Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to________________ Microvast Holdings, Inc. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 ...

Microvast Holdings, Inc. (NASDAQ:MVST) Q4 2022 Earnings Conference Call March 16, 2023 5:00 PM ET Company Participants Cassidy Fuller - Investor Relations Yang Wu - Founder, Chairman, President and Chief Executive Officer Sascha Kelterborn - Chief Revenue Officer Craig Webster - Chief Financial Officer Monica Gould - Investor Relations Conference Call Participants Colin Rusch - Oppenheimer George Gianarikas - Canaccord Genuity Operator Greetings and welcome to the Microvast Holdings’ Fourth Quarter 2022 Ear ...

>3.5x increase in backlog position = 35% revenue growth year over year to $204.5M | --- | --- | --- | |-----------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------| ...

PART I [Business](index=9&type=section&id=Item%201.%20Business) Microvast is a vertically integrated battery technology company specializing in battery components and systems for electric commercial vehicles and utility-scale energy storage - Microvast is a vertically integrated battery technology company designing, developing, and manufacturing battery components and systems for electric commercial vehicles and utility-scale energy storage systems (ESS)[27](index=27&type=chunk)[30](index=30&type=chunk) Key Financial and Operational Metrics (FY 2022) | Metric | Value | | :--- | :--- | | Revenue | $204.5 million | | Revenue Growth (YoY) | 35% | | Total Battery Systems Delivered (since 2009) | ~3,347.9 MWh | | Order Backlog (as of Dec 31, 2022) | $410.5 million (~1,599.7 MWh) | - The company's strategic focus includes expanding ESS solutions, shifting operations towards Europe and the U.S., and increasing manufacturing capacity to a target of **11 GWh per year by 2025**[61](index=61&type=chunk)[62](index=62&type=chunk) - In October 2022, Microvast received a **$200 million grant** from the U.S. Department of Energy (DOE) in collaboration with General Motors for a new polyaramid separator manufacturing facility in the U.S[55](index=55&type=chunk) [Risk Factors](index=21&type=section&id=Item%201A.%20Risk%20Factors) The company faces substantial risks across its business, operations in China, intellectual property, and stock ownership, including market adoption, regulatory compliance, and stock volatility - Business and Industry Risks: Growth is highly dependent on electric vehicle market adoption, with risks from battery safety incidents, a limited customer base (top five customers were **36.1% of 2022 revenue**), a history of net losses (**$158.2 million in 2022**), and intense competition[115](index=115&type=chunk)[119](index=119&type=chunk)[124](index=124&type=chunk)[129](index=129&type=chunk) - Risks of Doing Business in China: Operations are subject to extensive PRC government regulation, including cybersecurity and data laws, with a risk of securities delisting under the Holding Foreign Companies Accountable Act (HFCAA) if PCAOB cannot inspect auditors[112](index=112&type=chunk)[252](index=252&type=chunk)[267](index=267&type=chunk) - Intellectual Property Risks: A significant portion of the company's technology relies on unpatented trade secrets and know-how, which may be difficult to protect, alongside the risk of costly litigation for intellectual property infringement claims[275](index=275&type=chunk)[285](index=285&type=chunk) - Ownership and General Risks: Stock price may be volatile, future stock issuances could cause dilution, and the company is exposed to risks from health epidemics and geopolitical events[289](index=289&type=chunk)[306](index=306&type=chunk)[313](index=313&type=chunk) [Unresolved Staff Comments](index=57&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - Not applicable[325](index=325&type=chunk) [Properties](index=58&type=section&id=Item%202.%20Properties) Microvast's physical properties include owned and leased facilities across the U.S., Germany, the U.K., and China, supporting various operations Key Company Facilities | Location | Country | Function | Ownership | | :--- | :--- | :--- | :--- | | Stafford, TX | United States | Corporate HQ | Leased | | Lake Mary, FL | United States | R&D | Owned | | Clarksville, TN | United States | Manufacturing (cell, module, pack) | Owned | | Denver, CO | United States | ESS HQ | Owned | | Berlin | Germany | European HQ, Manufacturing (module, pack) | Leased | | Huzhou | China | Asia Pacific HQ, Manufacturing (full scope) | Owned | [Legal Proceedings](index=59&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings expected to have a material adverse effect on its business or financial condition - As of the filing date, Microvast is not involved in any legal proceedings anticipated to have a material adverse impact on the company[329](index=329&type=chunk) [Mine Safety Disclosures](index=59&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company's operations - Not applicable[330](index=330&type=chunk) PART II [Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=60&type=section&id=Item%205.%20Market%20for%20the%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Microvast's common stock and warrants trade on NASDAQ, with the company intending to retain earnings for growth rather than paying dividends - The company's common stock and warrants trade on NASDAQ under the symbols **MVST** and **MVSTW**[333](index=333&type=chunk) - The company intends to retain all available funds for business development and does not anticipate paying cash dividends in the foreseeable future[335](index=335&type=chunk) Securities Authorized for Issuance Under Equity Compensation Plans (as of Dec 31, 2022) | Plan Category | Securities to be issued upon exercise | Weighted-average exercise price | Securities remaining available for future issuance | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 60,466,526 | $6.08 | 16,490,228 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=61&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In FY2022, Microvast's revenue grew **35% to $204.5 million**, with gross margin improving to **4.4%** due to non-recurring warranty costs, maintaining strong liquidity Comparison of Results of Operations (FY 2022 vs. FY 2021) | Metric (in thousands) | 2021 | 2022 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Revenues** | **$151,976** | **$204,495** | **$52,519** | **34.6%** | | Cost of revenues | ($194,719) | ($195,422) | ($703) | 0.4% | | **Gross (Loss) Profit** | **($42,743)** | **$9,073** | **$51,816** | **121.2%** | | *Gross Margin* | *-28.1%* | *4.4%* | - | - | | Total operating expenses | ($157,448) | ($170,691) | ($13,243) | 8.4% | | **Operating Loss** | **($194,064)** | **($159,946)** | **$34,118** | **-17.6%** | | **Net Loss** | **($206,483)** | **($158,200)** | **$48,283** | **-23.4%** | - Revenue growth was driven by an increase in sales volume from **489.2 MWh in 2021 to 694.2 MWh in 2022**[383](index=383&type=chunk) - The significant improvement in gross margin was primarily due to the non-recurrence of a **$46.5 million warranty cost accrual** for a legacy product recorded in 2021, combined with better economies of scale[385](index=385&type=chunk)[387](index=387&type=chunk) - As of December 31, 2022, the company had **$327.7 million** in cash, cash equivalents, restricted cash, and short-term investments, with capital expenditures for 2022 at **$150.9 million** mainly for facility expansions[395](index=395&type=chunk)[406](index=406&type=chunk)[412](index=412&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=73&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exposed to interest rate risk on China loans, significant foreign currency risk from RMB fluctuations, and credit risk on trade receivables - The company's project finance loans in China are exposed to interest rate risk as they are tied to the Loan Prime Rate[431](index=431&type=chunk) - Significant foreign currency risk exists due to operations in China; a hypothetical **10% adverse change in the RMB exchange rate** would result in a **$2.8 million loss** as of December 31, 2022[433](index=433&type=chunk) - Credit risk is primarily related to trade receivables, with the company actively monitoring customer creditworthiness and overdue debts to mitigate this risk[434](index=434&type=chunk) [Financial Statements and Supplementary Data](index=75&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for fiscal years 2020-2022, including balance sheets, income statements, and cash flow statements Consolidated Balance Sheet Highlights (as of Dec 31, 2022) | Account (in thousands) | 2021 | 2022 | | :--- | :--- | :--- | | **Total Current Assets** | **$706,606** | **$545,067** | | Cash and cash equivalents | $480,931 | $231,420 | | Inventories, net | $53,424 | $84,252 | | **Total Assets** | **$995,291** | **$984,957** | | **Total Current Liabilities** | **$175,594** | **$252,409** | | **Total Liabilities** | **$308,593** | **$371,980** | | **Total Shareholders' Equity** | **$686,698** | **$612,977** | Consolidated Statement of Operations Highlights (Year ended Dec 31, 2022) | Account (in thousands) | 2021 | 2022 | | :--- | :--- | :--- | | Revenues | $151,976 | $204,495 | | Gross (loss)/profit | ($42,743) | $9,073 | | Loss from operations | ($194,064) | ($159,946) | | **Net loss** | **($206,483)** | **($158,200)** | | Net loss per share (Basic and diluted) | ($1.26) | ($0.52) | - In 2021, the company recorded an additional **$46.5 million warranty accrual** for a legacy product due to a faulty component, which was a major driver of the gross loss[420](index=420&type=chunk)[572](index=572&type=chunk) - The company adopted new accounting standards for leases (ASC 842) and credit losses (Topic 326) on January 1, 2022, with ASC 842 adoption resulting in **$18.8 million** in operating lease right-of-use assets and liabilities[523](index=523&type=chunk)[545](index=545&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=125&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[696](index=696&type=chunk) [Controls and Procedures](index=125&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of December 31, 2022, with a previously identified material weakness remediated - Management concluded that as of December 31, 2022, the company's disclosure controls and procedures were effective[697](index=697&type=chunk) - A material weakness identified in 2021, related to a lack of sufficient skilled staff with U.S. GAAP and SEC reporting knowledge, was remediated as of December 31, 2022[700](index=700&type=chunk)[701](index=701&type=chunk)[702](index=702&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=127&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This section details the company's executive officers and board of directors, including their biographical information, board structure, and committee compositions - The company's leadership includes founder Yang Wu as President and CEO, Craig Webster as CFO, Shane Smith as COO, and Dr. Wenjuan Mattis as CTO[710](index=710&type=chunk) - The Board of Directors is divided into three classes and includes notable members such as Nobel Prize winner Stanley Whittingham, an expert in lithium-ion batteries[741](index=741&type=chunk)[747](index=747&type=chunk) - The Board has three standing committees: Audit, Nominating & Corporate Governance, and Compensation, with the Audit Committee chaired by Arthur Wong, designated as the audit committee financial expert[755](index=755&type=chunk)[757](index=757&type=chunk) [Executive Compensation](index=132&type=section&id=Item%2011.%20Executive%20Compensation) The company's 2022 executive compensation for NEOs included base salary and equity awards, with no short-term cash incentives paid out, and non-employee directors receiving cash and RSU awards 2022 Summary Compensation for Named Executive Officers (NEOs) | Name and Principal Position | Salary ($) | Stock Awards ($) | Option Awards ($) | All other compensation ($) | Total Compensation ($) | | :--- | :--- | :--- | :--- | :--- | :--- | | Yang Wu, President and CEO | 542,895 | 439,997 | — | — | 982,892 | | Sascha Rene Kelterborn, Chief Revenue Officer | 384,772 | 159,993 | 2,552,000 | 68,653 | 3,165,418 | | Craig Webster, Chief Financial Officer | 309,908 | 159,993 | 3,190,000 | 13,330 | 3,673,231 | - The 2022 short-term incentive (STI) cash bonus did not pay out to NEOs because the pre-determined revenue performance threshold was not achieved[766](index=766&type=chunk) - Non-employee directors receive an annual cash retainer of **$70,000**, with additional retainers for committee chairs, and an annual RSU award valued at **$80,000**[798](index=798&type=chunk)[801](index=801&type=chunk) [Security Ownership of Certain Beneficial Owners and Management](index=139&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management) As of March 10, 2023, founder Yang Wu is the largest individual beneficial owner with **27.5%** of common stock, while all directors and executive officers collectively own **30.1%** Beneficial Ownership as of March 10, 2023 | Beneficial Owner | Percent Beneficially Owned | | :--- | :--- | | Yang Wu (President & CEO) | 27.5% | | All directors and executive officers as a group (13 persons) | 30.1% | | Cede & Co (>5% Holder) | 35.1% | | Evergreen Ever Limited (>5% Holder) | 10.2% (based on last filing) | [Certain Relationships and Related Transactions, and Director Independence](index=140&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) The company has key related party agreements, including a Stockholders Agreement and Registration Rights, with five of its seven directors determined to be independent - A Stockholders Agreement provides founder Yang Wu the right to nominate directors proportional to his beneficial ownership of common stock[808](index=808&type=chunk)[809](index=809&type=chunk) - The company entered into a Registration Rights and Lock-Up Agreement with pre-merger stockholders and insiders, including a **two-year lock-up for 75% of Mr. Wu's shares**[811](index=811&type=chunk)[812](index=812&type=chunk) - The Board has determined that **five of its seven directors** are independent under NASDAQ listing rules[818](index=818&type=chunk) [Principal Accountant Fees and Services](index=143&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The company's principal auditor is Deloitte Touche Tohmatsu, with aggregate fees of **$1.6 million** in FY2022, primarily for audit services, all pre-approved by the Audit Committee Accountant Fees (in millions) | Fee Category | 2021 | 2022 | | :--- | :--- | :--- | | Audit fees | $1.3 | $1.6 | | Audit-related fees | $0.1 | - | | Tax fees | — | — | | All other fees | — | — | | **Total** | **$1.4** | **$1.6** | - All audit and non-audit services provided by the principal accountant were pre-approved by the Audit Committee in accordance with its policies[823](index=823&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=144&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section provides an index of all financial statements, schedules, and exhibits filed with the Form 10-K, including corporate governance documents and material contracts - This section contains the index to financial statements and lists all exhibits filed with the annual report, including corporate governance documents, material contracts, and required certifications[827](index=827&type=chunk)[828](index=828&type=chunk)[829](index=829&type=chunk) [Form 10-K Summary](index=146&type=section&id=Item%2016.%20Form%2010-K%20Summary) No summary is provided under this item - None[833](index=833&type=chunk)

Microvast Holdings, Inc. (NASDAQ:MVST) Q3 2022 Earnings Conference Call November 10, 2022 6:00 PM ET Company Participants Monica Gould - Investor Relations Sascha Kelterborn - President & Chief Revenue Officer Craig Webster - CFO Conference Call Participants Colin Rusch - Oppenheimer Operator Thank you for standing by. This is your conference operator. Welcome to the Microvast Third Quarter 2022 Earnings Call. [Operator Instructions]. I would now like to turn the conference over to Monica Gould, Investor R ...

[PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the unaudited condensed consolidated financial statements and management's discussion and analysis for the period ended September 30, 2022 [Financial Statements (Unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section provides the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, and cash flows, along with their accompanying notes [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of September 30, 2022, total assets slightly decreased to $972.9 million, driven by a reduction in cash and cash equivalents, while total liabilities increased and shareholders' equity decreased Condensed Consolidated Balance Sheet Data (in thousands of U.S. dollars) | Account | Sep 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $295,816 | $480,931 | | Inventories | $82,262 | $53,424 | | Property, plant and equipment, net | $286,346 | $253,057 | | **Total Assets** | **$972,928** | **$995,291** | | **Liabilities & Equity** | | | | Total Current Liabilities | $231,835 | $175,594 | | **Total Liabilities** | **$357,072** | **$308,593** | | **Total Shareholders' Equity** | **$615,856** | **$686,698** | [Condensed Consolidated Statements of Operations](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the nine months ended September 30, 2022, revenue increased by 64.0% to $139.7 million, resulting in a gross profit of $6.8 million and a narrowed net loss of $124.5 million Statement of Operations Highlights (in thousands of U.S. dollars, except per share data) | Metric | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Revenues | $139,698 | $85,204 | | Gross (loss)/profit | $6,847 | $(43,896) | | Loss from operations | $(125,320) | $(146,471) | | Net loss | $(124,502) | $(159,844) | | Net loss per share (Basic & Diluted) | $(0.41) | $(1.27) | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2022, net cash used in operating activities increased to $58.6 million, while net cash from financing activities significantly decreased from the prior year Cash Flow Summary (in thousands of U.S. dollars) | Cash Flow Activity | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(58,595) | $(24,653) | | Net cash used in investing activities | $(84,719) | $(40,718) | | Net cash generated from financing activities | $34,226 | $634,370 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section details the company's business, accounting policies, significant events, and capital commitments, including a new loan facility and a DOE grant - The company's primary business involves developing, manufacturing, and selling electronic power products for electric vehicles, mainly in the Asia & Pacific region and Europe[29](index=29&type=chunk) - In September 2022, the company secured a new **$111 million (RMB 800 million) loan facility** to fund manufacturing capacity expansion in Huzhou, China[61](index=61&type=chunk) - Capital commitments for construction and purchase of property, plant, and equipment totaled **$260.5 million** as of September 30, 2022[117](index=117&type=chunk) - In October 2022, the company was selected by the U.S. Department of Energy (DOE) to negotiate and receive **$200 million in grant funding** for a new polyaramid separator manufacturing facility in the U.S[118](index=118&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses the company's financial performance, liquidity, and capital resources, highlighting revenue growth, gross margin improvement, and strategic initiatives - The company's order backlog increased to approximately **$140.6 million (477.4 MWh)** as of September 30, 2022, indicating strong customer demand[123](index=123&type=chunk) - The company plans to spend an additional **$90.0 million to $120.0 million** on capacity expansions for the remainder of 2022, funded by proceeds from the 2021 Business Combination[144](index=144&type=chunk) Revenue by Geography (Nine Months Ended Sep 30) | Region | 2022 Revenue (in thousands) | 2021 Revenue (in thousands) | | :--- | :--- | :--- | | Asia & Pacific | $125,746 | $73,360 | | Europe | $11,062 | $11,466 | | U.S. | $2,890 | $378 | | **Total** | **$139,698** | **$85,204** | [Results of Operations](index=42&type=section&id=Results%20of%20Operations) This section analyzes the drivers behind the 64% revenue growth and the significant improvement in gross margin for the nine months ended September 30, 2022 Comparison of Nine Months Ended Sep 30, 2022 vs 2021 (in thousands) | Metric | 2022 | 2021 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenues | $139,698 | $85,204 | $54,494 | 64.0% | | Gross Profit/(Loss) | $6,847 | $(43,896) | $50,743 | 115.6% | | Total Operating Expenses | $(133,400) | $(105,251) | $(28,149) | 26.7% | | Net Loss | $(124,502) | $(159,844) | $35,342 | (22.1)% | - The increase in gross margin for the nine months ended Sep 30, 2022, was primarily due to better economies of scale from higher sales volume and the absence of a **$40.8 million** additional warranty accrual from 2021[181](index=181&type=chunk) - R&D expenses for the nine-month period increased by **$9.8 million (42.3%)** year-over-year, driven by higher share-based compensation, increased personnel costs, and more material usage for experiments[185](index=185&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company identifies its primary market risks as interest rate risk, foreign currency risk, and credit risk, with foreign currency risk being the most significant - The company's primary market risk is foreign currency exchange risk, particularly with the Chinese Renminbi (RMB), where a hypothetical **10% adverse change** would result in a foreign currency loss of **$2.3 million** as of September 30, 2022[192](index=192&type=chunk) - Interest rate risk is not considered significant, as a **100 basis point change** would not materially affect operating results or financial condition[191](index=191&type=chunk) - The business has historically experienced seasonality, with higher sales in the third and fourth quarters compared to the first and second, partly due to the Chinese Spring Festival holiday[195](index=195&type=chunk) [Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of September 30, 2022, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were **effective** as of September 30, 2022[196](index=196&type=chunk) - No material changes to the company's internal control over financial reporting occurred during the quarter ended September 30, 2022[197](index=197&type=chunk) [PART II. OTHER INFORMATION](index=47&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, and details on unregistered sales of equity securities [Legal Proceedings](index=47&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business, and a previously disclosed lawsuit was dismissed in its favor - The company is not currently involved in any legal proceedings expected to have a material adverse effect on its financial condition[199](index=199&type=chunk) - The lawsuit filed by former employee Matthew Smith was resolved in September 2022 with a unanimous jury verdict in favor of Microvast, and all claims were dismissed with prejudice[116](index=116&type=chunk)[199](index=199&type=chunk) [Risk Factors](index=47&type=section&id=Item%201A.%20Risk%20Factors) The company directs investors to consider the risk factors disclosed in its Annual Report on Form 10-K for the year ended December 31, 2021, and its Registration Statement on Form S-3 - The report refers to previously filed documents, including the Annual Report on Form 10-K and a Registration Statement on Form S-3, for a comprehensive discussion of risk factors[200](index=200&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=47&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds%20from%20Registered%20Securities) The company reported no unregistered sales of its equity securities during the three months ended September 30, 2022 - There were no unregistered sales of equity securities during the third quarter of 2022[201](index=201&type=chunk)

Financial Data and Key Metrics Changes - Revenue grew by 93% to USD 64.4 million in Q2 2022, up from USD 33.4 million in Q2 2021, marking the sixth consecutive quarter of substantial revenue growth [24][25] - Year-to-date revenue reached USD 101.1 million, a 109.2% increase from USD 48.3 million in the prior six-month period [25] - Gross profit improved to USD 4.8 million in Q2 2022 from a gross loss of USD 6.8 million in the prior period, representing a 171.5% improvement [25] - Adjusted gross profit was USD 6.7 million in Q2 2022, compared to an adjusted gross loss of USD 6.8 million in Q2 2021, resulting in an adjusted gross margin of 10.4% [25][30] Business Line Data and Key Metrics Changes - The order intake for Q2 was USD 47.8 million, with significant contributions from various customers, including an order from JBM Group for over USD 11 million [21] - The company ended Q2 with a strong backlog of USD 105.3 million, driven by healthy order intake [11] Market Data and Key Metrics Changes - The Asia Pacific region (excluding China) saw revenue growth of 231% in Q2 2022 compared to Q2 2021, with India being a major growth driver [31][32] - The China business posted a 57% growth during the quarter, while Europe experienced a 15% growth rate [32] Company Strategy and Development Direction - The company is focusing on expanding its manufacturing capacities and expects order volume to increase as new capacities come online in Huzhou [15][37] - A new subsidiary, Microvast Energy, Inc., has been established to focus on energy storage solutions, which are seen as a significant growth opportunity [40] - The company is reaffirming its guidance of 35% to 45% revenue growth compared to 2021 and is optimistic about increasing forecasted contracted revenue [39] Management's Comments on Operating Environment and Future Outlook - Management highlighted challenges related to elevated raw material prices due to supply chain disruptions and inflation, with expectations for these prices to remain high through 2022 and possibly into 2023 [13][14] - The company is actively monitoring raw material trends and implementing strategies to mitigate impacts, including optimizing supply contracts and increasing selling prices [14] Other Important Information - The company closed the quarter with approximately USD 396.9 million in cash, cash equivalents, and restricted cash, with expectations to end the year with at least USD 250 million in cash [35][36] - Capital expenditures for the second half of the year are estimated to be between USD 180 million to USD 220 million, primarily for capacity expansion projects [35] Q&A Session Summary Question: Customer involvement in sourcing raw materials - Management confirmed that they are working with customers to find joint solutions for acquiring raw materials to enhance bargaining power [47] Question: New customer qualifications - Management indicated that there are at least 10 customers in alignment that are expected to generate revenue within the next 3 to 6 months [48] Question: Raw material cost mechanisms - Management stated that price adjustments can only be made per existing contracts, and provisions for price increases are included in some multiyear contracts [53][54] Question: Hydrogen vs. battery-powered vehicles - Management explained that hydrogen technology is emerging, and while it may involve smaller batteries, they have tested their battery solutions successfully in hydrogen trucks [56][57]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to________________ Microvast Holdings, Inc. (Exact name of registrant as specified in its charter) | Delaware | 001-38826 | 83-2530757 | | --- | --- | - ...

Microvast Holdings, Inc. (NASDAQ:MVST) Q1 2022 Earnings Conference Call May 16, 2022 6:00 PM ET Company Participants Sarah Alexander - General Counsel Yang Wu - CEO Craig Webster - CFO Sascha Kelterborn - President Leon Zheng - former CFO Conference Call Participants Adam Jonas - Morgan Stanley' Operator Thank you for standing by. This is the conference operator. Welcome to the Microvast First Quarter 2022 Earnings Call. [Operator Instructions]. I would now like to turn the conference over to Sarah Alexande ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to________________ Microvast Holdings, Inc. (Exact name of registrant as specified in its charter) | Delaware | 001-38826 | 83-2530757 | | --- | --- | ...