Financial Data and Key Metrics Changes - Capital expenditures in Q2 were $8.3 million, primarily for facilities and equipment purchases to prepare for higher volume QSC5B1 sample production [15] - GAAP operating expenses and net loss in Q2 were $123.6 million and $114.7 million respectively, with an adjusted EBITDA loss of $63 million [15][16] - The company narrowed its full-year guidance for adjusted EBITDA loss to between $250 million and $270 million [16] - Liquidity at the end of Q2 was $797.5 million, with an extended cash runway forecast into 2029, a six-month improvement over previous guidance [18] Business Line Data and Key Metrics Changes - The company announced an expansion of its collaboration with Volkswagen Group's PowerCo, with additional payments of up to $131 million over the next two years [5][6] - The upgraded deal allows PowerCo to produce up to an additional 5 gigawatt hours of QS cells annually, totaling up to 85 gigawatt hours [6][12] - The company has entered into a joint development agreement with another major global automotive OEM, enhancing collaboration beyond initial sampling [8][25] Market Data and Key Metrics Changes - The company is seeing market traction accelerate as new agreements provide commercial validation and increase urgency in the automotive sector [9] - Collaboration with Murata Manufacturing is progressing well, particularly in the Japanese market where demand for solid-state batteries is strong [9] Company Strategy and Development Direction - The company is now firmly in the commercialization phase, with the expanded deal with PowerCo demonstrating the economic value of its solid-state platform [12][13] - The business model focuses on monetizing development activities early and collecting licensing royalties as customers ramp production volumes [19][20] - The COBRA process has been baselined, significantly improving efficiency and productivity for separator production [10][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledges significant challenges in scaling production but believes they are closer than ever to achieving long-term goals with world-class partners [13] - The company emphasizes the importance of adapting technology to meet customer needs and maintaining a high-touch model for collaboration [25][60] Other Important Information - The company plans to invoice PowerCo for more than $10 million for development work already performed in Q3 [17][22] - The joint QS PowerCo team is focused on satisfactory technical progress towards QSC5 industrialization, which is tied to the original $130 million prepayment [69] Q&A Session Summary Question: Significance of the expanded agreement with PowerCo - The expanded agreement validates the company's vision for a dual cash inflow model, monetizing development activities and realizing royalties as production ramps up [19][20] Question: Financial impact of the expanded agreement - The agreement is expected to improve the bottom line and extend the cash runway, with preliminary assessments indicating it will not be recognized as revenue [22][74] Question: Details on the joint development agreement with the second major global automotive customer - The JDA aims to customize technology for the customer's needs, progressing towards a full licensing arrangement [25][60] Question: Significance of the COBRA process being baselined - The COBRA process is crucial for achieving high performance in solid-state technology, enabling gigawatt-hour scale production [26][27] Question: Capacity and engagement with US defense contractors or drone manufacturers - The company is focusing on creating an ecosystem that allows for various applications, including potential interest from US defense contractors [53][55] Question: Progress on the original $130 million prepayment - The prepayment is contingent on satisfactory technical progress, with public goals aligned with this progress [69]

Financial Data and Key Metrics Changes - In Q2 2025, GAAP operating expenses were $123.6 million and GAAP net loss was $114.7 million, with an adjusted EBITDA loss of $63 million, aligning with expectations [15][16] - The company ended Q2 with $797.5 million in liquidity, extending its cash runway into 2029, a six-month improvement over previous guidance [17] Business Line Data and Key Metrics Changes - The company announced an expansion of its collaboration with Volkswagen Group's battery maker, PowerCo, which includes additional payments of up to $131 million over the next two years [5][6] - The first milestones linked to expected payments of more than $10 million have already been achieved [6][34] Market Data and Key Metrics Changes - The company is seeing market traction accelerate as new agreements provide commercial validation and increase urgency in the automotive sector [8] - A joint development agreement has been entered with another major global automotive OEM, indicating strong demand for solid-state batteries [7][24] Company Strategy and Development Direction - The expanded deal with PowerCo demonstrates the economic value of the company's solid-state lithium metal technology platform and the effectiveness of its capital-light business model [12][20] - The company aims to monetize development activities early and collect licensing royalties as customers ramp production volumes, indicating a dual cash inflow strategy [19][20] Management's Comments on Operating Environment and Future Outlook - Management views the current quarter as a major inflection point, firmly entering the commercialization phase [12] - The challenges of scaling production remain significant, but the company believes it is closer than ever to achieving long-term goals with its partners [13] Other Important Information - Capital expenditures in Q2 were $8.3 million, with full-year guidance narrowed to between $45 million and $65 million [15] - The COBRA process has been baselined, which is expected to significantly improve efficiency and productivity [9][26] Q&A Session Summary Question: What is the significance of the expanded agreement with PowerCo? - The expanded agreement validates the business model, providing two sources of cash inflows: monetizing development activities and realizing royalties as production ramps up [19][20] Question: Can you expand on the financial impact of this expanded agreement? - The payments from PowerCo are expected to reduce GAAP net loss and improve the bottom line, with more than $10 million to be invoiced in Q3 for development work already performed [22][71] Question: Can you elaborate on the joint development agreement with the second major global automotive customer? - The JDA aims to customize technology to meet the customer's needs, progressing towards a full commercialization and licensing arrangement [24][32] Question: What are the implications from an OpEx and CapEx standpoint regarding the expanded agreement? - The inflows from the agreement are expected to be accretive, as they align with existing operational plans [70][75] Question: How many customers can the company manage at one time? - There is an upper limit on how many customers can be managed simultaneously to ensure high-quality service and protection of intellectual property [58][60]

Financial Data and Key Metrics Changes - In Q1 2025, the company generated revenue of $6 million, a slight increase from $5.9 million in Q1 2024, primarily driven by the SK On agreement and milestone execution [9][10] - Operating expenses decreased to $30 million, down by $1.7 million compared to the same quarter last year, attributed to lower direct labor costs [10] - The operating loss was $24 million, with a net loss of $15 million, equating to 8 cents per share [10] - Total liquidity at the end of the quarter was $300 million, with contract receivables totaling $2.2 million and current liabilities at $10.4 million [10][11] Business Line Data and Key Metrics Changes - The company is focused on electrolyte development, with plans to install a continuous manufacturing pilot line at SP2, expected to expand production capacity to 75 metric tons per year [4][5] - The company is close to completing factory acceptance testing for the SK On line, a key milestone in their line installation agreement [6] Market Data and Key Metrics Changes - Demand for multiple generations of the company's electrolyte from both existing and potential new customers has been observed, indicating strong market interest [8] Company Strategy and Development Direction - The company aims to execute agreements with Eskayon to develop solid-state cells based on its technology and operate a solid-state pilot line [5] - The focus is on driving electrolyte innovation and performance through customer feedback, which is expected to lead to improved electrolyte performance [6][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the promise of sulfide-based solid-state batteries and noted that customer engagement and electrolyte sampling activities are encouraging [9] - The trajectory of revenue growth is expected to be gradual, with significant electrolyte revenue anticipated as early as 2027, with the bulk around 2029 and beyond [18] Other Important Information - The company received $1.5 million in reimbursements under an agreement with the U.S. Department of Energy during the quarter [5][20] Q&A Session Summary Question: How to think about '25 revenue and timing around revenue from customers? - Management indicated that 2025 revenue is dominated by collaborative arrangements, particularly with SK On, and some government contracts [14] Question: Trajectory of revenues potentially beyond '25? - Management noted that customers are in early stages of cell development, with increased sampling but not large quantities yet, with significant revenue expected around 2027 to 2030 [17][18] Question: Update on the DOE grant? - Management clarified that the $1.5 million received is a grant, not a loan, and that is the current status [20]