Joby Aviation(JOBY) - 2023 Q1 - Quarterly Report

Special Note Regarding Forward-Looking Statements This section provides cautionary statements regarding forward-looking information, emphasizing inherent risks and uncertainties that could cause actual results to differ materially PART I. FINANCIAL INFORMATION This part presents the company's unaudited condensed consolidated financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures Condensed Consolidated Financial Statements (Unaudited) This section presents the unaudited condensed consolidated financial statements for Joby Aviation, Inc. and its subsidiaries, including the balance sheets, statements of operations, comprehensive loss, stockholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, fair value measurements, acquisitions, and other financial components for the period ended March 31, 2023 Condensed Consolidated Balance Sheets (Unaudited) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and stockholders' equity as of March 31, 2023, and December 31, 2022 Condensed Consolidated Balance Sheets (Unaudited) - Key Figures (in thousands) | Metric | March 31, 2023 | December 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total assets | $1,218,727 | $1,292,984 | $(74,257) | (5.74)% | | Total liabilities | $149,232 | $128,243 | $20,989 | 16.37% | | Total stockholders' equity | $1,069,495 | $1,164,741 | $(95,246) | (8.18)% | | Cash and cash equivalents | $49,795 | $146,101 | $(96,306) | (65.92)% | | Short-term investments | $927,980 | $910,692 | $17,288 | 1.90% | Condensed Consolidated Statements of Operations (Unaudited) This section outlines the company's financial performance, presenting revenues, expenses, and net loss for the three months ended March 31, 2023, and 2022 Condensed Consolidated Statements of Operations (Unaudited) - Key Figures (in thousands, except per share) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $75,518 | $72,071 | $3,447 | 4.78% | | Selling, general and administrative | $24,198 | $22,272 | $1,926 | 8.65% | | Total operating expenses | $99,716 | $94,343 | $5,373 | 5.69% | | Loss from operations | $(99,716) | $(94,343) | $(5,373) | 5.69% | | Interest and other income, net | $8,400 | $757 | $7,643 | 1009.64% | | Income from equity method investment | $0 | $14,458 | $(14,458) | (100.00)% | | Gain (Loss) from change in fair value of warrants and earnout shares | $(22,043) | $16,814 | $(38,857) | (231.10)% | | Total other income (loss), net | $(13,643) | $32,029 | $(45,672) | (142.59)% | | Net loss | $(113,393) | $(62,319) | $(51,074) | 81.96% | | Net loss per share, basic and diluted | $(0.19) | $(0.11) | $(0.08) | 72.73% | Condensed Consolidated Statements of Comprehensive Loss (Unaudited) This section details the company's comprehensive loss, including net loss and other comprehensive income (loss) for the three months ended March 31, 2023, and 2022 Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - Key Figures (in thousands) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net loss | $(113,393) | $(62,319) | $(51,074) | 81.96% | | Total other comprehensive gain (loss) | $3,272 | $(2,558) | $5,830 | (227.91)% | | Comprehensive loss | $(110,121) | $(64,877) | $(45,244) | 69.74% | Condensed Consolidated Statements of Stockholders' Equity (Unaudited) This section presents changes in stockholders' equity, including net loss, stock-based compensation, and other comprehensive loss, for the period ended March 31, 2023 Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - Key Changes (in thousands, except share data) | Metric | Balance at Jan 1, 2023 | Net Loss | Stock-based Compensation | Issuance of Common Stock | Other Comprehensive Loss | Balance at Mar 31, 2023 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Common Stock Shares | 622,602,815 | — | — | 6,919,790 | — | 629,522,605 | | Additional Paid-In Capital | $1,908,179 | — | $14,157 | $718 | — | $1,923,054 | | Accumulated Deficit | $(734,653) | $(113,393) | — | — | — | $(848,046) | | Accumulated Other Comprehensive Loss | $(8,846) | — | — | — | $3,272 | $(5,574) | | Total Stockholders' Equity | $1,164,741 | $(113,393) | $14,157 | $718 | $3,272 | $1,069,495 | - Total stockholders' equity decreased by $95.2 million from $1,164.7 million at December 31, 2022, to $1,069.5 million at March 31, 2023, primarily due to the net loss of $113.4 million, partially offset by stock-based compensation and other comprehensive gain[15][22] Condensed Consolidated Statements of Cash Flows (Unaudited) This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities for the three months ended March 31, 2023, and 2022 Condensed Consolidated Statements of Cash Flows (Unaudited) - Key Figures (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(78,568) | $(61,426) | $(17,142) | 27.91% | | Net cash used in investing activities | $(19,129) | $(476,132) | $457,003 | (95.98)% | | Net cash provided by financing activities | $422 | $80 | $342 | 427.50% | | Net change in cash, cash equivalents and restricted cash | $(97,275) | $(537,478) | $440,203 | (81.90)% | | Cash, cash equivalents and restricted cash, at end of period | $52,792 | $418,847 | $(366,055) | (87.40)% | Notes to Condensed Consolidated Financial Statements (Unaudited) This section provides detailed explanations of the company's significant accounting policies, fair value measurements, acquisitions, and other financial components - Joby Aviation is a vertically integrated air mobility company developing and operating eVTOL aircraft for air transportation as a service, headquartered in Santa Cruz, California[30] - The company's financial statements are prepared in conformity with U.S. GAAP and include all adjustments necessary for fair presentation, with no material changes to significant accounting policies from the prior annual report[34][36] Fair Value of Financial Assets and Liabilities (in thousands) | Category | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Total fair value of assets | $943,996 | $1,018,811 | | Total fair value of liabilities | $94,908 | $72,838 | - The company completed two acquisitions in 2022: an aerospace composite manufacturing company for $1.5 million cash and RSUs, and an aerospace software engineering company for $7.2 million cash, resulting in goodwill and intangible assets[50][51][53] Stock Warrants and Earnout Shares Liability (in thousands) | Liability | March 31, 2023 | December 31, 2022 | Change ($) | | :--- | :--- | :--- | :--- | | Warrant liabilities | $37,814 | $28,783 | $9,031 | | Earnout Shares Liability | $57,094 | $44,055 | $13,039 | - The company recognized a loss of $13.0 million from the change in fair value of Earnout Shares Liability and a loss of $4.2 million from the change in fair value of Delta Warrant for the three months ended March 31, 2023[70][75] Stock-based Compensation Expense (in thousands) | Expense Category | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $13,044 | $14,722 | $(1,678) | (11.40)% | | Selling, general and administrative | $4,214 | $4,707 | $(493) | (10.47)% | | Total stock-based compensation expense | $17,258 | $19,429 | $(2,171) | (11.17)% | Net Loss Per Share (Basic and Diluted) | Metric | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net loss attributable to common stockholders (in thousands) | $(113,393) | $(62,319) | | Weighted-average shares outstanding | 605,184,671 | 579,090,606 | | Net loss per share, basic and diluted | $(0.19) | $(0.11) | - On May 3, 2023, the company entered into a common stock purchase agreement for a registered direct offering of 43,985,681 shares at $4.10 per share, expecting net proceeds of approximately $180.2 million[94] Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial performance and condition, discussing key factors affecting operating results, components of operations, and a detailed comparison of financial results for the three months ended March 31, 2023, versus 2022, along with liquidity and capital resources Overview This section introduces Joby Aviation's business model, focusing on eVTOL aircraft development for air transportation as a service and its financial history of operating losses - Joby Aviation is developing a piloted all-electric eVTOL aircraft for air transportation as a service, targeting initial service with the Department of Defense in 2024 and commercial passenger operations in 2025[96][97] - The company has incurred net operating losses and negative cash flows since inception, with an accumulated deficit of $848.0 million as of March 31, 2023, funded primarily by stock issuance and the Merger[98] Key Factors Affecting Operating Results This section discusses critical elements influencing the company's financial performance, including market development, regulatory challenges, government contracts, and operational complexities - Revenue is tied to the undeveloped Urban Air Mobility (UAM) market, requiring significant investment in engineering, testing, manufacturing, certification, and infrastructure before launch[104] - The FAA's revised certification requirements for eVTOLs under the 'powered lift' classification and potential delays in operational regulations (SFARs) until late 2024 could impact the timeline for commercial passenger service[107][108] - Contracts with the U.S. Air Force under the Agility Prime program, expanded in July 2022 and April 2023, have a total potential value of over $131 million through 2026, providing operational learnings and research support[110] - The fully-integrated business model faces challenges including uncertain variable costs for aircraft assembly at scale, increased time and effort for component development and certification, and slower-than-expected hiring for software development and verification[113] Components of Results of Operations This section breaks down the individual elements contributing to the company's operating results, such as research and development, administrative expenses, and other income/loss items - Research and development expenses are expected to increase due to staffing for aircraft engineering, software development, and next-generation technologies, partially offset by government grants[116] - Selling, general and administrative expenses are expected to increase with additional personnel and consultants to support operations and public company regulatory compliance[118] - The company recognized no income from its equity method investment in SummerBio for the three months ended March 31, 2023, compared to $14.5 million in the prior year, due to SummerBio winding down operations[120] - Public, Private, and Delta Warrants, along with Earnout Shares, are recorded as liabilities and remeasured to fair value each period, leading to income or expense adjustments[121] - Interest income primarily comes from cash, cash equivalents, and marketable securities, and is expected to fluctuate with interest rates[128] Results of Operations This section provides a comparative analysis of the company's operating expenses and net loss for the three months ended March 31, 2023, versus 2022 Operating Expenses and Net Loss Comparison (in thousands) | Metric | 3 Months Ended Mar 31, 2023 | 3 Months Ended Mar 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $75,518 | $72,071 | $3,447 | 5% | | Selling, general and administrative | $24,198 | $22,272 | $1,926 | 9% | | Total operating expenses | $99,716 | $94,343 | $5,373 | 6% | | Loss from operations | $(99,716) | $(94,343) | $(5,373) | 6% | | Total other income (loss), net | $(13,643) | $32,029 | $(45,672) | (143)% | | Net loss | $(113,393) | $(62,319) | $(51,074) | 82% | - The 82% increase in net loss was primarily driven by a $38.9 million negative change in the fair value of warrants and earnout shares and a $14.5 million decrease in equity method investment income, partially offset by a $7.6 million increase in interest and other income[134] Liquidity and Capital Resources This section assesses the company's ability to meet its short-term and long-term financial obligations, detailing available cash, investments, and future funding strategies Liquidity Position (in thousands) | Metric | March 31, 2023 | | :--- | :--- | | Cash, cash equivalents and restricted cash | $52,792 | | Short-term investments | $928,000 | | Total available liquidity | $980,792 | - The company has incurred net losses and negative operating cash flows since inception and expects this to continue until sustainable commercial operations begin[136] - Management believes current liquidity will satisfy working capital and capital requirements for at least the next twelve months, with future needs potentially met through equity and debt financing[136][137] - Near-term cash requirements include spending on manufacturing facilities, production ramp-up, certification, infrastructure, skyport development, pilot training, software development, and aircraft production[138] Cash Flows This section analyzes the sources and uses of cash from operating, investing, and financing activities, highlighting significant changes between periods Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net cash used in operating activities | $(78,568) | $(61,426) | $(17,142) | 28% | | Net cash used in investing activities | $(19,129) | $(476,132) | $457,003 | (96)% | | Net cash provided by financing activities | $422 | $80 | $342 | 428% | - The increase in net cash used in operating activities was primarily due to a higher net loss, partially offset by non-cash adjustments like the loss from change in fair value of warrants and earnout shares and stock-based compensation[141] - Net cash used in investing activities significantly decreased due to lower purchases of marketable securities in 2023 compared to 2022[142][143] - Net cash provided by financing activities increased due to higher proceeds from stock option exercises, partially offset by loan repayments[144][145] Critical Accounting Policies and Estimates This section outlines the key accounting policies and significant management judgments and assumptions used in preparing the financial statements - Management's discussion and analysis relies on condensed consolidated financial statements prepared in accordance with U.S. GAAP, requiring estimates and assumptions that may differ from actual results[146][147] - The company's accounting policies are consistent with those outlined in its annual report on Form 10-K for the year ended December 31, 2022[148] Recent Accounting Pronouncements This section refers to the disclosures regarding recently issued accounting standards and their potential impact on the company's financial statements - Information regarding recently issued accounting pronouncements is provided in Note 2 of the Condensed Consolidated Financial Statements[149] Quantitative and Qualitative Disclosures About Market Risk This section discusses the company's exposure to market risks, specifically interest rate risk related to its short-term investments and foreign currency risk, concluding that neither poses a material impact - The company is exposed to interest rate risk on its $980.8 million cash, cash equivalents, restricted cash, and short-term investments as of March 31, 2023, primarily in money market funds, U.S. treasury bills, and government and corporate bonds, where a hypothetical 10% change in interest rates is not expected to have a material impact[150] - The company is not exposed to significant foreign currency risks as foreign operations are not material[151] Controls and Procedures This section details management's evaluation of disclosure controls and procedures, acknowledging a previously reported material weakness, but affirming the fair presentation of financial statements. It also outlines ongoing remediation efforts - Management concluded that disclosure controls and procedures were not effective as of March 31, 2023, due to a previously reported material weakness[153] - The material weakness relates to a lack of sufficient accounting resources with deep technical accounting knowledge to identify and resolve complex accounting issues in a timely manner[156] - Despite the material weakness, management believes the condensed consolidated financial statements fairly present the financial condition, results of operations, and cash flows in conformity with GAAP[154] - Remediation efforts are ongoing and require further validation and testing over sustained financial reporting cycles[156] PART II. OTHER INFORMATION This part includes disclosures on legal proceedings, risk factors, equity sales, defaults, mine safety, other information, and a list of exhibits Legal Proceedings The company is subject to ordinary course claims but management believes these will not have a material adverse impact on financial position, results of operations, or cash flows, though inherent uncertainties exist - The company is subject to ordinary course claims, but management does not currently believe they will have a material adverse impact on financial position, results of operations, or cash flows[160] Risk Factors This section refers to the comprehensive discussion of risk factors in the company's annual report on Form 10-K for the year ended December 31, 2021, noting that these factors could materially and adversely affect the business, prospects, financial condition, operating results, and stock price - The company's business, prospects, financial condition, operating results, and common stock price may be materially affected by risk factors detailed in the annual report on Form 10-K for the year ended December 31, 2021[161] Unregistered Sales of Equity Securities and Use of Proceeds This section details an unregistered sale of common stock to an accredited investor in March 2023, generating initial cash proceeds and future payments tied to milestones, with shares subject to vesting conditions Unregistered Sale of Equity Securities (March 6, 2023) | Detail | Value | | :--- | :--- | | Shares Sold | 137,174 | | Price Per Share | $7.29 | | Aggregate Amount | $999,998 | | Cash Proceeds Received | $100,000 | | Remaining Payment | $899,998 (tied to milestones) | | Purpose | General corporate purposes | Defaults Upon Senior Securities This section states that there were no defaults upon senior securities - No defaults upon senior securities were reported[163] Mine Safety Disclosures This section states that this item is not applicable to the company - Mine Safety Disclosures are not applicable to the company[164] Other Information This section states that there is no other information to report under this item - No other information was reported under this item[165] Exhibits This section lists the exhibits filed or furnished as part of the Quarterly Report on Form 10-Q, including corporate documents, certifications, and XBRL data - The report includes various exhibits such as the Amended and Restated Certificate of Incorporation, Bylaws, 2023 Performance Award Program, and certifications from the Principal Executive Officer and Principal Financial Officer[167] Signatures This section contains the required signatures for the filing, certifying the accuracy and completeness of the report