no director or officer of the company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated a Rule 10b5-1 trading plan during the first quarter of 2025[337](index=337&type=chunk) [Exhibits](index=83&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the company's articles of incorporation, bylaws, and certifications from the CEO and CFO as required by the Sarbanes-Oxley Act

Financial Data and Key Metrics Changes - The company reported a GAAP net loss of $8 million or $0.46 per share in Q1 2025, an improvement from a GAAP net loss of $8.5 million or $0.93 per share in Q4 2024, primarily due to a non-cash adjustment related to lease liabilities [27][28] - Non-GAAP net loss was $5.8 million or $0.33 per share in Q1 2025, compared to a non-GAAP net loss of $6.3 million or $0.69 per share in the prior quarter [28] - Cash burn for Q1 2025 was $8 million, which included $3.1 million of one-time payroll expenses, with expectations for a normalized run rate of about $5 million per quarter moving forward [25][29] Business Line Data and Key Metrics Changes - The Apollo LiDAR solution has reached a critical milestone with the first units produced, marking a significant step towards high-volume production [6][13] - The company is in the final testing and validation stage of integration with NVIDIA DRIVE, which is expected to enhance customer engagement and sales opportunities [7][18] Market Data and Key Metrics Changes - The company has successfully raised $24 million over the past fourteen months, including $13 million in Q1 2025, which reflects strong market enthusiasm for its technology [22][12] - The total addressable market (TAM) for intelligent transportation systems (ITS) alone is estimated at $20 billion, indicating substantial growth potential beyond the automotive sector [58] Company Strategy and Development Direction - The company has pivoted its strategy to focus on the automotive sector, developing a single high-quality product for Advanced Driver Assistance Systems (ADAS) while maintaining flexibility for adjacent markets [8][11] - A capital-light model has been adopted, significantly reducing operating expenses by 75% and headcount by nearly 60%, which positions the company for sustainable growth [9][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate macroeconomic uncertainties and adapt to industry changes, emphasizing a culture of operational discipline and innovation [10][19] - The company is optimistic about future growth opportunities, particularly in the automotive and non-automotive sectors, as it continues to engage with OEMs and expand into international markets [12][19] Other Important Information - The company resolved a lease dispute, reducing potential cash liability exposure from $6.4 million to $1.4 million, which is expected to provide a solid foundation for future operations [22][48] - The Apollo sensor's software-defined capabilities allow for rapid modifications, enabling the company to engage with various customers across different markets without significant increases in spending [17][56] Q&A Session Summary Question: Clarification on the real estate litigation timing - The lease liability was adjusted in Q1, with actual cash payout expected in Q2 [35] Question: Cash burn trend for the rest of the year - A normalized run rate is expected to be about $5 million per quarter, with Q2 anticipated to be slightly higher due to lease settlement liabilities [38] Question: Integration with NVIDIA and its impact on manufacturing scaling - The integration process is in the final testing phase, which will open up NVIDIA's ecosystem for scaling conversations with OEMs [42] Question: Inventory levels and manufacturing scaling timing - The company has sufficient inventory for anticipated short-term demand, with some ramp expected this year [45] Question: Market size comparison between automotive and non-automotive sectors - The automotive market is vast with 90 million vehicles sold annually, while non-automotive markets also present significant opportunities, particularly in ITS [58]

Strategic Priorities & Achievements - AEye launched Apollo lidar sensor into global markets[14] - The company reduced operating expenses by 75%[16] - AEye raised $24 million and secured access to up to $74 million in liquidity[17] - Apollo manufacturing line at LITEON is now operational[20] - The company raised $13 million in gross proceeds in Q1[25] Financial Performance - Q1 2025 GAAP Net Loss was $(80) million[35] - Q1 2025 GAAP EPS was $(046)[35] - Q1 2025 Non-GAAP Net Loss was $(58) million[35] - Q1 2025 Non-GAAP EPS was $(033)[35] - The company updated FY 2025 cash burn guidance to be in the range of $27 million to $29 million[37]

[Q1 2025 Earnings Release Overview](index=1&type=section&id=Q1%202025%20Earnings%20Release%20Overview) [Business & Operational Highlights](index=1&type=section&id=Business%20%26%20Operational%20Highlights) AEye achieved significant operational milestones in Q1 2025, including manufacturing the first Apollo units with its Tier 1 partner LITEON and advancing integration with NVIDIA's DRIVE platform, while expanding its customer pipeline beyond automotive into new markets - The first units of the Apollo lidar sensor have been manufactured by Tier 1 partner LITEON, with B-sample deliveries to automotive OEMs expected in **Q2 2025**[4](index=4&type=chunk)[6](index=6&type=chunk) - Reached the final testing stage for Apollo's integration into the NVIDIA DRIVE platform, aiming for wider adoption in ADAS and autonomous driving[4](index=4&type=chunk)[6](index=6&type=chunk) - Secured new customer agreements in Intelligent Transportation Systems and Defense, demonstrating product versatility[6](index=6&type=chunk) - Over **20 potential customer engagements** are moving towards proof-of-concept deployments, indicating a growing sales pipeline[6](index=6&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) In Q1 2025, AEye reported a GAAP net loss of **$8.0 million** and a non-GAAP net loss of **$5.8 million**, ending the quarter with **$25.9 million** in cash and marketable securities and a total potential liquidity of approximately **$74 million** - Ended Q1 2025 with **$25.9 million** in cash, cash equivalents, and marketable securities[8](index=8&type=chunk) - Total potential liquidity stands at approximately **$74 million**, intended to fund the production ramp-up of Apollo[8](index=8&type=chunk) - Q1 2025 cash burn was **$8.0 million** (excluding net financing), which is expected to decrease throughout the year[7](index=7&type=chunk) - Successfully resolved a lease litigation, reducing the potential cash liability from **$6.4 million** to **$1.4 million**[7](index=7&type=chunk) [Key Financial Results (Q1 2025)](index=1&type=section&id=Key%20Financial%20Results%20%28Q1%202025%29) For the first quarter of 2025, AEye reported a GAAP net loss of **$8.0 million**, or **$(0.46)** per share, an improvement from a **$10.2 million** loss in Q1 2024, with revenue increasing to **$64 thousand** Q1 2025 Key Financial Metrics vs. Q1 2024 | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $64 thousand | $20 thousand | | Gross Loss | $(32) thousand | $(243) thousand | | GAAP Net Loss | $(8.0) million | $(10.2) million | | GAAP EPS (basic & diluted) | $(0.46) | $(1.61) | | Non-GAAP Net Loss | $(5.8) million | $(7.2) million | | Non-GAAP EPS (basic & diluted) | $(0.33) | $(1.13) | | Adjusted EBITDA | $(5.9) million | $(7.7) million | - The weighted average common shares outstanding increased significantly to **17.4 million** from **6.4 million** year-over-year, impacting per-share metrics[19](index=19&type=chunk)[21](index=21&type=chunk) [Financial Position (Balance Sheet)](index=5&type=section&id=Financial%20Position%20%28Balance%20Sheet%29) As of March 31, 2025, AEye had total assets of **$28.8 million** and total liabilities of **$11.8 million**, with cash and marketable securities totaling **$25.9 million** Balance Sheet Summary (As of March 31, 2025) | Account | March 31, 2025 (in thousands) | Dec 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $26,962 | $25,171 | | *Cash and cash equivalents* | *$5,267* | *$10,266* | | *Marketable securities* | *$20,659* | *$12,012* | | **Total Assets** | **$28,796** | **$27,120** | | **Total Current Liabilities** | $10,769 | $11,307 | | **Total Liabilities** | **$11,798** | **$11,996** | | **Total Stockholders' Equity** | **$16,998** | **$15,124** | [Statement of Operations](index=6&type=section&id=Statement%20of%20Operations) For the three months ended March 31, 2025, AEye's revenue was **$64 thousand** with a gross loss of **$32 thousand**, while total operating expenses significantly reduced to **$6.8 million** - Revenue increased to **$64 thousand** in Q1 2025 from **$20 thousand** in Q1 2024[19](index=19&type=chunk) - Total operating expenses decreased by **35.5% YoY** to **$6.8 million**, driven by a **$1.0 million** reduction in R&D and a **$2.7 million** reduction in G&A expenses[19](index=19&type=chunk) - Loss from operations improved to **$(6.8) million** from **$(10.7) million** in the prior-year quarter[19](index=19&type=chunk) [Statement of Cash Flows](index=7&type=section&id=Statement%20of%20Cash%20Flows) In Q1 2025, net cash used in operating activities was **$7.8 million**, with **$8.6 million** used in investing activities, while **$11.4 million** was provided by financing activities, resulting in a net decrease in cash of **$5.0 million** - Net cash used in operating activities was **$(7.8) million**, comparable to **$(7.9) million** in Q1 2024[20](index=20&type=chunk) - Net cash used in investing activities was **$(8.6) million**, a significant shift from **$0.4 million** provided in Q1 2024, mainly due to higher purchases of marketable securities[20](index=20&type=chunk) - Net cash provided by financing activities was **$11.4 million**, a substantial increase from **$0.1 million** in Q1 2024, primarily from **$2.95 million** in convertible note proceeds and **$9.5 million** from common stock issuance[20](index=20&type=chunk) [GAAP to Non-GAAP Reconciliation](index=8&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliation) AEye reconciled its Q1 2025 GAAP net loss of **$8.0 million** to a non-GAAP net loss of **$5.8 million**, adjusting for items like stock-based compensation and changes in fair value of liabilities Q1 2025 GAAP to Non-GAAP Reconciliation (in thousands) | Description | Amount | | :--- | :--- | | **GAAP net loss** | **$(8,016)** | | Stock-based compensation | $2,501 | | Stock issuance and debt issuance costs | $2,095 | | Gain on termination of operating lease, net | $(1,685) | | Change in fair value of convertible note and warrant liabilities | $(680) | | **Non-GAAP net loss** | **$(5,785)** | [2025 Financial Outlook](index=2&type=section&id=2025%20Financial%20Outlook) AEye has revised its full-year 2025 cash burn forecast to a range of **$27 million** to **$29 million**, an increase attributed to a one-time litigation settlement and potential convertible note repayment - Full-year 2025 cash burn is now expected to be between **$27 million** and **$29 million**[9](index=9&type=chunk) - The increase from the previous **$25 million** forecast is due to a one-time litigation settlement and potential repayment of a convertible note[9](index=9&type=chunk) - Excluding these one-time costs, the underlying cash burn rate is consistent with previous guidance[9](index=9&type=chunk) [Supplementary Information](index=2&type=section&id=Supplementary%20Information) This section provides standard corporate disclosures, including a description of AEye's software-defined lidar technology, an explanation of non-GAAP financial measures, and a detailed list of forward-looking statements and associated risks - The company uses non-GAAP net loss and Adjusted EBITDA to provide additional insight into ongoing performance, adjusting for items like stock-based compensation and changes in fair value of liabilities[12](index=12&type=chunk)[13](index=13&type=chunk) - The press release contains numerous forward-looking statements regarding production, partnerships (NVIDIA, LITEON), market expansion, and financial projections (cash burn, liquidity), along with extensive risk factors that could cause actual results to differ[14](index=14&type=chunk)[15](index=15&type=chunk)