Financial Data and Key Metrics Changes - In Q3 2025, revenue was $16.5 million from 130 units shipped, down from $18.4 million from 135 units in the previous quarter, but up from $15.8 million from 94 units a year ago [18] - GAAP gross margin was 15.3%, an increase from 8.8% in Q2 2025 but a decrease from 18.1% in Q3 2024 [19] - Operating loss for the quarter was $7 million, the lowest since going public, down from $7.1 million in Q2 2025 and $9.7 million in Q3 2024 [20] - Non-GAAP operating loss was $4.8 million, also a record low, compared to $6.9 million in Q2 2025 and $6.6 million in Q3 2024 [21] Business Line Data and Key Metrics Changes - The company shipped 130 vehicles in Q3 2025, including 10 strip chassis for a major customer program, with revenue from these expected in future quarters [5] - The company delivered 18 powertrain systems to Bluebird Corporation in Q3 2025, with nearly 80 additional powertrain orders received since the quarter-end [9][10] Market Data and Key Metrics Changes - The company noted strong demand from major customers like UPS and FedEx ISPs, indicating a growing scale and returning customer confidence [5] - The Xos Hub, a mobile energy platform, is gaining traction in various segments, including electric trucks and school buses, with deployments accelerating in Q3 2025 [11] Company Strategy and Development Direction - The company is expanding into higher-margin, lower-concentration categories, including powertrains and energy infrastructure, to diversify its product offerings [9] - The focus is on building deeper relationships with customers and larger programs to create repeatable volume, which is seen as foundational for long-term growth [6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to improve margins over time as production scales and cost reduction initiatives are executed [20] - The company anticipates significant opportunities in 2026, with expectations of increased order sizes and a growing product pipeline [12] Other Important Information - The company amended its $20 million convertible note to enhance liquidity, allowing for quarterly principal payments starting in Q4 2025 [23] - Positive free cash flow of $3.1 million was generated in Q3 2025, marking the third time the company has been free cash flow positive since going public [24] Q&A Session Summary Question: What is the expanded opportunity for the hub platform? - Management expects double-digit growth in the EV charging segment, with significant opportunities in power resiliency and backup power applications [30][32] Question: Can you discuss the accelerated growth in chassis deliveries to Bluebird? - The partnership with Bluebird is strengthening, with positive customer feedback and additional orders expected as new powertrain configurations are developed [33][35] Question: What are the expectations for unit deliveries in Q4? - Seasonal delays are anticipated in Q4 due to peak delivery volumes for major customers, but the company expects to remain within its guidance range [36] Question: How is the company managing tariff impacts? - A multi-step approach is being taken to mitigate tariff volatility, including reshoring and working closely with suppliers and customers to share costs [43][45] Question: What are the expectations for margin improvement in 2026? - While specific guidance for 2026 has not been provided, management believes there will be a noticeable improvement in margins due to a favorable mix shift towards higher-margin products [59][61]