Arbe Robotics .(ARBE) - 2023 Q2 - Quarterly Report

Arbe Q2 2023 Financial Results Key Q2 and Recent Company Highlights The company secured a major preliminary order, advanced in OEM selection processes, and raised capital for growth - Weifu High-Technology Group placed an $11.6 million preliminary order for radar chipsets for 2024 and a $1 million order for professional services[2] - Arbe's chipset is in the final selection stages with 11 premium leading OEMs across Europe and China for level 2++ / level 3 programs[2] - Successfully raised $23 million from investors to enhance market penetration, R&D, and strengthen the balance sheet[3][4] - The company remains on track to achieve four customer design wins by the end of 2023[3] Q2 2023 Financial Performance Q2 2023 saw lower revenue and a net loss, though Adjusted EBITDA loss improved and liquidity remains strong Q2 2023 vs Q2 2022 Financial Summary (in millions USD) | Financial Metric | Q2 2023 | Q2 2022 | Change | | :--- | :--- | :--- | :--- | | Revenues | $0.3M | $1.2M | -77.4% | | Gross Margin | -1.0% | 72.7% | Decrease | | Operating Loss | ($12.6M) | ($12.1M) | Increased Loss | | Net Loss | ($12.6M) | ($11.6M) | Increased Loss | | Adjusted EBITDA | ($8.4M) | ($9.5M) | Reduced Loss | Operating Expenses (in millions USD) | Expense Category | Q2 2023 | Q2 2022 | | :--- | :--- | :--- | | Research and Development | $9.1 | $9.5 | | Sales and Marketing | $1.5 | $1.2 | | General and Administrative | $2.0 | $2.3 | | Total Operating Expenses | $12.6 | $13.0 | - As of June 30, 2023, Arbe had $31.6 million in cash and cash equivalents and $25.6 million in short-term bank deposits with no debt[8] Full Year 2023 Outlook The company reiterates its full-year 2023 guidance, targeting four design-ins and projecting revenues of $5-7 million - The primary goal for 2023 is to achieve 4 design-ins with automakers[9] Full Year 2023 Guidance | Metric | Outlook Range | | :--- | :--- | | Revenues | $5M - $7M | | Adjusted EBITDA | ($32M) - ($35M) | - Revenues are expected to be heavily weighted towards the end of the year, coinciding with the start of production chip shipments[9] Financial Statements Consolidated Balance Sheets Total assets and shareholders' equity increased as of June 30, 2023, while total liabilities decreased significantly Consolidated Balance Sheet Summary (U.S. dollars in thousands) | Account | June 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | Total Assets | $62,540 | $60,830 | | Cash and cash equivalents | $31,586 | $54,171 | | Short term Bank deposits | $25,602 | $400 | | Total Liabilities | $7,228 | $12,077 | | Total Shareholders' Equity | $55,312 | $48,753 | Consolidated Statements of Operations The company reported a sharp revenue decline and a wider net loss for the three months ended June 30, 2023 Statement of Operations Summary (U.S. dollars in thousands) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | | :--- | :--- | :--- | | Revenues | $289 | $1,236 | | Gross Profit (Loss) | ($3) | $899 | | Operating Loss | ($12,586) | ($12,085) | | Net Loss | ($12,611) | ($11,593) | | Basic Net Loss per Share | ($0.19) | ($0.18) | Consolidated Statements of Cash Flows For the first six months of 2023, cash from financing activities offset cash used in operations and investments Statement of Cash Flows Summary - 6 Months Ended June 30 (U.S. dollars in thousands) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | ($20,379) | ($23,572) | | Net cash used in investing activities | ($25,321) | ($926) | | Net cash provided by financing activities | $23,102 | ($5,002) | | Decrease in cash | ($22,532) | ($27,978) | | Cash at end of period | $31,717 | $71,436 | Reconciliation of GAAP to Non-GAAP Financial Measures Adjustments for non-cash items show an improved Non-GAAP Net Loss and Adjusted EBITDA loss compared to the prior year GAAP to Non-GAAP Reconciliation - Q2 2023 vs Q2 2022 (U.S. dollars in thousands) | Metric | Q2 2023 | Q2 2022 | | :--- | :--- | :--- | | GAAP Net Loss | ($12,611) | ($11,593) | | Stock-based compensation | $3,713 | $2,348 | | Revaluation of warrants | ($369) | ($2,014) | | Non-GAAP Net Loss | ($8,896) | ($11,163) | | Adjusted EBITDA | ($8,363) | ($9,530) |