Cepton(US:CPTN)2023-08-08 16:00Business Developments - Cepton has received a significant ADAS lidar series production award from General Motors, initially covering four vehicle models and later expanded to nine models, with production expected to start at the end of 2023[12][22]. - The company is engaged with all of the top 10 global automotive OEMs, indicating strong market interest and potential for future series production awards[23][29]. - Cepton's lidar solutions are positioned for mass-market adoption, focusing on high performance, reliability, and competitive pricing to meet automotive industry standards[10][11]. Financial Performance - Total revenue for the three months ended June 30, 2023, was $2.8 million, reflecting a $228,000 increase, or 9%, from $2.6 million in the same period of 2022[49]. - Lidar sensor and prototype revenue increased by $1.3 million, or 92%, to $2.8 million for the three months ended June 30, 2023, compared to $1.4 million for the same period in 2022[51]. - Gross profit for the three months ended June 30, 2023, was $434,000, a significant improvement of $957,000 compared to a loss of $523,000 in the same period of 2022[49]. - Net loss for the three months ended June 30, 2023, was $14.2 million, a decrease of $15.0 million compared to a net income of $843,000 in the same period of 2022[49]. - The company reported a net loss of $28.9 million for the six months ended June 30, 2023, compared to a net income of $42.0 million for the same period in 2022[86][87]. - Cash used in operating activities was $21.2 million for the six months ended June 30, 2023, an improvement from $32.3 million used in the same period in 2022[85][86]. Expenses and Costs - Total operating expenses for the three months ended June 30, 2023, were $15.6 million, a slight decrease of $25,000 compared to $15.6 million in the same period of 2022[49]. - Research and development expenses increased by $0.5 million, or 3%, to $16.6 million for the six months ended June 30, 2023, from $16.1 million for the same period in 2022[57]. - Selling, general, and administrative expenses decreased by $2.3 million, or 15%, to $12.9 million for the six months ended June 30, 2023, from $15.2 million for the same period in 2022[65]. - Lidar sensor and prototype cost of revenue decreased by $0.2 million, or 7%, to $2.3 million for the three months ended June 30, 2023, from $2.5 million for the same period in 2022[54]. - Development revenue decreased by $0.9 million, or 78%, to $0.3 million for the six months ended June 30, 2023, from $1.2 million for the same period in 2022[53]. Cash Flow and Financing - The company had cash, cash equivalents, and short-term investments totaling $69.6 million as of June 30, 2023, which is expected to meet liquidity needs for at least the next twelve months[76]. - Financing activities provided $54.6 million of cash during the six months ended June 30, 2023, primarily from the issuance of Preferred Stock to Koito[90]. - The issuance of 100,000 shares of Series A Convertible Preferred Stock to Koito raised $100.0 million, with conversion rights starting January 19, 2024[79]. - Interest income turned into a net interest income of $1.2 million for the six months ended June 30, 2023, compared to a net interest expense of $1.3 million for the same period in 2022[73]. - Investing activities used $33.8 million of cash during the six months ended June 30, 2023, primarily for short-term investments[88]. Market Conditions and Future Outlook - Supply chain shortages have led to increased lead times for products, potentially causing mismatches between supply and demand[27]. - The global economic environment remains volatile, impacting consumer confidence and economic growth, which could affect Cepton's business operations[18]. - The company expects to continue investing in research and development, which may lead to further operating losses in the future[80]. - Gross margins are expected to initially decrease as series production begins but are projected to improve as production volumes increase and material costs decrease[31][38]. - The company aims to drive down product costs to facilitate mass-market adoption of lidar in automotive applications[26].